Another of Denver’s top affordable-housing developers, Northeast Denver Housing Center, is facing foreclosure.
Northeast is delinquent on a $1.2 million loan for property at Montbello’s Sable Ridge site, threatening the viability of the planned $28 million development.
“We had gone through the whole process of getting the plan approved, the zoning – a substantial amount of work,” said Northeast’s executive director, Getabecha Mekonnen. “It is just by the time we went through that the market was getting very, very soft. … The market units have come down in price where they have reached the affordable market.”
The investor, Mile-High Housing Fund, hopes a deal can be reached to salvage the 120-unit development, but for now executive director Lara Jakubowski said the group is in the process of foreclosing.
“We’ve done two extensions for this,” Jakubowski said. “We’ve been hoping they could pull together a deal that could work on this. … There is a significant need for affordable housing. We need to rotate our money around for the folks who have projects that are going.”
In 2000, plans for the 14-acre site at Chambers Road and Andrews Drive included commercial redevelopment, housing for low-income elderly as well as the housing on Northeast’s 4-acre parcel. Northeast Denver Housing’s website said plans for the project include a central courtyard, a playground, a computer room and one- to four-bedroom units at 60 percent of the Denver area’s median income.
So far, only the Sable Ridge Senior Residences have been completed.
City Councilman Michael Hancock said he was disappointed to hear of the project’s problems.
“We brought it on with a great deal of excitement,” he said. “But we know that the economy has not been kind to those types of projects.”
Northeast Denver Housing’s troubles are just the latest in what is becoming a trend for affordable-housing developers. Last summer, the Colorado Housing and Finance Authority foreclosed on a $955,000 loan with Uptown Partnership for a 35-unit development in Capitol Hill.
Shortly before Uptown’s trouble, the developer of Roslyn Court, an affordable-housing complex in the Stapleton neighborhood, defaulted on a $4.7 million loan.
“The market has shifted a great deal in Denver,” Jakubow ski said. “It’s just difficult for developers to anticipate exactly where the market is going to be.”
Denver’s director of Housing and Neighborhood Development Services, Jacky Morales-Ferrand, said a glut of rental units in the city has hurt affordable-housing developers.
“What we used to consider affordable is now having to compete with market-rate rental because of the softening of the rental market in Denver,” she said.
“Ideally, what we are trying to do and what we are working to do is to see if we can find another affordable-housing entity to purchase the site.”
Staff writer George Merritt can be reached at 303-820-1657 or gmerritt@denverpost.com.
A clarification ran on this article, after its original publication. It indicated that five out of the seven parcels of the Sable Ridge development have been completed. The sixth, an office plaza, is in the permitting process.
