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December 13, 2012

Real Estate Surveys: Capitol Hill Housing

Specialty: Develops and manages vibrant and engaged communities of affordable housing in Seattle

Management: Christopher Persons, CEO

Founded: 1976

Headquarters: Seattle

Current projects:The Jefferson, 40 affordable apartments and commercial space in the Central District; 12th Avenue Arts, a mixed-use building with affordable housing and arts and performance space on Capitol Hill

Image courtesy of SMR Architects [enlarge]
Ground will be broken in January on the 12th Avenue Arts project. It will have 88 affordable apartments.

With the recent wave in development of apartments in Seattle, the market is due for a breather, according to Christopher Persons, CEO of Capitol Hill Housing.

“We should see things level off when the new product gets built and the leases are up,” said Persons. “There’s got to be 10 projects on Capitol Hill under construction now. They’re importing cranes from Alaska because the industry has been so busy.”

He expected that construction will slow down in 2013 and 2014 and pick up soon after.

Steady demand

Capitol Hill Housing’s predominant focus is on the affordable housing market.

Being in this sector, Persons said, means that demand rarely falls off. But Persons said his challenge is to always find ways to secure development money to meet that demand.

In recent years, Persons said he has emphasized partnering with public entities to make deals.

Capitol Hill Housing recently teamed with the city of Seattle on a project called 12th Avenue Arts that will have 88 affordable apartments. Ground will be broken in January and construction will be finished in 2014.

“The cost of the land is being paid for by us developing the garage space for vehicles currently parked on that property,” he said. “Having costs covered by the development of parking allows us to build the rest of the building.”

In addition, Capitol Hill Housing recently completed The Jefferson, a 44-unit development at 12th and Jefferson that will have 5,000 square feet of retail. It was developed on a vacant lot Capitol Hill Housing purchased from the city.

Persons said he hoped 12th Avenue Arts will become a “hub for the Capitol Hill community.”

(Editor's note: This article has been changed to reflect that Persons was referring to 12th Avenue Arts as a hub for the Capitol Hill community; and that The Jefferson is in the Central District.)

Such partnerships are mutually beneficial, Persons said, since new construction adds to the city’s tax roll.

Capitol Hill Housing also partners with private developers, as in the case of it bidding on a master development plan with Vulcan on Yesler Terrace.

Apartments peaking

The current boom in apartment development is at its top, Persons said.

“The apartment boom is probably peaking on Capitol Hill and downtown, and some projects on the back burner will wait until the next wave of multi-housing picks up,” he said.

Recent city studies have shown that the demand for affordable housing is twice the current supply.

“The demand for affordable housing is always too high in a city under-supplied in affordable housing,” he said.

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