GREENWICH — The town’s Affordable Housing Trust Board committed $150,000 in loans to two affordable housing projects, negotiating deals for reductions in building size with fewer affordable units.
At its Feb. 13 meeting, the town’s seven-member Affordable Housing Trust Board – which provides financial support to developers willing to reduce the size of a project or add affordable units – negotiated the reductions using formulas for “set-aside” and “assisted housing” projects.
Developers of the two projects – originally a 60-unit, six-story building at 240 Greenwich Avenue and a six-unit, four-story building at 171 Hamilton Avenue – agreed to reduce the height of their projects for $100,000 and $50,000 of funding respectively.
John Tesei, an attorney representing 240 Greenwich Avenue developer John Fareri, told the board that Fareri was willing to reduce building size by two stories given neighbor complaints.
“The area – everybody’s familiar with it – is one in which we happen to have a six-story building to our west, and to our north, another six-story building. So, we felt we were actually blending into that area,” Tesei said. “The area residents didn’t feel that way.”
The reduction in size would also switch the project from a set-aside to assisted housing – essentially allowing fewer units with higher rents.
“Set-aside” projects use a lower state median income cap of $102,600 – about 50 percent lower than the $151,800 area median income in Greenwich.
“Assisted housing” allows the developer to increase the rent of affordable units to 80 percent of the area median income, and drop the minimum number of affordable units from 30 percent to 20 percent of a project.
Before the board vote – which was unanimous – Board Secretary Sally Bednar said she wanted to ensure that no less than 20 percent of the units would be designated as affordable given the 10 percent decrease.
Tesei agreed and assured the board that Fareri was committed to providing affordable housing in Greenwich.
“I’ve always been a believer, and so has John, in affordable housing. I’m sure he’s built more than any other entity – other Greenwich Communities – in Greenwich in terms of the affordable housing components of projects,” Tesei said.
Board members also questioned the project’s completion date as 240 Greenwich Avenue developers were pursuing litigation against Harbor View Condominiums, a nearby 72-unit building.
According to Tesei, the Harbor View condominium owners claimed that Fareri was not allowed to build residential units on the property [240 Greenwich Avenue] as it was under a 1982 declaration that limited the use of the land. But Tesei said the developer pursued litigation in 2021 to avoid future delays, and that they expected to win the case.
“We had to be aggressive so that we didn’t wind up in a situation that they would wait until the last minute to try to frustrate the project,” Tesei said. “We fully expect to win it.”
Members said they wanted to be sure of the project timeline because the trust – formed at the end of 2021 – was funded through $1.1 million of Greenwich’s American Rescue Plan Act monies and must be expended by December 2026.
Tesei said that 240 Greenwich Avenue was a worthwhile investment, explaining that Fareri owns the property, is invested in the community and has a long history of completing local projects.
“You’re getting a lot of these applications where you have a contingent contract between the owner and a developer and they could easily run out of time or they’re in some type of economic distress,” Tesei said. “I think this is probably the most solid proposal you’re ever going to get.”
Later in the meeting, the board unanimously approved a second commitment for a $50,000 loan to developer Joseph Pecora for the 171 Hamilton Avenue project.
The original mixed-use plan – already approved by the Planning and Zoning Commission – was four stories tall, with three floors of residential units and one floor of commercial space. Of the six residential units, two were designated affordable under state median income.
But following negotiations with the board, Pecora agreed to reduce the building to three stories with one affordable unit rented at 80 percent of the area median income, changing the project to “assisted housing.”
Board member Brooks Harris acknowledged the drop in affordability, but said residents would recognize the decreased density.
“I like this project a lot more because going from four stories to three stories is something tangible that the community can understand,” Harris said, comparing the approved project to a development at 177 Hamilton Ave. for which Pecora was seeking $50,000 in funding.
At 177 Hamilton Ave., Pecora had agreed to add an additional affordable unit to the four-story, ten-unit building – which would have increased the project from 30 percent of the units designated as affordable to 40 percent, and a shift to the “assisted housing” rent formula that uses the area median income.
Pecora said he would have preferred to reduce density and change the building to a three-story development with retail on the first floor, but could not under current zoning regulations.
Board member and Planning and Zoning Director Patrick LaRow explained that even if a developer offered affordable units, the commercial portion of the building has to meet zoning requirements – and that the planned setbacks for the building did meet the criteria.
Pecora said he requested a change in regulations through the Planning and Zoning Commission, but could not guarantee the board it would be approved.
“I’m not convinced that it’s going to get done, personally,” Pecora told the board. “It affects the whole town. It doesn’t just affect my lot.”
But without the decreased density, Harris questioned how the new plan benefited the town. He said that with the switch to area income rental prices, the annual gross revenue was “significantly higher” for Pecora.
“It seemed to me that there might be a split that’s kind of different from [the original plan], where we got an extra one bedroom [that’s] 80% affordable, and still provided you better economics than you would get with a set-aside,” Harris explained.
Pecora acknowledged that he would take in an additional $30,000 a year under the changed plan, but said he would essentially break even given unknown, inflated construction costs.
But Bill Finger, vice chair of the board, said the members were looking to either reduce the size of a project through assisted housing or to gain a significant increase in affordable units.
“Personally, I’m not convinced that adding one unit is a significant increase in affordable units,” Finger said.
Finger said that he appreciated Pecora’s commitment to the town, but because the board was in its infancy, he did not want to set a precedent in which others requested similarly beneficial plans for the developers.
Harris also pointed to an additional financial benefit for Pecora under the “assisted housing” rent formula.
The additional $30,000 under area median income meant that Pecora could offer five affordable units instead of the current four, Harris argued, and still make more than he would under the original state median income.
Pecora said that he would break even in the long term if he were to add an additional affordable unit. But both Harris and Finger questioned his projections.
The required majority vote to commit $50,000 to the 177 Hamilton Avenue project failed with two members opposed, one member abstaining and four members in support.
Harris and Finger said they’d reconsider the application at a later date.
“The amount of time to do this stuff is intense,” Pecora said of the vote. “I’m just trying to do the right thing, and the pushback is immeasurable to me. It’s unbelievable. But that’s your call.”