Everett, Wash.
Published: Tuesday, April 8, 2008

Credit crunch claims Everett affordable housing plan

Plans to buy an Everett apartment complex to provide affordable housing have been put aside after the housing authority couldn't get a loan.

By David Chircop
Herald Writer

 EVERETT -- Everett Housing Authority is one of the latest casualties of the international credit squeeze.

The public housing agency last week shelved plans to buy a 96-unit Casino Road apartment complex after it failed to find a bank willing to lend it $11 million.

"The bottom line is the credit market is just squirrely right now," Housing Authority Executive Director Bud Alkire said. "There are so many uncertainties in the market and lenders are revising their lending standards."

It joins a growing list of housing developments in Everett delayed because lenders are tightening purse strings with the growing number of defaulting home mortgages.

The Port of Everett and Maritime Trust's $400 million waterfront development with 600 condos; downtown's Colby Tower project with million-dollar bay-view penthouses; and Rockefeller Square, another downtown 40-unit condo building, have all been delayed because of a lack of financing.

That's in spite of developer confidence that there is still enough demand in Everett to sell and lease residential and commercial space.

"The guidelines for lending are pretty tight. Unless you've got tons of capital, they make it difficult for you," said Dan Gunderson, a real estate agent with Windermere, who is representing the owners of Colby Tower.

The housing authority sought to close an $8 million deal for Casino Lanes Apartments at 824 W. Casino Road by summer. It also applied for an extra $3 million to renovate the complex, which was built in 1980.

It planned to pay off the loan with money from a variety of sources, including the future sale of the 255-unit Baker Heights public housing complex in north Everett, grants and the sale of tax credits to investors.

Alkire said the Housing Authority tried to get loans from Bank of America, US Bank and Key Bank.

All rejected the housing agency's application.

Across the country, affordable housing projects have been delayed or scaled back in part because companies are investing less in the federal government's affordable housing tax-credit program.

Along with fewer investors, returns on tax credits have also declined, Alkire said.

The State Housing Finance Commission, which administers the federal program in the Washington, could not be reached for comment on how the program is doing here.

The purchase of Casino Lanes was part of the Housing Authority's attempt to scatter public housing across the city.

Last year, the Housing Authority bought an eight-unit apartment on E. Gibson Road and a 21-unit complex on 75th Street, south of Beverly Lake.

Most of its housing units are clustered in Everett's Delta neighborhood, northeast of downtown.

The Housing Authority in 2005 decided to tear down and sell to private developers the land at Baker Heights, the city's largest and oldest public housing complex.

Wei Huang, a partner with Casino Lanes LLC of Bellevue, which owns Casino Lanes Apartments, said he suspected the Housing Authority might have trouble getting a loan.

"It's just unfortunate," he said.



Reporter David Chircop: 425-339-3429 or dchircop@heraldnet.com.
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