Affordable Housing Purchase in Fairfax—A Cliffhanger

Staff at the County of Marin’s Community Development Agency saw a real estate ad for a ten-unit apartment building in Fairfax and recognized an opportunity to save an existing “naturally occurring” affordable rental property.  Brookside Apartments, at 300 Olema Road includes ten units of two- and four-bedroom apartments. Its owner has kept the rents below market, but now wants to sell the building, preferably to a buyer willing to keep the rents affordable.

Because there is no land trust or other organization in east Marin capable of taking on such a property, the County contacted the San Geronimo Valley Affordable Housing Association (SGVAHA) to see if it could help. SGVAHA, located just over the hill from Fairfax, already owns and manages 26 housing units in Forest Knolls — including a mobile home park and several units of shared senior housing.  SGVAHA  entered into a purchase agreement on January 2, 2020 to acquire the property for $2.65 million. Escrow was set to close in April.

On February 25, 2020, the Board of Supervisors unanimously approved a grant of $500,000 to help finance the purchase. If SGVAHA can finalize the purchase, these tenants will be able to remain in their units at permanently affordable rents.

At the Board of Supervisors meeting, the measure received support from a number of speakers, including several members of the SGVAHA board, Fairfax residents and others. Fairfax’s representative to the Commission on Aging, Jody Timms, commented on the importance of rallying community support and donations to assist with the purchase of this building – thanking the property owner for his commitment to the Fairfax community. As Timms noted, “This nearly brought me to tears. I want to thank the building owner—this is so generous. In Fairfax, we will be there and do what we have to do to make this happen.”

Supervisor Katie Rice noted, “We really need to make some noise about this. There are multitudes of smaller apartment buildings with tenants who have been there for years. The owners have relationships with these tenants and want to do something about this crisis.” She went on to suggest that the County develop an outreach program to apartment owners who wanted to sell their buildings and do right by their existing tenants, encouraging them to come forward before the property formally went on the market. Housing advocates celebrated this community-based preservation purchase.

In addition to obtaining the Marin County grant, SGVAHA has been busy putting together the rest of the needed funding, including grants from the Marin Community Foundation, Tamalpais Pacific Foundation and a mortgage from a commercial lender. However, additional funding from the federal Community Development Block Grant (CDBG) program is also needed to pay for substantial rehabilitation over the next ten years. This part of the funding package has hit a bump.  A small portion of the building is apparently in a floodway (see history here>>), which precludes it from receiving this federal funding. A planned community fundraising drive, which could have helped defray part of the cost, had to be postponed when the COVID-19 crisis struck. 

SGVAHA continues to work for a solution and negotiate with the property owner to extend the timeline for closing escrow.  We all hope that this valuable and innovative purchase can be salvaged.

MEHC will provide updates on this purchase in the next newsletter.  It serves to remind us of how complicated the process of acquiring or developing affordable housing can be.  You can donate to SGVAHA here>>