Affordable Housing - A Crisis with Solutions - Part 1
In an article published by the Urban Land Institute in January 2019 and written by the immediate past chair of the Board of Directors of Fannie Mae, Egbert L. J. Perry, Mr. Perry states that we are in the midst of a national affordable housing crisis. While there is clear bipartisan consensus that we have an affordable housing crisis, the solution is not simple or easy to implement. But there are solutions.
Mr. Perry proposes that we have not only an affordable housing crisis, but also a community development crisis. He proposes that we should pursue 2 parallel solutions to both the affordable housing and community development crises:
Introduce housing that is affordable into neighborhoods that are already healthy and sustainable, and
Transform less desirable neighborhoods – the “bad zip codes” – into healthy and sustainable ones.·
This post is the first in a series that will discuss what is being done in both the public and private sectors to move the needle in developing additional affordable housing and transforming communities into those that are healthy and sustainable.
27 years ago, Mr. Perry and a business partner created the Integral Group LLC, with a vision to create a mixed-income housing solution with education (early childhood and K–12); health, wellness, and recreation; transportation accessibility; access to jobs; neighborhood retail goods and services; and a set of people-centered services designed to help lower-income families in their pursuit of greater economic independence. Their goal was to transform a “bad zip code” in downtown Atlanta.
The Integral Group partnered with another developer and the Atlanta Housing Commission and created the first such community on the site of what had been the nation’s first public housing project, East Lake Meadows. They sought to build “a neighborhood that provided upward mobility in a carefully curated mixed-income community, using compatible public/private partnership resources and strategies”. As a result of the implementation of this project, they saw significant improvement in the trajectory of the lives of thousands of individuals and families who lived there.
The results of this project are amazing. Violent crime is down more than 97%. Crime overall is down 73%—a level 50% better than the rest of Atlanta. Employment among families on welfare has increased to 70% from 13% in 1995. (The other 30% are elderly, disabled or in job training.) The income of these publicly-assisted families has more than quadrupled. In the surrounding area, home values have risen at 3.8 times the city average (to over $250,000 per home). A Wells Fargo bank, Publix grocery and Wal-Mart have moved in, and restaurants, shops and other services have returned. In 2019, an additional 108 new mixed-income apartment units will be constructed.
East Lake Meadows, a public-housing project with 1,400 residents, was a terrifying place to live. Nine out of 10 residents had been victims of a crime. Today it is a safe community of working, taxpaying families whose children excel in the classroom. Called the “Atlanta Model” by Henry Cisneros, former secretary of the U.S. Department of Housing and Urban Development, this type of development has been replicated in varying degrees across the city of Atlanta and in many other cities across the country. Thanks to private investors such as Warren Buffett and Julian Robertson, Purpose Built Communities was created, which helps other neighborhoods adapt the East Lake model. The Meadows Community in Indianapolis and the Bayou District in New Orleans have achieved considerable gains by emulating the “Atlanta Model”.
And what are the key aspects of these developments that help them to succeed and transform lives?
A mixed-income community that ensures children are around role models—employed adults who take care of property and spend time with their children.
The K-8 school, which opened in 2000 in East Lake, offered longer school days and an extended school year. It now serves 90% of the children in the East Lake neighborhood. Based on measures by the Georgia Department of Education, Charles R. Drew (a public charter school) is the top performing elementary school in the Atlanta school system.
A partnership of the public and private sectors that invests comprehensively in a small, geographically defined neighborhood.
A decent place to live, a secure environment with adult role models, and a great school with specially trained teachers together produced significant change in the East Lake Community, as well as the communities that followed in their footsteps.