September 25, 2023 | Rachel Ellis
Summit County in Colorado needs 2,528 more housing units, both rental and for-sale, to meet the needs of its workforce in the next five years, according to a 2023 housing needs assessment. The median rent in Breckenridge is roughly $2,220 a month. Breckenridge officials faced the challenge of providing affordable workforce housing while at the same time meeting its climate goals.
In 2019, during the Mountain Towns 2030 Summit, the Town of Breckenridge made a commitment to cut carbon emissions in half by 2030 and completely drop carbon emissions by 2050. Inspired by other affordable, net-zero housing projects like Basalt Vista, Breckenridge set out to achieve similar long-term and sustainable solutions.
“The free market won’t solve the issue of people who work in Breckenridge not being able to afford to live there too,” said the city’s Sustainability and Parking Manager Jessie Burley. “If we are going to spend public dollars and claim that housing is affordable we need to show that in the utility costs as well.”
Alta Verde, Phase I
The city worked with stakeholders to come up with a plan to build an affordable, high-efficiency housing complex called Alta Verde. The chosen site was an unprimed floodplain site along the Blue River corridor in the McCain subdivision, giving the city an opportunity to avoid a new natural gas line to the site and focus on energy ready homes standards and achieving “net-zero” development.
Breckenridge defines net-zero as fully electric housing with solar energy that offsets the electrical load onsite. Building this new residential space gave Breckenridge an opportunity to do something different and rethink design, functionality, and purpose while still upholding the look and feel of existing housing.
“Development code is not prescriptive,” said Burley. “We’re looking into how to reorganize our development code to reflect our new sustainability goals rather than focus only on the character of the town, something that in the past has made it difficult to do something new.”
Funding and qualifications
Xcel Energy put large developments on notice and said they were tapped with paying for new natural gas infrastructure, meaning it would be costly and require system upgrades. This made the economics for the first phase of Alta Verde especially compelling in driving new development in electrification rather than demand upgrading existing gas infrastructure.
In order to make the housing affordable for income-restricted individuals and families, maximum rent was set at 30% of a household’s gross income using the Summit County Area Median Income data – resulting in monthly rents for studio, one, two, and three-bedroom units ranging from $589 to $1,596.
Gorman & Company LLC, the developer and property manager for Alta Verde, used an interest list to send applications to candidates to certify the income of their job(s) in addition to any federal benefits they may receive. Kimball Crangle, Colorado Market President for Gorman, said that sometimes people don’t meet the requirements and demand is already high across the income spectrum.
“The process has to be open, fair, and equal to every person so a non-flexible income cap ensures that. We relieve some of that pain by the 16 non-tax credit units, offering some variation,” Crangle said. The remaining 64 additional units are financed with a low-income housing tax credit (LIHTC). The total cost to build 80 total units for Alta Verde, Phase I was $32 million.
The project was supported by a $960,000 Community Development Block Grant from the Division of Housing as well as a $650,000 grant from The Colorado Department of Local Affairs Energy Impact Assistance Fund RENEW program which helped cover 40% of the costs for the onsite solar system. The LIHTCs from the Colorado Housing and Finance Authority were syndicated by the National Equity Fund with loans from Vectra Bank and Lument.
Phase I was built to meet the Department of Energy’s zero energy and net-zero standards. Each unit is served by its own Carrier 3-ton, ducted heat pump system and electric tank water heaters and roughly 1,600 solar panels produce energy for the complex. There are also four electric vehicle charging stations and plans to create an e-bike share hub on site.
Alta Verde, Phase I site | Photo courtesy the Town of Breckenridge
Jessie Burley explained that when talking about energy in the housing market, it’s necessary to look at the building envelope as a whole rather than the individual pieces and parts – which she feels is still a learning curve for the building community. She also explained that it can be challenging to find space for enough solar panels to offset the electricity load of large scale multi-family buildings, something that drives the design and is considered from the beginning.
From a sustainability perspective, Burley feels Alta Verde is a proof of concept. Breckenridge has unique climate characteristics which have often been excuses for not employing more sustainable ideas. But now, the city has exceeded their expectations in being able to meet their goals economically and environmentally.
“We are striving for attainability and affordability while having a positive impact on tenants and the environment,” Burley said.
Kimball Crangle said that the Town of Breckenridge is very visionary with meeting local housing goals. Since the Town has previously worked as a developer themselves, they helped work through design charrettes with consultants and architects on how to develop the site. She also added that mixed-income communities are valuable because people can live together regardless of their income level. The pet areas, playgrounds, safe places for kids to ride bikes, open spaces, and gardens all make for a great place to live and bring people together.
Gorman has taken this project concept to others in the state. Their Village at Wintergreen community in Keystone further models the two financial capital stacks used for Alta Verde: low-income rebates and loans and private equity. The Colorado Energy Office and the City of Granby have also taken interest.
“We feel that these projects help to make a dent in the housing crisis because it’s such a hot topic for Summit County,” Crangle said.
Conclusion and next steps
Alta Verde, Phase I, was developed with an environmental and net-zero framework in mind. Phase II aims to have more of a demandside management component and it will use a different finance structure because there will be no low-income housing tax credits. Several hundred people unable to move in Phase I will likely be considered for Phase II, which is set to be completed in August 2024.