Burbank Housing nonproft buys Rincon Valley low-income apartment complex
In the six years since Sandra Pilisdorf and her domestic partner moved into Parkwood Apartments in Rincon Valley, they’ve only had their monthly rent increased once, from $1,150 to $1,200. For a retired couple on a fixed income, the below-market price was a godsend.
“We couldn’t find housing, but we found this. It was affordable and clean and quiet,” said Pilisdorf, 75. “You can’t find an 850-square-foot, two-bedroom apartment around here for that amount of money.”
Rents at Parkwood Apartments will remain affordable for the next 55 years since Burbank Housing, a Santa Rosa affordable housing nonprofit, bought the 56-unit apartment complex for $15 million on Wednesday.
The acquisition signifies one meaningful step in tackling Sonoma County’s longstanding affordable housing crunch, which was exacerbated by the October 2017 wildfires. More and more county residents have been priced out of most rental apartments and don’t have the financial wherewithal to buy a house.
“It’s not a huge number, but it’s a piece of the solution,” said Mark Krug, business development manager for Burbank Housing.
The apartment complex went on the market in July, and Burbank Housing put in an offer in early August. Within a day, Krug said the offer was accepted. The city provided a loan of nearly $2.5 million to Burbank to help close the deal.
“We are very happy that the current tenants and future tenants will be able to benefit from Burbank’s affordable housing model at a property that our family developed many years ago,” the seller, L.E.E. & J. Inc., said in a prepared statement.
The apartment complex, built in the late 1970s, is adjacent to Rincon Valley Community Park on Montecito Boulevard. On the other side of the park is the Rincon Valley Regional Library and Maria Carrillo High School.
One of the main motivators for Burbank Housing to buy the property was to maintain affordable monthly rents and keep tenants from being displaced. They don’t intend to ask any tenants to leave and won’t raise rents beyond the typical cost-of-living increases most years tied to area median income, Krug said.
“If a for-profit developer bought it, it is almost a certainty that the rents would have been increased significantly and many of the existing households would be unable to afford to live there,” Krug said.
Ninety-five percent of households living at Parkwood Apartments are at or below 80 percent of the area’s median income, qualifying them as low-income. The county’s median income for a one-person household is $58,850, while it’s $67,300 for a couple and $84,100 for a family of four.
Additionally, 37 percent of those households at Parkwood are under 50 percent of the area’s median income, which qualifies as very low-income.
A two-person household in the county with an income of $39,300 or less is considered very low income, according to the Sonoma County Community Development Commission. Pilisdorf and her domestic partner are in that range with annual household income of $36,000 from Social Security and other retirement income. Burbank Housing typically builds affordable housing complexes, and it can take up to three years for a single project. Buying Parkwood, however, took about six months as the nonprofit secured funding.
It wasn’t just crucial time saved, but money, too.
”Even before the fires, constructions costs were going up really fast,” Krug said.