David Senden – To Fight The Housing Crisis, Some Cities Are Going Micro
Long Beach Business Journal
August 1, 2016
As California’s major city populations steadily increase year after year, many cities have and will continue to explore options to alleviate the housing crisis in the state.
Long Beach is ranked the seventh largest city in California, with a population nearing 485,000 – an increase of more than 3,000 residents (or 0.7%) from January 2015 to January 2016, according to a May 1 report by the California Department of Finance Demographic Research Unit. These numbers are similar to other major cities in the state: Los Angeles grew to over 4 million by adding 1.3%, San Francisco grew 1.1%, San Diego 0.9% and Santa Monica 0.6%.
In a June 14 post, the California Department of Housing and Community Development said “the state has only built 45% of the units estimated to be needed to accommodate growth.” The department attributes this to stringent regulations and long permitting processes.
“I think there is an affordability crisis in our state, and it is impacting the younger generations, Millennials,” Phil Jones, managing partner at Coldwell Banker Coastal Alliance, said. “There are so many issues in our state, and government regulation adds to it.”
David Baker Architects of San Francisco recently completed a micro-unit condominium complex at 388 Fulton St. in the Hayes Valley neighborhood of San Francisco. Because of city requirements, the property is 50% micro-units and 50% two-bedroom units. The micro units range from 320 to 370 square feet and sell for $1,700 per square foot. According to Baker, Natural light, compact kitchen space and other space-saving storage features alleviate some of the feeling of living in a confined space. (Photos and floor plan provided by the David Baker Architects)
In May, Gov. Jerry Brown proposed new legislation to allow market-rate developments with 20% affordable housing on-site, or 10% if it’s near public transit, to be approved “as of right.” This means projects that fall under these specifications would be exempt from most local reviews, including environmental impact reviews, making it easier for developments to progress. The proposal is to be voted on later this month.
Another move to combat the housing crisis was recently made with several proposals to amend state zoning laws to make it easier for residents to build small units on their properties in their garages, as extensions of their homes or as freestanding structures.
However, some cities in the state, including San Francisco, San Diego and most recently Santa Monica, are already utilizing a method that could be a solution to certain cities housing problems: micro-units.
The simplest definition of a micro-unit is a very small studio apartment. Where studios usually range from 300 to 450 square feet, micro-units typically range from 200 to 300 square feet, sometimes less.
“It’s just a place to live,” David Baker, founder and principal of David Baker Architects in San Francisco, told the Business Journal. “I think we have a very skewed viewpoint here in the United States where we consider a 350-square-foot unit to be the living-equivalent of killing baby seals or something. But in other places, that would be considered a pretty good-sized unit.”
Baker reminisced about staying in a tiny, 150-square-foot unit in Japan, saying that it was fine. He also explained that in San Francisco there are thousands of units as low as 50 square feet that sometimes have a mother and child living there. Baker views these living conditions as preferable to adding to our state’s homelessness population because living spaces are “too small.”
In fact, Baker said that a major cause of the homelessness crisis in the state was the tearing down of micro-units in the past because they were “bad places to live,” but the units were not replaced with additional affordable housing.
From a developer’s standpoint, they might pursue micro-units because they are unique in many markets, have no competition and will yield a higher rent per square foot since more units would fit in the building.
Baker explained that in the 1980s developers in San Diego built micro-units as a replacement for defunct single room occupancy buildings (SROs). The city believed that nonprofits would utilize the units as affordable housing.
“They built these replacement SROs from 120 to 300 square feet, and it turned out that they were very popular as market-rate rental housing. Nobody was doing ownership because it’s more psychological than rental. Rental is just, can you afford the apartment and can you live there? With ownership there is, ‘Will I be able to sell it in the future?’ or ‘Are there comps?’”
Baker said he read a recent study that showed people living in dense, urban cities were staying in micro-units longer than standard apartments. He said this is because in these types of cities, people can use the city as their living room through parks and corner cafes that are easily accessible by foot or public transportation.
With Long Beach’s economic growth, several large development projects that promise to continue that growth and its increasing population, some in the city say it is time we look at some options.
Coldwell Banker’s Jones said the Long Beach housing market is constricted by high demand and a lack of inventory, which leads to affordability issues. “It’s pretty apparent that we need to have alternative options,” he said. “Mini homes and prefab homes are very small living quarters, but people can have a roof over their head and a place to call home.”
However, acknowledging the need for alternative options is easier than creating them for residents. David Senden, a principal at L.A.-based KTGY Architecture + Planning, described the construction of micro-units as being slightly more expensive than traditional units.
Senden explained that this is because in a building full of micro-units, there would be twice as many kitchens and bathrooms in the same amount of space as a building full of traditional units. However, he said, “You would probably be able to rent those two units for a greater sum than the one traditional unit.”
Baker, on the other hand, said that micro-units lend themselves well to modular construction which helps keep cost down. Modular construction is a form of prefabricating homes or buildings off-site and then putting the pieces together at the construction site. In the case of micro-units, each unit can be constructed individually and then stacked and connected to form a complex with the same safety standards as a traditional building.
Other aspects that city officials must examine to even consider implementing micro-units is the impact they might have on the city and its residents. In Long Beach and other major cities, the top concern is parking.
“We’re a parking-impacted city, and it’s a severe problem,” Jones said. “I think [micro-units] would really exacerbate that problem and put more stress on our infrastructure.”
In San Francisco, a city nearly five square miles smaller than Long Beach with almost double the population, there are no minimum parking requirements as there are in Long Beach. In fact, the Bay city has parking maximums that act as a cap for the number of parking spaces allowed and enables developers to omit parking from their plans entirely, which Baker says is a very progressive parking policy in the U.S.
“I’m like a progressive capitalist,” Baker said. “I don’t think you should force the private sector to provide something like a parking space. When you do that, you sort of kill the economic vitality of your city. And you’ll never crawl out of that hole – you’re just digging it deeper.”
Baker described a market-rate building his firm recently completed at 388 Fulton St. in San Francisco’s Hayes Valley neighborhood. The building is 50% micro-units and 50% two-bedroom units because of city requirements when working with micro-units, according to Baker. For the 70 condominiums for sale at $1,700 per square foot, zero parking spaces were provided.
“It’s right by BART [Bay Area Rapid Transit], it’s got a bike share, and there are Ubers and Lyfts all over the place. Nobody really has the excuse to think that parking is totally, absolutely essential now that you can summon a car from your phone.”
In Long Beach, however, current zoning laws downtown require one parking space per unit for new buildings. Some city officials question the feasibility of implementing such progressive parking reform as San Francisco, considering many Long Beach residents already disapprove of the amount of parking availability.
“Really, the infrastructure needs to catch up. But from a macro standpoint, a planner would say this pain is necessary to change behaviors,” Senden said. “Bike ridership has gone way up in Long Beach partially because it is getting more difficult to use a car. That is social engineering.”
Baker added, “The question is, what do parking and traffic have to do with quality of life? If your idea is that if you have minimal congestion and lots of parking then that’s a good place to live, good luck. Move to a suburb somewhere.”
Another zoning hurdle for micro-units in Long Beach is that the current downtown plan requires units to be a minimum of 600 square feet, however, 15% of units can be as small as 450 square feet if a request is approved. But 450 square feet still does not qualify as a micro-unit. Going smaller would require a change in policy and the downtown plan by a city council directive.
A major concern is that if the city were to implement these changes and begin building micro-units, what would happen if the fad died out. The buildings would remain for many years, but it may become impossible to keep long-term tenants.
“I’m a firm believer that people will rent as much space as they can afford in the location that is most appealing for them,” Senden said. “I’m not sure if Long Beach is that location or not. There might be a small market for [micro-units], but I don’t think it would be a deep pool of people that would choose that living arrangement in Long Beach. Not yet.”
Despite the challenges and opposition to micro-units, Baker maintains that they are a great way to produce an abundance of the most affordable housing. He cited regulations, such as minimum kitchen size, that make it illegal to create efficient designs, thus allowing cities to hinder innovation.
“I think what people should always keep in mind is just because you wouldn’t want to live there or it wouldn’t suit your lifestyle, doesn’t mean there isn’t a segment of the market that needs to be addressed,” he said. “So I would like to see people not get all moral about it. Let people be innovative. Let them be creative, and don’t get hung up on your cultural preconceptions.”