“I was born and raised here and for a vast majority of that time, there was dirt all over downtown Boise,” explains Nick Schlekeway, CEO of the Amherst Madison real estate firm. “There were dirt parking lots — eight, nine, 10 — that sat there for my entire life. In a span of about five years, every single one of those disappeared.”
The changes have brought hotels, office buildings, the JUMP complex and much more, plus thousands of new people and a lightning bolt of energy to the streets. But all the new construction has also brought challenges — namely, transportation woes and a significant housing shortage.
Challenges of infill housing development
For developers and their lenders, building housing in Boise’s downtown has been a difficult proposition. Compared with building on undeveloped land, building within a city means dealing with existing overlapping utility systems, the possibility of finding surprises below grade, a shortage of storage space during the build, hassles with busy roadways and much more.
“The initial cost is a little bit harder on a developer’s pocket,” says Shellan Rodriguez, who manages real estate development for Boise’s redevelopment agency, the CCDC (Capital City Development Corporation). “We try to decrease some of that risk.”
Building housing instead of commercial properties also comes with financial risk for developers and lenders, says Schlekeway, whose firm does business in both arenas.
“At the end of the day, all that stuff comes down to dollars and cents,” he says, adding that builders analyze things such as how much of a legal headache a project will be, what the taxes will look like and more.
Often, builders end up going with projects such as retail that have higher per square foot rents.
Meanwhile, residents face higher and higher prices as demand goes up and supply holds steady.
According to the U.S. Census Bureau, median annual household income in all of Boise comes in at just higher than $60,000, but average home ownership costs are at $1,336. Already, people are commuting more than 20 minutes to work, on average.
Those figures paint a difficult picture for residents throughout the city, but the situation is even harder for employees in industries that support hospitality and retail in the downtown core.
The role of CCDC
While these challenges to building housing projects won’t go away, the CCDC has long-term plans to help make housing available to the many people who work and recreate in Boise’s downtown.
In the past few years, the CCDC has been involved in several projects that it hopes will relieve the housing shortage, both downtown and throughout the area.
One of the first such projects was Water Cooler, built near Idaho Street and 14th Street. Designed as a work-live space, it offers urban living with rents that fit the budgets of people making up to 120% of the local median income.
After a competitive bidding process, the project was awarded to and built by Local Construct.
Casey Lynch is the company’s CEO.
“The insight we had with Boise wasn’t that people didn’t want to live downtown, it was that there were no options for them to live downtown,” he says, explaining why his firm took on the project. “We found that to be true — when we presented them with options, they were very excited about it.”
Other recent developments that were built with help from the CCDC have included Ash+Main, which offers townhome-style rentals near 12th Street, between Myrtle Street and the Boise River; and The Afton, which is nearing its second phase at the corner of 8th Street and River Street.
That project, which includes one-, two- and three-bedroom condominiums, has sold quickly and at higher-than-projected rates, says developer Michael Hormaechea.
While all projects are within walking distance of the city’s main attractions, only Water Cooler is located in the traditional downtown area.
Transportation and the future of downtown housing
For developers, real estate professionals and city planners alike, downtown housing remains one of the most important factors in how Boise will grow.
Without additional housing, streets will become more and more crowded with traffic, and that will effect everything from the workforce to retail to entertainment, they project.
Boise needs to have housing close to employment for big picture reasons, too, says Lynch.
“It’s critically important because it’s the no. 1 thing we can do as a society to basically improve environmental sustainability,” he says. “Locating housing near jobs is literally one of the biggest impacts you can have on reducing reliance on automobile carbon emissions, giving people the opportunity to walk or use public transportation to get to work.”
With all its challenges and opportunities, the fact that housing is on everyone’s minds bodes well for the future of the city, says Hormaechea.
“There is a very broad acceptance and concerted effort by both private sector developers and the city of Boise to promote workforce housing, all types of housing,” he says. “There is broad awareness that housing affordability is a big issue. It’s hard to have perfect solutions, but there are a lot of people working on it.”