There are currently thousands of individuals and families who are priced out of the Bay Area housing market, yet earn too much income to qualify for low-income housing subsidies. Commonly referred to as the “missing middle,” this group has been largely overlooked in the past, but interest in serving them has recently gained traction.
One area where the missing middle has been facing a serious challenge is in Berkeley. Rents in the city have been skyrocketing in recent years and its close proximity to job-rich areas means Berkeley’s need for housing for middle income workers and their families is only going to increase. Developer Heidi Lubin thinks that, with the help of the Local Initiatives Support Corporation (LISC) and the Bay’s Future Fund, she may have found an answer.
Lubin, founder of eSix Development Partners, has spent seven years working to help provide more environmentally sustainable, affordable housing for the missing middle. Her work, she says, is guided by the hypothesis that the most stable and impactful investments are transit-oriented developments, purpose-built for workforce housing, with all-electric, green building construction. And when she turned her attention to Berkeley, she had an epiphany. “In the case of Berkeley, I thought we could accomplish all of our goals and more by developing a co-living community,” says Lubin. “I had lived in a co-operative in college and previously built an all-electric co-living development in West Oakland; I just knew this could be the answer here.”
Lubin soon found the perfect space for her project– a vacant building at 1717 University. Situated right in the heart of Berkeley, the lot is well positioned for workforce housing—within easy walking distance to the Berkeley University campus, the commercial downtown area, and commuter hubs with services to San Francisco, Peninsula job centers, San Jose, and Sacramento. Trader Joe’s and a large park are just blocks away. The property’s then ownership, led by Matt Fialho, originally intended to sell the building on the open market, but taken by Lubin’s concept, they approached her to partner.
Lubin and Fialho joined with former Berkeley City Planning Manager Mark Rhoades to form a development team, H3M Partners, to develop the project. In a nod to sustainability, they would call it “The Bosco”— which means forest. All of this would only work, however, if they could source the needed capital to finance their innovative approach.
Fortunately, Lubin had heard about the Bay’s Future Fund (BFF). The investing arm of the Partnership for the Bay’s Future and one of the largest housing funds in the nation, BFF is focused entirely on preserving, protecting, and producing affordable housing in the Bay Area. She also knew it had a reputation and willingness to support and fund emerging developers. Lubin reached out to the Local Initiatives Support Corporation (LISC), who administers funds for BFF, and was able to secure a $3.3M loan to get the project off the ground.
“They were able to give us a great amount of flexible, predevelopment funding that worked with the equity we already had. It was critical, catalytic capital,” says Lubin. “In addition, as a woman developer who had the skills but not the traditional record of experience in a field where women are already highly underrepresented, I wasn’t sure who would take the chance. LISC and BFF bet on me. That alone made me feel like I could succeed.”
The Bosco will house 59 individuals in a mixture of units that range from two- to- four bedrooms– all organized around common spaces – accompanied by one stand-alone studio apartment. Two, five-bedroom units (designed to house 10 people total) and the stand-alone studio will each be restricted up to 50% AMI or lower; the remaining 12 co-living units will be priced at 90% AMI. Altogether, the units will rent for significantly less than market rate—26% less than nearby Berkeley studios and 70% less than a shared apartment. And rent includes a common membership package covering furnishings, utilities, WiFi, shared household goods, professional cleaning services, free laundry, and access to monthly events.
The Bosco will also have two rooftop gardens, an outdoor deck with a BBQ, bike and scooter parking. The best part? All of this exists within a highly sustainable, all-electric development. The building, which is on track to achieve LEED Platinum status, is using the highest energy efficiency equipment on the market.
“We’re always thrilled when we have the opportunity to support a project that can truly serve as a model to show the rest of the industry what’s possible,” says Cindy Wu, Executive Director of Bay Area LISC. “In the case of The Bosco, we have an incredible opportunity to provide housing to middle income Bay Area workers, while also showcasing environmentally sustainable co-living, and supporting a strong woman developer.”
Lubin is thrilled. “A financially stable and accretive project that can help provide a foundation for working Bay Area families that’s also better for humans and the environment? It doesn’t get any better than that!”