Why One Affordable Housing Complex in Oakland Has Been Vacant for 10 Years

Updated, 11:15 a.m. Wednesday

From his apartment complex, Ashburn Dancy can see the unique string of palm trees over his fence lining Ninth Avenue in Oakland's Bella Vista neighborhood. The trees stand in the foreground of the city's skyline, about a mile away.

The former boxer also has another view -- a beige, boarded-up apartment complex that has been quietly vacant for nearly a decade.

"What a waste, man," Dancy says.

For some in Bella Vista, the building has been an eyesore. They remember that it failed when it was public housing for low-income families. Others have become so used to the building that they say it has just become part of the neighborhood's backdrop. Now the owners want to reopen it and make some units affordable, though there's no guarantee this will happen.

But Bella Vista, which is southeast of Lake Merritt and close to Highland Hospital, is the type of neighborhood the city talks about preserving. It's working class, the average family income is below average for the region and it's diverse.

"Down over here, it’s mixed up pretty good," says Dancy.

Still, Bella Vista is not immune to the gentrification happening in Oakland -- a city trying to write its own narrative in the shadow of San Francisco, which has an uncontrollable housing market that has been defined by money and tech.

That has heightened many residents' sensitivity toward housing development in Oakland, and people are taking notice when property is being bought and sold. The building at 2530 Ninth Ave. has just 15 family units. It's not going to fix the city's housing shortage.

But the Ninth Avenue property is a microcosm of the kinds of decisions and reactions that occur when people are getting priced out and market forces take hold. Its owners say it likely can't reopen as housing for low-income families because it's not sustainable -- and many Bella Vista neighbors seem to understand. The next question is who will live in these units.

"That’s a big old complex. It has all those rooms and stuff," says Dancy. "Why is it closed down anyway?"

Why the Building Closed

The apartment house was built in the late 1970s to serve 15 low-income families. The Oakland Housing Authority was in charge of the complex, but OHA couldn't maintain the property because it was being underfunded by the federal government, says Executive Director Eric Johnson.

So the building deteriorated and was vacated by the end of 2005, he says.

In 2012, the Oakland Housing Authority submitted a request to the federal Department of Housing and Urban Development to allow it to sell the property to an affiliated nonprofit that OHA had created, which also contracts with HUD. That request was approved and the property was sold for the appraised value of $1.2 million in 2013.

Johnson also serves as CEO of the nonprofit, the California Affordable Housing Initiatives, or CAHI. He says that CAHI's purchase of the Ninth Avenue property kept it in the hands of people who want to preserve affordable housing. But it has been tough to put a deal together, and when the recession hit there wasn't a lot of building going on, he says.

Now that there's a lot of demand for affordable housing at all income levels, CAHI wants to fill the "workforce" housing niche, Johnson says. Workforce housing is for people with moderate income, such as teachers, who are also being priced out of Oakland, he says.

The Ninth Avenue property in Bella Vista is the group's first attempt to make this work, Johnson says.

Building Affordable Housing Is a Challenge Even With Owned Land

Since Gov. Jerry Brown cut redevelopment funding in 2012, Oakland's affordable housing developers have had to scramble to piece together money to see projects through.

Most of the larger affordable housing developers are working on projects that include dozens of units, says Johnson. The Ninth Avenue building has only 15 units, with the potential to add just a few more.

"The issue is nobody wants to get invested in a 15-unit property," he says.

CAHI opened up a request for proposals to develop the property. Two of Oakland's largest affordable housing developers, Bridge Housing and East Bay Asian Local Development Corp., confirmed that they did not submit an RFP application.

But CAHI, unlike OHA, is not required to partner with or sell the land to an affordable housing developer. This allows CAHI to be more flexible and creative with how it funds and develops the Ninth Avenue building. But it could be sold to a market-rate developer, which happened earlier this year with another, much smaller CAHI property nearby, Johnson says.

Income from the sale will go toward CAHI's mission to build or preserve affordable housing projects in the future, but it also could mean one less parcel available for affordable housing now.

Some neighbors and housing activists have argued that any land where housing can be built is sacred land and should be used for affordable housing -- especially land owned by an affordable housing nonprofit like CAHI.

"Oakland really does need housing for our lowest-income residents," says Amy Vanderwarker, co-founder of Eastlake United for Justice, which formed after the city tried selling a parcel of land on East 12th Street to a market-rate developer.

But Vanderwarker says it's hard to find the funding to make any affordable housing project work, even for more moderate-income people, like CAHI wants to do.

"It takes a lot of creative thinking," she says.

Part of the challenge is that projects at that level don't get federal tax credits that are aimed at housing for the lowest-income residents.

Plus, Johnson says that whoever develops the Ninth Avenue property needs to ensure its future maintenance. He points to the building's deterioration when it was last used for public housing.

At Least One Option Would Keep the Land Affordable

Earlier this year, CAHI received four proposals to develop the property. Johnson says the nonprofit has chosen its finalist but won't say who it is just yet. The decision will likely be announced by the end of the year.

One of the four proposals came from the Oakland Community Land Trust, which purchases land to keep it affordable. So far, the trust has focused its efforts on developing 18 single-family homes around Oakland. The Ninth Avenue project would be its first venture into a larger-scale development, says Executive Director Steve King.

"Over the past few years it has been increasingly difficult for us to compete in the single-family market," he says.

The land trust wants to turn the 15 units into a permanently affordable rental cooperative, King says. It would be similar to the tactic being used by other affordable housing developers in Oakland to purchase property in order to stabilize rents and housing costs.

"It’s essentially resident-controlled housing over community-controlled land," he says.

King presented his plan to a group of Bella Vista neighbors, some of whom I spoke with and who say they support his plan.

But CAHI gets to decide who leases or owns the Ninth Avenue property, and Johnson says his group rarely agrees to a deal where it gives up ownership of the land. A ground lease may be more likely, he says, in which the nonprofit maintains ownership of the land but a developer gets to build on it.

Johnson says CAHI wants a certain number of affordable units, but he can't guarantee any number. It's unlikely that it will be 100 percent housing for extremely low-income residents or high-income residents.

Whatever the building becomes, Ashburn Dancy says he wants families that are going to stick around.  He comes from a military family and moved around a lot as a kid.  It wasn't good, he says.

"I want some low-income families that are going to stay there for the duration," he says. "Some young kids that are going to be there. Not somebody that’s going to go in and out, in and out. That messes up the neighborhood."

Other neighbors agree. Whatever goes in, they want people who are going to be a part of this community -- one that’s changing rapidly and that could look different soon.