Affordable housing crisis threatens Miami-Dade, say local leaders

An affordable housing complex in Overtown built by the Miami-based Carlisle Development Group.
An affordable housing complex in Overtown built by the Miami-based Carlisle Development Group. MIAMI HERALD STAFF

Low-income workers could be pushed out of Miami-Dade County if public officials and local developers don’t work together to build more affordable housing, speakers said at a conference on Wednesday.

“Frankly, our government resources are not enough to address the problem,” said Miami-Dade Mayor Carlos Gimenez, who spoke at the Homes for All Housing Summit at Miami Dade College. “Government cannot do it alone.”

Gimenez touted a multi-year, mixed-use redevelopment planned for the public housing complex at Liberty Square, which he said would serve as a template for future public-private affordable housing projects.

County commissioners have allocated $74 million for the new effort in Liberty City. That public money, Gimenez said, will be enough to leverage an additional $200 million from private developers.

South Florida is one of the least affordable housing markets in the nation.

The Center for Housing Policy in Washington, D.C. found that nearly 40 percent of working households in Miami devote at least half of their income to housing. That was tied with Los Angeles for the highest percentage among major metro areas.

A local worker would need to make $17.50 per hour to afford a market-rate, one-bedroom rental apartment, according to statistics compiled by the Miami Coalition for the Homeless, which organized the conference.

But the mean wage for renters in Miami-Dade is just $15 per hour, meaning many workers are getting pushed further and further away from their jobs in the urban core as luxury condos pop up across the downtown and on the beach.

The most vulnerable residents are extremely low-income renters, who make 30 percent of the area median income. (A family of four at that income level would earn $24,250 per year.)

For every 100 renters at that income level, there are only 33 affordable units on the market, according to the Shimberg Center for Housing Studies at the University of Florida.

Because of that shortage, many of Miami’s 75,000 poorest renters spend more than 60 percent of their income on housing costs, greatly increasing their risk of homelessness, said Bobbie Ibarra, executive director of the nonprofit coalition for the homeless.

“There is a housing crisis,” said Miami Mayor Tomás Regalado, who also spoke at the conference. “Half of the calls we get at my office are about housing.”

Miami is home to roughly 5,500 of the 9,000 public housing units in the county, Regalado said.

The city hopes to use the EB-5 investment program — which offers foreigners a green card in exchange for creating a certain number of local jobs and investing at least $500,000 in capital — to create more affordable housing projects.

“We’re expecting the demand for affordable housing to increase in the next 12 months because we have not kept up,” Regalado said. The mayor also discussed his plans for a city-wide crackdown on absentee landlords who force tenants to live in slum-like conditions.

Business leaders are concerned that the lack of affordable housing could have a serious effect on local commerce.

Barry Johnson, president of the Greater Miami Chamber of Commerce, said business owners are worried their employees may be forced to move out of the county and commute several hours to work, just as low-income workers in the Keys often do today because of the lack of workforce housing.

“Inadequate worker housing makes a mockery of any pretension to good economic policy,” agreed Ned Murray, associate director of the Metropolitan Center at Florida International University.

One solution that could solve long commutes for low-income workers? Transit-oriented development.

More and more developers are building residential projects next to Metrorail and other public transit stops, said Kenneth Naylor, chief operating officer of the affordable housing developer Atlantic Pacific Company.

“The ability to live near transit and potentially eliminate a car from a household’s monthly budget could make as much or more difference to their bottom line as living in an affordable unit,” Naylor said.

But rising land prices and escalating construction costs in South Florida make it increasingly harder for affordable housing projects, where the margins are already thin, to reap a profit. Developers must depend on a pool of local, state and federal dollars that shrank during the recession and have been threatened by budget negotiations in Washington D.C. and Tallahassee.

Speakers at the conference said building mixed-income projects could help developers overcome the funding shortfall. Mixed-income housing creates communities of affordable, market-rate and luxury units in the same building or complex.

“If we continue to rely on income-segregated housing, we’re going to fail because there aren’t enough resources to address those needs,” said Albert Milo, Jr., president of the Related Group’s affordable housing division.

Related has built more luxury condos in South Florida than any other developer. But the mega-builder has also invested significantly in workforce housing since 2009. Related’s chairman Jorge Perez has spoken frequently in recent months on the importance of shrinking the income gap.

“There is a strong need here,” Milo said. “If every for sale unit is over half a million dollars, we have a huge problem on the home ownership side that is only going to trickle down and create further problems for the rental market.”

The proposed housing project at Liberty Square will be mixed income, although the county hasn’t yet announced the price range for units.

But some developers in Miami are skeptical about mixed-income projects, even though they’ve been used effectively in many cities around the country, said Michael Liu, director of public housing and community development for Miami-Dade County.

“I can tell you right now that in private discussions with certain developers, they are deathly afraid that having 10 units out of a 100 that may be [low income] is going to taint the whole building and make mixed-income development unpalatable,” Liu said.