In a 3-2 vote Monday, the Charlottesville City Council rejected a special use permit proposal from the developers of West2nd Condos on Water Street. Mayor Nikuyah Walker, Vice Mayor Heather Hill and Councilor Wes Bellamy voted against the permit, while Councilors Kathy Galvin and Mike Signer voted in favor of it.
The permit would have allowed West2nd developer Keith Woodard to add an additional floor to the previously proposed nine-story construction design to increase the number of units in the building from 86 to 97. The construction of the condos is a component of the redevelopment of the City Market into a mixed-use facility including underground parking, office and retail space.
The Council originally approved a design plan from Woodard in the summer of 2014 for the development after eliciting proposals from developers for the redesign of the City Market.
The site plan for the development was originally approved July 2017, but Woodard later requested approval from the city to add another floor to the project and additional residential living. The project was originally slated for completion by 2020, although it now faces an uncertain future with the Council’s rejection of the developer’s proposed permit.
Woodard said the modifications to the original design were necessary to preserve the financial viability of the project by spreading costs across more units. The project has been subject to rapidly rising construction costs since it began in 2014.
During the public comment period of the meeting, many spoke against the special use permit for the project on the grounds that its contribution to local affordable housing was insufficient. Special use permits require City Council approval.
“Every time one of these development projects is pushed through … it is pricing out residents and if housing policy doesn’t fundamentally change within 30 years, this city is going to be an entirely white, upper-class city that drives out existing residents,” city resident Michael Payne said.
Don Gathers, former chair of the Charlottesville Blue Ribbon Commission on Race, Memorials and Public Spaces, said the Council needed to prioritize affordable housing over development.
“Before we pledge, promise or offer to give another dime of city money to another developer, can we please have a serious conversation about affordable housing,” Gathers said. “Let’s put our efforts and money into a concrete goal of creating some affordable housing here in this city.”
“This thing is nothing more than backdoor gentrification,” Gather added.
The Councilors listened to a presentation from David Pettit, a local attorney and representative of West2nd, before they debated the merits of the special use permit. Woodard also answered questions from the Council concerning the project.
“It is an extremely important project,” Pettit said. “What it means to the city is that it provides a very attractive and very functional permanent home for the city market with restroom facilities, level market area, adjacent parking … all of the amenities that are really required to help the city market prosper.”
Pettit also said the redevelopment of the site would be economically beneficial to the downtown area of Charlottesville by producing $945,000 in annual direct tax revenues for the city and ongoing employment opportunities.
“It provides a very beautiful, mixed-use retail, commercial, residential building with high density residential development in an area where the city wants to see high density residential development,” Pettit said. “You want people downtown who can walk from where they live to shops and restaurants, movies.”
Pettit also discussed the construction of affordable housing in the Charlottesville community as an important component of the project.
As a condition for the approval of certain development projects in the City of Charlottesville, developers are required to either construct a certain number of affordable housing units or contribute an amount of money to the city’s affordable housing fund.
Woodard had previously agreed to construct 16 units of affordable housing on Harris Street in Charlottesville in lieu of contributing $316,000 to the fund.
Pettit said Woodard was committed to physically building affordable housing in the city rather than donating money to the affordable housing fund, because he wanted to continue to the construction and maintenance of local affordable units.
Walker asked Pettit why no affordable units could be included on the site of the development rather than being constructed separately on Harris Street.
“This building is so expensive to build, its not economically feasible to put affordable housing in the building,” Pettit said. “It makes much more sense to build affordable housing in a building that doesn't have two and a half floors of underground parking and half of the site occupied by a plaza.”
Bellamy said projects such as the City Market redevelopment were problematic in Charlottesville because low income members of the community do not benefit from them.
“I think one of the issues people are having ... whenever we begin to create housing that is supposed to be top-notch, high level … very rarely do individuals from low income communities have the opportunity to take advantage of such,” Bellamy said.
Under the city’s affordable housing guidelines, developers are required to maintain the constructed affordable units as affordable for at least 4.7 years. Bellamy asked Woodard if 16 affordable units could be constructed with a guaranteed price maintenance time of 20 years, but Woodard said such a commitment would not be financially viable.
“I'm not a developer, so I'm rather perplexed when you say we can't make it work because it won't be economically feasible, though some would say you have made a lot of money in this city,” Bellamy said.
In response, Woodard said development projects were essential to producing economic growth that could, in turn, fund affordable housing development.
“In order to drive the economy in the city and to drive the funding for affordable housing, we need to have projects,” Woodard said. “If developers can’t build projects, there won’t be money for tax revenue or affordable housing, so there is a public good here.”
Galvin also said the project was economically essential to the downtown area.
“It really is an economically viable and important building for the downtown area,” Galvin said. “If we do not allow investment to take place in this city, we will lose the capacity to do everything people are saying they want us to do, from affordable housing to schools to just fixing our potholes.”
Hill agreed that development in the city was important but expressed concern about the financial viability of the project.
“I do believe we need to develop in this city,” Hill said. “I do not want to be sending a signal that we are not open to developing in this city, I am just concerned about how much is too much? Where is the limit to this, to what we can continue to be asking of this property, it’s clearly financially tight.”
After the Council failed to reach a consensus on any possible change in either the number of affordable units or the duration of time they should remain affordable, the special use permit was rejected in the 3-2 vote.