By Lindsay Walker | Daily Independent
It’s no secret Phoenix is booming. From its population to its job market, the city is growing at an almost unheard of rate, experts say.
That growth, however, has created plenty of problems for affordable housing. Rental rates are high and homebuilders can hardly keep up with the demand, leaving inventory sparse and the need for more affordable housing. Developers are getting creative to fill the gaps in the market, with many now purchasing struggling hotels and turning them into multifamily housing projects.
Phoenix-based Chamberlin & Associates is one local group taking part in the emerging commercial real estate trend with four such Valley projects in the works and some under contract in other states. With Chamberlin’s developments, everything is included at a fraction of the cost of a typical apartment — from Wi-Fi to cable and resort-style amenities.
“Someone can move in and pay an affordable price with everything included,” said Flor Aparicio, vice president at Chamberlin. “It’s rapidly expanding due to that fact. For the investment part, it’s a lot better buying an existing community.”
Ms. Aparicio said it is a win-win situation for all since investors simply have to rezone and redevelop an existing structure and tenants have access to a more affordable place to live. She said developments can run an average of $12,000 to $15,000 per hotel room, with the goal of 100 units per project.
On of Chamberlin’s projects is The Woodson on 2420 W. Thomas Road in Phoenix. A former Vacation Inn, The Woodson now will offer residents the choice of studios, one-bedroom and two-bedroom apartments with amenities such as a clubhouse, pool and a pet play area. Construction is about 80% complete, though pricing is not yet available.
The company looks at location, traffic, pricing and more when considering sites to redevelop. Zoning, however, can be tricky, according to Ms. Aparicio. While some hotels are zoned for multifamily housing, others are not, dragging out the development process.
“Zoning is actually what takes the longest to approve,” she said. “That is a huge playing factor, a lot of them cannot even be converted. This is a newer trend and it takes a long time to go through the process. We actually started a year and a half ago with the first one and we’re not even done yet.”
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