Arlington County Board members and advocates were split this weekend on how many units at the Barcroft Apartments should be set aside for Arlington’s lowest-income earners.

Two years ago, the county and Amazon loaned $150 million and $160 million, respectively, to developer Jair Lynch Real Estate Partners to purchase the aging garden apartment complex, located on 60 acres near the corner of S. George Mason Drive and S. Four Mile Run Drive.

The purchase agreement stipulated all 1,335 units would be affordable to households earning up to 60% of the area median income, or AMI, for 99 years, in an effort to avoid displacing the 1,100 resident families who lived there.

After community members advocated for deeper affordability, Jair Lynch developed a financing plan that further commits the county and property owner to keep at least 134 units for households earning up to 30% AMI. This would be the county’s largest commitment of 30% AMI units to date, among the properties in its affordable housing stock, according to a county report.

Board members celebrated the plan, which outlines how Jair Lynch will refinance the county’s loan to cover various renovation and redevelopment phases and try to achieve savings for the county in the long run. During remarks when they approved the plan, members said it documents how this project can be financially viable, despite cripplingly high interest rates.

“There are so many good things that are happening here,” County Board Chair Christian Dorsey said. “The areas where people want improvements are absolutely doable because the partners involved are committed not only to making this a financially viable experience but a good experience.”

He said that Saturday’s discussion was not the time or place to add in a new affordability commitment.

Advocates wanted to see a total of 255 units set aside for 30% AMI households — a single person earning $31,65o or a family of four bringing in $45,210. That number reflects that 255 households at the Barcroft Apartments that reported earning up to 30% AMI in 2021, when Jair Lynch purchased the complex, according to the Arlington Community Foundation.

“Deeper affordability should not expire when the current residents move on,” Arlington Community Foundation Director of Grants and Initiatives Anne Vor der Bruegge said. “We acknowledge the sobering financial dynamics at play and the need to protect the viability of this deal, however, we believe that our goal can ultimately be accomplished using land use and other tools that have not yet been explored.”

Interim County Board member Tannia Talento was not so sure.

“When we look at other committed affordable properties in Arlington that are not able to maintain a good quality of maintenance for their buildings, I just cannot in good mind say, ‘Let’s deepen affordability and we’ll figure it out later,” she said. “I just can’t do it.”

Should market conditions improve or Jair Lynch finds other funding sources, the county and the developer will revisit this minimum commitment, which will hold if market conditions worsen instead, per the report.

“Part of the financing plan is utilizing these potential savings to pay down the County’s debt while still meeting County goals,” a report says. “These anticipated savings are important due to the significant increase in the cost of capital to the County because interest rates have jumped dramatically since the 2021 acquisition.”

Debt service on the county’s short-term line of credit is currently $9 million annually for interest alone — more than four times what was projected in 2021 for the 2023 fiscal year, the report says. The county says this puts a strain on its Affordable Housing Investment Fund, or AHIF, and its ability to take on new projects.

“That is an understatement, considering AHIFs total appropriation for FY 2024 is $20.5 million,” said former independent County Board candidate Audrey Clement, the lone speaker this weekend opposed to the project.

She also said the costs are too high for the first renovation phase.

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