A new community land trust has launched in Denver, with $24 million in initial funding and a goal to acquire 700 homes scattered across the city and surrounding suburbs, including single-family houses and condos, The Denver Post reports.
According to the Post, Elevation Community Land Trust and its backers plan to seek an estimated $23 million in contributions from local governments, and an additional $11 million could come from new private partners as well as donations of public and private property. The funding plan calls on Denver’s new $150 million dedicated housing fund as a source of money. The Post previously reported that land trusts would be eligible for some of that funding.
Dave Younggren, president and CEO of Denver-based Gary Community Investments, which has committed $5 million to Elevation through the Piton Foundation, told the Post that informal conversations with public officials have been encouraging.
Denver is one of the fastest-growing cities in the United States, and city officials often cite a figure of about 1,000 residents added every month.
In May, the Urban Institute released a report on the state of Denver’s low- and middle-income housing. According to that report, neighborhoods that were once low- to moderate-income strongholds such as Five Points and Whittier have gentrified in the last 15 years, and longtime residents may be left out of new prosperity. Many neighborhoods in the Lower Downtown area have changed, and residents there have higher incomes and are more highly educated than was the case 15 years ago.
As the Urban Institute report notes, the state of Colorado does not allow rent control, and even if municipalities wanted to stabilize rents, a 2000 court decision prohibits them from doing so. In that context, the report also cites that land trusts “may be increasingly important strategies for Denver moving forward.”
Under a CLT, an entity like Elevation acquires land through purchase or public transfer, then leases homes on that land to families or developers. Because the family or developer needs to purchase only the building and not the land, a CLT home is usually more affordable than a conventionally purchased home. The lease to the household or developer, known as a ground lease, establishes conditions to protect permanent affordability, such as the CLT always having the right to repurchase the building at an affordable price, established by a resale formula built into the ground lease. A CLT may also use a ground lease to regulate rents on its land.
According to Fannie Mae, which finances family mortgages to CLT homeowners, there are around 225 active CLTs around the country, representing around 20,000 rental units and 15,000 homeownership units.
The Globeville Elyria-Swansea (GES) Coalition Organizing for Health and Housing Justice, formed in August 2015, has been organizing Denver residents around displacement threats. The group conducted its own study in the Globeville and Elyria-Swansea neighborhoods, with members going door to door to survey 500 residents. About 80 percent said they want to stay in their community, 74 percent had lived in the community between seven and 10 years, 80 percent had only a high school diploma or less, and 61 percent earn less than $25,000 a year. Alarmingly, 51 percent of residents surveyed were renting their units without a formal lease, and of those who own their homes, 58 percent had already been approached about selling.
The GES Coalition study recommends the formation of a community land trust as one of its top priorities to protect those residents against the loss of their communities. The Post reports that the members of the group are concerned that the regionwide Elevation CLT may erode their own chances to get a piece of the city’s $150 million dedicated housing fund.
“How we stitch this all together with the advice and the expertise around this room is going to be the next challenge,” Erik Soliván, director of Denver’s Office for Housing and Opportunity for People Everywhere (HOPE), which is administering the $150 million city fund, told the Post.
Oscar is editor of Next City. Before that, we was a contributing writer and Equitable Cities Fellow for Next City. Since 2011, Oscar has covered community development finance, community banking, impact investing, equitable and inclusive economies, affordable housing, fair housing and more for media outlets such as Shelterforce, B Magazine, Impact Alpha, and Fast Company.