Powder House Lane Apartments

North Shore Community Development Coalition to purchase a 29-unit, multi-family complex of five buildings on Powder House Lane in Manchester for affordable housing.

The Manchester Affordable Housing Trust (MAHT) last week presented a comprehensive update to the Board of Selectmen (BOS) on its strategy to rehabilitate and develop four properties, including Newport Park, The Plains, Loading Place Road and the DPW site on Pleasant Street.

Just two days after that BOS meeting, a Salem-based community housing organization purchased the 29-unit building complex on Powder House Lane abutting Saw Mill Brook with funds donated by private citizens.  The plan is to convert naturally vacated units over time to income-restricted units marketed to tenants selected by lottery and earning less than 80 percent of local “area median income” (AMI).

The new owner, North Shore Community Development Coalition, Inc. (NSCDC), received $1.5 million in donations and purchased the property for $3.7 million. 

The matchmaker for the Powder House Lane deal was Manchester resident Frank Nitkiewicz, according to Mickey Northcut, CEO of NSCDC.  Nitkiewicz is the Chief Financial Officer at the Federal Home Loan Bank of Boston, a federal wholesale bank charged with guaranteeing community housing transactions.  He is also treasurer of the Board of Directors at NSCDC, along with several other housing project boards affiliated with NSCDC.  And, Nitkiewicz is on the board of directors of the Citizens Initiative for Manchester Affordable Housing (CIMAH), the group that organized the $1.5 million in funding for the Powder House Lane purchase and requested that MAHT receive a portion of the donations as a passthrough to demonstrate town support of the purchase by NSCDC.

The purchase preserves one- and two-bedroom rental units in downtown Manchester that are already affordable because of their size and location.  Eventually, NSCDC will migrate all of these units to formally designated, low-income housing.

MAHT Chairman John Feuerbach told the BOS that the Powder House Lane units will be a plus for the town.  But will they impact MAHT’s comprehensive plan to build new units at the Pleasant Street DPW or the plans to make much-needed renovations and upgrades at Newport Park, The Plains, and Loading Place Road? Feuerbach said while the MAHT is encouraged by the purchase of Powder House Lane and supports it, the project is on a separate track than the MAHT and MHA plan.

MAHT’s comprehensive plan is based on a recent study conducted by Beverly Gallo, a consultant with the Peregrine Urban Initiative. That study is a hard crafted “proof of concept:” a detailed approach to rehabilitate 84 existing units on the three sites, and add 90 more across all four sites, totaling 174 units in the preliminary plan. 

Gallo and MAHT carefully accommodated all environmental and regulatory guardrails across the sites, and vetted public-private approaches for financing construction and assuring long-term viability of the properties.  This includes new state grants and tax credits that require a unit-for-unit development match to secure funding, Feuerbach said, and it will be the basis for an RFP (Request For Proposal) that will be released to developers to work in partnership with MAHT and the Manchester Housing Authority on the projects.  The exact plan provides both matching grant funds and revenue from new units that will fund the rehabbing of existing units and ensure financial sustainability of all units in the future.

The real lynchpin for the MAHT/MHA plan, said Feuerbach, lies in the availability of the Pleasant Street site and the timing of the DPW’s planned move from that site to another town site on Upper School Street, currently being used by Black Earth Compost.  The town composting operation is supposed to move to the town’s tranfer station off Pine Street.  Confirmation by the BOS on the sequencing of these “dominos,” is critical for the timing of the RFP, he said.

Selectman Becky Jaques lauded the sheer magnitude of the work done by the MAHT and the Manchester Housing Authority to get to this point.  Jeff Bodmer-Turner, another Selectman, asked about deed complications with the sites, since some of the properties (Newport Park and The Plains) are jointly managed with Massachusetts Housing and the town.  Only the DPW site is purely town owned and operated.  Feuerbach said the MAHT had anticipated those issues.

The BOS said it is willing to pursue the plan’s concept and work with options that include the DPW site.  Feuerbach told the BOS the RFP can go out to potential developers as long as the status of the DPW site is addressed.  The RFP is expected to be released sometime in the summer or fall.

Last month at Crowell Chapel on Rosedale Avenue, the MAHT held the first in a series of meetings with current tenants to share its plan and how upgrades might roll out.  They also wanted to allay tenants’ concerns for disruption.  Feuerbach said the meeting went well.  Public outreach will expand this summer to residents in impacted neighborhoods of all four sites to hear concerns and factor them into the RFP process. 

For tenants of Powder House Lane, Northcut said not much will change, and that’s good news to tenants there.  The rents at Powder House Lane are already in line with those in the middle of affordability, like teachers, public safety employees, restaurant workers, and supermarket employees.  The building’s new management company, Peabody Properties, began asking current tenants to complete a short, two-page income verification. 

“The first goal is to understand who is living there, to get an income profile, and not lean on anecdotal evidence,” he said.  “We want to remove the speculation.  By mid-June, we’ll know what the demographic is of most of the people who live there.  We will also have a sense of whether anyone is leaving.”

Northcut said NSCDC will definitely not be evicting tenants or paying them to leave.  Instead, he said, as tenants move on and units naturally vacate, NSCDC will certify the open units with the town and added to the state’s regulated list of subsidized housing. 

Currently, one unit at Powder House Lane is vacant, and one more is anticipated.  These units will be marketed by fair housing practices, said Northcut, that include drawing from a lottery pool of candidates after 60 days of advertising the unit’s availability, with special consideration for racial inclusion of under-represented minority groups. 

As part of its participation in being a passthrough entity, Feuerbach said the MAHT requested a formal agreement (a signed memo of understanding) to clarify a series of important moves of NSCDC, like performing an income certification of all tenants and formalizing an Affirmative Housing Plan that will lower the 80 percent AMI standard for tenants over time.  The building would have to be permanently deed-restricted as a low-income property.  And if the deal falls through for any reason, donors will get their money back.

Clearly, none of these are an issue for NSCDC.  Its mission is purely about investing in affordable housing, and ensuring inclusivity and diversity for communities in which it operates.  And now, that includes Manchester.

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