250 Gull Pond Road, Wellfleet

Background Information

A new rental housing development is planned by Community Housing Resource, Inc. (CHR) at 250 Gull Pond Road Wellfleet. The development is small with just 3 one-bedroom and 3 two-bedroom townhouse style units. It will serve a range of incomes including up to 30% AMI with project based rental subsidy, up to 60% AMI and up to 100% AMI. It is located on a high elevation wooded site located within easy reach of Route 6, Wellfleet Town Center and the Wellfleet Elementary School as well as the wonderful ponds and ocean beaches of the Cape Cod National Seashore.

As on all recent CHR developments, the development team includes Jessica Snare, Spring Hill Design Architects and East Cape Engineering, Inc., Development Consultant Dan Violi, Zoning / 40B Attorney Peter L Freeman and Closing Attorney Joel Feinberg; all of whom have worked together with Community Housing Resource, Inc. (CHR) on other successful affordable housing developments on the Outer Cape. CHR will serve as general contractor for the project, given the small size and expertise we have in-house.

A little background is needed to explain the current situation of the development:

The land for development was a Tax Title taxing by the Town of Wellfleet and was committed to affordable housing purposes in by vote of Town Meeting in April 2003. In mid-2006, after an RFP process, CHR was given Designated Developer status. From mid-2006 to late 2007, CHR, at its own cost, pursued site development engineering and architectural plans to submit for regulatory review. Following design work, construction and development budgets were prepared and financial feasibility was finalized including public subsidy sources needed.

With financial feasibility demonstrated, in February 2008, the regulatory process under Chapter 40B Comprehensive Permit could begin with a request submitted to the MA Department of Housing and Community Development (DHCD) for the required Project Eligibility Letter. On May 23, 2008, DHCD awarded Project Eligibility Letter for development of 5 home ownership condominiums with the potential for subsidy resources under the DHCD Housing Stabilization Fund Program.

With Project Eligibility Letter in hand the application to the Zoning Board of Appeals could be submitted May 27, 2008. The application to the ZBA was approved on October 30, 2008. With regulatory approvals in place, CHR was able to request subsidy funds from DHCD in December 2008, however, in January 2009 CHR was informed that due to changes in the economy DHCD would no longer be accepting applications for affordable home ownership developments.

Since 2009, efforts were made to assemble alternative funding sources. In early 2010, one major source was secured from another division of DHCD, the Community Development Block Grant (CDBG) was identified to pursue the infrastructure improvements. In August 2010 Wellfleet was invited to apply for these funds and by mid-2011 the funds were awarded to the Town. By the end of 2011, the Town had awarded a contract through a public bid process. The infrastructure construction began in December 2011 and was completed by July 2012.

While the infrastructure was underway, it became evident that the October 30, 2011 expiration of the ZBA Comprehensive Permit required an extension which was granted on October 6, 2011 by the ZBA for an additional three years to October 30, 2014.

Sample look of one-bedroom townhomes to be built at 250 Gull Pond Road.

Other than the CDBG award, only local resources were available to build the home ownership housing. Those funds were committed and increased. However with DHCD no longer funding home ownership projects as the original Project Eligibility Letter contemplated, a technical issue existed with the 40B Comprehensive Permit Project Eligibility Letter requirements which required an alternate “Subsidy Program”, so a Local Initiatives Program application was pursued. The LIP approval was obtained in June 2014 and concurrent with marketing efforts construction on the homes was started to preserve the Comp Permit term requiring start by October 2014.

Unfortunately, marketing failed to attract enough eligible mortgage-able homebuyers, and the decision was made, in conjunction with the Wellfleet Housing Authority, to pursue the rental housing approach. CHR is in process of requesting ZBA approval of an amendment of the Comprehensive Permit to allow a change to rental and an increase of the number of units from 5 to 6, as well as approval of the new Subsidy Source reverting to the HSF Program from the more recently approved Local Initiative Program. The ZBA has been supportive of prior changes needed we anticipate approval at the hearing scheduled for April 17th.

Based on a Pre-Application submitted February 20th, DHCD has invited CHR to submit a full application for rental housing funding in the April 23rd Round. The request is for $300,000 of DHCD funds under either the HSF or AHTF programs. These funds will supplement committed local resources in the amount of $144,112 from the Wellfleet Community Preservation Act Funds, and $228,000 from Wellfleet Affordable Housing Trust Fund. Additionally the Town of Wellfleet support of this development includes a contribution of the land valued at $250,000 and Infrastructure Site Improvements that were supported by a DHCD CDBG Reserves award in 2011. Other local resources include $200,000 from the Barnstable County HOME Consortium that is tentatively “reserved” conditioned on award of the necessary additional funds.

CHR is seeking Construction Period Financing from The Life Initiative in the amount of $600,000 and Permanent Rental Financing from MHP in the amount of $590,000.