Design, budgeting, prefabrication key to affordable housing projects

On a quiet, tree-lined street in Perryville, MD, a line of clean and classic duplex houses is providing 75 formerly homeless veterans with comfortable places to live. Located on the Perry Point Veterans Affairs campus, the new development also provides residents with easy access to medical services.

In downtown Baltimore, an adaptive reuse project has transformed an old firehouse and a new, contiguous building into a 92-unit apartment complex, Paca House, to serve chronically homeless city residents and low-income veterans. Paca House’s amenities include a large lobby, an outdoor courtyard, a community room with a kitchenette, free wifi in common areas, as well as resource rooms and access to counseling services.

In the Mondawmin neighborhood, the Metro Heights building added an architecturally striking building to a long-struggling community and offered quality housing to low-income individuals. In addition to 70 affordable apartments, the building includes a club room, business center, fitness room and yoga studio.

Affordable housing projects can have a profound impact on the lives of individuals and communities. Furthermore, “we have an affordability crisis across the entire country,” said Rick Kottke, Vice President of Construction at Harkins Builders.

Faced with that housing shortage, sharp rises in the price of building materials and evolving standards for affordable housing developments, how can project teams successfully deliver these projects?

“Our clients rely on solid budgets to be established early so they can secure financing,” Kottke said. Although Harkins is active in multiple building sectors, affordable housing is one of the company’s biggest segments. It is currently building 20 affordable housing projects and has another 50-plus projects in the development pipeline. 

Creating and maintaining that budget is challenging even in the best of times. Due to the complex array of project partners, funding sources, tax breaks and other government incentives involved in affordable housing projects, it can take nine months or more to complete underwriting after the project budget is set.

“In the current environment, a nine-month delay can make pricing a real challenge,” Kottke said. “For Harkins and everyone, it has been very difficult to deal with price volatility or predict inflation rates.”

Consequently, Harkins has adopted several practices to preserve budgets. Those include early and extensive materials choices. Harkins works with clients to identify all preferred materials but also multiple alternatives in case items become unavailable or unaffordable.

“Our number one mitigating tactic is to procure materials and equipment early – prior to construction. That creates added demands around storage and handling, but once we have the materials, the price is fixed,” Kottke said.

Increasingly, Harkins Builders is also turning to prefabrication and modular construction services as a means of meeting the challenges of affordable housing projects. Prefabrication doesn’t necessarily lower the cost of construction. However, prefabbing select items – such as components of bathrooms and kitchens – can significantly speed construction, lower site congestion and improve quality control. Those qualities benefit all affordable housing projects, including new construction projects as well as creative applications within renovations of existing buildings. Coincidentally, the quality control aspect of prefabrication is also proving to be a useful tool in meeting sustainability and energy efficiency goals in many affordable housing projects.

Building performance standards have been steadily rising for housing developments and several mid-Atlantic states have already adopted plans to implement net-zero energy or carbon-neutral building standards, especially for projects receiving government support. Maryland is expected to adopt similar net-zero building standards soon. Some affordable housing developers have even decided to embrace passive house standards. Harkins is currently working on two affordable, passive house projects in Delaware.

“Passive house is picking up momentum,” Kottke said. “It takes a really knowledgeable team to do it right and keep the costs in line. But the benefits outweigh the costs and we have clients pushing for that design, so we are investing heavily in bettering our understanding and expertise in passive house design.”

The improvements in building performance, onsite amenities and overall design have made affordable housing projects increasingly impressive, Kottke said. “The design has evolved and creative project solutions have evolved to the point where you could look at an apartment building and never know that it’s an affordable housing project… We are very excited and honored to be part of these projects and know they are helping people in need. Our team members take a great deal of personal pride in knowing that we are building someone’s home. There is nothing more precious or sacred than a home.”