Summit County Citizens Voice

Breckenridge may go back to the drawing board with plans for an affordable housing development on the Valley Brook parcel, off Airport Road.

Affordable housing discussion pulled off work session agenda, town to hold executive session on details of potential deal with Mercy Housing

By Bob Berwyn

SUMMIT COUNTY — A work session discussion on the Valley Brook affordable housing project has been pulled off the Breckenridge Town Council agenda. Instead, the council will meet with members of an affordable housing committee behind closed doors to discuss the future of the project.

According to a couple of town council members, the town’s deal with Mercy Housing may be on the verge of falling apart. Town manager Tim Gagen said he couldn’t address the issue until after the executive session of the town council meeting, but several council members have said the agreement may not have enough support.

Based on a supplemental staff report for the March 9 council meeting, town staff and the subcommittee appeared to be in favor of completing the deal with Mercy in some form, but other council members have grown skeptical of the agreement with Mercy. Those doubts are based in part on changing economic conditions, and also on the risk that the town would take on under the proposed structure of the deal.

Mercy Housing wants the town to commit to buying certain number of units in advance to keep the construction process going. The Denver-based company also wanted up-front payment of of  of part of the town’s subsidy for the project — specifically the $725,000 developer fee and an overhead payment of $150,000 — at closing. Mercy also wants the town to assume the carrying costs for units that don’t sell within a certain amount of time. Finally, Mercy was also looking for an option that would let the company walk away in the event of poor sales. Read more about the proposed agreement here.

Council members Jeffrey Bergeron and Dave Rossi both said that housing market has changed significantly in the past year. While the demand for affordable housing still exists, it’s not clear that the people who need the housing can get the financing. Rossi said it might be time to rethink the project from the ground up, looking for a way to keep more of the construction and development local.

At the same time, Mercy has been proceeding with soliciting bids for the project, apparently selecting Hyder Construction as the general contractor. That may muddy the waters even more as town council discusses whether to continue the town’s partnership with Mercy.

Filed under: affordable housing, Breckenridge town council, business, economy, real estate, Summit County Colorado Tagged: | affordable housing, Breckenridge, Breckenridge town council, development, Mercy Housing, Summit County Colorado, Summit County News, Valley Brook affordable housing