Friday, February 19, 2010
Noted architect Bing Sheldon embarks on a senior housing co-op
A senior moment
Portland Business Journal - by Wendy Culverwell Staff writer
Cathy Cheney | Portland Business Journal
One of Portland’s best-known architects is breaking ground on a $45 million cooperative housing project for seniors.
The 62-unit Sheldon Cooperative will be among the first co-ops of its kind in Oregon.
George “Bing” Sheldon, 75, and his wife, Carolyn, are lending their name to the Northwest Portland project, which is restricted to residents 55 and over.
The Sheldon was conceived as an in-city project for retirees who want to control their surroundings and their future expenses. The project has recruited 21 families, including the Sheldons, to move in when it opens in late 2012.
The membership roster includes business executives, judges, educators and politicians, including former Multnomah County Commissioner Maria Rojo de Steffey.
Rojo de Steffey said she and her husband are eager to surrender the joy of maintaining their single family home.
“We’re done,” she said.
Unlike a traditional condominium, the Sheldon will operate as a cooperative, a legal structure that actually predates condominiums. Members will own shares of the building rather than the individual units.
The Sheldon will be built on a 35,000-square-foot site at Northwest 19th and Lovejoy streets. The site can accommodate 90 units, 30 more than planned.
It has secured commitments, in the form of $5,000 refundable deposits, from 21 households. It needs 50 to qualify for a 40-year mortgage backed by the U.S. Department of Housing and Urban Development under a little-used program to foster cooperative housing.
The HUD co-op program guaranteed just five projects in 2008, totaling just $25 million, and about 227 housing units. Though common on the East Coast and in some parts of the Midwest, co-op buildings are almost unknown in Oregon.
At the Sheldon, members will put up the equity, then retire the mortgage as part of their monthly fees.
For a 1,050-square-foot unit, the numbers work out to $150,000 for the membership equity contribution, due at ground breaking, and monthly fees of $2,400.
The monthly fee covers debt service, utilities, any services the building members choose to purchase and all future maintenance, including appliance replacement. The mortgage interest portion of the fees are tax deductible.
Equity growth is limited to 2 percent a year, which is designed to keep it affordable in the future and ensures residents can quickly recover their equity when they want to sell later.
MJ Steen, who specializes in high-end real estate with Windermere/Cronin & Caplan Realty Group Inc., said the Sheldon model is appealing to West Hills residents who want to live in the city.
Using a cooperative legal structure will also help boost its chances of getting built.
“It’s a creative way to get a project financed and constructed,” Steen said.
The Sheldon team has an option to purchase the site, currently occupied by a low-slung former film processing center.
It selected Northwest Portland’s alphabet district because it is walkable, has grocery stores and physicians offices, and because the property has its own streetcar station.
Friendly discussion launched project
Bing Sheldon, chairman of Portland’s Sera Architecture, dates the start of the project to a question he posed to friends during a gathering at Mount Hood two years ago. What, he asked his retirement-aged peers, comes next?
For most, the unhappy choice was to live in an institutional senior facility, buy a pricey condominium or stay in a current, oversized home.
Most opted to stay put in homes where they raised children.
The Sheldons and their friends recalled how their own parents put off downsizing until they moved directly from family homes to nursing centers.
They wanted to enjoy their retirement years, unfettered by home maintenance and unexpected repair bills.
“We all know our incomes are not going to be ballooning,” Sheldon said.
By providing its own equity to launch the project, the Sheldon eliminates the need for investors. That cuts costs and reduces pressure to maximize units to maximize profits.
The member-owners call the shots, from how many units the project has to the amenities it wants and even the services it contracts.
Sera Architecture is designing it with oversized decks, a garden and a library. A dining room is out, deemed too “nursing home.”
Retired political junkie and civic activist Mitzi Scott already has joined.
Scott, 65, has lived in a house overlooking downtown Portland for 20 years. She depends on a car to get around, but is ready to use the streetcar to get around town.
“I know that I can stay in The Sheldon longer than I can stay in my house,” she said.
To develop the project, Sheldon enlisted Mark Desbrow, formerly of Opus Northwest LLC, a prolific multifamily developer.
Sera and Opus partnered to develop Park 19, a successful 101-unit apartment project about four blocks away from the Sheldon site.
With development work hard to come by, Desbrow formed Green Light Cooperative, a limited-fee development company, to spearhead the project on behalf of members.
With a limited pre-development budget, Desbrow said about 95 percent of the interest in the project has come from word-of-mouth, though he welcomes interest from real estate brokers.
wculverwell@bizjournals.com | 503-219-3415
http://portland.bizjournals.com/port...ml?t=printable
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