Naturally Affordable Housing and McKinney Capital aim to serve ‘missing middle’ with North Park project

REAL ESTATE: Building New Workforce Housing Without Subsidies

A North Park developer broke ground in mid-September on an apartment building that the company said will be the first in a series of projects that will set the tone for workforce housing built without subsidies.

Estimated to cost about $13 million to build, Kansas Street Workforce Housing at 4233 Kansas St. by Naturally Affordable Housing and McKinney Capital will have 39 studio and one-bedroom apartments, said John O’Connor, co-founder of Naturally Affordable Housing and president of the El Cajon Business Improvement District.

Rents haven't be set yet, but O'Connor said that they would be below market rate thanks in part to the small size of the apartments.

“It's because of that smaller unit that we're able to charge a lesser monthly rent just based on square footage,” O'Connor said. “The project definitely works financially for us but the monthly check that our tenant is going to write will be less than the comps (comparable rents) in the neighborhood.

Transit Oriented

Averaging about 560 square feet, the apartments will be small but “you don't feel cramped,” O'Connor said.

“When you look at a 560-square-foot apartment, the way we can design them and do them these days, that's a nice space for our target market,” O'Connor said.

OBR Architecture based in North Park designed the project.

Likely renters will be “the younger person, the person that works in North Park or the school teacher that doesn't make enough to go spend on a luxury apartment or a single-family home but they make too much to get any help from anybody,” O'Connor said.

Because of its location one block south of El Cajon Boulevard near a rapid transit bus stop and bike lanes, the four-story building will have no parking as permitted under revised zoning regulations – a measure that also keeps down construction costs.

“That's what every politician is telling everybody to do and we're doing it,” O'Connor said. “This is the new city policy. They want to encourage the walkable (El Cajon) boulevard and encourage transit.”

To help make up for the lack of parking in the building, O'Connor said the project will have a driveway for ride-sharing vehicles. He said his company also may offer tenants voucher for ride-sharing services.

More Units Planned

“The sort of space that we're in, we truly feel is the missing middle,” O'Connor said. “We like this size, we like this neighborhood, we feel like it's a win-win for all involved.”

O'Connor and David Iwashita formed Naturally Affordable Housing in 2018 with the goal of building infill housing projects for middle-income renters in contrast to the luxury apartment towers that have been popping up downtown.

The company has several other projects planned, O'Connor said.

“We're actively looking for more,” O'Connor said. “This is the first one for Naturally Affordable Housing coming out of the ground.”

Still in design stages is a larger Normal Heights project at El Cajon Boulevard and 40th Street which Naturally Affordable Housing is calling Bridgedeck – a reference to the nearby bridge deck transit center on El Cajon Boulevard above Interstate 15.

Plans for Bridgedeck are a little bit in flux because Naturally Affordable Housing recently acquired land from the city to expand the size of the site.

O'Connor said that Bridgedeck would likely have 150 to 200 apartments.

“Now it's no longer an if in terms of our footprint, now it's we have our footprint,” O'Connor said. “Construction on that is probably a good eight to 12 months away.”