New Block™ provides a solution to economical challenges faced by multifamily developers across the nation
By KEVIN NEWMAN
In recent years, particularly since the recession, builders and developers have been faced with myriad of obstacles. These challenges not only make it more difficult to develop, but also to receive approval from the respective cities to move forward with projects that must meet a variety of sustainable-building requirements and zoning regulations.
Based on conversations we’re having with developers, the biggest challenges currently are the costs associated with construction and the leveling off of rents in certain markets. The cost of construction and the cost of land are currently exceeding what rents can be attained, which makes it nearly impossible for many developers to build in areas where rents do not exceed the $3.00-4.00/square foot range. Due to rising development costs, building in areas where rents are under $3.00/square foot is challenging enough. These rising costs, in addition to the upcoming linkage fees in areas such as Downtown Los Angeles, which will be applied to new developments to address the need for funding affordable housing, create obstacles to build and develop market-rate multifamily housing in general.
Another challenge many developers face is the saturation of the luxury rental markets and the need to develop more affordable housing. Because of the saturated market and higher construction costs, many of our clients are looking to design more sustainable and cost-effective buildings. They are more disciplined in where they add more value to the property, and they are making the incorporation of amenities and common areas a priority to create a more socially oriented environment for residents. While many people directly relate sustainable building to the lessening of the carbon footprint, developers are learning that, in order to achieve sustainability and affordability, they must now look to the incorporation of community. The more compact a space can be, the more affordable it can be in regards to the amount of materials and energy being used. In working with our clients to create spaces such as this, our overarching goal is to further the revitalization of urban areas by designing new developments that embrace cultural diversity while still maintaining a strong sense of community, as well as sustainability.
Taking our personal goals into consideration and addressing the various financial challenges we know developers and landowners face, we made the decision to patent our affordable-building architectural design concept, New Block™. This was originally constructed in 2013 for Irvine, CA-based housing developer Jamboree Housing and the City of Buena Park’s Redevelopment Agency. The project, called Park Landing, has since won 10 industry awards for design excellence, including recognition as LEED Gold for Homes Certified in 2014 and NAHB Nationals: Silver Award for Best Green/Sustainable Home Design in 2015. In patenting New Block™, our hope is that more multifamily housing developers across the nation will adopt the concept as a cost-effective solution to rising construction and land costs that have halted the forward progression of their projects.
Targeting minimum two-acre urban infill sites, New Block™ is built entirely in Type V wood-frame construction and provides up to 24,000 square feet of useable open space, 45 percent of which is park landscape. It incorporates a sustainable “live green roof” system, which meets sustainable living standards and provides an “Urban Park” for residents to come together and enjoy the outdoors, offering a way to successfully incorporate that community feel developers are after.
Furthermore, New Block™ is a bridge between lower density three-story garden walk-up apartments and four-story over podium construction typologies, a design concept that ultimately offers developers construction plans that address the constraints surrounding the maximization of density, while meeting the open space and sustainability requirements of smaller land sites at an affordable rate.
After working with our patent attorneys for eight years, we’ve proudly created a patent license that is designed to give developers the flexibility to either hire a local architect of their choice, or use our services. Whether the developer chooses to hire an outside architecture firm or not, they will need to first sign a contract to attain rights to the patent for each individual development. In doing so, our firm can move forward by providing the developer with a patent license.
In patenting New Block™, we’re hopeful that developers across the nation will see the concept as a smart opportunity to add value to up and coming neighborhoods without breaking the bank.
Kevin Newman is a Founding Partner and CEO of Newman Garrison + Partners. More information can be found at www.nggpartners.com