Tag Archives: SRO

Housing demand and the regulatory path of least resistance: Seattle and microapartments

Seattle Space Needle. Photo by author.

The feature piece in The Stranger last month delved deeply into Seattle’s trend of micro-apartments. Dominic Holden offers an in-depth look at not just the development trends, but the politics of the policy and planning conversation around development in an expanding city.

A few things popped out:

Room for rent: The article describes Seattle’s micro-apartments like this:

But inside each town house, the developer was building up to eight tiny units (about 150 to 250 square feet each, roughly the size of a carport) to be rented out separately. The tenants would each have a private bathroom and kitchenette, with a sink and microwave, but they would share one full kitchen for every eight residents. The rent would be cheap—starting at $500 a month, including all utilities and Wi-Fi—making this essentially affordable housing in the heart of the city.

If that sounds familiar, it should – it’s a situation similar to what already happens in big cities – renting a room in a group house. For a fraction of cost of a studio or 1-bedroom apartment, you can instead rent a room in a shared house. Considering that comparison, there is clearly a market for these kinds of spaces, and it’s not exactly new.

It ain’t much, but it’s home: While the rise of micro apartments is in the news in Seattle, it’s not a new thing for cities. Single-room occupancy (SRO) apartments have a long history in cities. The Blues Brothers highlighted this housing typology in their 1980 homage to the city of Chicago (“how often does the train go by?” – “so often you won’t even notice it.”).

Chicago’s WBEZ documented the dwindling numbers of SROs in the city, noting how this particular form of affordable housing has served a different market of individuals than the kinds of tenants mentioned in Seattle:

The Chateau is among the city’s shrinking pool of single-room occupancy hotels (map below), which offer an important housing option for people with low- and fixed-incomes. SROs also serve clients with troubled credit or criminal histories. The North Side has long been an SRO hub, but in recent years many such buildings have been purchased by developers and closed, only to reopen as more expensive housing — often beyond the means of prior tenants. Some SRO residents and community organizers worry the Chateau Hotel might be the next building in this trend.

The key difference is in the level of maintenance, and thus the target market. Nonetheless, it’s not hard to see how micro-apartments like likes in Chicago or the new construction in Seattle would appeal to a number of potential markets. None other than The Stranger’s own Dan Savage makes note that he lived in an SRO when first moving to Seattle, and “I wasn’t sketchy then, I’m not sketchy now.”

As a part of re-evaluating the SRO’s sketchy reputation, Next City focused on the role this type of housing can have in the future of our cities.

Meeting housing demand: As Holden notes, a dynamic and expanding city like Seattle needs room to grow, and needs opportunities for a wide range of incomes. He also makes note of the only sure-fire way American cities have to meet growing demand post-WWII – sprawl. “Accommodating our growing population by shipping workers into the low-density sprawl of the exurbs is not the way a city should operate.”

This isn’t unique to Seattle. Other cities (including New York and DC) are struggling to meet the demand for housing, and are considering micro apartments as one potential solution.

The politics of neighborhood opposition: Holden’s Stranger article offers a fascinating dive into the politics of those opposed to these projects. Holden examines the stated objections to these projects (which include everything but the kitchen sink – or, in the case of complaints about shared kitchens, why not bring it up?) and finds most opponents to be “dramatically exaggerating”  the impacts. “Tick through the neighborhood groups’ complaints,” he writes, “and they don’t add up to a logical argument.”

The two issues in opposition that Holden deems to have legs deal with a tax break loophole for these developments and an exemption from the city’s normal design review process (more on this later). The principal objection is that the apartments count as many units for the purposes of a tax break, but few units to avoid the threshold for additional design review scrutiny.

Holden’s article goes into substantial detail about his interactions with some of the individuals and groups in opposition, highlighting a kind of fanaticism. Even without the crazy elements, the strength of the opposition and relative lack of proponents involved in the discussion shows the kind of game theory challenge for urban development regulations – opposition is strong, but only in a narrow segment of the population; support is broad, but few individuals feel the need to organize in favor of developments like micro apartments. The existing legal procedures favor the organized, and therefore give organized groups leverage in discussions.

The limits of design review: While a procedural loophole exempts micro-apartments in Seattle from design review (and Holden flags this as a legitimate complaint from opponents), there are limits to what such reviews can accomplish. Holden notes that such reviews in Seattle are largely administrative. He also ferrets out the intentions of those pushing for design review: “What public reviews will do is give activists a chance to obstruct microhousing by quibbling with the appearance.”

Holden understands the importance of process, and the cost it can impose on any new development. Since developers must (at a minimum) cover their costs to even entertain a proposed project, any increase in procedural time and costs means those costs must eventually be baked into the cost of the final product.

If the city pursues design and environmental reviews—which could improve the aesthetics and aren’t inherently flawed processes—they should be administrative reviews. They should be conducted by city staff who notify the public but limit input to letters in writing. They shouldn’t involve neighborhood meetings that are easily sidetracked, shouldn’t require multiple revisions to the architecture, and shouldn’t allow appeals.

If the public is allowed to obstruct these projects—and their arguments thus far have been specious—the results will be predictable: Every time developers must redesign the buildings to satisfy the neighbors, every time the project is delayed for further review, every time a spurious appeal is filed, the more it costs to build that project. And that has one predictable outcome: It will make them more expensive to rent, i.e., fewer people will be able to afford them. In other words, whether deliberate or not, the effect of neighborhood advocacy and its input on development projects will make living in these places more expensive and push out workers with less money. That would seem like a terrible mistake—unless pushing out poor people is the actual goal.

Development following the path of least resistance: Given the increasing costs of compliance with the regulations and procedures, it’s not hard to understand why so much real estate development seeks to follow the path of least resistance.

Leaving aside the question of whether micro-apartments are a worthy policy for cities to pursue (as opposed to other expansions of zoning allowances), it does show the catch-22 inherent in things like design review: the additional regulatory review is required because the outcome those reviews shape is a desirable policy goal – but the very cost of the review makes achieving those desired outcomes less likely.

The ideal would be a case where the desired outcome is prioritized, given the path of least resistance. Holden’s discussion of keeping reviews administrative and not subject to lengthy public hearings and appeals is an example. I suspect that (with the exception of some special cases), changing the outcomes from the path of least resistance cannot be accomplished through de-regulation alone.

However, the larger question looms in the background: what agreement is there about the most desired outcomes?