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A private real estate firm, nonprofit developer and the Fairfax County government are working together in a public-private partnership to preserve a garden apartment community in Reston as long-term affordable housing.
Insight Property Group and AHC Inc. — the private and nonprofit parties, respectively, both based in Arlington — in a joint venture bought Colvin Woods Apartments for $72 million from a Penzance Management LLC affiliate last month. Insight announced the acquisition in an Oct. 27 press release. It was partially funded with a $15 million low-interest loan from Fairfax County.
The apartment complex, which the duo has re-dubbed Haven Reston, comprises seven buildings with 259 one- and two-bedroom apartments total, built in 1979, plus a community clubhouse and outdoor pool. The apartments sit on the 22-acre parcel at 11023 Becontree Lake Drive, though the joint venture's purchase also includes an adjacent, wooded 26-acre parcel. That’s about two miles north of the Silver Line’s Wiehle-Reston East Metro station and about three miles west of the expanding mixed-used development at Reston Town Center.
“Through our joint venture with Insight and with significant support from Fairfax County, we’re ensuring housing security for hundreds of individuals and families for decades into the future,” Paul Bernard, AHC’s president and CEO, said in an AHC press release.
Haven Reston is the second affordable housing venture in which Insight and AHC have joined forces, the first being Haven Largo, formerly Camden Largo Town Center, which was made possible by Prince George’s County’s right of first refusal program.
Low-interest loans — in this case, at a 2% rate — are a common way for local governments to subsidize affordable housing. In exchange for the loan, the new owners will cap 60% of the units’ rents at no more than 60% of the area median income and 40% of units at 80% of the area median income. Those income eligibility thresholds will kick in fully in 2025. Until then, existing tenants with incomes exceeding those limits may continue to live there, but they’ll have to move when their leases expire. Households making less than the eligibility thresholds won’t have to move, Tim White, Insight’s chief investment officer, said in an email.
The apartments are currently “market affordable” — or what’s sometimes described as “naturally occurring” affordable — meaning “generally affordable” to households making no more than 100% of AMI, according to documents the Board of Supervisors considered Aug. 2. But they aren’t guaranteed to stay that way, unlike “committed affordable” units, whose rents are contractually capped below market rate.
Insight and AHC’s joint venture will convert the apartments’ affordability from the naturally occurring sort to the committed sort.
The Fairfax County Redevelopment and Housing Authority, or FCRHA, an independent local housing agency, will administer the county loan. That agency is the conduit for other county-supported affordable housing undertakings, as well, including the ground-leasing of public land for the development of committed affordable units at Bowman Towne Court and Government Center. FCRHA also owns the 195-unit Cedar Ridge apartment community, which is adjacent to Haven Reston to the west.
The joint venture anticipates repaying the county loan by refinancing Haven Reston after 2030 under the Low-Income Housing Tax Credit program, or LIHTC, a federal tax subsidy to investors administered by the states. A LIHTC award must be applied for and isn’t guaranteed. If the project’s eventual LIHTC application is successful, the apartments’ affordability mix could change to reflect deeper affordability requirements.
Insight and AHC plan various capital improvements to Haven Reston, such as renovating the clubhouse, replacing some HVAC equipment, repairing asphalt, and adding some outdoor amenities like grilling stations, White said in an interview.
