City Investing $38 Million in Affordable Housing in FY23

The City’s 2022-2023 Annual Budget again includes a significant increase in funding for the development and preservation of affordable housing in Cambridge. The chart below breaks down the funding sources.

The total anticipated direct funding for affordable housing in FY23 from the sources noted above is over $38 million, compared to over $32 million in FY22. Through FY22, the City has appropriated more than $278.8 million to invest in affordable housing initiatives. These funds have been used to preserve or create more than 3,625 affordable units to date. The City will also continue to support this effort through zoning tools that promote affordable housing, by providing access to affordable rental housing, and by providing homeownership education, counseling, and homebuyer financial assistance.

The City Manager will continue work with the City Council to examine potential new revenue sources to facilitate affordable housing initiatives.

Preserving Affordability at Fresh Pond Apartments

In FY22, the Affordable Housing Trust provided $34.5 million in loans and other assistance to complete preservation of long-term affordability of all 504 affordable units at Fresh Pond Apartments at 362 and 364 Rindge Avenue. This commitment includes providing financing to the owner to reflect the value discount needed to continue affordability, and funding a rent phase-in reserve, which will be used to assist in transitioning some current residents to a new affordable rent structure in the coming years. Preserving affordability at Fresh Pond Apartments caps the City’s efforts started in 2009 to preserve the affordability of 1,094 units at 10 privately-owned properties where continued affordability was at-risk.

Building New Affordable Housing

The City continues to use funds appropriated to the Affordable Housing Trust to expand a pipeline of new affordable housing in Cambridge. The adoption of the Affordable Housing Overlay (AHO) Zoning Ordinance in FY21 has begun to help developments advance toward construction.

Notable developments include:

• 1627 Massachusetts Avenue. Funding from the Affordable Housing Trust is anticipated to be used to purchase this property from Lesley University. Planning will begin in FY23 for the creation of new affordable housing at this prominent property near Harvard Square through renovation of the historic structure and new construction on the large surface parking lot.
• Squirrelwood. 23 new affordable rental units were completed in FY22 to help recapitalize and preserve affordability of 65 existing affordable units at Linwood Court and Squirrel Brand Apartments.
• Rindge Commons. Plans advanced for new development of affordable rental housing in a two-phased mixed-use development in the Alewife area. The first phase, expected to begin in FY23, will create 24 affordable rental units, along with non-residential space that will include a new area for early childhood education programs.
• 52 New Street. A plan to build 107 units of affordable rental housing in a mixed-use development next to Danehy Park was advanced through the AHO community review process in 2021. Once all funding is secured, construction is expected to begin in FY23.
• Jefferson Park Federal Public Housing. The Cambridge Housing Authority (CHA) is moving forward with plans for the revitalization of 175 units in North Cambridge to continues to provide this much-needed affordable housing that will remain financially and operationally viable into the future. Plans were advanced through the AHO and include the creation of more than 100 affordable units. Construction is expected to begin in FY23.
• Frost Terrace. The creation of 40 new units of affordable rental housing in Porter Square were completed in FY22.
• 2072 Massachusetts Avenue. A proposal to build 49 units of affordable rental housing near Porter Square advanced through a public review process. Planning for an affordable housing development on this site is expected to continue in FY23.
• Walden Square II. A plan was advanced through the AHO process to create new units of affordable rental housing at the Walden Square apartment property.
• 49 Sixth Street. A proposal is being developed to create 46 new units of affordable rental housing through the AHO at the former Sacred Heart rectory, school, and convent in East Cambridge.
• 116 Norfolk Street. CHA has proposed to renovate existing rental housing and create 62 affordable units through the AHO to better serve low-income residents with on-site supportive services.
• 35 Harvey Street. Planning began in FY22 to convert this 16-unit single-room occupancy (SRO) with shared facilities into 12 small apartment units for individuals moving beyond homelessness.
• Broadway Park. A plan was advanced to build 15 affordable condominiums for first-time homebuyers in The Port. Planning for an affordable housing development on this site is expected to continue in FY23.

Inclusionary Housing

Through FY22, over 1,495 housing units were completed or under construction under the City’s Inclusionary Housing provisions. Several new rental buildings with affordable units for low- and moderate- and middle-income residents were also completed in late FY22. In these buildings, more than 130 new units will be made available to applicants in late FY22 or early in FY23. With more than 200 additional new inclusionary units now under construction, the City will continue to see new inclusionary housing becoming available throughout FY23 and beyond. Over 1,086 residents have moved into an inclusionary rental unit in the last decade.

Affordable Homeownership

FY22 marked the first new offering of inclusionary homeownership units in several years as nine new units were made available to first-time homebuyers through a new online application for affordable homeownership units. The City continues to offer homeownership education and counseling to prospective homebuyers. More than 500 participants attend the City’s homeownership workshop each year, with many also receiving homeownership counseling.

In FY23, the City will also continue to offer financial assistance to income-eligible homebuyers. The City’s HomeBridge program for homebuyers was recently expanded to serve households earning up to 120% of area median income. Offering up to 50% of a home purchase price, HomeBridge will continue to be available for income-eligible residents looking for homes on the market. These purchased homes then become part of the City’s affordable housing stock. The City oversees more than 500 affordable homes throughout Cambridge. When these homes are sold by current owners, new buyers are selected through the City’s homeownership resale program. In the last 5 years, 70 residents purchased their homes with assistance from the City. More than 150 residents have purchased a City-assisted affordable home in the last decade. Learn more about City programs and services related to affordable housing at Cambridgema.gov/housing. For additional support, view the Housed in Cambridge online guide.