CHISPA wants affordable senior homes in Marina. The City wants market-rate renters.

HISPA wants to build affordable apartments for seniors next to the new bus station in Marina – but the City and Monterey-Salinas Transit want more than just poor grandparents living there.

The City and MST want a compact mix of market-rate and low-income rentals at the corner of De Forest and Reservation roads. Councilman Gary Wilmot says the majority of the project should be market rate, not affordable. “[CHISPA] is looking at it backward,” Wilmot says. “We need to do at a minimum 70 percent market rate. For a downtown to thrive you need to have an entire spectrum of incomes.”

The MST-owned site is slated for mixed-use development: commercial shops on the ground level along Reservation Road with homes above the stores, and a public plaza linked to the bus stop. On Oct. 1 MST opened the first piece – the new $5 million transit exchange – for business. City and MST officials hope the project’s next chapter will increase their cash flow and uplift downtown business.

Planners originally tailored the project to include two or three stories of apartments with underground parking. So when CHISPA recently proposed 35 affordable units with surface parking, the City Council sent the nonprofit homebuilder back to the drawing board.

On Oct. 2 the council directed city staff to sit down with CHISPA and MST later this month to try to work out a deal. But the City, MST and CHISPA may have conflicting goals.

CHISPA says one- and two-bedroom apartments for people 55 years and older is a good match for the site given its public transit. Dana Cleary, director of real estate development for CHISPA, says that older tenants are more likely to hop on the bus. They could also walk to a coffee house and shop at nearby Long’s and Save Mart. “They are not a group that has a lot of money,” Cleary says, “but they are a group that keeps their money downtown.”

Rents at the CHISPA complex would go for about half the market price.

If open today, rents would range from $326 to $678 per month, Cleary says. By comparison, Marina rentals listed in the >>Herald on Oct. 6 ranged from $725 to $1,200 per month.

Marina officials, on the other hand, want people with disposable income to live and shop in downtown. The City also wants high-density development. The plan for the MST site calls for underground parking to increase the size of the plaza and make the area more walkable. MST wants to meet the city’s design guidelines and procure a lucrative lease to boost its revenues. CHISPA, however, can’t meet all of these desires on its own. The nonprofit would need to partner with a market-rate developer or receive significant financial help from the City.

But no market-rate developers have come forward. CHISPA was the only developer to submit a proposal after MST sent out its second request for proposals in June. Cleary says CHISPA tried to attract for-profit developers to partner with but had no luck. (In the midst of a national downturn in the housing market, this is not surprising.) So CHISPA proposed a 100 percent affordable complex. While some local cities would see the promise of low rents as a blessing, Marina seems unimpressed.

Although the average home is selling for more than $600,000 in Marina, some councilmembers say the city doesn’t need more affordable housing beyond the transit center’s planned 20 percent to 30 percent requirement. At the maximum capacity of 65 units, the project would result in about 16 affordable ones.

City leaders point to affordable complexes such as Charles Apartments and CHISPA’s Marina Manor as proof that there is enough low-income housing. And, says Mayor Ila Mettee-McCutchon, this is not counting all the inclusionary homes that will be built on the city’s Fort Ord property, including senior housing at Cypress Knolls.

“We are building so much affordable housing in our major developments that I don’t think we need 100 percent to be affordable,” Mettee-McCutchon says.

While homes for elderly residents look like a tough sell for CHISPA, the affordable homebuilder is hoping for a compromise. Cleary says CHISPA could build the senior units first and the market-rate apartments could be phased in later. Either way, she says, senior housing will be needed in Marina.

“Even if all the wealth of Monterey County concentrated along Reservation Road, you still got to provide for your grandparents,” she says.