Birchez Associates LLC

Housing projects on 9W gain momentum, battle Mother Nature

by Katie Cahill Saugerties Times January 20, 2006

If both the Teicher Organization and Birchez Associates were putting forth the same model of housing in Saugerties in their respective Commons at Saugerties and Birches at Saugerties, then this could be a melodramatic story about their battle to be the first on the market.
But it’s not.
The only thing that makes the Commons, a 72-unit condominium project, and the Birches, a 60-unit income- and age-restricted senior residence, similar is that they are both new, on Route 9W and have battled the frustrations of developing a stormwater management system that actually works. Both came under strict scrutiny as they awaited the approval of the town planning board and their neighbors. And both are getting more than a little bit tired of explaining the difference.

TO GRANDMOTHER’S HOUSE WE GO
If this was a race to be finished, Birches would win. “We’re approaching the 50 percent mark with the last inspection,” said developer Steve Aaron. “We anticipate all the buildings physically being up before the end of the month and then we’ll start working on the inside.”
Last winter, Aaron approached the planning board with his proposal for 60 single-story units, 52 single-bedroom and eight two-bedroom, intended for income-restricted seniors. The project was to be similar to another Aaron development, Chambers Court in Kingston, which provides handicapped accessible and handicapped adaptable units that allow the tenants to “age in place.”
“At the Birches there will be dual viewers on the doors, emergency call systems, carpets that won’t interfere with a walker or wheelchair, and windows will open from inside with minimal force,” Aaron said, listing off a few of the senior-friendly qualities of the Birches. While following the example of its sister site, the Birches will be Aaron’s star pupil. “We have the benefit with new construction to do innovative things,” Aaron said. “We want the [the seniors] there as long as they want to stay.”
Aaron is not, however, resting on his laurels.
“We’re going to be incorporating some new changes,” he continued, “we can always improve. We have radiant heat in the floors. Every unit has its own boiler which gives the tenant more control over their environment. There will be areas for tenant storage. We’re going to have a full-time close circuit television monitoring for security outside, in the all the common areas and community buildings.”
The Birches will reach out to potential residents within the next 90 days, Aaron said, working with the Catskill Mountain Housing Officials, a management team, and the Saugerties Housing Authority. The one bedroom units will cost from $385 – $595 and the two bedroom units will come in between $585 – $710, depending on the income of the tenant. Rent will include hot water, heat, air conditioning, security and on-site laundry facilities. The units are subsidized for 50 years; rents, said Aaron, will remain stable for at least one year.
What does affordable housing cost to build?
“We’ve spent about $9.5 million total, including all soft costs and land acquisition,” Aaron said.
“We didn’t get any grants at all,” Aaron said. “The only portion of it that is a grant is the low income housing tax credits which we syndicate for equity. The federal home loan must be paid back. The New York State Housing trust fund is also a loan and must be paid back. We also took out $915,000 worth of conventional mortgage and $400,000 of [Birchez Associates] own money.”
Congressman Hinchey recently secured another $750,000 for Birchez Associates, albeit through a labrythine manner: the funds, initially secured from the Federal Home Loan Bank of New York’s Affordable Housing Program were awarded in a grant to Ulster Savings Bank. In turn, Ulster Savings awarded a grant to Catskill Mountain Housing Development Corporation, Inc., [CMHDC] based in Greene County. CMHDC then provided a low-interest loan to Birchez Associates.
In regards to property tax, Aaron said, “We worked out a PILOT [Payment in Lieu of Taxes] agreement with the town prior to commencing construction. Right now the way it’s structured, the town will receive more in taxes than if we were a market-rate project. It’s a win-win when a project like this can be built and doesn’t in any way affect the local taxpayer.”

WATER WOES
Due to excessive storm water, the site, Aaron said, has been “a challenge.”
The Birches are “in the process of installing retention ponds with impervious surfaces. Then there’s outlets once the water reaches a certain level and it goes into a massive system of pipes, which we are also in the process of installing, which will eventually go down 9W into the creek,” explained Aaron.

He said the system has been “an extraordinary expense” – the piping alone costs $500,000. “We also took on responsibility for dealing with a pipe that is running under 9W and dumping onto our land that belongs to the DOT,” said Aaron. “We’re confident that our engineering is solid.”
All has not, however, run smoothly. On January 2, Saugerties police and town building inspector Paul Andreassen received a complaint from the owners of R.I.C.H. Farms, stating that The Birches was pumping water directly onto their property. The crews were ordered to stop and Andreassen said he has not received a complaint since.
Aaron does not want to antagonize R.I.C.H. Farms, but maintains that their problems are not created solely by his development, but also by neighboring Guardian Self Storage.

‘A WIDE RANGE’
Directly across Route 9W from Twin Maples Plaza, the Commons at Saugerties is not moving with the same speed as the Birches, but it is moving. In spring of 2005, the Teicher Organization received approval from the town planning board for the 72 market-rate condominium units. Teicher broke ground immediately, pushed its way through site work and is now in the final stages of completing the first residential building on the property, said Harv Hilowitz, mid-Hudson Valley regional manager for the Teicher Organization. Last week, crews began work on the Commons club house.
Although calls from potential buyers are already coming in, Hilowitz said the Commons units will not officially be for sale until the state attorney general’s office approves the offering plan, a document designed for consumer protection required of all condominiums. “It’s a very big, thick document that is hundreds of pages long,” explained Hilowitz. “It includes financing, construction, the budget for management for the project, the condominium owners association that will be formed once it’s occupied…”
As of press time, the Commons had preliminary approval from the state, which permits the Teicher Organization to begin conversations with interested parties, but no binders may be signed and no money can be exchanged. Hilowitz said he expects approval sometime this month.
“When we get that we will be able to go back to the general public and begin actually advertising and selling the units,” he said. “There’s been a fantastic response to the Commons, a lot of interest and a fairly large percentage of people we’ve talked to have verbally stated that they are going to buy.”
Each condominium has two bedrooms and two baths; the price range for the first two buildings is $189,000 to $224,900. These pricy figures won’t intimidate potential buyers, predicts Hilowitz. “There’s no competition for this project,” he said. “There are no other condominiums in the area and there’s a pent-up demand for condominium-type housing and housing in general.”
The 11.1 acres of the Commons will be “heavily landscaped” and well-lit at night. In terms of amenities, the Commons will offer a clubhouse for residents with an exercise room, kitchen and meeting rooms. There will also be a playground. Once a condominium owners association is established, Hilowitz said those on the board can choose who will manage maintenance and if additional amenities, such as a pool, are desirable. If any changes are made to the property, the association will then be required to hire an engineering team and present their plans to the town planning board for approval.
Hilowitz anticipated the Commons will “represent a wide range of people in the community.”
“Some of them are downsizers,” Hilowitz said, “older folks with big houses somewhere in the immediate area. Another type is start up potential owners who are young professionals, married couples and single parents. The third is investors who are looking to buy the units to sell when they increase in value. It’s a very nice cross section.
The first two buildings, which Hilowitz said should be completed this spring, will hold 14 units; the entire project will be completed a year from now, depending on weather and approval from the attorney general’s office.
So what’s the bottom line?
Hilowitz said the Teicher Organization, paid a previous developer $1.25 million for the property and the plans. That figure does not include the cost of materials, labor and construction, figures for which Hilowitz did not have at press time. As for taxes, the Teicher Organization is “paying now for raw land,” said Hilowitz. “Once the individuals buy condos they will pay taxes for their unit and also have a monthly condominium fee,” a portion of which will go toward paying “common area” tax.

MANAGEMENT MADE EASY
Aaron isn’t the only one battling excess water.
“The property has been engineered to retain all of its water,” Hilowitz said. “No water is going off the property so therefore there should not be any issues with any neighbors.”
Andreassen confirmed that there had been no reports regarding water overflow onto other properties. “Our stormwater management plan was properly engineered to withstand all of the rains of the summer and in October and the snow on and off,” Hilowitz said. “The system is working exactly as it was designed to do, not creating any flooding on the property.”
The system uses detention ponds, which “will leach back into the groundwater to be available for wells.” The stormwater management plan of the initial plans purchased by the Teicher Organization from the property’s previous owner was found unsatisfactory by the planning board and the company had to resubmit a plan. Hilowitz said the Teicher Organization was not put off by this request, rather the “professional people in the government have been enormously helpful.”

“They’ve been very accommodating throughout,” said Hilowitz. “We have a good working relationship and that’s noteworthy because that can’t always be said.”