strategic planning session · insurance taxes p & i mortgage note $94,600/$ 5,991 $85,100/...
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Strategic Planning Session 24 September 2020
Strategic Planning SessionsSession I
Intros
Case Study: Lumber Pricing• Condition
• Options for Addressing
• Questions to be answered (To Do)
Intro to Strategic Planning-Goal/Purpose
Session II
Recap/Update on Case Study: Lumber Pricing
Surveys/Stakeholder Input Themes
Framework in Progress & Setting Goals
Future Session
Reviewing ‘The Plan’
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[hlb]case study: Lumber Pricing
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In Progress
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Voiced at Session 1 Status
Builder Survey 7/32 Received
Reviewing price cap @ $212,000, affordability ranges
Scope defined, discussing with consultants & experts
Reach out to Partners (Lisc/City/GHBA)
Initial calls made
Reach out to Suppliers Initial calls made50-70%
Query to Land Bank network Complete (3 responses)
Determine average cost to build, and increase expectation (for materials)
Based on RFQ Responses (1200SF @ 159,733)
Innovation in construction & sourcing
Ongoing collection of ideas
Goal Schedule:Research—continue to build out data in next couple of weeks & Discussed at Program Committee
Preliminary Proposals—Discussed at October 8, 2020 BOD Meeting
Final solutions advanced: October
What are the levers?Land Cost--Builder O&P--Sales Price
Schedule—Wait for prices to go down, keeping people waiting for houses?
Subsidy— Philanthropic funding to support price increases?
Strategy—Look at ways of bulk-sourcing materials?
For Consideration:Case by Case—we could address this problem on a case by case basis
Collective ‘solution’-We could develop a systemic approach to solving across all builders.
Each situation may need a unique solution
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Sales PriceRevised
Sales Price
Questions to be answered?Can we ‘temporarily’ agree to contract extensions?
Meeting our goals to meet the affordability crisis get pushed back
What is affordable? What Sales Price is manageable?
Staff is advancing a scope of work with consultants to understand the range of issues of affordability.
What might collective purchasing do—is there an avenue to get lumber in bulk?
Staff proposes conversations with GHBA , other partners IDEAS?
Do we develop a one-time subsidy for materials pricing increases?
A grant program to apply to may provide subsidy relief, and potential ‘good will’
Subsidies that could help:Land Cost—Maintain land prices
Materials Cost: One timesupport for lumber costs and/or other infrastructure
Sales Price-We could pay builder or homebuyer the difference between the final sales price and our ‘affordable’ price.
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Home Price
Average
Insurance Taxes P & I Mortgage
Note
$94,600/$
5,991
$85,100/
$5,389
$197,031
without
subsidy
$162 $305 $898 $1,365 22.78% 25.32%
$197,031
with subsidy
$162 $305 $761 $1,228 20.49% 22.78%
212,000
without
subsidy
$162 305 937 $1,404 23.4% 26%
230,000
without
subsidy
162 305 1017 $1,484 24.7% 27.5%
Affordability Review in Progress Affordability:The current consideration is that anything that is 30% and below of your monthly net income would be ‘affordable.’
Accommodations might need to be made with people of varying credit history, different bank loan products, and additional monthly costs/debt that may factor into the equation.
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[hlb]strategic planning session
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The Dream Headlines!
Houston Land Bank Makes Possible Homeownership for Record Number of Buyers; Record Number of Homes Back on County and City Tax Rolls.
The Houston Land Bank programs create affordable homes for Houstonians and support local economic development
Houston Land Bank Consistently Increasing Number of Vacant Lots Returned to Productive Use Through Multiple Programs
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HLB Makes Big Footprint Bringing 50 Affordable Homes at Premier Site Inside the Loop
*These are not real headlines, but aspirational!
Rhetta reviews the Surveys!
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Assets:• Passion• Diverse
backgrounds• Community
perspective• History with the
organization and community
• Political connections
Challenges:• Communication and
expectations setting• Board culture• Familiarity between
existing and new members
• Disconnect between old and new ways
• Engagement at committee level
• Trust between staff and board
• Lack of clarity around vision
• Identifying funding streams
Surveys:
• 6 responses, (4 served on board 0-1 year)
• Primary interests: share knowledge/ skills, participate in “working board” and support leadership/staff, passion for mission
• Size, range of backgrounds, diversity, expertise all rated as “good” or better
Recent Wins!
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Key Partners:• City of Houston,
City officials, Housing and Community Development, City Planning
• Builders• Land owners• Community Land
Trust• Community
Development Corporations
• Like minded non-profits
• Land banks in other cities
• Outside vendors
Recent Wins• Acquisition of Independence Heights property• Policy document well drafted• Meetings organized and productive• Successful rebranding of the organization• Successful implementation of New Home Development
Program• Ensuring lots do not deteriorate and facilitating
construction of affordable homes
Mission and Customers
Our Core Work:
• Affordable housing to create more stable and sustainable families and communities
• Bring affordable housing to the city of Houston
• Turn vacant and abandoned land into truly affordable single-family home
• Ensure vacant lots do not deteriorate; facilitate construction and sale of affordable homes to local residents
• Acquire abandoned properties, return them to functional and best use
• Revitalize unserved communities in Houston
Who is Served with this Work:
• Low income individuals and families• Lower and middle income residents• 120 and below AMI• Workforce development communities• Families that qualify for affordable
housing Builders HCDD Harris County and HISD
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Rhetta’s Stakeholder Interviews
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Opportunities• What does a sustainable org structure and staff look
like and how does that align to the available funding• Valued and integral part of a larger vision for the city,
playing a unique role the city cannot play on its own• Can become more relevant but must articulate a clear
vision for work that responds to Houston-specific opportunities and context
• Funding is narrow and restrictive – organizational evolution hampered by single stream
• Lack of major subsidies impacts builders and purchasers negatively
Interviews:
Rhetta Detrich with : Sharone MayberryZack BurghliRobert FiederleinTom McCaslandAnderson StouteSam Dike
.
Rhetta’s Stakeholder Interviews
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Transition• HLB staff and leadership has been effective at managing
a challenging transition and setting new systems and structures in place
• Transition period too long – “purgatory”; focus on crafting and implementing a vision rather than transition mechanics
• LARA/HLB work historically linked to the will and support of administrations; what is the future for this relationship
• Listening and soliciting feedback from community and partners has been positive
Board of Directors• Appointed board structure creates unique challenges,
regarding perspectives and priorities• Skills and knowledge of the board is vast, but not focused• Disconnect between board members who have longer
tenure (pre-dating HLB) and newer members• Lack of alignment on future vision is an impediment to
progress and creates disconnect with leadership/board• Lack of effective and productive communication between
board and leadership slows and derails the work to be done
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Future Directions• Expanding number and size of land parcels will make
major difference in impact• Focus on the most cost effective means of acquiring
and developing the land to ensure efficiency and true affordability
• Eliminate barriers for partners to make the work less complicated and more cost effective
• Opportunity to emerge as a key agent in land and community development by working with range of partners
• Impact will come from being more entrepreneurial –where they develop, which partners, types of development
• Avoid becoming developers. Be a partner to developers, but don’t own that role.
• “De-politicize” the work; shape own agenda and goals independent of city
• Craft a vision that all are bought into and many celebrate the successes as their own
Rhetta’s Stakeholder Interviews
[hlb]working plan framework & goals
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[HLB] view
Houston is a city filling in quick: NOW is the time to build our inventory for the longer-term, to secure land for a neighborhood’s vision.
A Land Bank is a key tool in a city’s toolbox to secure underutilized property and convey that property into productive use, supporting public purposes. houston land bank 16
Mission Critical Moment for HLB
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building wealth through homeownership anchors opportunity for families—and there are many types of families and neighborhood types, leading to a need to create a variety of housing typologies, for a variety of economics
We can contribute to a systemic approach to neighborhood revitalization—an affordable housing +plus planTo focus on the district, not the deal.
There are a variety of neighborhood organizations that need expanded capacity to be able to accomplish the breadth of work in the neighborhoods—the Land Bank is poised to extend its expertise to support neighborhood capacity.
Policy Commitments
• Single Family Housing focus
• Goal to increase affordable housing in rapidly changing neighborhoods (Independence Heights, Settegast)
• More developments like ‘Towne Park Village’
Complete Communities
• Housing goals by neighborhood, vary in types and strategies.
Housing Production
• HCDD has announced 200 single family houses/year (NHDP)
Resilient Houston & Climate Action Plan
• 375,000 new homes across every income level by 2050
[City of Houston]
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[HLB] mission
Strategically acquire, dispose, and steward vacant, abandoned, and damaged property into productive use to catalyze transformative community and economic development for the City ofHouston.
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Demonstrate continuous improvement and define national best practice
be a good neighbor in communities we serve
Provide proactive and transparent access to data, activities, and operations
[hlb] values
collaborate with partners on keyinitiatives to support equitable and transformative development
identify highest and best use for sites that support community needs and initiatives, utilize resources to create added value
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Other values?
Opportunities
• To achieve ‘Complete Communities’ goals, more land is needed—this ranges from affordable housing, to neighborhood amenities such as cultural or food resources, to economic engines for jobs.
• Further strengthening the mission based LGC between government and private sector:provides more opportunities for all government entities related to land securitization for policy goals.
• Home ownership is part of a spectrum of choices, and with a diversity of residents/incomes/life circumstances, there are many opportunities to support people of low-moderate income . HLB could also support other housing options.
Seeing Opportunities to expand
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Challenges
• The City is huge—to be effective, we have to be strategic—we cannot have the same role and engagement everywhere.
• There are increasing pressures on providing affordable housing with existing financial models and subsidies—additional resources and innovation needed to assure affordability
• We do not receive many properties through the property tax foreclosure process (LARA) requiring new models and funds to acquire land
• HLB relies on city money to date which may be more and more limited, and limiting. Increased financial revenue provides us with options for program development, and longer term security.
Use challenges to frame strategy
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Reframing The Customer (s)?
Homebuyer(NHDP)
Builder(LARA)
ORIs the customer ultimately the Neighborhood ? A dynamic prosperous neighborhood with sufficient affordable housing and a mix of options/amenities is where homebuyers and builders benefit most.
For other goals, should our customer be neighborhood organizations that lack real estate development capacity? houston land bank 23
Establishing the HLB Lenses
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Goals 2020-1: Goals 2020-1:
HLB : Property Management &
Housing Initiative: Our traditional program of land maintenance, and
sales to create affordable housing
Goals 2020-1:
NHDP (Contract): our existing grant from
HCDD outlines this role
New OpportunitiesOrganizational:
Goals 2020-1:
Our current work
The Opportunity for Growth & Diversification
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Lets determine the annual goals for our current programs
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HLB Goals to date
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Short Term Program Goals• Secure $700,000
in sales• Develop new
programs to achieve goals
• Increase Inventory• Unique housing
typologies on lots (e.g. duplex)
Long Term Foundational Goals• Interlocal
Agreement• Advance
legislation
Context
• 59 Houses sold in 2019
• ~250 Lots in Audit-advance to development
• Program still focuses on affordable single-family housing up to 120% AMI
HLB Housing Initiative To Date 2020:
• 19 Houses sold to date
• 55 Houses in Development—advancing vacant lots
• 19 Recent Lot Sales (Round 1 & 2)
• Acquisitions: 5 lots in Independence Heights!
Goals 2020, 2021:
____________Houses Sold
____________Lots Sold
____________Acquired Lots
____________Alternative Housing Types?
Draft Strategic Plan in Development
NHDP
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Context
• 13 Houses sold in 2019 (first sale, June)
• Program took a year to work out the processes
• Program focuses on affordable single-family housing up to 80%
• 60,000 SF of Land Acquired
HLB Housing Initiative To Date 2020:
• 18 Houses sold to date directly to homebuyers, 7 under contract
• 27 Houses in Development—known.
• ~150 Additional Lots Holding + Acquired Properties
• 350,000 SF of Land Under Contract
Goals 2020, 2021:
____________Houses Sold
____________Acquired Lots
____________Alternative Delivery Process
Short Term Program Goals• Demonstrate pilot
in Independence Heights-streamline construction process
Long Term Goals• Resetting
Interlocal Agreement
• Advance legislation
Draft Strategic Plan in Development
given the opportunities that we see, how can we leverage our work and increase impact?
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How can we adjust our lens to have greater impact?
• Example: Lot to block to neighborhood
What do we need to achieve to have impact?
• More land in neighborhoods
How do we expand impact for homebuyers?
• Homebuyer spectrum of choices
• Secure land for ‘+’ amenities
What do we need to know to be strategic?
• Data & Local market knowledge from community
Where should we be focused?
• Strategic high value add locations, depending on activity
What do we need to do to get this done?
• Partners
• Additional Resources
Rounding out Impact from Core Programs
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Outcomes 2020-1:• __Lots Sold• __Homes Sold• $700,000
programs:• Acquire land?• Support builders?• Demo new roles?
Outcomes 2020-1:• $8M property
acquired in 3 neighborhoods
• Meet HCDD Goals for #
HLB Housing Initiative:
Increase production & acquire land
Properties conveyed to productive use
Facilitate new homeownership
opportunities
Provide Revenue for program activities
Develop & Implement Acquisition Strategy
Outcomes 2020-1:• _ Pilot programs:
• Lease to purchase program?
• Enhanced Startup Builder program
• Land equity investment
NHDP (Contract): Working with HCDD, Innovate to increase
production
Acquire property for HCDD production goals
Provide housing opportunities to deeper affordability and in new
neighborhoods
Demonstrate new organizational capacity
New OpportunitiesIncrease housing options in a pilot
neighborhood, explore new model to
extend activity (+)Provide more
homebuyer choices
Extend builder/non-profit builder capacities
Demonstrate new LB roles in new
neighborhoods
Organizational:Demonstrate
Neighborhood strategy
New resources for current programs
Deepen community engagement activities
in neighborhoods
Demonstrate systemic approach to
neighborhood
Good Neighbor PLUS
Outcomes 2020-1:• $___• __New key
partners • Planning &
Implementation strategy for 1 neighborhood
Goa
l & S
trat
egie
sO
utc
omes
& Im
pac
t
Impact 20-22:• __? New Builder
businesses?Impact 2020-1:• __Homebuyers• ?
Impact 2020-1:• __Homebuyers
Impact:
What might a Strategic Plan Look Like?
Draft Strategic Plan in Development
Housing Production & Increase Inventory
Neighborhood
Revitalization Focus
Demonstrate Expanded Capacity
Organization Sustainability
New Roles in Production
New Housing Models
New Resources
Oversee Construction:
3013 BoltHouse Sales:
NHDP
Ideas: Duplexes, Lease to Own
EPA Grant Funding: Support
Additional Partners
Housing + amenities
Ideas: Small neighborhood
business support
New Opportunities & Organizational Development
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Draft Strategic Plan in Development
Next Steps: How should HLB prioritize its work in the next 1-2 years?
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Data
GoalsStrategies
• Kinder Presentations• Settegast• State of Housing
• Real Estate Values per Neighborhood
• Affordability Matrix• Review of Neighborhood
Opportunity• Land
portfolios/dangerous & surplus building information
???
What Additional Information Needed?
Draft Strategic Plan in Development
How do we Accomplish the Plan?
Programs & Resources
Outcomes & Impact
Strategy
Goal Main Goal
Strategy 1
Desired target 1
Desired Target 2
Strategy 2
Desired Target 3
Existing Staff
Focus
New Progra
m
New Staff
needed
Committee Assignment
Sta
ff P
ropo
sals
Boa
rd O
f D
irec
tors
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Draft Strategic Plan in Development
How do we process the work at the BOD?
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Utilize Committees to Advance Goals/Outcomes
Proposed Committees
Executive
Agendas, Committee Assignment
Coordination across Committees
Personnel
Finance
Budget
Audit
Monthly Financials
Partnership & Program Dev
Discussion new program
development
Aligning/Identifying partners and
Resources
Marketing
Community Engagement
Real Estate Acquisition & Disposition
Review of Strategy/ongoing
work
Transaction Pipeline
Review of contract templates/policies
Procurement & Oversight
Procurement schedule & reviewing
draft/Template RFQ’s
Program/Grant Compliance
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Draft Strategic Plan in Development
HOMEWORK:Prioritization Exercise(thank you!)
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