Angry residents shout as city OKs $2M for affordable housing project in Newport Shores

Dozens of Newport Shores residents stormed out of the Newport Beach City Council meeting Tuesday night — many shouting at officials as they exited — after it became clear that the council was going to allocate nearly $2 million to an affordable-housing project in their neighborhood.

“I’ve lived in Newport for almost 40 years and I’ve never seen anything like this,” Mayor Ed Selich said of the residents’ reaction.

The council voted 6 to 0 to allocate more than $4 million to three projects, each aimed at improving existing affordable-housing units or creating new developments to serve lower-income people. Councilman Scott Peotter was absent for the vote.

The city agreed to give up to $600,000 to Habitat for Humanity Orange County to repair the homes of 30 low-income senior citizens and allocated $1.5 million to Seaview Lutheran Plaza to aid the rehabilitation of a 100-unit apartment building that is affordable to lower-income seniors in Corona del Mar.

However, the allocation that drew opposition was a $1.97 million grant to Community Development Partners for the firm to acquire and rehabilitate a 12-unit apartment building in Newport Shores and convert it for affordable housing.

The money dispersed Tuesday is part of a fund that housing developers could pay into if they were unable to build affordable housing into their projects to comply with state mandates, according to city staff.

Several Newport Shores residents objected to the city putting money toward the project at 6001 Coast Blvd. for seven affordable-housing units for veterans and five for low-income seniors. Preference would be given to seniors who also are veterans.

A site manager would live in one of the units to monitor the property, according to city documents.

Some of the project’s critics cited the high cost of developing in Newport Shores rather than in than another area of the city where the money would stretch further to cover more housing units. Others expressed concerns about the development’s close proximity to a neighborhood park, alleging that the housing project would change the character of the community.

Several residents said the city appeared to be cramming the proposal down residents’ throats and that they weren’t given enough time to look into the project.

Resident Leslie Long asked the council to delay voting on the item so more public outreach could be done.

“We want to help our veterans,” Long said. “It’s not about not taking care of our military men; that’s not what this negativity is about. It’s about the ... unknown factors this project proposes.”

Community Development Partners, a Newport Beach-based affordable-housing developer, is purchasing the apartment building from an owner who operates month-to-month lease agreements with current tenants. Eric Paine, chief executive of Community Development Partners, said repairs likely would begin in July, with the first tenants moving in in early 2017.

The building would be used for affordable housing for at least 55 years, according to the agreement. The cost of housing would be determined based on a tenant’s annual income, but Paine said the rent likely would be between $500 and $1,012 per month.

The average rent for a one-bedroom apartment in Newport Shores is about $2,000 per month, according to online housing data.

Newport Beach officials began requesting proposals years ago from organizations and housing operators in need of funds to improve or expand the number of affordable units in the city, according to city staff.

Paine said he and his brother, both longtime Newport residents who run Community Development Partners, felt compelled to answer the city’s request.

“We feel that we can provide a superior product and service to that portion of the population,” Paine said. “We had targeted veterans specifically, knowing they were underserved in Newport Beach.”

Councilman Tony Petros, who represents the Newport Shores area, scolded Community Development Partners for what he felt was inadequate public outreach on the project to ensure that residents were comfortable. But he said that does not diminish the project’s benefits.

“This is something that will add certainty to the Shores area,” Petros said. “If anything, it will create an opportunity for us to get alongside those who have made the ultimate sacrifice for us — veterans and seniors.”