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  • Dylan Anderson

One of the nation's largest affordable housing firms tapped to serve as Brown Ranch master developer

An Urban Land Institute panel recommended the Yampa Valley Housing Authority bring on a development partner last year.

The Yampa Valley Housing Authority identified one of the nation’s largest affordable housing developers to serve as its development partner for the Brown Ranch on Thursday.


The Michaels Organization, a New Jersey-based housing firm that has developed 57,000 units across 39 states and manages even more, would serve as a joint venture partner on the Brown Ranch with the Housing Authority, taking over roles like developing project proformas, raising capital, project engineering and design, and providing cost and completion guarantees.


Adding a master developer partner to the team working on the Brown Ranch was a recommendation from an Urban Land Institute panel last year and hopes to significantly mitigate developmental risk for the housing authority and ultimately deliver the affordability promised. The Housing Authority Board approved a Memorandum of Understanding with Michaels on Thursday, which shows the intentions of each side and will allow for negotiations on a master developer agreement.


“As you develop housing, there’s a significant portfolio of risks,” said Housing Authority Executive Director Jason Peasley. “We are generally risk-averse as an organization and we bring in partners who can absorb those risks.”

Peasley said this deal isn’t that dissimilar from deals the Housing Authority has made on previous projects, though this is on a much bigger scale.


“For the last 30 years, I’ve been doing nothing but developing, building and managing affordable housing,” said Bruce Morgan, a Senior Vice President at Michaels. “Having worked with a lot of different (housing) authorities all over the country, we are very excited about this opportunity.”


The process to bring in a master developer has been ongoing for much of the year, with four groups submitting a response to a request for qualifications sent out in February. Of those, three firms were interviewed and Michaels was chosen.


Morgan emphasized that unlike many of the largest affordable housing firms in the country, Michaels is entirely privately owned. This is important, he said, because they can make decisions based on what is best for the project and not based on the desires of shareholders.


In addition to Michaels, the Housing Authority also intends to bring on a firm called Lowe to serve as a program manager for the Brown Ranch, a move that would help extend YVHA’s staff capacity. Lowe, which also has a large housing portfolio nationwide and was one of the three firms interviewed, would serve as an owner representative for the Brown Ranch. In this role, they would help with construction oversight, quality control, financial modeling, vertical development strategies and the cumbersome entitlements and permitting process.


“We are in need of bringing in partners that can help us build our capacity because the Housing Authority, as successful as we have been thus far and not as mighty along as we are when we bring in partners,” Peasley continued.

Jim De Francia, a Principal with Lowe, said the 50-year-old company has extensive experience with large planned developments, including one in China. He said he would be able to draw on the company’s extensive expertise including architects, construction specialists and financial analysts.


The partnerships hope to help the Housing Authority to meet aspirational timelines for Brown Ranch development. Based on information shared on Thursday, horizontal construction could start as soon as May of next year, with a groundbreaking on the first vertical structures starting by October 2024. The Housing Authority’s goal has been to deliver the first units at the Brown Ranch by the end of 2026.


“Not only is this an appropriate allocation of risk, but it’s also I think the best outcome for the community,” said YVHA Board member Michael Ann Marchand, who is part of the board's development team that interviewed the firms. “I think that it allows us to move at a speed that we didn’t have access to prior to this structure.”


Top Photo Caption: The Brown Ranch as currently planned includes 2,262 units of a variety of housing types targeting a broad spectrum of incomes. (Yampa Valley Housing Authority/Courtesy)

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