Gary Kerr’s Post

Massachusetts’ housing crisis is routinely discussed in terms of woefully insufficient supply, but there is another layer to peel back. We don’t just lack enough housing; we lack options in the existing inventory. As documented in a recently published study from the Pioneer Institute, restrictive zoning and astronomical costs are at the heart of both. This plays out in multiple, unfortunate ways. Seniors looking to downsize can’t find independent living options in their community, so they remain in a house that’s too large for their current needs. A couple ready to start a family cannot find a family-sized apartment unit, so they postpone their plans. Young adults interested in home ownership find limited inventory that greatly exceeds their budget, so they leave the state in search of more affordable options. This is a critical quality of life issue, not to mention a threat to the economic competitiveness and future of Massachusetts. As a developer, we want to be part of the solution on housing, but we face economic & regulatory realities that hamper what we can produce. Writing in Banker & Tradesman, report author Andrew Mikula correctly points out that policy makers should offer incentives that would spur the creation of family-sized apartments in urban areas. But there are additional steps we could take through rezoning to free up more types of housing to be built, giving residents more options. The allowance of ADUs by right is a great example of that in action. Read more about Mikula’s findings here: https://lnkd.in/eTpW_-dT

Last month, the Cambridge City Council’s housing panel discussed a proposal to legalize six-story apartment buildings by right in an effort to address the city’s acute housing shortage. Cambridge’s landmark proposal presents a bold, albeit sensible, approach to addressing the housing crisis. At this time, only one-third of residential land is zoned for single- and two-family housing, contributing to the city’s affordable housing shortage. Allowing six-story residential buildings by right would offer a more efficient use of limited space in a densely populated market – ‘building up’ rather than ‘out.’ A parcel that would have previously been developed into a single-family home could now become an apartment building for numerous residents without any additional approvals, saving time and money while increasing the number of homes available to Cambridge. If this zoning overhaul comes to fruition, it would represent one of the largest-scale zoning reforms locally and would also make Cambridge the first city in Massachusetts to end single-family zoning as the default for housing construction. As the story from The Boston Globe notes, Cambridge has actively tweaked its zoning in recent years in response to the current housing environment. Unfortunately, the substantial onsite inclusionary requirement presents a large roadblock to creating large-scale housing in that market, but this is a positive step worth applauding. Other municipalities would do well to follow in Cambridge’s footsteps to increase housing production. Read more here: https://lnkd.in/dcvscdtr

In Massachusetts, we face the challenges caused by the lack of housing daily, which doesn’t just affect our current residents – it threatens our state’s future.   In my recent op-ed published in CommonWealth Beacon, I outlined how developers, municipalities, and community members can collaborate to build housing at scale to jumpstart the necessary volume of new development. To get back on track, we need to produce 200,000 homes, a staggering figure that is impossible to meet without cooperation.   We’ve found ourselves in this difficult moment due to several factors, but at the top of the list are restrictive zoning and resident pushback. These challenges require work and all parties moving in the same direction. Given the scale of the situation, and its impact on all facets of life, it will take a coordinated, all-hands effort akin to the moonshot.   Read more here about my perspective on how we can move beyond local resistance and zoning barriers to address the broader housing crisis: https://lnkd.in/g9Fcnv6C          

A new report on migration trends from Boston Indicators, the research arm of the Boston Foundation, calls for us to face an alarming truth: there is an increasing number of people leaving Massachusetts, and this trend has the potential to directly affect the state’s economic competitiveness. Released last month and titled ‘Mass. Migration,’ the report found that working-age adults are fleeing the Commonwealth in exchange for more affordable surrounding states. Across 2021 and 2022, MA lost an average of 22,631 net individuals aged 25 to 44, a substantial increase over previous years and the greatest outward migration compared to any other age group. It is important to recognize that our economy relies heavily on this age group, who are essential for the labor market, and that an exodus negatively impacts companies trying to recruit and retain staff. With a rapidly aging population and lower birth rates, outward migration also has the potential to strain services ranging from healthcare to everyday staples like grocery stores, pharmacies, and coffee shops. The economic impact could be felt by all. While many factors contribute to outward migration, housing understandably is at the top of the list. With housing costs in Massachusetts and Boston among the highest in the country, the affordability and availability crunch is top of mind for young people making decisions about where to live and put down roots. To support Massachusetts’ economic competitiveness for years to come, decision-makers and the development community must unite to prioritize building housing at scale. This is the best way to ensure we have an appropriate supply of living options for the current and future residents needed to fuel a thriving economy. Read more about the report here: https://lnkd.in/eF8T5Rui

Last month, New York passed a housing package designed to confront housing affordability head-on amid one of the worst crises in the nation. At the forefront of this deal are significant enticements for renters to laborers to developers. This new housing deal offers substantial tax breaks for developers, more protections for tenants, and higher wages for union laborers and construction workers. With the state of the current macroeconomic environment, it’s well understood that it's incredibly expensive to build housing. Coupled with lengthy permitting processes and limited development opportunities, the difficulties serve to fan the flames of the housing crisis, especially in the northeast. New York’s leadership deserves plaudits for reaching a deal that offers benefits to those who build, develop, and live in housing while also acknowledging that the largest barrier to production is cost. Addressing that challenge directly is both prudent and something we are not seeing in Mass. You may recall talk of a tax incentive program intended to kickstart stalled Boston developments back in the fall. This ultimately did not move forward due to concerns around impact and ROI, leaving these developments to remain idle and offering no progress on the crisis. As a developer, my position on pursuing development is simple: the math has to work. In the current environment, this is all too often not the case, despite the massive need for supply. Efforts to realign the economics and bring costs to a more manageable level can get developments moving while signaling to the business community that opportunities can be found, leading to even more production. Given the 200,000-unit shortfall Massachusetts currently faces, we would do well to take a page from New York’s book. Read more here: https://lnkd.in/eUBbu9Dx

The high cost of home ownership naturally leads to renting being the more feasible option for many Americans. What is surprising, however, is that not all renters do so out of necessity. Findings published in a recent report (“The New American Dream”) from property management software provider Entrata indicate that an increasing number are renting by choice.   “The New American Dream” report shines a light on the growing number of renters choosing to rent, rather than own a home, with one in five expecting to be lifelong renters. While owning a home has traditionally been recognized as an important milestone for adults, there are several reasons why individuals now stray away from that path.   Among the report’s findings: ·        66% of respondents answered that renting is a better fit for their current lifestyle ·        23% cited the flexibility of location offered by renting ·        56% reported that they are prioritizing paying off debts ·        43% prefer to use their money to save for retirement ·        74% opt to spend on in-person experiences like entertainment, dining, and travel ·        46% of respondents believe renting gives them the means to pursue hobbies   What these results demonstrate is that financial flexibility is a key driver for this trend, and without a major shift in the affordability of homeownership, this will likely persist.   Others, meanwhile, are attracted to the robust amenity packages offered by newer multifamily developments with proximity to retail and entertainment in dense, walkable neighborhoods. One such example from Greystar’s local portfolio, 212 Stuart Street, offers elegant, simplified living immersed within one of Boston’s most charming neighborhoods. As a former resident of the 212 Stuart Street community myself, I found the amenities to thoroughly exceed my expectations.      Renting is no longer seen as a stepping-stone to homeownership; it can be a strategic choice for a growing number of individuals who prioritize flexibility and financial freedom. This trend is yet another reason why it’s crucial to build housing of all types at various price points. When we develop robust multifamily alongside single-family housing, it opens up opportunity and increases the likelihood of finding the ideal residence.    Read more here: https://lnkd.in/emjmqg6Z  

I was excited to see Sky Zheng, Executive Chef of Wa Shin, featured in Boston Globe Media’s “Getting Salty” column. Wa Shin is 212 Stuart’s retail tenant, delivering the newest upscale, world-class cuisine option to the city. 212 Stuart joined the exquisite Bay Village neighborhood in 2022 as a rare instance of ground-up development in the area. Attracting both visitors and locals alike, Bay Village is renowned for its numerous and excellent arrays of cuisine, making Wa Shin a perfect addition. Nestled on the corner of 212 Stuart’s ground floor, the newly opened Wa Shin delivers an intimate full-service omakase sushi experience, offering guests hand-selected locally sourced seafood, alongside imported Japanese seasonal ingredients. With Chef Zheng, who was previously executive chef at NYC’s Michelin-starred Sushi Nakazawa at the helm, guests can experience a true taste of Japan with creative options such as barracuda, uni, and aged wagyu. If you are in the Boston area, be sure to stop by Wa Shin (https://washinboston.com/) to savor one of the city's most unique dining options. Read more here: https://lnkd.in/ehj-bmMT

The MBTA and MassDOT’s recommendation to extend the Silver Line bus service through Everett, connecting to the Orange Line at Sullivan Square Station, represents a bold yet sensible transportation proposal that could greatly improve transit access for residents and accelerate the municipality’s transformation.   Despite Everett’s population (50K), location (3.5 miles from City Hall in Boston), and density (12K people per square mile), public transit traditionally has been lacking in the city. Once the Orange Line was moved away from Everett in the 70s, the transportation situation got worse. Without major bus routes servicing the city, residents have required transfers to reach employment centers and other points of interest, which was made even more difficult by the pace and frequency of the buses that did go through Everett.   This positive recommendation comes at a moment when the city of Everett is experiencing a development boom. Greystar alone is bringing 1,900 new housing units through a $730M investment in the city. Additional and more convenient transit options will enhance the attractiveness of moving to Everett – and allow residents to get to where they need to go.      To the credit of Everett’s leadership, they have aggressively worked on improvements to better serve residents and to support future development for several years. This has included installing peak-hour bus lanes on Broadway at a time when other cities were worried about whether such lanes would be feasible. Mayor DeMaria has also championed fare-free buses to expand usage and help mitigate traffic by taking cars off the road. It should come as no surprise that the Mayor has also offered support for the Silver Line’s extension.   If approved, the extension could take years to come to fruition – but it is another important step to address the lack of connectivity that has challenged Everett for decades. Increasing access to transit is an important tool in addressing our region’s housing crisis, expanding the attractiveness and convenience of living further from employment.   Read more via The Boston Globe: https://lnkd.in/dGJB4iKk