Retailers follow area growth

The Leander City Council passed a resolution in February to promote the development of two primarily low-income apartment complexes in the city—one for seniors age 55 and older, and the other for individuals and families. At the same meeting, council accepted a petition to annex more than 1,800 acres of land for single-family luxury homes.

Expanding Leander's housing options on both ends of the income spectrum coincides with the city's plan to grow the local workforce and entice new retailers, Leander City Manager Kent Cagle said.

"If you just have all high-income or all low-income housing, it can create different problems," he said. "We're looking to diversify the mix of housing available."

The spectrum of housing

Income-restricted housing is not new in Leander. Three communities—Cedar Ridge Apartments, Lakeline Apartments and Leander Station Senior Village—receive government aid to provide affordable rental spaces. DDC Merritt Legacy Ltd., which owns Leander Station, plans to build the two new low-income apartment complexes at South Bagdad and Old Quarry roads.

Council's support of the low-income properties is the first step toward developing the apartments, said Lisa Beauchamp, director of operations for DDC. The company applied for $22 million worth of federal tax credits and funds allocated through the Texas Department of Housing and Community Affairs. She said DDC cannot build in Leander without them.

"The federal government said; 'We will award tax credits to developers who agree to build this type of housing and commit to certain features and functions.' It's required we have the city's support to do this in order to receive the tax credits," she said.

If DDC gets the tax credits, which will be awarded in July, construction on the 50-acre development will be completed about a year after obtaining city permits, Cagle said.

Eighty percent of both the multi-family and senior living communities is reserved for lower income residents, which is determined by household size and the area's median income, Cagle said. An individual or family must make 60 percent of the median area income or less, and for a family of four, that totals $45,540.

"They have to have jobs and incomes. It's not some sort of welfare where they are getting it for free," he said. "They have to pay rent and can't have felony convictions."

In contrast, about 3,000 single-family luxury homes—some priced at more than $1 million—are slated for about 1,800 acres known as Crystal Falls West, north of FM 1431 and east of Nameless Road. Once annexed, Cagle said he expects the area to bring about $1.2 billion of value to the city over the next 20 years.

Promoting diversity

Promoting varied housing options aligns with Leander's plans for future growth.

"One thing we need to focus on in Leander is creating more jobs. We all want high-paying jobs, but not all can be," Cagle said. "In many areas, you're going to have a variety of jobs, and if you only have high-income properties, for the lower-paying jobs in the community, people will have to commute."

Kirk Clennan, Leander economic development director, said diverse housing helps ensure the city's long-term success.

"In order to build a city that is tolerant, creative and open-minded, we need to have homesteads for everyone, and that's what we are working towards. We also want to encourage those homesteads to be near each other instead of 'I'm over here, you're over there,'" he said. "We want a sustainable community that's affordable to everyone. If we become the exclusive enclave for the wealthy, where do the teachers live? Where do the police officers live?"

Retail attraction

Job creators and retailers follow population growth. Retail site selectors research household income, educational attainment and other demographics when considering where to expand their business.

Housing developments can play a role in the site selection process, said Charles Heimsath, who did a demographic market analysis on Leander's transportation-oriented district through his company, Capitol Market Research. He said emerging multifamily developments signal an increase in population density and can become an important driver for retailers.

Low-income senior housing, like one of the projects planned by DDC, will not likely impact retail attraction since low-income seniors are not part of the workforce and have little disposable income, Heimsath said.

"But having some affordable housing at a lower income level for families that may have workers who need jobs, that could be quite attractive for a retailer," he said. "Most retailers have people that are at or just above minimum salary or wage levels, and they need those people to operate those

businesses."

Heimsath said minimum-wage employees who live near their job site are less likely to quit because they have a shorter commute, which means retailers have a more reliable workforce.

Cagle said while retail attraction is not guaranteed, adding more apartments to Leander's housing market is a good move for the city.

"We are going to be more interesting to retailers in the future as the economy continues to improve," he said. "Apartments are a pretty hot real estate product right now, so I'm sure we'll be hearing from them."