Additional Information Requested by the CPC for 5-21-2018 application.pdfAdditional Information Requested by the CPC at meeting on 5/30/2018
To answer questions related to the application submitted on 5/21/2018 Table of Contents Northampton TeenHousing
Community Preservation Project Application
Section Pages
Table of Contents A1
Summary A2
Project Costs A2
Value Engineering A2
Cost per Unit A3
Rising Construction Costs A3
Phased Construction Option A3 Additional Attachments
Cost Increase Sample Letter A4
Updated Pre-construction Schedule A5
Phased Construction Cash Flow Graph A6
Letter of Support – City of Northampton A7
Presented by: DIAL/SELF Youth & Community Services
PAGE A1
Summary The purpose of this additional information is further clarify DIAL/SELF’s Request for CPA funds
through the expedited process option noted in the CPC Plan and to answer specific questions asked by
CPC members at the meeting on 5/30/2018. DIAL/SELF is seeking expedited funds ($236,000) from the CPC to ensure the creation of an additional 4 units of supportive low income housing for young adults to be completed by early 2019. This will
allow youth to gain a stable living environment as soon as possible and reduce the risks of increased
construction costs by $50,000 or more which would be incurred if the project needs to wait 6-9 months to start. Project Costs The initial plan in 2016 for this project was to locate a pre-constructed building with 8 to 10 units of housing already in place and to do relatively minor renovation work. The real-estate market did not support that option as a possibility. Prices for multi-unit dwellings skyrocketed, and the only multi-unit
dwellings in the project’s price range required far more funding to renovate than the project could hope
to bring. The Friends of Hampshire County Homeless Individuals and DIAL/SELF adjusted the parameters of the project to find a new way to achieve 8-10 units of housing. A property was located that had an existing building in need of a number of updates that was connected to a lot which was not easily buildable for a commercial developer, but possible for a non-profit one. An initial pro-bono
consult with an architect determined that creating a new building on the site could be achievable and a
revised concept and development budget was created. Renovations for the existing structure were completed by Wright Builders, and cost more than anticipated.
A full set of bid plans were developed and 3 contractors chose to submit bids. Contractors that submitted bids included Wright Builders, Keiter Builders and Renaissance Builders. Bids came in at over $400,000 the original project budget estimates. Value Engineering After reviewing several factors DIAL/SELF selected Keiter Builders and worked with them and Jones-Whitsett Architects to engage in serious value engineering of the project. Some examples of project scope changes include: Storm water system design, other misc landscaping elements, roof structure
design and materials, siding materials, flooring materials, interior and exterior finishes and specialized
systems.
PAGE A2
Cost Per Unit
The current price for the entire project, including property acquisition, renovations and new construction is now estimated at $1,325,480. A total development per bedroom unit cost of $165,685. The MA Department of Housing and Community Development, which oversees a large amount of the affordable housing development in the state, funded a similar project for low-income housing for homeless young
adults in Orange, MA in 2015. The allowable cost per unit for that project was $230,473 due the specific
nature of the special population being housed in the units. This project’s cost/unit is $64,788 less than the one built in 2015. Rising Construction Costs The construction industry is booming. There is a labor shortage and material costs are continuing to rise at an extremely high pace due to many factors, including national policy and trade decisions. Depending on what Building Cost Index you look at, the average cost increase is projected between 5-8% base line, with the potential for that to be even higher depending on material costs impacted by foreign trade
issues. Attached you can read a letter dated 5/25/2018 from ABC Supply Co to Keiter Builders. This
letter outlines additional price increases coming soon, and notes that this is the 3rd price increase in less than a year. It also states that they anticipate costs continuing to rise sharply. With the cost of construction continuing to rise at such a rapid pace, it is incredibly important for the
project to commit to contractors and venders as soon as possible to control significant project cost
increases. Phased Construction Option CPC members on 5/30/2018 expressed concern for committing a large portion of FY 2019 funds to this
project prior to reviewing other projects submitted in the Fall round. While DIAL/SELF would prefer a commitment of the full $236,000 in the expedited funding round, there is possibility for a smaller amount of funds to be awarded now, and DIAL/SELF could apply for the balance of funds needed during the Fall round.
If DIAL/SELF enters into a phased construction contract it would be divided into 4 phases: site work, weather tight building envelope, rough MEP, and final finishes. Please see the attached updated pre-construction schedule and new Phased Construction Cash Flow
Chart provided by Keiter Builders for details on the timing, scope and cash needs of each phase.
Phase one and two are set to complete prior to CPC decisions being made in the fall round, Phase 3 would start during the Fall round decisions and phase four would complete when Fall round funds are being disbursed.
DIAL/SELF has cash on hand to complete phase 1. A funding award now of $75-100,000 would allow the project complete phase 2 and submit a request during the Fall CPC round for the remainder of the $236,000 award request. This would likely still result in a month or two delay and some added costs between phases 2 and 3. Phase 4 would be funded through grants and fundraising obtained over the next
6 months and if needed some financing. Delays to any of the phases will increase project costs.
PAGE A3
PAGE A4
DI
A
L
S
E
L
F
P
R
E
-
C
O
N
[
R
E
V
0
1
]
Pr
e
-
C
o
n
s
t
r
u
c
t
i
o
n
S
c
h
e
d
u
l
e
Page 1 of 1
Ex
p
o
r
t
e
d
o
n
J
u
n
e
6
,
2
0
1
8
5
:
3
1
:
4
8
P
M
E
D
T
PA
G
E
A5
Keiter Builders, Inc. | 35 Main Street, Florence, MA 01062 | Office: 413-586-8600 | Fax: 413-280-0124 | KeiterBuilders.com 1
PROJECT OWNER CASH FLOW FORECAST PER PHASE [TEEN HOUSING]
June 07, 2018
Project Name: Dial / Self Teen Housing
Estimated Value: $725,000.00 [Per Owner]
Phasing: Below, the project cycle has been separated into [4] distinct phases.
PHASE #01: $159,500 [22% of project cost]
General requirements, demolition of existing structures, site work, excavation, parking lot, utility connections,
subsurface electrical and plumbing, footings, foundation, slabs / pads, concrete stairs and metal railings.
PHASE #02 $203,000 [28% of project cost]
General requirements, framing, roofing, windows, exterior doors, siding and exterior trim, exterior paint, and porches
PHASE #03 $174,000 [24% of project cost]
General requirements, showers and tubs, rough MEP, insulation, sound attenuation, air sealing, drywall, primer and
ceilings, fencing, planting, and landscaping
PHASE #04 $188,500 [26% of project cost]
Plumbing, electrical, fire suppression, and HVAC equipment / finishes, interior doors, interior trim, millwork, stair
assembly, door hardware, flooring and tile, bathroom accessories, appliances, bike racks, window blinds, and fencing.
Note: If phases are separated by time, please include a 4-8% contingency for winter conditions, temporary heating,
increased materials costs and subcontractor / vendor loss of efficiency.
PAGE A6
P
A
G
E
A
7