DENVER (KDVR) — The Denver Housing Authority has partnered with the City and County of Denver to launch a pilot program aimed at supporting the development of new middle-income rental housing.
Through the program, Denver’s Department of Housing Stability and DHA will provide property tax relief to unlock “otherwise financially infeasible projects” and expand housing options for Denver’s “essential workforce,” the mayor’s office said Thursday.
“This program reflects the kind of innovation we need to solve Denver’s housing crisis,” said Denver Mayor Mike Johnston in a statement.
The mayor’s office said the program, coined the Partnership for Middle Income Housing Pilot Program, aims to address a problem with an expected shortage of housing that is affordable for working families in the next 10 years.
According to data from the Denver Regional Council of Governments, Denver will be short more than 4,200 such units within that timeframe — if no action is taken.
“We’re using every tool available to help people stay in the communities they grew up in and make sure working families can afford to live in the neighborhoods they want to,” Johnston said.
The pilot program will offer a tax exemption for up to five new multifamily developments in 2025 for projects that agree to deed restrict apartments for 30 years to be affordable to households earning less than 100% of the area median income, the mayor’s office said.
Currently, the area median income for Denver is $98,100 for a 1-person household and $140,100 for a 4-person household, according to the mayor’s office.
“This is a smart and scalable strategy to catalyze viable housing opportunities for the middle-income workforce,” said Joaquín Cintrón Vega, Chief Executive Officer of the Denver Housing Authority, in a statement.
Eligible projects must be new construction, meet affordability requirements and be able to demonstrate that the project would not be “financially viable” without receiving the property tax relief and exemption from the state portion of sales and use tax, the mayor’s office said.
DHA, on their end, will enter the ownership structure of the project as a “special limited partner” in order to access the exemption, according to the mayor’s office, which said HOST, meanwhile, will underwrite each proposal to determine the appropriate length of the tax exemption.
The tax exemptions are capped at 15 years, with an expected average of around 10 years.
“We’re proud to be part of a team that’s working to bring forward a new kind of housing option for Denver families and one that is responsive to the city’s real needs and the people we proudly serve,” Cintrón Vega said.
The mayor’s office said applications to be included in the program will be prioritized based on alignment with the city’s “strategic goals,” including:
- Building in a neighborhood where there is a high risk of involuntary displacement
- Developments that are transit-oriented
- Provision of family-sized units, accessible design, or green building features
- The depth and duration of affordability beyond what is required by the city ordinance
Letters of intent are being accepted for round one of the program beginning July 15, with accepted projects expected to be approved in late 2025 or early 2026, the mayor’s office said.
If the pilot program is successful, the mayor’s office said it could be “considered for expansion.”
The program builds on the city’s 2022-2026 Strategic Housing Plan, according to the mayor’s office, which said it also complements new programs from the Colorado Housing and Finance Authority and Proposition 123 funding.
