Invite them where?

I listened to a panel discussion on WCHL yesterday afternoon as I drove around doing errands in the rain. Local residents who held various leadership roles in Chapel Hill and Carrboro talked about their vision for the town. One comment in particular stuck with me. Delores Bailey, executive director of Empowerment, said she would like to see Chapel Hill invite UNC students to stay in town once they graduated. But for that to happen, she conceded, Chapel Hill needed a place for them to live.

George Cianciolo, co-chair of CH2020 also spoke of his desire to preserve diversity in town, and that hinged on affordable places to live.

Dwight Bassett, Chapel Hill’s economic development officer, touted the launch of LaUNCh, a business incubator, and its potential to contribute to economic diversity. But until those entrepreneurs hit it big and get bought up by Microsoft, they will have to live out of town or triple up with roomies to share the rent on a closet-size apartment with brushed nickel appliances.

And I watch Timber Hollow Apartments, a former oasis of modest-income housing next door to me, be transformed by Ron Strom with granite countertops, high-end fixtures, and a state-of-the-art club house and swimming pool that will result in rent hikes beyond the means of the graduate students, teachers and municipal workers who live there now.

Town Council members talk as if they agreed that affordable housing is necessary, but so far they have only pushed for higher payment-in-lieu and considered a tax hike to subsidize rents. The cannibalization of older, affordable units into high-rent districts won’t stop until council puts its foot down.

Council can’t require rents to be affordable. But if council members hold to a vision of the need for residential units affordable to those who earn modest incomes, council members can say no to developers who request a special use permit for something that doesn’t include a significant portion of modest-income housing. Council can say, “No, your proposal for high-end units doesn’t meet a need for the town; it doesn’t fit the demographic we want to attract.”

Strom has resisted entreaties by Bailey, Bassett and Robert Dowling, executive director of Community Home Trust, to preserve some of the units as affordable. Strom says he can’t make the numbers work, even though the numbers worked when he bought it, due to its near zero vacancy rate. The energy efficiency upgrades he is making are covered by the town’s WISE program, so he is still making a nice profit.

But Strom wants more than a profit – he wants to make a killing. His out-of-state investors want to make a killing, too, those investors who are paying him an investment management fee to deliver high returns. Strom makes a nice return if he collects fees for the $12 million fund to purchase Timber Hollow. He makes even more on $30 million his investors would pony up for him to increase the density, glitz up the place and jack up the rents.

Many other 30-year-old-plus apartment complexes are similarly vulnerable. Until council gets serious about affordable housing, Delores Bailey can’t send out any invitations.
– Nancy Oates

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  1. DOM

     /  April 29, 2013

    He’s going to rehab shoddy housing – LYNCH HIM!

  2. Many

     /  April 29, 2013

    Hi Nancy,

    Let me play “the Fred” here; whats your definition of “a profit” vs. a “making a killing”?

    Unlike “the Fred” though, here is the reasoning behind the question with an admittedly changeable position/opinion in the interest of discussion.

    I was thinking of investing in Timber Hollow. The returns are better than a CD or a T-Bill but there are definitely relatively safe dividend growth stocks which are selling at relatively speaking historically low valuations where one can do better. I am sure you have noticed that real estate is a risky business these days and the total risk/reward ratio of the investment is usually what separates the profit vs. killing categories.

    Perhaps after sunk investment costs, taxes and fees it’s not such a “killing” otherwise Ron Strom would have already sold out. (think Greenbridge). My (admittedly amateur) opinion is Ron Strom should to construct an MLP under section 7704 of the tax code to run this thing and sell shares. (and perhaps he has already considered this)

    BTW Ron Strom is pulling out all the stops in the promotion, using all of the Chapel Hill buzz words: “Transit Oriented Development”, “Increasing Density”, “Rendering More Energy Efficient”, “More Walkable, Compact Development”, “Organically Providing Affordable Housing”, “Nurturing Community” blah-blah-blah……what’s not to like? If it just had Light Rail it would be perfect.

    One jewel just for you caught my eye: ” INCREASE THE RATIO OF WORKFORCE HOUSING’BY 2020 AND DEVELOP A PLAN FOR STUDENT HOUSING IN THE COMMUNITY” (the use of all caps is in the document) about one-third of the way down here:

    Perhaps Ron Strom is listening to you?

  3. Don Evans

     /  April 29, 2013


    Ron Strom would say anything to get his project off the ground. If you compare what he promised the council with what he is saying to residents in nearby neighborhoods, you’d recognize the antics of the classic pitchman who is only interested in the sale.

    Before you invest in such an “attractive” opportunity, you might want to triangulate the claims and the realities. Then again, if money is all you’re interested in and not community, then Strom is your man.

  4. Many

     /  April 29, 2013


    Could you provide some real examples? I am serious. At least on the surface the proposal looks like it meets the Towns criteria.

    What exactly is the delta between his obviously rosy pitch to the council and what he is saying to the neighbors? Rather than just saying “no”, my take is that the Town along with investors should put in place measurable and achievable checks & balances to hold him and his partners to their promises. People should be asking the big “How So?” questions, understanding the dependencies and cementing assurances. “Trust but verify” should be the mantra and subsequent equivocations should be view with skepticism.

    On the surface, Ron Strom fits the locally owned bill….as did Tobin, but perhaps as I suggested earlier “locally owned” is not something to support unconditionally, and something that seems too good usually is 🙂

  5. Nancy

     /  April 29, 2013

    Many — Strom’s application lists two apartment complexes that charge higher rent. My reading of this is that he has found a pocket of modest-income people in Timber Hollow that have not been fully exploited and taken advantage of yet, so he is moving in for the kill. Timber Hollow is not a shoddy complex, as DOM seems to believe. It is a nice place where modest-income people can live decently. By Strom’s own admission, many people who live there now will not be able to afford his higher rents. (He says he’ll “work” with them. I’ll let you know if I find anyone he has helped.) Strom is taking what had been affordable housing on a transit corridor and turning it into high-end housing on a transit corridor. That is not being community-minded, regardless of where Strom lives.

    As a landlord who supplies, on a minute scale, affordable, decent housing for students, I can tell you that it is possible to do right by the community and still make a modest profit.

    You asked Don for a couple of examples of Strom’s duplicity: Strom would not meet with neighbors as a group; he would meet only with a few at a time (or in my case, he told me I was not to bring anyone with me when I met with him). He told different people different stories about his plans and sowed dissension among neighbors until we all got together to compare notes. He continues to threaten one group of neighbors supportive of affordable housing that if he has to keep any units affordable, he will be allowed to increase the density above the R-5 he is requesting (which is patently false). He has not been honest about where the required retention ponds will go.

  6. Many

     /  April 29, 2013

    “…..Strom is taking what had been affordable housing on a transit corridor and turning it into high-end housing on a transit corridor…..”

    Oh yes. This has been my point all along about TTAs plans for transit. I have seen it happen elsewhere; the net effect is to displace those that the press release is claiming to help, increasing rather than decreasing traffic and generally making things worse. If land use and planning are not in place before the transit then it will be a free for all and we all know deepest pockets will win in that case. TTA has not been honest with their own propaganda and I would argue their plans run directly counter to the “locally owned” mantra I so often hear from the same people promoting TTAs plans.

    I guess I am surprised that anyone would meet the developer in a private setting and expect consistency. My take; the Town or developer needs to host public meetings and the topic(s) and agenda(s) need to be outlined beforehand (to be fair). The meeting needs to be moderated to avoid the inevitable off topic comments, rants and filibuster.

    If even retention and storm water plans are not a known quantity and location then there isn’t much to discuss is there? Everyone needs to have a picture of the plat in advance so the abstract is minimized and they can formulate questions/concerns. I thought this was further along than it apparently is.

  7. Bonnie Hauser

     /  April 29, 2013

    Part of the problem is that we prefer to discuss “Transit Oriented Development” rather than “Transit Dependent Populations”. Had we had a legitimate discussion – our high speed transit corridor (or BRT if it were my choice) would be running along 15-501 north – serving 19,000 low to medium income commuters per day – vs 12,000 along 54 East (assuming you believe the MPO’s projections – which are under review)

    Lets not forget our growing senior and other populations who are not on any of these corridors. Last I heard, the Mebane/Efland bus service is on the chopping block (for you in Chapel HIll, that’s the county’s Buckhorn EDD, and the home of two, soon to be three Habitat communities)

  8. DOM

     /  April 29, 2013

    My God, people. Get a grip.

  9. Jon DeHart

     /  April 29, 2013

    Cost is a function of supply and demand .
    Chapel Hill is a great place to live so there is a high demand.
    Our policies on Affordable Housing , ironicaly make it more expensive . If we charge a developer a fee , the develeoper doesn’t make less profit they just pass teh costs along to the future renter or homeowner .

    The more we regulate affordable housing, the more expensive housing becomes . It really is that simple .

  10. Many

     /  April 29, 2013


    I agree I made the same point a month or two back. However there are some things that could be done. If OWASA (and the county) is artificially restricting supply as it appears to be doing, then it’s not quite that simple.


    I tried being reasonable. I didn’t like it. – Clint Eastwood.

  11. Cam

     /  April 29, 2013

    So Nancy and Don do you just hate anyone named Strom? Is there something you aren’t telling us? About other relationships you might have that influence how you feel?
    I imagine that the town could have gotten some concessions on affordability from Strom if he had been allowed to increase the density significantly instead of just some, but, oh yeah, the neighbors resisted any encroachment into the existing 200 foot buffer.
    As sure as developers are always going to try and profit, NIMBYS are always gonna whine. This was a pretty classic example of a site that was considered appropriate (in the comprehensive plan) for higher density but the neighborhood opposition scared the developer away.

    I’ll be upfront: I am friends with Ron and BILL (the antichrist). This doesn’t mean I support blindly anything they do. It does mean I take all your Strombashing with a grain of salt……

  12. Don Evans

     /  April 29, 2013


    Comes under the heading of “Spade, Calling a Spade a.” If the Stroms weren’t a pair of scoundrels, we wouldn’t bash them!

    Nice of you to be friends with the two because I hear they haven’t liked each other since Chapel Hill North.

    As for Timber Hollow, Strom wants R5 zoning there — the only thing he won’t be allowed to build there is a nuclear reactor. He’s not at a disadvantage because of the zoning.

    As far as your facetious use of NIMBY, it doesn’t apply here. We realize that the complex will be redeveloped. We recognize his right to make changes at the site. We don’t oppose that. We would just like to see some workforce housing remain at the site. Just seems reasonable — unlike the Stroms.

  13. John D

     /  April 30, 2013

    I have known Ron Strom for years. You guys are barking up the wrong tree. If you want affordable housing, and I think it’s a laudable social/community goal, then take it up with the city fathers. You are being both mean spirited and wrongheaded to attack a developer for market based participation.
    Furthermore Nancy, kindly have the intellectual integrity to write with an objective vocabulary, rather than with one that you think sways the argument in your favor, without having to actually win the argument. Weak. “Out of state investor?” really? As if people who live out of NC are inherently evil/nefarious? Make a “killing?” How do you know? Give me the return on investment number that indicates “a killing” in your opinion, and then we can discuss. Until you are willing to take a transparent stand on the issues, you are not to be trusted. Just so much emotional, self righteous bloviation. Come on.

  14. Don Evans

     /  April 30, 2013

    John D

    We’re not talking about affordable housing, we’re talking about workforce housing. Slight difference, so it would be good if you and Strom would stop trying to muddy the waters by mis-labeling the issue.

    Interesting that you believe we are being “meanspirited” when your buddy is the one taking away the workforce housing. Blaming the messenger there, I think.

    And are you really worried about our vocabulary when Strom is using his vocabulary to divide the adjacent neighbors and get one past the town council? Get some morals, dude!

    So if you really are one of Strom’s buds, how about taking him aside and discussing community spirit with him. He certainly could use some clarification.

  15. John D

     /  April 30, 2013

    dear Donny, I didn’t address my comments to you, but rather to Nancy. She can stick up for herself, dude. Right? Or does the one without intellectual integrity need you to shield and protect her from criticism? Maybeeee …

    and I ain’t muddying the waters. Affordable housing applies to all manner of working Americans. Teachers, mechanics, carpenters. It is not a rigidly defined notion of who lives where.

    One last time, if you got a beef, take it up with the city fathers. This concept too advanced for you? i note you were afraid to take it on. Until our market based system is replaced with a govt controlled one, you will continue to be marooned on the low road. Gotta run …. looking for some morals, dude.

  16. Many

     /  May 1, 2013

    I sense distrust in some of the postings 🙂

    Can I get a working definition of “Affordable Housing” and “Workforce Housing”? Intuitively it seems like “Workforce Housing” is a subset of “Affordable Housing”.

    I would also like to know why the people opposed to the re-development think the numbers in the link I referenced will not be sufficient for either?

    “According to Robert Dowling, executive director of the Community Housing Trust, the affordable housing income thresholds for one, two, three, and four person households are currently $38k, $44k, $49k, and $54k. These numbers represent 80% of the median household income for the Chapel Hill area. If one were to take 28% of’ these median income numbers, the traditional percentage for borrower loan qualification, one would arrive at a monthly cost of housing that is 32% higher than Timber Hollow’s average one bedroom rental.’Timber Hollow is providing a housing alternative for graduate student and work force housing that is 75.5% of the CHT affordability levels.”


    During a conversation with a Council member, Timber Hollow was described as ‘‘organically’’ providing affordable housing and that we should seeks ways to maintain the current mix of housing, particularly with longer term residents. We will work with every existing long’ term resident to ensure that he or she is not displaced from Timber Hollow as a result of our renovation program.”
    End quote;

    I realize that some peoples living environment one on side and a lot of money on the other, is at stake here and emotions are high. However in the cold light of day are the numbers above correct? If the above statement by the developer were codified/enforced, would that be sufficient?

    If so, the Town leadership is on the hook to make sure there is no misinterpretation and that these promises happen. I know there will be some on both sides of an emotional issue who find fault no matter how small, but if the above guidelines are indeed adhered to then what else it take to make this project a success?

  17. DOM

     /  May 1, 2013

    Methinks this blog has lost any street-cred it had by coming on so hard with such a vacuous argument. This is so obviously a NIMBY issue for the blog hosts that it isn’t even worth commenting on any longer — so I won’t.

  18. Nancy

     /  May 1, 2013

    DOM — You’re right: There is an element of NIMBY-ism in this. I want my children to have the option of remaining in Chapel Hill once they graduate college, but if the Ron Stroms of the world cannibalize workforce housing solely to post bigger numbers in their own bank accounts, my children and other people who would add to the fabric of the community won’t be able to live here. And, there’s the fact that when one of my neighbors asked Strom whether he would want to live next door to the development he was proposing for Timber Hollow, he responded, “Hell, no!” But that hasn’t caused him to rethink any of his plans.

  19. Don Evans

     /  May 1, 2013


    Last I heard, NIMBY is an acronym for “not in my back yard.” Nancy and I have said from the beginning that we are not opposed to Strom building on the property — we are opposed to him not including work force housing.

    No matter how many times you post that bogus label or Strom’s buddies make that claim, the fact remains that this is not a NIMBY issue for Nancy and me — it’s an issue of keeping our community inclusive and holding Strom to a higher standard of social responsibility.

  20. Fred Black

     /  May 1, 2013

    Nancy and Don, this issue has been fought over and over and we seem to be no closer to knowing the right way to encourage the inclusion of affordable or workforce housing, other than using extortion. I am not a fan of that or do I feel the ends justify the means. What will we do next, require restaurants to have a range of prices on their menu? There must be a better way to achieve our housing goals because we know we tend to fail when we legislate against supply and demand.

  21. Many

     /  May 1, 2013

    I still want to know what is inconsistent between “our housing goals” and what is stated in the proposal.

  22. Nancy

     /  May 2, 2013

    Fred and Many — We already have diversity among restaurants. On Franklin Street, I can eat at Elaine’s or Italian Pizzeria 3 or 411 West or Noodles or TOPO or Sutton’s. What’s wrong with Strom’s proposal is that people who hold lower-income jobs at the hospital, the university, the town or the state, as well as graduate students, have to move out because they can’t afford the rent hike. Ergo, Strom is taking housing units that are good quality and affordable and realizing that he can make more money for himself if he puts in granite countertops and a state-of-the-art pool and clubhouse and go after a demographic that will pay higher rents. Timber Hollow is profitable at its current rents. Strom is putting his greed ahead of what’s best for our community. He’s certainly not the first developer to do that, but he is trying to present himself as community-minded, which his actions prove he is not. He says he will “work with” people who are being forced out, but so far he hasn’t, and he has not shared his plan for what “work with” means. Strom is snookering the community.

  23. Fred Black

     /  May 2, 2013

    Among is different from within, and you are arguing for a range of rents within. It sounds like you want the government to tell him what he must build and what he must charge for rent. What other projects had to do this? When we had the affordable housing task force discussions, why was this not included?

    I really think you are way off base with your charge of “greed,” as I don’t think you know the numbers in his economic model. Without those numbers, you have crossed the line and are simply speculating.

  24. Cam

     /  May 2, 2013

    The affordable housing task force that I was on (2007) discovered that there were a number of complexes in town that were charging well below Section 8 level rents. I don’t recall if Timber Hollow was one of them or not. We also discovered that our options for promoting affordable rentals (indeed any affordable housing incentives) were limited. No rent control is permitted under state law, it is hard to insist on permanent affordability, co-ops are forbidden as well. Other municipalities that wanted to promote affordable housing had used density bonuses, etc. that really didn’t work here. Density bonuses would create projects with no parking whatsoever which at the time were not considered tenable.
    At any rate, affordability is a function of supply and demand. Since we aren’t going to reduce the desirability of our school system (to lessen demand); we need to increase supply. Up zoning for higher density is one of the only ways to do this. Timber Hollow would appear to be an excellent place to do this. More units on less land reduce costs and, hopefully, rents. There are lots of places that could be zoned for greater density without hurting the community, this would stabilize the student rental market and take less housing away from families.
    Why aren’t you calling all the other developers in Chapel Hill names as well? All the recently built complexes in town have focused on getting higher rents than established units. I acknowledge that is too bad that lower income tenants are being underserved. I was against the ACC adding more than 8 teams but they did anyway.

  25. Diogenes

     /  May 2, 2013

    It appears they can’t figure out affordable housing in Silicon Valley either.

  26. Nancy

     /  May 3, 2013

    Cam — In the years that I’ve been watching requests for increased density come before Town Council, Ron Strom’s plan is the first to replace affordable housing for no reason other than the developer’s personal profit. Bicycle Apts. will tear down affordable housing with the ostensible reason that the town wanted to draw students living in Durham back to Chapel Hill. I was critical of that plan because it did not include workforce housing. But Strom’s plan will tip the first domino in an unstoppable string of such projects unless Town Council does what it can to send a message of disapproval. That’s why I’m focusing on his plan.

  27. The overlooked part of affordable housing is enabling more people to afford a place to live. The fact is that housing can only be so inexpensive before it’s shoddy. Everyone who cares about this issue (and judging from the history of this issue over the last several decades that actually would be everybody) should constantly promote higher wages for those on the low end of the wage scale. In fact this would be good for the local economy in many ways and the Chamber should be out in front on this.

  28. Strom has resisted entreaties by Bailey, Bassett and Robert Dowling, executive director of Community Home Trust, to preserve some of the units as affordable. Strom says he can’t make the numbers work, even though the numbers worked when he bought it, due to its near zero vacancy rate. The energy efficiency upgrades he is making are covered by the town’s WISE program, so he is still making a nice profit.