The Alexandria City Council has mixed feelings about serving as a cosigner for the Alexandria Redevelopment and Housing Authority’s plan to keep its senior residents in the city.
Faced with a $40 million budget shortfall, ARHA abandoned plans to replace the aging 11-story, 170-unit Ladrey Senior High-Rise with a six-to-seven-story 270-unit L-shaped building. The U.S. Department of Housing and Urban Development subsequently ended its operating support for building management and maintenance, issuing vouchers for the relocation of Ladrey’s residents by the end of the year.
Now, the Council is being asked to backstop $56.8 million in ARHA loans to acquire Alate Old Town (1122 First Street), a recently built senior housing apartment building in the Braddock neighborhood, for the relocation of Ladrey Senior Hi-Rise residents.
“We want to figure out how to make this work,” Mayor Alyia Gaskins said. “It’s figuring out in a time of limited resources and a time of economic uncertainty, where we also don’t know what else we’re going to be hit with.”
ARHA CEO Erik C. Johnson stated that he has been working on the deal for three months. ARHA plans to invest $6 million of its savings in the Alate property, renaming it Silver Fox, and has applied for Virginia Resources Authority bond funding.
“These decisions are not easy, and are sometimes painful, and require creativity, collaboration, partnership, and consensus,” Johnson told the Council.
Johnson reported that Bonaventure, the developer behind The Alate, agreed to its sale for $56.8 million. The property was assessed at $53.1 million earlier this year, according to city records.
“It‘s not a requirement that ARHA buy a building to relocate everybody,” Vice Mayor Sarah Bagley said. “It is an opportunity that we are evaluating as a city.”
City Council Member Abdel Elnoubi stated that ARHA should utilize housing vouchers for the Alate property, rather than purchasing it.
“Why can’t we use those vouchers and move the residents into the vacant building without purchasing it?” Elnoubi asked. “Given all the risks with purchasing that property?”
Johnson said that he has a willing buyer in Bonaventure, which is not focused on affordable housing.
“So, why would I do that?” Johnson asked Elnoubi. “I am taking resources that the federal government is providing to us, using them as leverage to secure an asset that we will have for another 40-to-50 years.”
Council Member R. Kirk McPike said that the city and ARHA are contending with an unreliable partner in the federal government.
“Across this planet, there are people today dying and starving because congressionally appropriated funds are just not being paid,” McPike told Johnson. “I am concerned and think the city needs to be thoughtful about the unreliability of a major partner here in this process, which is not you at all. And it’s not us.”
Council Member John Taylor Chapman said that he supports the project.
“I think this project has already started to allow ARHA to grow its capacity for the seniors,” Chapman said.
City Manager Jim Parajon stated that the city’s AAA bond rating and ability to undertake large-scale projects would be negatively impacted if ARHA defaulted and the city had to absorb the funds into its balance sheet.
“If that happens, this would limit our financial capacity to undertake projects and borrowing,” Parajon said. “While not at direct financial support at this point, the city would be responsible if this deal were to fail over a period of time… This would be a substantial risk for the city if a series of cascading things happen.”
Johnson plans to initiate a comprehensive renovation of the Ladrey Hi-Rise in the first quarter of 2027, with completion expected by 2029. ARHA would then own multiple affordable senior housing apartment buildings.
Helen McIlvaine, the city’s housing director, stated that ARHA recently disclosed the plan and is assessing project risk in collaboration with the city attorney’s office, as well as the finance and housing departments.
“Around 50 to 60 residents will still have to be relocated elsewhere,” McIlvaine said. “They will have a right to return when the proposed renovations are completed to facilitate the Silver Fox acquisition.”
The next ARHA Board meeting is on June 23 (Monday). Council is expected to make a decision on the matter at its meeting the following day, June 24 (Tuesday).
The bond financing deadline for the project is later this month, and ARHA has an anticipated closing date of Aug. 5 for the sale of the Alate/Silver Fox, Johnson said.
