Montgomery County has utilized its Right of Refusal law to intervene in the proposed sale of the Westchester West Apartments at 3214 Hewitt Avenue in Aspen Hill. Residents concerned about the impact of the sale on rent prices, or the potential redevelopment of the property, sought to bring the proposed transaction to the attention of County elected officials with the assistance of nonprofit Action in Montgomery (AIM). County Executive Marc Elrich and County Councilmember Natali Fani-Gonzalez asked the County's Department of Housing and Community Affairs (DHCA) to intervene in the sale.
On June 8, 2023, DHCA purchased Westchester West Apartments from Westchester Gardens LLC., for $67 million. It then immediately resold the property to ECD Westchester Apartments, LLC, for an undisclosed amount. The buyer is a shell company created by nonprofit Enterprise Community Development of Silver Spring. A $5 million loan to ECD was provided by the County to urgently address maintenance work at the property that the previous landlord had deferred.
Westchester West was seen as valuable by the County due to the fact that a large number of its 345 units are family-size 3-bedrooms. This is a size of unit increasingly hard to find at affordable prices, and market-rate developers are not building them in significant numbers today.
Current rents at Westchester West Apartments are considered affordable to households with incomes between 55% and 60% of Area Median Income (AMI) under DHCA’s 2022 rent and income limits. Under the terms of the County's sale to ECD, Westchester West Apartments will remain affordable for 35 households with incomes at or below 50% of AMI; 275 households with incomes between 50% and 60% of AMI; and 35 households who earn more than 60% of AMI. The last category was implemented to avoid evicting current residents who earn more than 60% of AMI.
“Preserving affordable housing is an essential part of a successful affordable housing strategy,” Elrich said in a statement. “I directed DHCA to use the County’s right of first refusal to match the sale offer, purchase this building, and then transfer to an affordable housing partner. The bottom-line is that we saved the homes of hundreds of families who could have been forced out by increased rents if we did not intervene. If we are going to solve our affordable housing problems, we must get serious and use everything in our toolbox, including using our right of first refusal to intervene in similar transactions that could price out current residents.”
“When I realized that the building was about to be sold, I saw this as an incredible opportunity for the County to intervene," Fani-González said in a press release. “Working in partnership with County Executive Elrich, we convened meetings with DHCA, and the community alongside AIM, to discuss how we could make this incredible purchase possible. Our low-income immigrant community took action to protect their families from displacement, and that’s why we are celebrating today.”
Westchester West residents expressed gratitude for Elrich's action. "We are very grateful to the County government for this result,” resident Maria Vasquez said Thursday. “For us, giving stability to our children is our priority. Knowing that we have secured our home in an area where our children can access an excellent education is something that fills us with great peace of mind."
There's much talk about affordable housing from developer lobbyists and Astroturf YIMBYs who are, in reality, just seeking upzoning for more luxury housing at market rates. They falsely suggest that building more supply will reduce prices, an argument soundly disproven over the last 20 years in Montgomery County and elsewhere. The U.S. housing market, sadly, no longer operates under market forces.
In contrast, actions such as Elrich took here will preserve large numbers of units. There are really only public, government solutions to the affordable housing crisis, if one is serious about the issue. Government acquiring or building housing itself is the only tool that will make any significant difference in housing prices and affordability.
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