Agenda Date: 02/03/2026
Subject:
Title
Discussion of a Request from Grovewood Community Development, a non-profit affordable housing organization, for funding support from the city’s Affordable Housing Fund
Body
|
From: |
James L. Becklenberg, City Manager |
|
Prepared by: |
Kathleen Osher, Deputy City Manager |
|
|
Julie Latham, Housing Policy Manager |
|
Presentations: |
Jo Ellen Davidson, Executive Director, Grovewood Community Development |
|
|
Julie Hoelbel, Director of Real Estate, Grovewood Community Development |
PURPOSE:
Consideration of a funding request from Grovewood Community Development, a mission driven affordable housing non-profit, in support of the renovation, preservation, and continuation of 64 existing affordable housing rental units across three properties in Littleton.
LONG-TERM OUTCOME(S) SERVED:
Robust and Resilient Economy
DISCUSSION:
Grovewood Community Development, a mission driven affordable non-profit organization, is requesting $1M of funding from the city’s Affordable Housing Fund and a contribution in-kind to waive city fees in support of their preservation and renovation project on 64 affordable rental units across three properties in Littleton:
1. Lara Lea Apartments (5540 S Elati St) - 36 units built in 1972
2. Fox Street Apartments (5368 & 5388 S Fox St) - 16 units built in 1962
3. Regal Apartments (5531 S Delaware St) - 12 units built in 1962
These locations serve low- and very low-incomes households, with 97% of units serving those earning 30-50% of Area Median Income (AMI), and the remaining 3% serving those at or below 60% AMI.
The work includes a moderate rehab following Enterprise Green Community sustainability guidelines and will involve the upgrade of several major building systems and some unit reconfigurations. The project will also add ADA units at Lara Lee and Fox Street, where there are none currently. The refinance and renovation of these properties will help preserve and extend affordability provisions at these locations, with the project resulting in a new recorded 40-year land use restriction agreement (LURA) on the properties. This thereby extends the affordability period of these properties and provides improved quality and livability for low-income residents for years to come.
BACKGROUND:
Grovewood Community Development was formed in 1995 originally as Community Housing Development Association, Inc. (CHDA), a stand-alone 501(c)(3), through a collaboration of AllHealth Network, Arapahoe House (subsequently The Recovery Foundation), and Developmental Pathways. GCD’s mission is to provide quality, service-enriched housing for people with modest means including those with intellectual and developmental disabilities, mental illness and/or substance use disorder in the south metro Denver area. GCD owns ten affordable housing communities with 363 total units in Littleton, Englewood, and Aurora, and is actively developing the 4.79-acre former site of the Aurora Stables into a two-phase affordable housing community with 85 family units (Phase I) and 49 senior units (Phase II). In addition to housing, GCD offers residents resource navigation programs and community activities to help residents achieve their best quality of life.
The Inclusionary Housing Ordinance (IHO) went into effect November 1, 2022, with a requirement that 5% of new units be affordable for residential projects with 5 units and up, and that applicants could comply by either building units or paying a fee in lieu. The IHO stipulates that the funds collected from the fee in lieu be utilized by the city for the purposes of planning for, subsidizing, acquisition of properties for, or developing affordable housing in partnership with other organizations. The city established the Affordable Housing Fund to accept these payments and developed a policy on the review criteria and disbursement process for funds. The Affordable Housing Fund has received $2,785,766 since inception and disbursed $990,929.17, leaving approximately $1.7M in currently available funds.
Grovewoods’s request for support on their preservation and renovation project meets the Affordable Housing Fund criteria as outlined below:
• The request supports 100% affordable properties that are deed, covenant, or otherwise restricted to ensure long-term (30+ years) affordability. Requests that create new formally restricted affordable units or extend the affordability of existing ones are in alignment with IHO parameters
√ Yes, 97% of the units serve 30-50% AMI levels, with the remaining 3% serving those at or below 60% AMI. The project will result in a new recorded 40-year land use restriction agreement (LURA) on the properties, thereby extending the affordability period of these properties.
• The project is located within city limits
√ Yes:
§ Lara Lea Apartments (5540 S Elati St)
§ Regal Apartments (5531 S Delaware St)
§ Fox Street Apartments (5368 & 5388 S Fox St)
• The requested funding fills a demonstrable financing gap
√ Yes, Grovewood provided information on their capital stack; support from Littleton helps make this project possible.
• A preference but not requirement that the funding leverages other resources, such as county, state, or federal funds
√ Yes, funding is anticipated from the Low-Income Housing Tax Credit (LIHTC) non-competitive 4% program, debt funding from Colorado Housing Financing Authority, and grant and/or loan funding from Colorado Department of Housing, and Arapahoe County. Local funding support from the city will facilitate a more competitive application to these other entities. Grovewood is also contributing owner equity to the project.
Supporting this request aligns directly with the city’s adopted goals and the 2027 Strategic Plan initiative to cultivate a favorable environment for housing development across all income levels. Additionally, the Denver Regional Council of Government’s (DRCOG) recent Regional Housing Needs Assessment identified households earning at the 0-50% AMI levels as the area of greatest need for additional housing in Littleton. Supporting this project helps preserve and extend affordable housing that is critical to the city and its housing goals.
Prior Actions or Discussions
• March 25, 2025, council study session discussing parameters for a policy on affordable housing fund disbursements.
• Augst 12, 2025 council study session reviewing DRCOG RHNA as part of a public meeting and review for compliance with SB24-174 Sustainable Affordable Housing Act.
• September 23, 2025, council study session reviewing the draft policy for affordable housing fund disbursement and providing direction to proceed as written.
FISCAL IMPACTS:
The Affordable Housing Fund currently has approximately $1.7M available to support affordable housing projects. This funding request would reduce available funds.
STAFF RECOMMENDATION:
Staff recommends support for Grovewood’s request for funding and recommends waiving city fees in support of Grovewood Community Development’s project. Staff requests council direction regarding support for the request. With council direction, staff will return to council with a resolution reflecting the level of support council directs.
ALTERNATIVES:
Council could fund at varying levels or deny the funding request.
Proposed Motion