Members of the Condominium Developers Association, a Northern Virginia trade group, assembled Wednesday to discuss with elected officials prospects for continued development despite an already high inventory of condominiums and a short supply of rental units.
Aside from reviewing specific incentives their localities offer, the officials discussed scattering low- to moderate-income tenants in condominiums that otherwise might go vacant for more than a year.
Alexandria Vice Mayor James P. Moran Jr., Arlington County Board Chairman Ellen M. Bozman and Fairfax County Supervisor Thomas M. Davis III alternately touted their respective jurisdictions and noted obstacles in common in response to questions submitted in advance.
The first contended that although condominiums are more economical than townhouses or detached houses, development had been "clouded" by the issue of tenant displacement. Asked whether this had changed, all three politicians maintained that tenant rights are an inextricable part of the conversion process.
Noting that 40 percent of the 2,624 conversions Alexandria approved in 1981 were still vacant, Moran conceded, "We perhaps went a little too fast." But he said Alexandria still likes condominiums because at an average cost of $66,000 they are indeed relatively affordable and a good way to keep municipal workers living in town; people take better care of property they have invested in, and higher property tax revenue has been "a tremendous boon."
"The one negative factor is what is happening to the tenants that get displaced," Moran told the developers at the Tysons Corner Holiday Inn.
Federal programs to aid low- to moderate-income tenants have been phased out, and the politicians agreed that the cost of either preserving rental housing or facilitating condominium purchases exceeds local jurisdictions' capacities.
Moran said he preferred "mainstreaming" low-income people into private developments instead of creating public housing. Alexandria's experience after 40 years, he said, was that rather than make its beneficiaries self-sufficient, public housing spawned second- and third-generation tenants.
Developers can gain a quick cash flow by selling scattered units to local housing authorities, Davis said. Bozman noted that since passage in 1971 of a real estate tax relief law, 900 Arlington families had been helped in scattered sites.
But she warned that the housing situation resulting from conversions is "getting worse than the early days," which she dated from 1974. At that time, she said, 25 percent of the Arlington tenants in converted buildings could afford to buy in. Now that "we're dipping into the housing stock," that figure has dropped to 4 or 5 percent and some elderly tenants are on their third conversion, she said.
Bozman said that 68 percent of Arlington's 10,000 condominium conversions have affected those with low or moderate incomes. And with 26 percent of the county's apartments already converted into condominiums, the trend is accelerating: 1,700 were converted last year, she said.
"I think of the 1,700 units . . . 1,600 were added to inventory," joked Gregory Friess of Colonial Village Inc., standing in as moderator for association president Samuel A. Finz, whose wife was giving birth.
When incentives for developing multifamily housing came up, Ray F. Smith Jr., president of Sequoia Building Corp. of Fairfax, said he lost a deal last week to take over and preserve 824 apartments because Arlington lacks a housing authority. Instead, he said, someone else will convert to condominiums units that would have rented for $450 a month.
Lat November, Arlington voters defeated a referendum for a housing authority that would have had bond-issuing power. Even though housing authorities in Fairfax County and Alexandria offered backing, he said, Arlington officials said the county could not participate.
"Until more people start talking about what this housing authority really is--we're not creating a ghetto, we're not doing the S&Ls out of business--this thing isn't going to fly," Bozman said.
Other remedies and incentives the officials suggested included the following:
* Phasing in sales of condominiums. Moran noted that in a typical conversion, "everyone gets kicked out of an apartment complex," resulting in "a deluge of relocation problems" while sales stagnate.
* Permitting variances, such as reduced parking requirements, for high-density, low- to moderate-income developments near Metro stations.
* Requiring that residences be included in large office developments.
* Offering discounts to tenants who buy their converted units and long-term leases to the elderly and handicapped.
* Selling units to investment buyers, who rent the apartments back to the tenants.
Davis sought to put the developers' problems into perspective by saying, "The real problem right now rests with the economy. . . . The real answer lies with interest rates.
The economy notwithstanding, Davis confidently strode up to Sequoia's Smith after the meeting and said, "I've got to hit you up" for a contribution to replace the Falls Church High School band uniforms that shrank recently when the band was caught in a storm.
"Charles E. Smith Co. just gave me a thou," Davis said.
"We will match Charles E. Smith," Ray Smith said. "Do we get credit for this?"