Apartments open in tight market

As pressure continues to mount on county management to conclude negotiations with Douglas County deputies, pay is not the only challenge facing deputies, firefighters and teachers among other workers.

The county housing issues have been exacerbated by the sudden jump in prices that started during the coronavirus outbreak and hasn’t shown any sign of slowing.

The third quarter of 2022 saw record median and average sales prices in East Fork Township, according to figures released by the Douglas County Assessor’s Office.

The median sales price for a home was $629,320 between July 1 and Sept. 30, twice what it was in 2015. The average sales price was $786,735, double 2016’s prices.

That’s about when builders Allan Sapp and Mike Day started working on the 81-apartment complex at the end of Crestmore Drive.

“Mike and I were having lunch one day and he said his wife was running her Bible Study group, and there were a bunch of young professionals who had no place to live,” Sapp said during an interview just before Thanksgiving. “I said, ‘that sounds like a pretty good demographic.’ We started looking around and we found five unbuilt parcels of which this was the largest.”

The county tried to address the shortage of multi-family housing in 2017 with several master plan amendments, but many of those units have been built as townhomes.

That year, Sapp and Day purchased five acres at 1280 Crestmore, which was previously part of the senior housing project next door.

“We bought this with multi-family on it, and the planning office said all you need to do is submit a plan and you’re good,” Sapp said.

That didn’t turn out to be entirely accurate. When they went back to the county, they were told that without transferring development rights they would only be able to build five houses on the site.

In 2018, Sapp had to go to the Douglas County commission to get the master plan changes to remove the property from receiving area, which would have required the purchase of 76 development rights, one per apartment.

After clearing the governmental hoops, they faced what might be a greater hurdle, finding financing.

“No one would touch us with a 10-foot pole,” Sapp said.

He said one issue is the maximum density of 16 units per acre, which means higher costs per apartment. The other issue was that Sapp and Day lacked a history with multi-family projects.

“So, we split it up and sold it to my friends,” he said. “I have some really nice friends.”

They were able to leverage that investment into a loan, which enabled them to complete the first half of the project.

“Now with the rise in interest rates, that financing has just stepped away for our second four buildings,” he said. “We’re waiting until we get people in here and can demonstrate what we’ve done.”

That means 37 units are available for rent, which won’t make much of an impact on the shortage.

A three-bedroom apartment with appliances, granite countertops, two bathrooms rents for $2,350 a month, which Sapp said is similar to a home in the Ranchos. He said the one bedroom apartments will likely start around $1,495 while two bedrooms will be around $1,800.

“The long-term throw is that people are moving to Carson Valley and it’s difficult to build rentals,” he said.

Sapp said he hoped young professionals, including law enforcement officers, would rent the apartments.

“We want people with good jobs who pay their rent,” he said.