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As Reno gentrifies, ‘naturally occurring’ affordable housing is being torn down

The site of the former 7-11 Motor Lodge, which was torn down to make way for the Neon Line District, in Reno, Nev.
Bert Johnson
/
Mountain West News Bureau
The site of the former 7-11 Motor Lodge, which was torn down to make way for the Neon Line District, in Reno, Nev.

Chris Cox and his brother Ronald have been living in a weekly motel near downtown since last summer. But life here is no vacation. The building is more than 70 years old and it’s falling apart.

“The walls are filthy. They didn’t bother to clean it,” Chris said, gesturing around their shared room.

“This bed’s got pee on it,” added Ronald. “On the other side of the mattress.”

They used to live in a three-bedroom house, but they were evicted during the pandemic. Since then, the Cox brothers have struggled to navigate the bureaucracy of government housing assistance.

Experts call these weekly motels “naturally occurring affordable housing,” because they aren’t supported by public subsidies. But they’re getting scarcer in Reno. On the other side of town, a developer is knocking them down to make way for the redevelopment of downtown. Meanwhile, Reno renters are being squeezed by a housing affordability crisis caused by rapid population growth that’s outpacing home construction and local wages.

The motel room where the Cox brothers live isn’t just unpleasant, it’s unsafe. One day in early September, Ronald tripped on a crack between the carpet and the linoleum in the kitchenette.

“Down to the floor I went,” he said. “I knew instantly that my hip was broke.”

Months later, he’s still recovering from the fall. But even after the accident, Cox and his brother say the motel’s owner hasn’t done anything to make their room safer. They’d complain, but they can’t risk another eviction.

High demand for affordable housing and a limited supply means there are long waitlists – even at some of the motels. Chris says they’d move on if they could.

“It would cost us a lot of money – more than we make total – just to move out of Reno,” he said. “But then if you got no money and you don’t know where you’re going, then what do you do?”

 Chris Cox (left) and his brother Ronald have been living in a weekly motel for six months. They'd move on, but they can't afford to leave town.
Bert Johnson
/
Mountain West News Bureau
Chris Cox (left) and his brother Ronald have been living in a weekly motel for six months. They'd move on, but they can't afford to leave town.

Jacobs Entertainment has bought and knocked down more than a dozen motels since 2017, according to a recent ProPublica investigation. They’re making way for the proposed Neon Line District, which will remake a large part of Reno’s urban core. The company estimates the project will cost $1 billion and will eventually include 3,000 dwellings alongside shopping and entertainment.

Jeffrey Jacobs, the company’s CEO, made a verbal commitment that 10% of any housing he builds will be affordable. But he plans to bring on third-party developers to build most of the new apartments and condos in his development – firms that have made no such promise.

“We’ll develop very little of the housing,” Jacobs said. “I’m trying to attract California residential developers to come into the market. That’s really not what we do.”

There’s nothing in writing to enforce his promise, either. The development agreement for the project, which Reno City Council members approved in October, doesn’t set a goal for the amount of affordable housing in the development.

That has some community members skeptical Jacobs will follow through. Terry LoBianco joined a recent virtual community forum about the project. She’s concerned the city won’t be able to enforce that benchmark.

“I’m a little amazed and concerned that the city has actually not made this mandatory,” she said.

Jacobs also bought and closed the Castaway Inn, another former weekly motel on Reno’s west side.
Bert Johnson
/
Mountain West News Bureau
Jacobs also bought and closed the Castaway Inn, another former weekly motel on Reno’s west side.

Jacobs recently offered to donate land where more than 800 subsidized units could go – but he doesn’t want to build that project, either. Instead, he’s asking public officials to put some “skin in the game” by adding enough property to bring the total number of units up to 1,000, which could then be built and managed by the Reno Housing Authority. Jacobs also suggests government subsidies could help finance the project.

“If everybody’s on the same page on the vision, then we go out and try to see if we can attract some federal and state money to come into Reno,” he said.

City officials who support the Neon Line development plan say any new housing – even luxury condos – will take pressure off the lower end of the market by adding to overall supply. So the city council agreed to reduce the up-front cost of building the Neon Line District by deferring permit fees and extending sewer credits that were set to expire.

But for now, Jacobs’ company is sitting on a growing number of empty lots where weekly motels used to stand. So far, more than 500 rooms have been lost.

Reno City Councilmember Devon Reese says they were never meant to be long-term housing in the first place.

“As those things sort of fell into becoming housing, unfortunately, the owners of those housing units were not maintaining them very well,” he said. “So they became very difficult places for human beings to live.”

The Reno area is growing fast, like many cities across the West. In 2014, the state brokered a deal that gave Tesla generous tax rebates in exchange for opening a manufacturing center east of town. Dozens of tech and manufacturing companies have followed. As a result, seasonally adjusted employment in Reno-Sparks has grown by almost 50,000 jobs.

It’s a pattern playing out across the West and only accelerated by the pandemic. While working-class people lost income during mandatory business closures, white-collar employees who could work remotely started buying homes in cheaper areas near public lands and other amenities. Reese blames the crunch on decades of lagging construction, which ground to a halt during the Great Recession and has been slow to recover.

“We have, perhaps for the last 30 years, not built at the pace that keeps consistent with the growth that we’ve experienced,” he said.

Back in downtown Reno, near the site of the Neon Line District, Dante Martin says he used to stay in motels, too. He doesn’t like seeing them knocked down.

“It takes everybody’s, like, low-income place where they used to live away,” he said.

Martin can remember at least two motels where he used to rent a room that have been torn down so far. But it’s been a long time since he was able to get a room, because Martin lost his job at the Tesla plant about eight months ago. He’s been sleeping outside ever since.

The former 7-11 Motor Lodge is seen days before it was knocked down.
Bert Johnson
/
Mountain West News Bureau
The former 7-11 Motor Lodge is seen days before it was knocked down.

“It’s better to be in shelter than out here in the elements,” he said. “Way better, way better.”

Brian Bonnenfant studies housing supply at the University of Nevada, Reno. He says the affordability crisis is nothing new – just look at tourist towns around the West. It’s hard to find low-cost housing around nearby Lake Tahoe. The same goes for Idaho’s Lake Pend d’Oreille and Aspen, Colorado.

“Nobody really has found a solution to the problem,” Bonnenfant said. “Everybody has tried a lot of different solutions and we’re not seeing the needle move.”

He says new market-rate construction in Reno is finally catching up to demand, which should bring prices down. But that doesn’t mean much for people like the Cox brothers or Dante Martin.

According to Bonnenfant, that’s because the rules of supply and demand don’t apply to affordable housing. Instead, developers rely on government subsidies to help finance those projects.

“That’s where we're in really deep doo doo,” he said.

To have any hope of easing the housing crunch, Bonnenfant says, developers will have to build a lot more.

Across town in South Reno, a new apartment building is taking shape. Roxanne DeCarlo is executive director for the Empowerment Center, a women’s halfway house and the developer behind the project.

“Right outside of this rear entrance will be a nice, large patio,” she explained. “We plan on having benches and a couple barbecues and probably an awning to create some shade because it gets so hot here during the summer.”

The amenities sound posh, but these won’t be expensive luxury condos – the first phase of this development will include 42 affordable housing units. DeCarlo says they plan to give priority to people who are recent graduates of local addiction recovery programs.

Tracy Wheeler manages block grant funding from the U.S. Department of Housing and Urban Development for a regional consortium of city and state governments. She helps direct money to projects like this. In the world of public housing support, business is booming.

“Traditionally, we were seeing probably about three, maybe four applicants come forward a year,” she said. “This past funding cycle, we received eight.”

DeCarlo says the Empowerment Center wouldn’t have been able to build any housing at all without those federal subsidies.

“This is a multimillion-dollar project,” she said. “The thought of being able to privately fund for that seems overwhelming.”

Roxanne DeCarlo with the Empowerment Center says without federal subsidies, the new affordable apartment complex they’re building wouldn’t have gotten off the ground.
Bert Johnson
/
Mountain West News Bureau
Roxanne DeCarlo with the Empowerment Center says without federal subsidies, the new affordable apartment complex they’re building wouldn’t have gotten off the ground.

According to Wheeler, about 1,100 affordable units have been approved and are now waiting to be built. But adding new housing to the market takes time – especially now, with supply-chain failures making raw materials scarcer and more expensive.

Aspen Schuyler is tired of waiting. On a chilly night in December, she joined a small crowd outside Reno City Hall to protest the rising rents.

“You really just need to work your ass off in order to be able to make a living and afford food and housing,” she said. “And then you can’t afford anything else.”

Schuyler is a student at the University of Nevada, Reno and lives with her parents. She says she’d have to work two jobs to be able to live on her own.

She was joined by fellow student Donny Brooks, who moved from Las Vegas to attend college. He’s got three more years before he can graduate, but he’s not sure he’ll be able to keep up with Northern Nevada’s cost of living.

“The future is very uncertain. It’s kind of a struggle right now,” Brooks said. “I’m just hoping I’ll be able to finish.”

Schuyler and Brooks want the city to adopt rent caps, to stop prices from getting any higher.

Meghan Archambault says another solution might be to increase wages to keep pace with the cost of living. She runs the Reno-Sparks Mutual Aid Facebook group, where neighbors can ask each other for help with anything from buying groceries to finding a new place to stay.

“It doesn’t matter how many housing units you build if nobody can afford to rent them,” she said.

Archambault wants to see the old motels get remodeled instead of torn down – although Brian Bonnenfant at UNR says it costs more to rehab an old building than it does to start fresh. And she wants public officials to adopt tougher requirements for new construction, like a mandatory minimum amount of affordable units for market-rate projects.

During last year’s legislative session, lawmakers introduced two bills that would have allowed local governments to raise more funding for affordable housing by charging impact fees.

But developers lobbied hard against both proposals and they died without getting a vote.

Meanwhile, long-time residents like Chris Cox, his brother Ronald and Dante Martin are being left behind.

“This has really screwed me up,” Ronald says. “I don’t have nothing – and it sucks. Why me? Why us? I don’t get it.”

This story was produced by the Mountain West News Bureau, a collaboration between Wyoming Public Media, Nevada Public Radio, Boise State Public Radio in Idaho, KUNR in Nevada, the O'Connor Center for the Rocky Mountain West in Montana, KUNC in Colorado, KUNM in New Mexico, with support from affiliate stations across the region. Funding for the Mountain West News Bureau is provided in part by the Corporation for Public Broadcasting.

Copyright 2022 KUNR Public Radio. To see more, visit KUNR Public Radio.

As Reno gentrifies, ‘naturally occurring’ affordable housing is being torn down

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