Why Did Raleigh’s Planning Commission Accept $1.5 Million in Lieu of Promised Affordable Housing Units at Union Station?

It’s Thursday, April 3.

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Should GoTriangle and the developer Hoffman & Associates be allowed to pay $1.5 million into Raleigh’s affordable housing fund instead of including affordable units in the high-rise apartment complex they’re building next to Union Station, as they originally offered?

Last week, a majority of the members of the Raleigh Planning Commission said yes, though the City Council has the final say.

Ordinarily, a developer in Raleigh is not obligated to build any affordable housing or pay any amount of money into the city’s affordable housing fund. But since GoTriangle and Hoffman voluntarily added an affordable housing condition when they got the property rezoned back in 2019, the city has leverage to hold them to that commitment—or not.

In other parts of the country where mandatory inclusionary zoning is legal, cities like Portland and Minneapolis would likely require a significantly larger contribution from the developers.

In Portland, developers can choose to build a certain amount of affordable housing onsite or pay a fee of $27 per residential square foot. Constructing 385 market-rate apartments with footprints of, say, 700 square feet, would trigger a $7.8 million payment to the city.

In Minneapolis, where the payment-in-lieu fee is $22 per residential square foot, the city could charge the developers about $5.9 million.

Raleigh isn’t Portland or Minneapolis. It can’t enact a mandatory inclusionary zoning policy without running afoul of the General Assembly. But in this rare instance, city leaders get to decide whether GoTriangle and Hoffman’s proposal represents a fair trade-off.