Two development teams presented competing visions to the Kirkland City Council for the city‑owned Houghton Village site, offering 100% affordable and mixed rental/homeownership plans that would put housing and ground‑floor community space on the parcel the city bought in 2022.

The proposals, presented during the council’s July 1 study session, focused on delivering a high share of affordable housing while providing neighborhood‑serving commercial or nonprofit space. Developer Joey Lonsford of Inland Group described a mid‑rise model with about 140–175 units restricted to 60 percent of area median income (AMI) and a conceptual $90 million budget for a 175‑unit scheme. Yi Zhao of Imagine Housing outlined a lower‑rise option that deliberately does not maximize height and would include about 120 rental units plus roughly 20 affordable homeownership units with more than 18,000 square feet of ground‑floor commercial/community space.

Both teams told council they plan to use Low‑Income Housing Tax Credits (LIHTC) and state bond programs as the primary equity sources, and both said additional public subsidies or land‑value concessions from the city would be required to reach deeper affordability. Lonsford’s illustrative pro forma assumed a 50 percent land discount and included placeholder commitments from local funders: $2.75 million from ARCH, $9 million from the Evergreen Impact Housing Fund and developer equity/deferred fees. Imagine Housing likewise listed LIHTC, state housing trust fund dollars, ARCH and philanthropic sources (including Amazon’s Home Equity Fund) in its conceptual stack and said its timeline would likely push major funding awards into the 2028–2029 cycle.

Council members pressed both teams on specifics the proposals left open. Council member Black asked whether Inland had experience leasing ground‑floor retail; Lonsford said Inland has placed coffee shops and services under multifamily buildings and would lean on local community engagement and commercial partners to lease space. Council members also asked about parking assumptions under recently adopted state law (SB 5184). Both teams said they modeled existing and recently enacted rules into underwriting but acknowledged on‑the‑ground parking demand for households would be higher than the minimums the city can legally require for small units. Council member Paschal asked about co‑location of market‑rate and affordable units; both teams said mixed towers raise regulatory and financing complexities and that, in practice, market‑rate and affordable units often end up in separate structures in the same project.

On affordability depth, council asked whether teams could deliver more units under 50 percent AMI. Inland said deals pencil best at 60 percent AMI without more subsidy; Imagine said it could consider some lower‑AMI units but warned lower rents reduce the project’s debt capacity and therefore require additional subsidy. Both teams said they would revisit income mixes if the city prioritized deeper affordability.

Councilmembers also asked about the city’s likely contribution. Deputy Mayor Arnold signaled the city would probably not meet the most aggressive subsidy assumptions in the proposals and asked staff to return with analysis of what the city could afford and the implications for unit mix and design. Multiple councilmembers also asked staff for: (1) a comparison of the existing commercial square footage on the Houghton site to the commercial space proposed in each submission; (2) clearer estimates of carrying costs and staff capacity should the city hold the property through design and entitlement; and (3) options for selling the parcel instead of pursuing a city‑led redevelopment if public subsidy or management capacity proves insufficient.

What happens next: staff said they will return to council with more detailed budget scenarios, land‑value assumptions (including an updated appraisal for five‑story build‑out), clearer parking and impact‑fee treatments, and options for advancing a development agreement or marketing the land for private sale.

Ending: For now, the council asked teams to continue working with staff while the city refines financial assumptions; no decision or binding agreement was made at the July 1 meeting. Quotes in this article come from presenters and council members who spoke during the July 1 study session.