South Metro Housing Options lays out pipeline, seeks funds to fill $1M gap on 50-unit Montview Flats

South Metro Housing Options (SMHO) presented a progress update and financing request to the Littleton City Council and staff, describing a multi-project pipeline anchored by Montview Flats, a 50-unit affordable rental development that SMHO expects to break ground after closing financing this spring.

SMHO chair Kate Peterson opened the presentation with a request for continued council partnership. "Thank you very much for having us and all your support for affordable housing in Littleton," Peterson said, noting SMHO serves more than 2,000 residents through its voucher and owned-unit programs.

The meat of the presentation outlined financing and schedule for Montview Flats and broader funding challenges. Sarah Burr, SMHO real estate development manager, said Montview Flats will include a mix of one- and two-bedroom units serving incomes from about 30% to 70% of area median income. "We will expect to close on financing sometime this spring. And as soon as we close, we will break ground," Burr said, adding SMHO expects about a 15‑month construction schedule with completion targeted in summer 2026.

SMHO described the Montview capital stack in detail. Total project cost is about $25.5 million, SMHO said, with the Low-Income Housing Tax Credit (LIHTC) equity piece estimated at roughly $11.9 million. SMHO identified a seller carry (land) line of about $2.6 million and said private debt and LIHTC equity together comprise roughly 80% of the project financing while public funding represents about 20% of the capital stack. SMHO executive director Corey Ritz said, "We are still coming up short in what we need. We do still have a funding gap with this project for a little over $1,000,000." SMHO said the City of Littleton has already committed $1,000,000 of ARPA/fee‑in‑lieu funding to the project.

SMHO flagged several funding risks. Staff told council that federal and regional funding streams SMHO has relied on — Community Development Block Grant (CDBG) and HOME funds, and local CDBG contributions from Centennial — have been smaller than expected for this project, and the organization said it will not assume similar levels for future projects. SMHO also emphasized rising costs across construction, insurance and interest rates and described how those market pressures increase the size of funding gaps.

To close Montview’s remaining gap, SMHO asked the city to consider tools that can improve competitiveness, including allocating private activity bonds and clarifying how Littleton will disburse Inclusionary Housing Ordinance (IHO) fee‑in‑lieu dollars. SMHO said Littleton’s private activity bond allocation last year was about $2.8 million (based on population) and that SMHO could need $10–$15 million in private activity bond capacity for its next project. Council staff said the city could consider keeping private activity bond allocation local and that council action on an allocation would need to occur before an internal September deadline to make the bonds useful for competitive LIHTC applications.

SMHO also described non-LIHTC activities: a homeownership program (sales of scattered single‑family properties placed into a community land trust) and preservation work. SMHO said it has sold 49 of 59 first‑time‑homebuyer homes to date at an average sale price of about $280,000, with roughly 20 more houses in a later tranche. SMHO noted preservation projects — acquisition‑rehab and land‑trust homeownership — have produced lasting affordability but are often more expensive to execute because sellers price properties at market and HUD program rules add capital needs.

Council members pressed SMHO on siting and design, asking about dispersal across Littleton (SMHO said it is looking for southern parcels to avoid concentrating units in one quadrant) and whether projects would require rezoning. SMHO said many LIHTC projects are sized to about 50 units for economic viability but acknowledged the city can assist by offering zoning and regulatory relief that reduces per‑unit cost, citing parking relief and density allowances as examples. SMHO also urged that small, practical clarifications — waivers for siding/stucco rules, temporary construction flexibility with utilities and fire services, and faster administrative responses — materially reduce time and cost overruns on tight urban infill parcels.

Direction and next steps were explicit. City staff told council they will return to discuss policy for allocating IHO/fee‑in‑lieu funds and private activity bonds; SMHO said it will request additional Littleton support to close Montview’s gap. Council staff said a March meeting will include more detailed policy options and an action pathway for private activity bond allocation so SMHO can be competitive in upcoming LIHTC rounds.

Why it matters: SMHO’s pipeline and near‑term financing needs affect where affordable homes will be built in Littleton, how much city funding will be available for future projects, and how city zoning and administrative practice can change costs on infill affordable projects. Montview Flats, if funded, would add 50 subsidized rental homes targeted for very low‑ and low‑income households and would be a test of how local fee‑in‑lieu and city bond allocation practices can support or limit LIHTC‑based development.

What’s next: SMHO requested city policy work on private activity bonds and the IHO disbursement process, and staff said they will return to council on March 25th with options for how Littleton could allocate and deploy those resources for majority‑affordable projects.