For residents and business owners in the Old Town Newhall redevelopment area, the overall numbers of this project can get a bit scary!

Redevelopment by the Numbers

Here’s how the redevelopment numbers break down:

Residential Redevelopment

• 690 Existing Dwellings in the area
• 380 Dwellings to be Replaced
• 310 Existing Dwellings to Remain

Ouch! That’s more than half of the existing dwellings slated for a date with the wrecking ball! These will be replaced with a maximum of 1,092 new residential units.

Commercial Redevelopment

• 957,243 Existing Square Feet
• 750,321 Square Feet to be Replaced
• 236,922 Square Feet to Remain

That’s over 78 percent of the existing commercial space scheduled for the wrecking ball as well! There will be a maximum of 1,017,422 square feet of new commercial space added after the dust from the wrecking balls clears.

Rental Housing an Endangered Species

The residential plans get even more scary for existing renters and owners as we get deeper into the actual plan details. The plan is that "the City will endeavor to help the residents turn rentals into ownerships," meaning that most rental stock will be eliminated and replaced by "affordable" housing. There will likely be some sort of programs initiated including possibly down-payment assistance programs, silent second mortgages and home improvement programs to help move this program forward.

Those that do not qualify for these programs will receive relocation assistance as required by Federal law, outlined in the Uniform Relocation Act. According to this law, "Computation of a payment under this subsection to a low-income displaced person for a comparable replacement dwelling shall take into account such person’s income," and this amount shall not exceed $5,250.

This residential redevelopment isn’t all bad, since the downtown Newhall area has definitely seen better days. But with this area being one of the "most affordable" areas in Santa Clarita, it’s likely that many of these tenants will be forced to move elsewhere, or maybe to add to that "overcrowded homes" issue with multiple families under one roof. Add to this the recent immigration sweeps in the area, and you’ll start to get a flavor of what’s happening here.

And, as in the commercial areas, the eminent domain provision has been provided for in the residential redevelopment plans. For buildings with "derelict landlords", especially those facing Pine Street and Market Street, eminent domain has been specified as a "beneficial tool" to use for the area’s long-term improvement.

Market Street alone (from Race Street to Newhall Avenue) has been allocated over $4 million for streetscape improvements, including curb extensions, pedestrian-scale light fixtures, street furniture and new trees. With this sort of financial commitment, you can be sure that there won’t be any derelict buildings remaining in the area!

Stay tuned! There’s still more to come in this series. We still haven’t covered the premise of "sales leakage" out of the area, developer issues, income projections, and other important items that are part of the overall Newhall Redevelopment Plan.

The remarkable run of record housing sales and prices since 1998 has become a major puzzle and topic among economists. The high prices have put homeownership out of reach for many young people and low-income households hoping to break into the market.

Economists increasingly are concluding that the shortage of affordable housing in Washington and other major U.S. cities on the East and West coasts is a result more of man-made restrictions on development than high construction costs or other market forces.

‘It simply takes too long and is too expensive to move through the development process,’ said Mark Vitner, senior economist at Wachovia Securities, pointing at ‘smart growth, slow growth and no growth’ movements in many of the same areas where the population and demand for housing are growing the fastest.

What many economists have been proclaiming as a ‘bubble’ in Washington and other high-cost areas can be mostly explained by the restrictions on development, combined with a rush to homeownership by renters taking advantage of low interest rates, he said.

The restrictions have mounted as homeowners have grown more powerful and more willing to use their power to stop or greatly restrict development in their neighborhoods through the political and regulatory processes and the courts, according to a study published recently by the National Bureau of Economic Research.

See the full RisMedia article here.