Dunham Court

The Szanton Co. has proposed building Dunham Court, a four-story, 49-unit affordable housing project – shown in this rendering – that would be next door to Cape Elizabeth’s Town Hall and overlook the new Village Green. Rendering courtesy of The Szanton Co.

CAPE ELIZABETH — An affordable housing proposal has divided residents of this affluent seaside community, and the battle line goes right through the town center.

For some residents, the town center is exactly where Dunham Court should be built, within walking distance of the Pond Cove IGA Foodliner and a CVS pharmacy, along with the public schools, community center, police and fire station and Thomas Memorial Library.

For other residents, the town center is the last place they want to see a four-story, 49-unit building. It would be right on Ocean House Road (Route 77), beside the butter-yellow Town Hall and the sprawling new Village Green, with its block granite war memorial and ship’s mast-style flagpole.

But Dunham Court is the first major affordable housing project to come before town officials in 50 years, at a time when already precious housing stock has grown even more scarce and costly amid a pandemic-driven buying spree. The median home price here is $625,000 and rising, and while the lack of affordable housing may be more acute in Cape Elizabeth, it’s emblematic of a housing crisis erupting across southern Maine and the nation.

Opponents say the project would be too big, the apartments would be too small for many families, and it’s all just happening too fast, although the Town Council, Planning Board and developer have held more than a dozen public meetings so far. They’ve asked the council to reject the Dunham Court proposal and form a town committee to develop a strategic plan for affordable housing. And they’ve threatened to gather signatures for a town referendum on the project if the council doesn’t scuttle it.

Dunham Court “would cast its shadow over our town green and set us on a course for subsequent infrastructure and more density, both of which the majority of the town’s residents simply do not want,” Brooks Bornhofft said in his testimony to the council last week.

Supporters say Dunham Court would be ideal for younger people who work in town but can’t afford to live here, as well as older residents who want to downsize from in-demand single-family homes but stay in town. They say the project should be built in the town center to avoid costly infrastructure expansion and preserve prized farmland and open space. And they note the lack of other available or feasible building sites in town, which has hampered significant affordable housing development so far.

“Despite everybody wildly applauding that they support affordable housing, they want it someplace else,” Priscilla Armstrong told the council last week. “Well, I don’t particularly feel that our town center is a vision of loveliness, (but) I think this plan is lovely. It’s the center of town. It’s where it should be.”

The access road to the site where The Szanton Co. wants to build Dunham Court, an affordable housing project, next door to Cape Elizabeth’s Town Hall. Derek Davis/Staff Photographer

Dunham Court has come under attack early in its review, when the developer is seeking four zoning amendments that would make financing and construction possible. If the changes are approved, the building would be 10 feet taller than the 35-foot height limit for the town center district. The amendments also would halve the amount of land needed per unit, more than double the building footprint limit, and release the developer from hosting commercial tenants on the first floor. The project also would need a tax increment financing arrangement with the town that would return a portion of property taxes to the developer over 30 years.

The project is proposed by The Szanton Co., a well-regarded housing developer in Portland that specializes in mixed-income rental housing financed through federal low-income housing tax credits administered by the Maine State Housing Authority. The company has built and now manages more than 550 apartments in 11 buildings in Portland, Biddeford, Lewiston, Auburn, Bath and Exeter, New Hampshire, and it has 292 units under development in projects in Cape Elizabeth, Old Orchard Beach, Bath, Portland and Lewiston.

Nathan Szanton, the company’s founder, invited Cape residents to tour its other properties, which he said are designed to be attractive and contribute to the vitality and economy of each community. “I’m very proud of them,” he said.

Szanton’s partners include Bobby Monks, a prominent town resident who is widely known as an entrepreneur, financier, real estate developer and political activist. Monks defends the Dunham Court proposal, named for Linwood Dunham, a highly respected town resident who died in 2000 at age 108.

“There is no way I would be part of any project that would be anything but healthy for our town,” Monks said. “We have been lucky to live in Cape and that opportunity should be afforded to everyone.”

Right now, few people can afford to live in Cape Elizabeth, according to Erik Jorgensen, government relations director for MaineHousing. He spoke to the need for affordable housing at last week’s council meeting.

The quasi-state agency defines “affordability” as housing that doesn’t cost more than 30 percent of household income, Jorgensen said, and it considers fair market rent for a two-bedroom apartment in Greater Portland to be $1,592.

Dunham Court

The Szanton Company has proposed building Dunham Court, a four-story, 49-unit affordable housing project that would be next door to Cape Elizabeth’s Town Hall and overlook the new Village Green. Rendering courtesy of The Szanton Company

Cape Elizabeth, a rural suburb of Portland with a population of 9,300, has 535 rental units, he said. That includes Colonial Village, a 22-unit subsidized senior housing complex on Starboard Drive that was built in the 1970s.

These days, tenants need a yearly household income of $92,000 to lease a median-priced, two-bedroom apartment in Cape, which runs about $2,300 per month, including utilities, Jorgensen said. Prospective homeowners need a yearly household income of $174,000 to buy a median-priced home of $625,000, he said.

“So if you’re a typical member of the workforce, you probably don’t have much of a chance to live in this community in the absence of a project that might provide affordable housing,” Jorgensen said. “If you’re a fireman working in Cape Elizabeth and you can’t live any closer than Buxton, that’s not a good thing.”

Jorgensen pointed to starting annual salaries for several careers in the region, including firefighters ($29,650), teachers ($43,340) and farming, fishing and forestry occupations ($29,730). Median household income in Cape Elizabeth is $123,116, according to the U.S. Census. On average, renters in Cape earn 41 percent less than the median household income, he said.

Jorgensen said the lack of affordable housing is a growing problem across Maine and the nation, driven most recently by homebuyers fleeing urban areas overwhelmed by the COVID-19 pandemic. Maine alone needs an additional 25,000 affordable units, he said, including single-family homes and apartments, with an acute need for multi-family housing in areas of Cumberland and York counties, where single-family homes are drawing multiple offers above the asking price.

MaineHousing is financing and building record levels of affordable housing, Jorgensen said, and is on track to produce up to 1,000 units per year as a result of recent state and federal policy changes. Projects are usually financed with low-income housing tax credits, which require “a certain scale to make the numbers work,” he said, but developers in Portland, Sanford, Biddeford, Kennebunk and York are trying innovative alternatives.

Producing more affordable housing also has been identified as a priority of the Greater Portland Council of Governments and its Metro Regional Coalition. Its latest progress report found that increasing demand and rising housing prices have created “greater difficulty for an increasing number of households to find housing they can afford in the community they wish to live in.”

The report concluded that increasing affordable housing options in and around Portland would stem the trend of people moving outside the metro area, which leads to a loss of beneficial diversity in metro communities and increases traffic, congestion, air pollution and demand for costly infrastructure and services in outlying towns.

Rising housing costs in Cape Elizabeth have had a noticeable impact over the last decade, said Town Planner Maureen O’Meara. The number of volunteer firefighters has fallen from about 60 to 30 and the number of students in the town’s schools has fallen from about 1,800 to 1,600, she said. The school district struggles to hire bus drivers and fill other positions.

“There are far fewer people who live here and work here, and it’s not good for the community,” O’Meara said.

Dunham Court

The Szanton Co. has proposed building Dunham Court, a four-story, 49-unit affordable housing project – shown in this rendering – that would be next door to Cape Elizabeth’s Town Hall and overlook the new Village Green. Rendering courtesy of The Szanton Co.

A 1992 town ordinance requires major housing developments to include 5 percent low-income units or 10 percent moderate-income units, but that has produced only 15 condos or houses so far, she said.

“It has succeeded in creating some permanent affordable housing, but it’s not nearly enough,” O’Meara said. “The problem is getting worse, we’re getting farther and farther behind, and we’re becoming less and less affordable.”

Dunham Court would include 41 one-bedroom and eight two-bedroom apartments, as well as a fitness center, community room for residents, free Wi-Fi, heat, hot water, parking, indoor bike storage and a coin-operated laundry.

Thirty-nine apartments would be reserved for households below 60 percent of the area median income, which is $42,000 for one person, $48,000 for two people and $59,940 for three people. Ten apartments would be leased at market rate. Affordable rents would be $1,080 for one bedroom and $1,299 for two bedrooms; market rents would be $1,495 for one bedroom and $1,695 for two bedrooms.

Dunham Court is the latest project planned as part of the 4-acre Ocean House Common Subdivision that was approved for Dr. David Jacobson, who is building a new home for his dental practice beside the Village Green. Jacobson gave the land to the town for the green.

The Planning Board has reviewed and recommended the zoning amendments sought for Dunham Court. The seven-member Town Council appears to be as divided as residents and has referred the matter to its ordinance committee.

Some opponents already have threatened to organize a town referendum on the project if the council approves the ordinance amendments. When the full council will act on the requested changes is unclear, but Chairman Jamie Garvin is hopeful the project will move forward.

“I think people are very averse to change,” Garvin said. “Many hold an idealized view of this town in their heads. One project isn’t going to solve all of the housing problems in Cape Elizabeth or the region, but it’s a start.”

Councilor Caitlin Jordan stated her opposition clearly during last week’s council workshop.

“Do I want a four-story building that ginormous in the center of our small town? Right now, I’m a no,” Jordan said.


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