State’s millions boost 104 affordable homes at Murphy Crossing as more commercial plans emerge

Published 2:00 pm Tuesday, November 5, 2024

With more than $15 million in state funding under its belt, local affordable housing developer Thistle & Nest is set to build 104 homes in south Bend and sell them at reduced cost to low-income households, part of a larger development plan including an RV park, pickleball courts and an aviation-themed food cart space near Murphy Road and the Bend Parkway.

The nonprofit received confirmation Friday of a $10 million award when a state policy board approved a $165 million package for nine affordable housing projects across the state. For Thistle & Nest, the money adds to $5.4 million secured in 2023 for the first 30 affordable homes at Murphy Crossing.

Construction on the first phase will start in 2025, and homes will be available on a rolling schedule by the end of the year and into 2026, said Amy Warren, Thistle & Nest co-founder and board president.

The state funding acts as a zero-interest loan, reducing project costs and allowing the nonprofit to pass the difference on to buyers.

A town home that might normally be sold for $425,000 on the market could be sold to a low-income buyer for $250,000 to $300,000, Warren said.

“We can buy down our building costs with this state funding, essentially,” Warren said. “We are building high-quality, market-rate homes.”

Thistle & Nest uses a land trust model, meaning the nonprofit maintains ownership of the land after selling the homes built on the land.

State funding requires the homes to remain affordable for at least 40 years, and because of Thistle & Nest’s nonprofit covenants with the IRS, affordability will remain beyond then, Warren said.

“Our homes are perpetually affordable,” she said.

All 104 homes are restricted for households making less than 80% of the area median income, or about $84,000 for a household of four in Bend. That’s considered low-income by federal housing standards.

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Bend’s median home price was $714,000 in October. According to city data, 16% of households in Bend can afford to buy a home without a cost burden, which is defined as spending more than 30% of income on housing.

Bend needs to add nearly 32,000 housing units over the next 20 years to accommodate growth, according to preliminary data published in a September draft of Oregon’s 2025 Housing Needs Analysis.

Of those 32,000, about 12,900 need to be attainable to low-income earners, according to the draft.

Facing high construction costs and interest rates, a group of nonprofit developers including Thistle & Nest have leaned on programs from the city, county and state governments, plus groups like the Bend Chamber of Commerce, to build units the market doesn’t provide.

Thistle & Nest has received $44 million in government subsidies for housing projects in Central Oregon since forming in 2022, according to Larry Kine, another co-founder. He said the nonprofit has planned 340 affordable units in Central Oregon, including communities in Prineville and Madras. Construction is continuing on the 133-home Woodhaven Estates in southeast Bend off of 27th Street, where the first buyers are being matched to homes.

Vision for Murphy Crossing: planes, pickleball and RVs

Kine and other partners acquired the roughly 30-acre site southwest of the Murphy Road and the Bend Parkway in 2020 and 2021 under Murphy Crossing LLC. Affordable housing will cover the western parts of the properties, near other housing, while commercial uses will be situated closer to the parkway.

That includes a 176-space RV park that is nearly ready to open, according to Kine. The park will also include RV storage spaces, or “garage mahal,” Kine said.

Initially intended to open in 2022, the project faced delays and concern from some nearby residents over land use and tree removal.

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On Oct. 30, Kine submitted pre-application documents for another amenity just south of Murphy Road: an aviation-themed taproom and food cart pod inside an airplane hanger-style building, with a min-runway and windsock.

“Some of the partners are aircraft enthusiasts, so we’ve decided we’re going to model it after a hangar, and call it ‘The Hangar,’” Kine said.

There will also be an outdoor plaza with fire pits, Kine said. He plans to partner with The Bite, a food truck pod and taproom in Tumalo, to rotate food options between the two.

Plans also include eight pickleball courts in an 18,900-square-foot facility.

Kine said the use for other commercial property at Murphy Crossing hasn’t been determined, but he is considering a child care facility.