Wash U Live Near Your Work Program - North City Development
I would love to hear experienced St. Louis investors and people who interested in the city weigh in on Wash U's Live Near Your Work Program (https://lnyw.wustl.edu) and all the investment they have done in the central corridor.
Live Near Your Work Program:
- Wash U and Barnes Jewish Hospital offer $8500 in a forgivable loan to part time (at least 20-24 hrs) and full time employees for down payment and closing costs. Employees must live there for 5 years to keep the full benefit, and it is prorated by 20% every year until fully forgiven.
- In the neighborhoods north of Delmar $8500 would be enough downpayment to buy some of the nicest houses with 3% down.
Keller Williams Young Professionals hosted a lecture by Hank (Henry) Webber, executive vice chancellor and chief administrative officer at Washington University, Board Chair of Cortex Innovation Community and Invest STL, and Board member of the Arch to Park Collaborative.
Some points from his lecture:
- - St. Louis City population has hit it's bottom and is projected to grow fast.
- 1940: 816k
- 1950: 856k
- 1960: 750k
- 1970: 622k
- 1980: 453k
- 1990: 396k
- 2000: 348k
- 2010: 319k
- 2016: 316k
- City average home prices are lower than the region, but he doesn't expect that to last too long.
- From 2000-2016 average income in the city is up 10%, primarily due to attracting college educated white millennials. MSA is down 1.3%
- Why Wash U focuses on neighborhood improvement:
- Successful neighborhoods support the recruitment of students, faculty, and staff
- Nearby neighborhoods are part of the way of life for the University community
- Demonstrate the university’s commitment to meet the needs of St. Louis and improve neighborhoods
- Washington University Medical Center Redevelopment Corporation (WUMC) was formed in 1962 and stabilized Central West End and Forest Park Southeast (The Grove). in 2018 they expanded to include North Delmar neighborhoods.
Conclusions:
- Wage and cost of living data argues that St. Louis is very attractive place to live and should be an attractive place for firms to locate. We must as a region, promote St. Louis.
- The central corridor of the City is becoming a magnet for the white college educated millennial population. Need to build on momentum of job and residential growth.
- North City Initiatives/areas of promise: NGA, east Delmar Loop/Maker Art District, Invest STL, Wash U Live Near Your Work Program
- Need a downtown strategy for crime prevention, revitalization, and growth.
- Need a better ability to compete as a region.
- Recognize depth of equity challenge in St. Louis.
- A few statistics:
- South of Delmar, 9% of the land is vacant, north of Delmar 31% is vacant.
- Median household income in the neighborhoods south of Delmar is $ 48,474, North of Delmar it is $28,023.
- South of Delmar, 4.9% of all children live below the poverty line. North of Delmar, 51.5% of all children live below the poverty line.
- In the neighborhoods immediately south of Delmar 18% of the population is African- American. In the neighborhoods immediately north of Delmar, 93% of the population is African American.
- A few statistics:
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My overarching takeaway:
- Near North St. Louis is very rough, but as I have been driving the neighborhoods and meeting people, I do keep meeting more and more college educated millennials who want to live near the Loop and CWE, but can't afford them or choose to live cheap. I met a young single blond girl who lives in a house north of Delmar with a group of friends because her share of the rent is something like $300/mo and she can ride her bike to CWE. I also know another millennial married couple that owns a new build in that area because they could afford it, and couldn't afford anything comparable without driving 30 minutes out from the city.
- St. Louis is known for cashflow investing in the REI community. Between Delmar and Page is probably one of the few areas in St. Louis where appreciation can be expected in the next decade while still getting great cashflow. The biggest obstacle to landlords is going to be vacancy while waiting for quality tenants.
- My wife and I are personally considering moving into that area, and I am networking with other real estate investors, agents, business owners, churches, local politicians, and others who are interested in developing this area.
- I have a 5500 sq ft 4 family with a 4 car garage under contract in this area for $10,000 to close. It needs $80k+ invested in it to rehab. These 3/2 units would rent for $900+. I'm considering closing on it myself and sitting on it until I can rehab.
- What are your thoughts?
- Have you seen these kinds of investments turn areas in other cities?