The Boston Redevelopment Authority board met Thursday and approved $258.5 million worth of new development, generating 530 jobs and 586 new housing units. The Harvard Life Lab, 35 South Huntington Avenue, the Residences at Boston Landing, 44-apartment Douglass Park in the South End, the renovation and expansion of Jamaica Plain’s Goddard House for 167 residences, a 24-condo building in South Boston and an affordable homeownership opportunity development in Roxbury.
The Residences at Guest Street were approved by the BRA Board Thursday.
By the numbers, these totals are disheartening. It’s $487,735.85 per job and, subtracting $17 million for the Life Lab, $412,116.04 per housing unit. That’s not very good. It’s comparable to development costs in other cities, like San Francisco, however.
According to the Greater Boston Housing Report Card, construction and land acquisition are the biggest contributors to the $274 per square foot cost of development. Construction costs are $159 per square foot, land aquisition $41, site preparation $29, developer fees $19 and financing $17.
The Report Card recommends larger projects (with greater economies of scale) and relaxed zoning regulations as a way of mitigating the impact of the high costs, but didn’t really offer any ideas on the costs themselves. But developer and financing fees could be brought down with a simpler, quicker permitting process, since the uncertainty about the state of the market would be reduced.
But the high construction costs are likely driven by the high cost of providing parking. According to Donald Shoup, in 2012, it cost $95 a square foot to build underground parking in Boston and $75 a square foot for above ground. That’s a cost of $25,000 to $31,000 per space.
The latest round of BRA approvals included 439 parking spaces, 356 of which will be structured or underground. Using Shoup’s four year old numbers, the cost of those 356 parking spots works out to $11,036,000, plus another $2,075,000 for the surface spots, for a total of $13,111,000 on parking. That’s 18 percent of of the cost of the total amount of development, using old numbers.
Parking has other effects on development. Shoup found that parking minimums reduce the size of projects because the marginal costs of parking makes proving the minimum too expensive, even when when the larger project size is allowed by zoning.
“Mandatory parking minimums amount to an Affordable Parking Act,” Shoup wrote. “They lower the cost of parking by raising the cost of everything else.”