Milton planners approve conditional use for Cypress Grove

The Milton Planning and Zoning Commission unanimously approved a conditional-use permit that would allow the developer of Cypress Grove to increase the number of units in the development from 240 to 246 and designate 36 units to be designated as workforce housing.

The change has its roots in the Delaware State Housing Authority’s Mixed Income Market Fund, which the state established using $7 million in federal American Rescue Plan Act funds. The fund is intended to encourage developers to provide affordable housing units by providing financing for the development of those units. Projects must be approved by the local jurisdiction and already under construction, for which Cypress Grove qualifies in both cases. A developer must commit to having at least five affordable units with a maximum of 15% of the units being affordable.

In exchange, developers would be able to receive financing of up to $125,000 per one-bedroom unit, $135,000 per two-bedroom unit, and $150,000 per three-bedroom unit. 

Cypress Grove was already approved for 240 units comprising 144 multi-family homes and 96 townhouse units in 14 apartment-style buildings with 12 to 24 units in each building, along with 5 acres of commercial property fronting Route 16.

At the commission’s April 16 meeting, developer Preston Schell said the plan is to take one of the 24-unit buildings and convert three three-bedroom units, one on each floor, into six one-bedroom units, giving the building 30 units.

Schell said rent on the workforce housing units would be $300 to $400 under market rate compared to the other units. For state funding, affordable/workforce housing is defined as a unit priced at 65% of area median income. He said the change also comes about because he has found there is the most demand for one-bedroom units. Schell said additional two- and three-bedroom units within the Cypress Grove project would be designated as workforce housing. He said the monthly rent would be $1,279 for a two-bedroom unit and $1,469 per month for a three-bedroom unit, about 20% under market rate. 

Schell said applicants would be income-qualified and the discounted rent rate would last for 20 years. While an applicant must be making under 65% of area median income, Schell said the intention is to allow for the discounted rate to apply for up to 80% of area median income. Beyond that, he said, a tenant would revert to market rate. 

Commission Chair Richard Trask asked Schell whether the additional units would cause the need for additional parking. Schell said the development already had an excess of parking, but the plans were adjusted to open space in case the need for additional spaces arises once the development is built out. 

Of who he envisions renting the units, Schell said, “It’s going to be teachers. It’s going to be policemen. Half the service-level employees that live in Sussex County, particularly in their younger years, are going to qualify for this housing. If you go to a restaurant and wonder why they don’t have enough cooks or have enough wait staff available, it’s because we don’t have housing like this available to them.”