NJ Affordable Housing Development

[Michael J Murphy Jr]

Anyone with experience in development of affordable rental housing in NJ?  

I am working on the potential development of a site in NJ.  The site has been identified as a site by the municipality to meet the Township's Fair Share obligation for affordable housing.  In the Fair Share settlement agreement the site is identified to accommodate 500 housing units with 100 units to be family rental units (affordable).  The remaining 400 units are to be market rate.  If this entire community is 100 units affordable and 400 market rate, equaling 20% affordable, it's in line with what I have seen in the past and general market acceptance. 

My issue lies in three alternative options:

1. If I were to make the 400 units "for sale" rather than rental, then the 100 affordable units would be 100% affordable.  What does that do from a valuation perspective?  Are they worth anything for just the land?  Can I sell just the land, without any tax credit financing tied to it?

2. If I decreased the total units from 500 down to 350 to satisfy some public concerns but kept the 100 affordable units, my percentage of affordable units jumps to almost 29%.  What does that do to land valuation?  I know if drives the total cost down, but does it substantially lower the per unit (market rate) valuation?  Would an apartment developer even be interested in something with that high of a percentage affordable?

3. If I did the 100% affordable units as rentals and did the balance 250-400 units as for sale, what would the exit be for the 100 units approved for affordable rental?  Are there groups looking to buy and develop that?

Thanks,

Mike