Amarilo’s Ciudad Verde Transforms Affordable Housing Enterprise: WUF Part 2

Published: Sunday, June 22nd, 2014 by Lenora

Real estate developers generally don’t attend the World Urban Forum. So, when a busy, accomplished international real estate developer like Roberto Moreno of Amarilo not only attends but participates actively – in more than a standard CSR effort – it already communicates volumes. Moreno’s presentation is permeated with his transparent enthusiasm to share the model that he and his firm are deploying in Colombia in the hopes of transforming not just social housing but the social and economic issues that are endemic to slums in Colombia’s cities.

In the community case study Moreno shared at our WUF7 panel, that of Ciudad Verde in Soacha, the elements he detailed show a well-thought out community that has been developed with the participation of urban planners. Moreno is certain the project breaks new ground on commercial responses affordable housing in Colombia. This video illustrates Amarilo’s vision in action.

(Photo credit: Amarilo)

Master developer: ambitious and complex. Amarilo already has six large affordable housing projects under way to develop over 90,000 units of multifamily housing in cities across Colombia. All are mixed income communities. Yet, Ciudad Verde is the largest and most concentrated of all of them with the final target of developing 49,500 units. That means a community of 150,000 to 200,000 people.

In this project, Amarilo acts as both a developer of the majority of the land and, crucially, as the promoter and master developer. The master developer assumes both risk and responsibility for overall project management, including land assembly and acquisition, siting issues, government, infrastructure and overall project financing. As the promoter, Amarilo took charge of bringing together urban planners urban design, the legal elements of implementation and the communications strategy of the project.

(Photo credit: Amarilo)

The master plan comes from Amarilo’s leadership, as does the coordination of central, state and municipal governments. To that point, Moreno’s work initially required negotiating and closing on 26 separate parcels of land, a task that in itself took 2 years (2007-2009). In addition, Amarilo coordinates the involvement of 9 real estate developers who each offer different housing solutions. The firm also brought in financial institutions to compete for homebuyers’ mortgage business. This level of competitive offering is unusual for this market segment.

(Photo credit: Amarilo)

Sustainability as a social and environmental commitment. Dedicating 20% of the project’s master plan to green space is unusual. Yet, Ciudad Verde is intended as a walkable and bike-able green community with bike lanes throughout. Rainwater storage serves common areas and landscaping, and integrated waste management and recycling round out the sustainability features of the project. On the social side, the community library, early childhood learning center and the high school are as central to Amarilo’s social commitment as the commercial centers, which bring local jobs and mixed economic uses to the project. In fact, Moreno emphasized that income from shopping areas helps cross-subsidize the maintenance of the residential areas.

(Photo credit: Amarilo)

Integrity and openness about ongoing challenges. It shows that Roberto Moreno has recently lectured to students at Harvard’s Graduate School of Design in a class taught by Deidre Schmidt, Housing and Urbanization in Global Cities. He tempers his enthusiasm with reality and recognizes the challenges that the model still faces, some of which are social difficulties intrinsic to the socioeconomic context beyond Ciudad Verde that real estate alone can’t solve. He lingered briefly on elements with which Ciudad Verde and other communities continue to struggle:

  • Public transportation awaits the local government’s still unmet commitment to extend the Transmilenio system
  • Education doesn’t meet demand yet, so families must settle for equally scarce options elsewhere
  • Health services need to be better and more available to residents
  • Security issues have to be a collaborative effort for the developers, the community and the police
  • Maintaining public spaces in the area requires more manpower and financial support, but maintenance fees have to be kept at an accessible rate
  • Community services to encourage residents to work and live together in dense living quarters are an ongoing effort
  • Delays in roads and other services illustrate incomplete fulfillment of government commitments and can undermine residents’ trust and patience, as well as the project’s value

Taking a look at the Ciudad Verde’s Facebook page, there’s no question of a sincere effort to build community and address the issues above. As master developer, Amarilo has to stay engaged in keeping the community moving forward and focused on continuous improvement. Moreno pointed out with a mix of grit and pride that Amarilo had already sponsored over 3,000 community meetings.

(Photo credit: Amarilo)

Partnership with residents. Is it possible for a real estate developer to think of their customers as partners? Moreno thinks that it is. He points to the sales area where developers and banks offer choices for homebuyers as a new phenomenon: “These homebuyers have a choice. That’s a new approach. They haven’t had choices in the past.” In fact, Amarilo’s success with Ciudad Verde hinges on the company being able to engage the community to collaborate to build the value of the assets. Amarilo could surely manage the project less actively with the certainty that the affordable housing gap will still float even a mediocre project. Moreno doesn’t want mediocre. He wants a win-win, a long-term asset, a legacy.

Next frontiers. Moreno still has a long way to go with Ciudad Verde. Currently 14,000 families are living in Ciudad Verde and 54% of the project has been sold (26,500 units). He continues to work on better ways to cooperate with government and the community. He recognizes increasingly the importance of pairing social and financial investments for the success of the project. He wants to show that collaboration across sectors works. Most importantly, he clearly intends to make housing the development vehicle that transforms Colombian cities for all.