Local developer, major taxpayer explains why he supports affordable housing in New Canaan

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NEW CANAAN — Local developer Arnold Karp, currently embroiled in controversy as he seeks to build up to two affordable housing projects in the city, has defended his position and calls himself an “affordable housing advocate.”

“I believe it belongs to every community in our state, I believe it belongs to every community in the country. If people can’t live and work in the same communities, we’ve done a disservice,” he said.

Many residents have sought to dissuade him from building a 102-unit, 8-30g complex on the corner of Weed and Elm Street, for which he recently submitted a new application. In many corners of the city, residents posted signs in their front yards that read “yes, affordable housing, no overdevelopment.”

“They’re all putting up signs thinking they’re going to embarrass me,” but “they should be embarrassed,” Karp said as he fired back.

Within 1.5 miles of his proposal on Elm Street, possible plans for a development on Hill Street prompted New Canaan Residents Against Destructive Development to petition the city to revoke a wetland permit received by Karp. Neighbors learned of concept plans for a nearby 101-unit apartment building turned over to the fire marshal’s office. Karp said no application or plan has been officially submitted for the property.

Karp argues that while he’s heard concerns about possible shifting resident demographics with more development, there are plenty of people “already here” who need affordable housing, Karp said.

The perception is that the residents are “ultra-rich, very rich”, but “there is an invisible group that is not insignificant in this city, and in our peer cities, that are overcrowded with housing,” said the president and chief financial officer of Karp Associates, Paul Stone.

Housing burden includes households that spend 30% or more of their annual income on housing, according to CT Data Collaborative. From 2015 to 2019, 38.8% of New Canaan households fell into this category, including 50.8% of renters, according to the website.

Restaurant and store owners told Karp they would have an easier time hiring employees if the workers could afford to live here, he said. Residents who live at The Vue, his large multi-family development on Maple and Park Street, help support local businesses, he added.

“In my heart,” the Vue should have affordable housing, he said, adding that he offered to build up to nine affordable housing units before being turned down by the city.

People speak ‘out of both sides of their mouths’ when they say ‘we don’t want more people in this town, and yet they decry empty storefronts because they don’t have enough foot traffic to sustain them’ , added Stone.

Karp claims he is New Canaan’s biggest taxpayer. Tax assessor Sebastian Caldarella said it was difficult to know exactly how much he was paying because “most of his properties are under LLC and not under a specific name”.

The developer said many of its critics say it’s “doing it for the money”. While “the numbers are working, they’re not great,” Karp said. “It would be much better for me to put money in the stock market or whatever.”

While each unit costs $500,000 plus land, Karp said he would receive $1,200 to $1,800 a month in rent for affordable units. “Do the math – you never pay for this unit,” he said. Instead, residents who pay the market price help pay for affordable housing.

He strongly believes the city needs to decide where it will build affordable housing because it only has 3% of its total housing stock deemed affordable while he notes the state’s goal is 10%.

“Doing nothing is not an option,” he said.

Karp warned that other developers might be “less desirable” to residents than him. While he says he wants to build thoughtful development deals, he said others may wish to build six- or seven-story buildings, noting the 8-30g rule allows builders to circumvent zoning regulations local.

“Every property that’s over water and sewer” could be developed by builders using 8-30g, so “the wolf is knocking on the door” and the city must “find a way to keep them at bay.”

One of the biggest barriers to affordable housing is where to put it, he said. “No matter where we put it, somebody seems to be unhappy,” Karp said. “I personally don’t care where I build it, but I’m not do not will build it.

Stone said those who opposed the local plans “don’t want to be perceived” as being against affordable housing, but says many “say they are for it, but not in their city.”

He said 8-30g allows developers to build housing for “zero land and construction cost to the city,” otherwise he estimated the Canaan Parish building would cost around $65 million.

Karp said many argue he holds an edge when coming up with new development, but countered by saying he spends “an undue amount of time, money and effort” on his apps.

First manager Kevin Moynihan recused himself from talks about future development as City manager on the Weed Street proposal because he is a close neighbor, but Karp said he always spoke out against it.

City officials said the state should have granted New Canaan a moratorium on 830g developments after residents of Canaan Parish moved into the new building. Even if the city had been granted the four-year moratorium, the process takes five years to develop something with state money, Karp said.

“We need a plan not for four years, not for eight years, but for 12 years,” he said.


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