If you drive north on Cherry Street you’ve probably noticed that no work is being done on our government-financed, low-income apartment building. Here’s the saga of the Carmel Building:

Buildings don’t usually migrate from one country to another, but the Carmel building did. The apartment building was saved from destruction and moved from land onto a barge and sailed from Canada to the United States. It was loaded on the back of a truck and moved to Port Townsend to become affordable housing.

The financing of the project is even more unusual. In April 2017 Port Townsend and the non-profit Homeward Bound decided to purchase and move the Carmel building to become affordable housing. The cost of the move was $250,000.

Since Homeward Bound did not have the money to move the building, the city borrowed and paid for the move and entered into a one-year loan agreement with Homeward Bound to repay the city $250,000.

However, Homeward Bound was unable to find financing in order to pay the $250,000 so the city borrowed $834,000 and loaned it to Homeward Bound to complete construction and to repay the city. As soon as the loan was finalized, the city took $250,000 leaving Homeward Bound $584,000 to complete the project.

After about two years, it was determined that an additional $1 million is needed to complete the project, and because the loan payments by Homeward Bound relied on rental income from the project, Homeward Bound is unable to start paying the $834,000 loan to the city. The city continues to make annual payments on the debt without payments from Homeward Bound.

As a result, this affordable housing is on hold because neither party has money to finish construction.

Robert Gray
Port Townsend