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Editor’s Note: This story was updated on Sept. 17 with additional information about current tenants, below-market rents for eligible educators and the timeline for transitioning Azara to educator housing.
A San Mateo County collaborative effort has acquired an apartment complex for $54.8 million to provide housing for teachers and other education staff.
The purchase of the 74-unit Azara community at 1650 S. Delaware St. in San Mateo marks the first educator workforce housing project for the San Mateo County Office of Education (SMCOE).
“We’ve been working on this for about three years,” Hugo Torres, president of the San Mateo County Board of Education, told the Pulse. “We viewed multiple properties before getting to this point, and we are just so excited to finally reach the finish line of making this possible for educators in the county.”
The acquisition, announced Tuesday, Sept. 15, during a press conference at the SMCOE headquarters in Redwood City, involved the countywide group Housing Endowment and Regional Trust (HEART).
Under the agreement, HEART bought the apartment building, with SMCOE providing a loan from a fund account reserved only for facilities. HEART issued bonds to cover the project’s remaining cost.
“The property was offered for sale by the owner and HEART submitted an offer,” Armando Sanchez, the group’s executive director, said in an email to the Pulse. “The sale price was $54,750,000. HEART is the owner of the property and will operate it for the long-term benefit of SMCOE. HEART received an $8 million loan from SMCOE and issued bonds for the balance.”
The building was built in 2021 and does not need renovations, Sanchez said.
It will provide housing for teachers, paraeducators, counselors and other school employees who serve students in SMCOE programs, HEART and county education leaders said in a news release.
They noted that current tenants still occupy the building and will not be displaced. But as apartments become available over time, they said, the units will be offered to eligible SMCOE employees at below-market rates.
HEART projects the building will be entirely occupied by educators within 10 years.
“HEART currently anticipates roughly six units becoming available to educators in a typical year although actual turnover will vary from year to year,” Sanchez said during the conference. “This approach keeps the property occupied and financially healthy while educator occupancy grows over time.”
Though it doesn’t replace new construction, he said, this strategy for educator housing takes less time than building a development from scratch.
“Creating 74 new affordable or workforce units from the ground up can require years of land acquisition, approvals, design, financing and construction,” he said. “At Azara, the housing already exists. … It gives HEART and its public partners another tool for addressing housing affordability.”
Azara will target “low- and moderate-income SMCOE educators,” Sanchez told the Pulse. “Rents will be on a sliding scale, averaging 25% below-market rents. Over time as debt is paid down, average rent discounts will increase.”
The bonds used to help finance the project carry no interest, Torres said, “so that was a huge cost-saver.”
The projected timeline for paying down the debt is 30 years, Torres said. Once that happens, sole ownership of Azara will go to SMCOE.
Education employees could start moving into the complex by the end of this year or early 2027, he said.
The building features one- and two-bedroom units and 97 parking spaces – including 14 electric-vehicle spots, Sanchez said. Other amenities include a lobby with a fireplace, a state-of-the-art fitness center, a roof deck and a private dog park.
Such a project is critical to have in a region with “high rents, long commutes and a competitive housing environment,” Sanchez said.
“HEART is exploring the possibility of partnering with other public agencies to acquire similar type employee housing,” he said.
Redwood City Councilmember Diane Howard, who serves as vice chair on the HEART board, described Azara as a model for other school districts, cities and public agencies to tackle workforce housing challenges.
“No single program will solve San Mateo County’s housing affordability problem,” Howard said during the conference, “but projects like Azara give us another practical tool.”
Azara is a way to help support and retain teachers – which ultimately benefits students, Torres added.
“In order to invest in our students, we also need to invest in our teachers,” Torres said. “We have some incredible teachers in the county. By retaining them, we are also supporting our students because we know that they do better when they have consistency with their teams, and this being such a high-cost county, it’s giving our educators an affordable place to live.”
Having educators living in the community they serve “just makes our schools so much stronger and allows our students to thrive,” he also said.
Among other educator housing efforts on the Peninsula is a proposal for a new mixed-use development at the site of the Redwood City School District’s offices.
The project at 750 Bradford St. in downtown Redwood City is a partnership between The Sobrato Organization developer and the district. It would include 108 residential units for rent and 165,524 square feet of office space, according to the city’s website on current development projects. The city has deemed the application for 750 Bradford complete, but the proposal still needs to go through environmental review, public hearing and other steps.
Two years ago, the Jefferson Elementary district in Daly City opened the 56-unit Eastmoor Heights complex as the first facility of its kind in the county for K-8 educator housing.
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This is a spectacular development. I have watched the housing struggle for educators worsen over 4 decades in SMC as tech money drove housing costs through the stratosphere. This very appealing facility will enable educators to eliminate onerous commutes and engage as part of the community they serve. Congratulations to all who persisted to make this happen.