505 Coalition*
Position Statement on the 505 W. Chapel Hill St. Development
June 5, 2025

Re: Response to City Staff Memo dated June 16, 2025

The 505 Coalition stands by our previous position that the development of the property at 505
West Chapel Hill Street must include a significant number of residential units affordable at 60%
AMI, in perpetuity. And there must be no more delays in this element of a development plan.
Addressing the lack of affordable places to live is our community’s most critical and pressing
need, and the 505 site offers the City a chance to do something significant now, not wait for
years in the future. We reject the City Staff’s recommendation to simply stop moving forward.
This is a pivotal moment, and now is NOT the time for Council to take its foot off the gas.
As we stated in our position statement in October 2023: “We believe this significant public asset
can give us a unique chance to take a big step forward in meeting Durham’s affordable housing
needs... Downtown’s long-term residents – educators, first responders, bus drivers,
maintenance workers, and especially those on fixed and low-to-moderate incomes – are being
displaced and priced out of the City they helped build and now serve in so many essential
ways.[1]”

Discussions about how to use this important plot of land have gone on for almost a decade.
During that time, hundreds if not thousands of Durham residents have been priced out of
Durham’s urban core, or forced to spend an unsustainable amount of their income on rent or
mortgages. We believe that it is simply unacceptable for the City of Durham to pass up an
opportunity today to use an asset that the City, and by extension, the people of Durham, own, to
do what our residents most need: build safe, attractive, affordable housing.
At this critical moment, we collectively and respectfully ask the Council to pursue the following:

(1) Honor the first priority of the RFP and ask the City staff to negotiate and execute a cost-
effective contract with a developer – Peebles or another qualified affordable housing developer

– to build 160-200 units of housing affordable at 60% AMI in perpetuity at 505. We agree with
City staff that no market rate housing or commercial space should be built at this time. Not only
are market conditions unfavorable, but subsidizing these uses makes no sense in a City where
lab and market-rate housing infrastructure is already adequate.

This affordable housing effort does not need to start from scratch. Peebles has already
submitted to the City a preliminary “low density” proposal – for several stick-built five story
buildings that would require much less subsidy than a 10 -12 story tower using steel
construction. So, the City subsidy for 160 units, for example, might be roughly $15M
(approximately $100K per unit) rather than over $200K per unit required for steel tower
construction. We think this project IS achievable with a reasonable subsidy from the City. And, it
could leave room for the other components envisioned by Council to be built when market
conditions improve.

(2) Time is of the essence. Council should stipulate that this contract be finalized in time for the
developer and the City to apply to the NC Housing Finance Authority for a 4% LIHTC allocation
in fall of 2025, or in January 2026 at the latest.

(3) If Council determines that it has lost confidence in the City’s ability to work constructively with Peebles, then Council should agree to the Staff’s recommendation to end the negotiation process with Peebles. At that point, the City can pivot to identifying another developer – one
with deep AH expertise – to execute the plan to build low density AH at 505 W. Chapel Hill St. Akridge has previously submitted a good response to the RFP.

(4) Most importantly, the members of the 505 Coalition agree that the City of Durham should
NOT STOP the development process, but continue to move it forward with the AH component
with all possible speed. The AH crisis continues to worsen, and our City employees, teachers,
first responders, and other essential service workers deserve action, not further delay.

*505 Coalition members:
Durham CAN
Durham Committee on the Affairs of Black People
Duke Memorial United Methodist Church
Durham chapter of the NAACP
People’s Alliance
Durham Coalition for Affordable Housing and Transit