City of Alexandria, Virginia
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MEMORANDUM
DATE: SEPTEMBER 4, 2025
TO: THE HONORABLE MAYOR AND MEMBERS OF CITY COUNCIL
THROUGH: JAMES F. PARAJON, CITY MANAGER
FROM: HELEN S. MCILVAINE, DIRECTOR, OFFICE OF HOUSING
DOCKET TITLE:
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Consideration of Application for and Award of Grant Funds from the Virginia Department of Behavioral Health and Developmental Services (DBHDS) for Construction of Permanent Supportive Housing (PSH) Units at Seminary Road.
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ISSUE: Consideration of an application for and receipt of $3,790,000.00 in Grant Funds from the Virginia Department of Behavioral Health and Developmental Services (DBHDS) to construct permanent supportive housing at the Seminary Road development.
RECOMMENDATION: That City Council:
1. Authorize application for and receipt of state grant funds in the amount of $3,790,000 to fund construction of permanent supportive housing (PSH) to be owned by Sheltered Homes of Alexandria (SHA) at Seminary Road; and
2. Authorize the City Manager to execute all necessary documents that may be required.
BACKGROUND: Through a partnership among the City of Alexandria, Housing Alexandria (HALX), and Sheltered Homes of Alexandria (SHA), a mixed-income, mixed ability community at Seminary Road is being constructed. The project includes 31 for-sale affordable town homes (Phase I) and a condominium building that will include seven permanent supportive housing (PSH) units to be owned by Sheltered Homes of Alexandria, as well as three for-sale affordable condominium units. The Seminary Road development was recently rebranded Cardinal Path by HALX: Phase I is nearly complete, with a ribbon-cutting and open house scheduled for September 26 before new homeowners move in. The Phase II condominium building will begin construction later this Fall and is anticipated to be completed next year.
DISCUSSION: The land assemblage enabling the project includes a city easement next to Fire Station 206, a private home acquired by HALX, and a group home owned and operated by SHA. Residents of the group home have been relocated to local apartments during the construction period. Cardinal Path offers a rare opportunity for first time homebuyers with incomes up to 80% AMI to acquire new homes in the City; it also helps persons requiring permanent supportive housing (housing plus assistance and case management), including persons with intellectual and developmental disabilities, to remain in the community within a residential setting that reflects best practices, as well as proximity to amenities and services. The Cardinal Path project has multiple sources of funding, including grants from the City, Virginia Housing (VH) (both an Amazon Impact REACH grant as well as funding from the Governor's new Workforce Housing Initiative Grant program), the National Housing Trust, the Amazon Housing Equity Fund, and DBHDS capital grant funds, along with a construction loan from Burke & Herbert Bank. The City, VH and HALX will also provide downpayment and closing cost assistance to eligible buyers. Long-term affordability will be secured through a restrictive re-sale covenant that ensures some shared equity is passed along to lower sales prices for future buyers. The permanent supportive housing units, operating as rental units subject to income restrictions, will be owned by SHA with case management and operational support from the City.
Since the project's approval by City Council in 2021, both construction costs and interest rates have risen, requiring HALX, SHA, and the City to seek additional soft funding to ensure affordability for the populations to be served. Unlike rental housing, for which tax credit equity is available to subsidize costs, several other non-City funding sources have been secured here. Fortuitously, the construction timeline of Cardinal Path's Phase II, with its planned delivery of units in 2026, aligned well with the DBHDS's regional grant opportunity. A total of seven permanent supportive housing units has been incorporated in the final project design, including two studio units, three one-bedroom units, and two three-bedroom units. The DBHDS award closes the project gap and reinforces the emerging collaboration among the state, DCHS, and Housing, to help Alexandrians with disabilities find and maintain housing in the City with ongoing case management and other support.
FISCAL IMPACT: The Capital Grant Fund award closes Cardinal Path's funding gap, with no additional City money required. The City will grant the award funds to SHA to help them pay for construction of the PSH units. Future residents of the permanent supportive housing units owned by SHA will receive other assistance via existing City staffing resources pursuant to an ongoing arrangement between SHA and DCHS.
ATTACHMENTS: None.
STAFF:
Emily A. Baker, Deputy City Manager
Alethea Predeoux, Deputy City Manager
Christina Zechman Brown, Deputy City Attorney
Kate Garvey, Director, Department of Community and Human Services
Helen S. McIlvaine, Director, Office of Housing|1010|