More than 100 affordable homes coming to 2 SLO County cities this year. Where?
More than 100 units of affordable housing from the Housing Authority of San Luis Obispo are on track to hit the market by the end of this year.
2026 is promising to be a fruitful year for HASLO, with two multimillion-dollar affordable housing projects set to open in San Luis Obispo and Arroyo Grande — a higher level of production than usual, HASLO executive director Michelle Pedigo.
Coincidentally, both projects cost almost the same at $38 million each, broke ground around the same time early last year and will bring a similar number of units online at the end of 2026, she said.
Pedigo said with HASLO’s waitlist longer than ever, the nonprofit will have to have more years like 2026 to meet the demand.
“This is probably the most we’ve had coming online at the same time,” Pedigo said. “Plus, we have two coming online at the end of this year, and then two more at the end of 2025, so it’s been huge to add that many to the inventory.”
SLO in line for senior affordable housing project
Balay Ko on Monterey, a 55-unit affordable housing population reserved exclusively for seniors over the age of 55, is around half a year from completion on the corner of Monterey Street and California Boulevard, across the street from the recently closed Frank’s Famous Hot Dogs.
Named for the Balay Ko Foundation, which backed the project financially, construction work on the new complex is progressing nicely and will wrap up on time in early October, Pedigo said.
It was also backed by tax credit equity through the Low-Income Housing Tax Credits, the city and county of San Luis Obispo, the state Department of Housing and Community Development, the San Luis Obispo Housing Trust Fund and HASLO’s own Public Funds Loan, totalling around $38 million in total funding, Pedigo said.
Little is publicly available about the Balay Ko Foundation, which does not speak with media or give statements on its contributions, though its donations have backed several projects designed to tackle homelessness, including the Cabins for Change transitional project in Grover Beach and the Welcome Home Village in San Luis Obispo.
“It seems like they really want to go out and choose projects themselves that they’re interested in,” Pedigo said. “They kind of seek you out if they think that your project is worth donating to.”
One of Balay Ko’s top priorities is providing immediate housing relief to homeless individuals — a priority reflected in the new development’s 14 homes reserved for seniors experiencing homelessness, she said.
Pedigo said the project will serve seniors who make 30% to 60% of San Luis Obispo’s area median income. In practice, that’s between $37,000 and $75,000 for a household of three people, the average number of occupants in a HASLO project, she said.
On-site, HASLO will provide a service coordinator who will organize resident meetings, identify service needs and interests, advocate for partnerships with community agencies and facilitate community-building events that foster a healthy and supportive living environment, Pedigo said.
Educational programming for residents will also be provided, giving assistance navigating the healthcare system and other essential services.
A 95-space parking structure is also coming in the second phase of development once the units have opened, Pedigo said.
The project’s 55 homes will be split across a mix of one-bedroom and studio units, according to project specs provided by HASLO.
Thirty of the units will be covered by project-based vouchers that ensure that those units will remain affordable for 55 years, while the other homes will provide reduced rent via a tax credit, with a preference for Emergency Housing Voucher holders, as those vouchers will expire later this year if unused, she said.
“There’s a large portion of the population that is under that 30%, so that if you place them in a 30% unit, even though that rent is lower than market — substantially lower — it’s still too high for them,” Pedigo said. “It’s not 30% of their income, so those project-based vouchers look at the individual’s income and base the rent on their 30% of their income, and then we subsidize the rest of the rent on the unit.”
63 affordable units coming to South County
Meanwhile, an even larger development is rising in Arroyo Grande on the corner of North Oak Park Boulevard and El Camino Real — coincidentally across the street from AJ Spurs Saloon & Dining Hall, another well-known local restaurant.
Arroyo Terrace, working on the same construction timeline and price tag as the Balay Ko project, is set to bring 63 affordable homes to the market by the end of this year.
As with most affordable housing projects, the project is backed by a mix of funding sources, including tax credits, the city of Arroyo Grande, a grant from San Luis Obispo County, a contribution from the California Department of Housing and Community and a public funds loan from HASLO.
Because it’s focused on families, the project will include 17 three-bedroom units, 16 two-bedroom units, and 30 one-bedroom units, along with on-site laundry, a community room and a play structure with turf, according to project specs provided by HASLO.
Though the project site’s tight confines have posed challenges in the construction process, HASLO still fit 88 parking spaces onto the lot, Pedigo said.
Arroyo Terrace won’t carry the same senior housing restriction, and will see only three units set aside for people exiting homelessness, Pedigo said. It’ll also target a slightly lower income range at 30% to 50% of the AMI, she said.
Like the Balay Ko project, on-site supportive services will include a dedicated service coordinator and on-site educational programming for residents, Pedigo said.
The service coordinator will organize resident meetings, identify service needs and interests, advocate for partnerships with community agencies and facilitate community-building events that foster a healthy and supportive living environment.
Educational classes will be developed based on resident feedback collected through surveys and may include topics such as smoking cessation, diabetes prevention, nutrition, financial literacy and mental health awareness, Pedigo said.
100+ units to start leasing in late 2026
Pedigo said both developments will wrap up construction in early October, and will start signing leases between October and December.
More information on how to apply for both projects is available on HASLO’s website once the buildings are closer to completion.
