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Affordable housing and Lake Oswego might seem to be a contradiction in terms, but in one of Oregon’s most expensive and exclusive suburbs, officials broke ground Wednesday on a small apartment project dedicated to providing units at below-market rates.

A few dozen dignitaries and industry officials busted out ceremonial golden shovels for El Nido, a 55-unit development on Boones Ferry Road near Lake Oswego’s Lake Grove neighborhood.

The $32 million project is Lake Oswego’s second affordable housing project funded by Metro bonds. The first, Mercy Greenbrae at Marylhurst Commons, was completed with 100 units in May 2024.

鈥淚’m very pleased that this project is in Lake Oswego,鈥� Clackamas County Commissioner Ben West said. 鈥淎ffordable housing sites should be distributed throughout the county.鈥�

Metro purchased the site in 2023 from the city of Lake Oswego for $2.3 million. Before that, the parcel had long served as construction staging for the Boones Ferry Road project, Lake Oswego Mayor Joe Buck said.

Using the land for affordable housing is 鈥渓ife changing, and it’s the most impactful thing we could do,鈥� he said.

Construction commenced after developer Hacienda Community Development Corp. successfully legally challenged a decades-old 25-foot setback requirement from an adjacent road that severely constrained the site’s buildable area.

鈥淚 thought, we’re going to be left with a dining room table in the middle,鈥� joked Ernesto Fonseca, chief executive of Hacienda CDC. 鈥淐learly, that’s not going to work.鈥�

The building will outlive today’s troubled times, he said, noting 鈥渟o much persecution of minorities in this country.鈥�

鈥淭his will pass,鈥� Fonseca said, while the building will continue to provide affordable housing well into the future. 鈥淭his will be here for a long, long time ahead.鈥�

El Nido’s design team is a partnership of Mackenzie and Access Architecture. Colas Construction is serving as general contractor alongside subcontractors including J.A. Mechanical and SOS Exterior Remodeling.

Andrew Colas, CEO of Colas Construction, recalled that Hacienda CDC first hired the Black-owned contractor in the late 1990s. Hacienda took a chance on Colas Construction for a project with two six-unit buildings when Colas had not yet tackled a project that large, he said.

鈥淭here was always an RFP written that said you shouldn’t try,鈥� Colas said, referring to a request for proposals.

Colas said he had worked with the subcontractors on increasing their capacity to take on bigger jobs, including co-signing for a line of credit in one case.

El Nido 鈥� Spanish for 鈥淭he Nest鈥� 鈥� is part of Metro‘s drive to build thousands of affordable housing units funded by the $652.8 million regional housing bond passed by voters in 2018. The regional government is on track to build 5,600 affordable housing units, well above the initial goal of 3,900 homes, Metro Councilor Christine Lewis said.

鈥淲e’re overdelivering,鈥� she said Wednesday. 鈥淲e’re killing it.鈥�

Ten units at El Nido will provide permanent supportive housing with services for residents. One apartment, to be used by the property manager, is not a regulated affordable unit, leaving El Nido with 54 affordable units.