A proposed new affordable housing development first green-lighted by the City of Niles last summer has taken a giant leap forward with news from the Michigan State Housing Development Authority that developers have earned nearly $1.4-million in tax credits from the federal government.
The Niles Post Office Apartments project is one of eighteen projects across the lower peninsula that will improve and grow quality affordable housing options for low- to moderate-income Michiganders thanks to the tax plan.
In the latest round of federal Low-Income Housing Tax Credits (LIHTC) awards, MSHDA will allocate $15,017,379 to fund major renovation and construction projects to build or rehabilitate 977 apartment units according to Executive Director Earl Poleski. The Niles project is expected to create 60 new housing units.
Poleski says, “We have seen some really thoughtful, strategic plans for high-quality affordable housing in this funding round,” and adds, “There is an overall commitment to serve the whole person through housing—whether it’s homes closer to where they work, homes for under-served populations or homes with significant supportive services like Andy’s Place—we’re creating housing for everyday people.”
Andy’s Place in Jackson is a highly anticipated new construction project that will provide long-term care for individuals struggling with opioid and other substance abuse disorders. The recovery housing project will consist of 50 low-income units with permanent supportive services for people recovering from addiction and their families. MSHDA allocated an annual tax credit amount of $1.2 million, which will leverage approximately $11 million of private investment in Jackson.
In Niles, General Capital Group of Milwaukee bought the old post office property from the City of Niles in August for $789,000 after announcing plans to transform the historical building into affordable housing units, with plans for 60 both in the building and a new four-story building to be built behind the property. Only eight units will actually fit into the renovation of the old post office building itself, the other 52 units will be in the new space behind it, but also connected to it.
The sale in August was contingent upon approval and receipt of the affordable housing tax credits announced this week by MSHDA. The project was approved this week for an LIHTC award totaling $1,366,982. Due to the tax credit plan, the 60 units are slated to be restricted exclusively for those whose income is no greater than 80-percent of the media income for the Niles area.
When the project was approved originally last summer, plans were to launch construction early in 2019 if the tax credits were authorized this fall, with expectations to be ready for occupancy in early 2020.
Elsewhere, West Michigan developer Dwelling Place will use a collective $1.6 million in LIHTC to construct Franklin Apartments and Grandville Apartments. Those two affordable housing projects will be part of Plaza Roosevelt, a neighbor-driven, strategic collaboration between eight partners to transform a two-block area along Grandville Avenue SW and Franklin Street in Grand Rapids. The 5.5-acre site will be further developed with a new high school, expanded medical services and commercial space, in addition to the rental units.
MSHDA’s Poleski says, “The Plaza Roosevelt plan is remarkable because it’s an affordable housing plan that’s greater than the sum of its parts,” noting, “This project will strengthen health, education and economic outcomes in the area. I’m proud of our partners for gathering local input and creating infrastructure that residents of the Roosevelt Park neighborhood need.”
The combined investment from the two Plaza Roosevelt affordable housing projects will leverage approximately $14.2 million of private money in Grand Rapids.
A third notable project in this funding round is the Ruth Ellis Center (REC) in Detroit. Full Circle Communities, Inc. will use more than $1.4 million in LIHTC to develop 42 units of affordable housing in Detroit’s Piety Hill. Most of the apartments—36 units—will be designated as permanent supportive housing for homeless youth or those who are at risk of becoming homeless. The Center’s namesake, Ruth Ellis, was the first woman in Detroit to own her own printing company and was an ardent social activist. Ellis died in 2000 at the age of 101. This tax credit award will leverage approximately $13.5 million of private investment in Detroit.
LIHTC are federal tax credits administered by MSHDA through a competitive application process. The Authority holds two funding rounds per year, in October and April, each for roughly half of the available $23 million credit. Developers can draw on their tax credit amount annually for 10 years, keeping housing affordable over the long term and sustaining major investments in local communities.
Poleski concludes, “Without the incentive of these federal tax credits, we simply would not be able to maintain and grow Michigan’s housing infrastructure for our low- and moderate-income folks.”
Niles Post Office Apartments, Niles Developer: General Capital Development, LLC
