Detroit Mayor Mike Duggan, city and state officials joined developers on Monday to announce five housing projects selected for a federal low-income housing subsidy to build and preserve rental apartments in the city.
The development plans include new and preserved housing amounting to 282 units in five Detroit neighborhoods: Midtown, Corktown, the North End, Forest Park and New Center. The affordable housing is aimed at people making between $16,500 and $44,000, or 30% to 80% of Area Median Income. The total value of the projects is $122.9 million.
“We have made a commitment from day one, that nobody is going to be pushed out of Detroit. … There’s plenty of room in the city for everybody of all ages but affordable housing doesn’t build itself. Each individual project is very complicated. It takes a whole series of partners,” Duggan said.
The projects were selected as part of the federal Low-Income Housing Tax Credit program, a competitive federal subsidy administered by the Michigan State Housing and Development Authority.
“You need that support with state and federal money to make these projects work because it costs more to build than you can rent out to people with low incomes,” Duggan said.
Three of the projects will be new construction, creating 157 units of affordable housing. Two others will renovate 125 units in existing buildings while preserving their affordability for at least the next 30 years, Duggan said.
The new construction plans include:
- Brush Watson (Midtown): The mixed-use and mixed- income project aims to offer 163 affordable housing units, of 310 total units. Rent for these units will range from $400 to $1,000, with AMI between 30% and 80%. The project, developed by American Community Developers, will include three buildings on approximately 8,000 square feet of commercial space along Brush Street with underground parking for residents. The total investment is $65 million.
- Left Field at the former Tiger Stadium site (Corktown): The first phase includes 60 units, 48 of which will be set aside as affordable housing, ranging from 30% to 80% AMI. It will be developed by American Community Developers. Work is expected to begin next summer. The total investment is $15 million.
- Jim Holley Residencies (The North End): Named after Rev. Jim Holley, a longtime leader of the Historic Little Rock Baptist Church. Sixty units will be between 50% and 60% AMI, including 5,000 square feet of commercial space. Work on the project at 9001 Woodward Ave. is expected to begin in the spring and take up to 15 months to complete. The City of Detroit gave a $2 million HOME award and MHT Housing of Bingham Farms is the developer. The total investment for this project is $17.8 million.
The preservation plans include:
- Midtown Square (New Center): Located at 93 Seward in New Center. All 73 of the units will remain affordable, with an AMI range between 50% and 60%. The redevelopment is being performed by John Stanley and Develop Detroit. The total investment is $18.5 million.
- Friendship Meadows (Forest Park): The 52 units in this senior-housing complex at 1003 Leland St. will remain affordable with AMI between 30% and 60%. The redevelopment will be conducted by Robert Beale. The total investment is $6.6 million.
Mona Ross-Gardner, a 30-year resident of Brush Park and a representative of the Brush Park Citizen District Council, said she has seen her neighborhood in bad shape over the years but development progress has created a “whole new world.”
“The community is 100% behind them and what we really appreciate is the diversity that they’re allowing to come back into the neighborhood with the affordable housing,” Ross-Gardner said.
The city last month announced a $48 million fund offering developers low-interest loans, private grants and other financial tools to preserve and create affordable housing.
Donald Rencher, director of the city’s housing and revitalization department, said Monday’s announcement is also a message to developers that Detroit is a place where they can build and thrive.
“There is a diversity in the developer pool as well,” he said. “… We’re seeing minority developers getting a shot to build in the city as well.”
The Low-Income Housing Tax Credit program is a federal subsidy allowing state housing agencies like the Michigan State Housing Development Authority to award tax credits to private developers to create affordable rental housing projects. It is the largest federal program encouraging the creation of affordable rental housing for low-income households, according to the Tax Policy Center, a Washington, D.C.-based nonpartisan think tank.
“These five developments, they also represent a lot of characteristics that we look for when we look at good affordable housing development, such as being mixed income housing, putting together affordable housing and market rate housing in very strategic areas of the city,” Chad Benson, MSHDA acting director of development, said.
The projects will also be close to amenities like grocery stores, pharmacies, doctors offices and transportation options, he said.
More than 20,000 affordable apartments have used this tax incentive in Michigan, according to MSHDA.
Nushrat Rahman covers issues related to economic mobility for the Detroit Free Press and BridgeDetroit as a corps member with Report for America, an initiative of The GroundTruth Project. Click here to support her work.