Approval came about a month after initially expected, but a 75-unit affordable apartment project planned for investment-hungry north Minneapolis on Friday nailed down $722,300 in city aid.
The Minneapolis City Council approved the subsidy, a tax increment financing package that rounds out funding for the $17.6 million project – the next staple in the Hawthorne EcoVillage development, which aims to reinvigorate stagnant pockets of the North Side.
Nonprofit developer Project for Pride in Living originally planned to seal the financing plan last month, but a technicality tied to a U.S. Department of Housing and Urban Development loan held up the process. But PPL has said the delay won’t push back construction, expected to start as soon as June.
The complex will sit on five parcels near the intersection of Lowry Avenue North and Lyndale Avenue North, in one of the poorest sections of Minneapolis. The area has not seen a new high-density project since Lowry Avenue’s 2008 reconstruction, billed in part as a catalyst for redevelopment nearby.
To date, PPL’s EcoVillage initiative – designed to promote sustainable, affordable development – has centered primarily on single-family homes. The apartment complex will add a mix of one-, two- and three-bedroom units plus a pair of townhomes.
The new rentals will require tenants to earn no more than 60 percent of the area median income. That shakes out to $40,000 to $45,000 per year for a family of four. The project will cater specifically to the local workforce.
Tax increment financing provided by the city on Friday plugs a gap in the financing framework. A favorite development incentive used by most Minnesota cities, the tool allows developers to use a portion of a project’s tax upside to cover upfront costs.
PPL incorporated TIF into its plans after a city policy sidelined higher-value tax credits. Minneapolis tends to apply those to denser projects in areas with less concentrated poverty. The city staff offered up TIF as a way to bridge the gap.
Other project funding is coming from several sources, including a $1.88 million contribution from Minneapolis’ affordable housing trust fund. PPL also lined up $6.67 million low-income housing tax credits, plus nearly $1 million from multiple Hennepin County pools.
In addition, the Minnesota Housing Finance Agency agreed to funnel $3.13 million in housing bonds for the complex. The Metropolitan Council agreed to invest $1.2 million. Other dollars came from the Hawthorne neighborhood and a Home Depot Foundation grant.
North Minneapolis rentals in line for $722K in TIF
Minneapolis weighs TIF for North Side rentals
Share this:PrintFacebook63LinkedInTwitterGoogle +1Download