Financing for construction of a $10 million, mixed-use building at 875 Massachusetts Ave. closed Dec. 22, allowing developers to proceed with the project after a funding snag nearly killed it.
The four-story building, called Trail Side, is to include 10,900-square-feet of first-floor retail space and an underground garage with 69 parking spaces. The second, third and fourth floors are to house 69 one-bedroom apartments for tenants who earn between 30 percent and 60 percent of median income. Rents will range from $325 to $700 a month.
The project, which is being counted on to breath new life into the east end of Massachusetts Avenue, is being developed by Riley Area Development Corp. and Monument Realty. The building will be built on land leased from the Center Township Trustee, which owns a vacant structure on the site that will soon be demolished.
The ground lease and Trail Side’s tax-credit financing almost caused the deal to unravel.
The developers overcame numerous obstacles last year, including concern from neighbors that there wasn’t enough parking and initial reluctance on the part of the Center Township Trustee to sign the 45-year ground lease.
In early November, Alliant Capital, the syndicator lined up to buy the tax credits sold to finance the project, informed the developers it needed a 55-year ground lease to make the credits marketable to end users. It’s unlikely the state-sanctioned tax credits would have been available had the deal not closed before the end of the year.
The Center Township Trustee agreed to the 10-year extension with little time to spare, said Bill Gray, executive director of Riley Area Development Corp. Gray said the project is the most complex, from a funding standpoint, that his group has ever attempted.
Now that financing has closed, demolition of the vacant trustee building should start in February. Construction will commence once the site is cleared and should take about eight months.