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Developer seeks tax break on $16.2M apartment project

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A local developer plans to build a 260-unit apartment complex on 22.5 acres on the southwest side, and is asking the city of Indianapolis for a tax break to help defray costs.

Herman & Kittle Properties Inc. has proposed developing the $16.2 million project on vacant property southwest of Mann and West Mills roads. The market-rate apartment community would consist of 29 residential buildings, a clubhouse, covered parking and a pool, according to its tax abatement request with the city.

An analysis by city development staff estimates that the project will add $11.4 million in assessed value to the tax base. In addition to the $16.2 million cost of developing the project, Herman & Kittle expects to pay the city about $600,000 for infrastructure improvements to the Mann and West Mills intersection.

Herman & Kittle has requested a three-year tax abatement, which would save the firm about $452,000 in property taxes, according to city staff. During that time, it still would pay an estimated $229,000 in property taxes.

After the abatement expires, the firm would pay about $227,000 annually in property taxes for the apartment development.

The company is seeking the tax break to help offset the cost of the $600,000 in roadway improvements, according to city staff.

The project would create four jobs at an average wage of $22 per hour.

The Metropolitan Development Commission will consider the abatement request during its meeting at 1 p.m. Wednesday. MDC staffers have recommended that the commission approve the abatement.

Herman & Kittle develops, owns and manages multifamily rental housing and self-storage facilities throughout the Midwest and Gulf regions, according to its website. It currently manages more than 100 properties, including more than 8,000 apartment homes and 12,000 self-storage units.
 

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  • WHY!
    If it's such a profitable business, then they shouldn't need any TAXPAYER FUNDED CORPORATE WELFARE to build a piddly little ol' apartment building, now should they? Well past HIGH TIME for the building businesses to learn to fund their own shindigs.
  • Suburban sprawl
    Does any private business know how to make the numbers work without asking for government handouts anymore? It's one thing for the City to offer subsidies to development that acts as a catalyst for reinvestment and utilizes existing infrastructure and resources, but this proposal does neither. Taxpayers will be picking up the tab to provide fire and police services, not to mention on-going road and utility maintenance. Is this not enough of a subsidy to support suburban sprawl and provide country club living for a few?
  • Bring Jobs
    use the tax break to bring in jobs. Indianapolis could better invest in a new business that will bring in higher tax reveune and paying jobs. Indy doesn't need more apartments.
  • Waste of Space
    One ten unit building per acre, what a waste of space and money. We should give tax breaks to developments that improve Indianapolis, not developments that eat up (presumed) greenfields. The city of Indianapolis should not be encouraging this type of development.

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    1. How can any company that has the cash and other assets be allowed to simply foreclose and not pay the debt? Simon, pay the debt and sell the property yourself. Don't just stiff the bank with the loan and require them to find a buyer.

    2. If you only knew....

    3. The proposal is structured in such a way that a private company (who has competitors in the marketplace) has struck a deal to get "financing" through utility ratepayers via IPL. Competitors to BlueIndy are at disadvantage now. The story isn't "how green can we be" but how creative "financing" through captive ratepayers benefits a company whose proposal should sink or float in the competitive marketplace without customer funding. If it was a great idea there would be financing available. IBJ needs to be doing a story on the utility ratemaking piece of this (which is pretty complicated) but instead it suggests that folks are whining about paying for being green.

    4. The facts contained in your post make your position so much more credible than those based on sheer emotion. Thanks for enlightening us.

    5. Please consider a couple of economic realities: First, retail is more consolidated now than it was when malls like this were built. There used to be many department stores. Now, in essence, there is one--Macy's. Right off, you've eliminated the need for multiple anchor stores in malls. And in-line retailers have consolidated or folded or have stopped building new stores because so much of their business is now online. The Limited, for example, Next, malls are closing all over the country, even some of the former gems are now derelict.Times change. And finally, as the income level of any particular area declines, so do the retail offerings. Sad, but true.

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