A proposed $20 million, low-income housing development in the Mapleton Fall-Creek area is moving along again after being on deck since 2014.
The developers—Mapleton-Fall Creek Development Corp. and Merchants Affordable Housing Corp.—are closing in on a complex financing plan that includes federal and local money sources.
Next week, the Indianapolis City-County Council will consider allowing the issuance of a $2.4 million developer-backed tax increment financing bond, part of a package that includes up to $17 million in developer-backed economic development revenue bonds to help pay for the “acquisition, construction and equipping” of the project, called Central@29.
The project is a “multi-phase, multifamily, mixed-use affordable rental development,” according to the Mapleton-Fall Creek Development Corp., and it will be located on Central Avenue between Fall Creek Parkway and 30th Street.
“This is a transformational development,” said Duane Ingram, CEO for the Mapleton-Fall Creek Development Corp. “Its something that this neighborhood has not seen since the Marott was built in the 1920s."
The Marott, 2625 N. Meridian St., opened in 1926 as the city's first luxury hotel. It was converted into a 240-unit market-rate apartment building in the 1980s.
“We’re working as hard as we can to provide quality, affordable housing and to preserve affordable housing options for the future residents in the Mapleton-Fall Creek Community,” Ingram said.
The first phase of the project is expected to cost $20 million and contain 114 units for low-income families earning up to 60 percent of the area’s median income. The second phase, estimated to cost $10 million, will accommodate senior residents. The second phase doesn’t have a financing plan in place yet.
The group is expected to break ground on the first phase in early spring. A previous iteration of the project was scrapped when Mapleton-Fall Creek Development Corp. changed its development partner.
Most of the project is expected to be funded through federal Low-Income Housing Tax Credits. The group hopes to purchase more than $8 million through the Indiana Housing and Community Development Agency, which administers the program in Indiana.
The group would sell the tax credits on the open market to investors, who would purchase the credits so they could receive personal or business tax relief. The development group would get funds up-front to build the project.
Jim Crawford, a Krieg DeVault lawyer who serves as bond counsel for the city and has been working on the project, said the developers are seeking an “inducement resolution” from the Council, which does not obligate the city to issue the bonds unless the developers “put financing together to their satisfaction.”
The $2.4 million TIF bond would be paid through tax revenue created by the project.
And there would be no city dollars or tax revenue pledged to repay the up to $17 million in developer-backed economic development revenue bonds, Crawford said.
“These are conduit bonds under the Internal Revenue code issued to create economic development,” Crawford said. “Bond holders are looking solely to the project to pay those bonds back.”
The group has also secured “community development block grant” funding from the city of Indianapolis, a loan from Local Initiatives Support Corp., and a development loan from the state. The group anticipates $6.3 million in permanent debt on the project.
Previously, the Mapleton-Fall Creek development group was working with BWI Development & Management Inc. to build the project. But Ingram said the community development group “took another approach” after its former partner was not “100 percent comfortable” sponsoring one of the bonds.
Ingram said the council’s metropolitan and economic development committee is set to hear the proposal Sept. 19.