A $25.6 million residential real estate project expected to bring affordable housing—including units reserved for those experiencing homelessness—to the former grounds of Central State Hospital is moving forward.
Chicago-based Mercy Housing and Missouri-based MACO Development Co. plan to build a 156-unit apartment complex at 3355 Kirkbride Way on the west side of Indianapolis, north of West Washington Street and east of North Tibbs Avenue. The units will be affordable, with 35 of the units (or 22%) designated for permanent, supportive housing for people experiencing homelessness.
The project, called Central Greens, is a result of a 2017 partnership between the Indiana Housing & Community Development Authority and the city called the Indianapolis Integrated Supportive Housing Initiative to create 500 rental units, 25% of which will be designated for the homeless.
The Metropolitan and Economic Development Committee of the City-County Council was introduced to the project Monday night.
The committee voted in favor of approving an inducement resolution for the issuance of up to $19 million of economic development multifamily housing revenue bonds to finance a portion of the cost of land acquisition and construction.
The resolution, which is preliminary, now moves on to the full council with a “do pass” recommendation. The full council meets Monday to consider the proposal.
The developers are now securing financing for the project, with plans to begin construction early next year.
Rent for the 35 units would be paid with Housing Choice vouchers provided by the Indianapolis Housing Agency. Residents would also receive support services from Adult & Child Health.
The remaining 121 units will be workforce housing for people earning at or below 80% of the area median income. To qualify, a one-person household would need to earn less than $44,700 annually. A three-person household would need to earn less than $57,550.
Sixty of the units would have one bedroom and 96 would have two bedrooms. Rents would range from $720 to $1,045.
Funding for the project is expected to come from several sources, including more than $10 million in equity from federal affordable tax credits, and more than $1.2 million in funds from the Indiana Housing & Community Development Authority.
The developer expects to close on financing in the first quarter of 2020 and will return to the city council at that time for final approval of the tax-exempt bonds. Construction would begin shortly after and should be complete in the third quarter of 2021.
Central State Hospital closed in 1994, and the city bought the 150-acre property a decade later. Development began in 2011, when Carmel-based Pedcor Cos. broke ground on the site’s first project: the 144-unit affordable apartment complex called The Steeples, with the help of federal tax credits.
Pedcor followed with The Retreat, a 62-unit senior-housing complex that also used tax credits.
Another developer, Indianapolis-based Reverie Estates, converted the hospital’s administration building, constructed in 1938 and now called Central State Mansion, into a mix of micro-offices, creative studios and co-living spaces. Reverie developed the project along with the 1899 event center west of the mansion that originally housed the hospital faculty dining hall.
Central State opened as the Indiana Hospital for the Insane in 1848 and housed more than 2,500 patients at its peak in the 1950s.