Affordable apartments planned for former strip club site
An Indianapolis developer plans to build a five-story building at the former Night Moves location near Switchyard Park that will include 64 apartments, including 48 that will be affordable, with monthly rents as low as $281.
The Bloomington City Council unanimously approved tax abatement for the project, at 1730 S. Walnut St.
For three of the one-bedroom units, rents are capped at $281, while six of the two-bedroom apartments will go for $338. The one-bedroom market rate apartments are projected to rent for $850 per month. In addition, 10 of the units will be reserved for clients of Stone Belt, a nonprofit that supports people with disabilities. Some of the units will offer views of the 65-acre public park.
Jeff Ryan, vice president of development for Real America LLC, told The Herald-Times he hopes residents can move in late next year.
The company can offer the inexpensive apartments in a prime location primarily because of support from the city and federal tax credits, he said.
The Bloomington Redevelopment Commission is selling the property, valued at $975,000, to the developer for $1. The tax abatement will lower the owner’s property tax liability by $138,408 over the next decade.
In addition, Ryan said Real America received federal tax credits of $1.2 million per year for 10 years. The company applied for the credits through the Indiana Housing and Community Development Authority. Ryan said the agency approves only 40% of the applications it receives. The program is capped by the federal government, because the credits reduce federal tax collections.
Most affordable housing units in the country are built because of the tax credits, Ryan said. The companies who obtain those credits sell them to other businesses, primarily banks, who use those credits to lower their tax liability. Meanwhile, Real America uses the revenue from the sale of those credits to help pay for the construction of the building.
Ryan said in a typical apartment project, the owner would have 20% equity, and 80% of the cost would be financed by a loan. Thanks to the revenue from the tax credits, Real America can build an apartment complex with 80% equity. The lower loan payments allow the company to offer the apartments at a much lower rates.
Ryan said the first floor of the Retreat@Switchyard project will include about 3,000 square feet of commercial space. While tenants are still unclear at this point, Ryan said a café that sells sandwiches, coffee and ice cream would be “incredible."
He said the city is supporting the project because it wants to make sure that living near the park is affordable for people of all incomes — not just people who can pay top dollar for housing in a prime location.
City council members unanimously approved the tax abatement Wednesday evening, with council members Isabel Piedmont-Smith, Stephen Volan and Ron Smith heaping praise upon the planned development.
Piedmont-Smith said she was excited to see an affordable housing development in a location where people don’t need to rely on a car.
“This is a great location for such a project,” she said.
Tenants in some of the units can earn no more than 30% of area median income, defined by the federal government as "extremely low income," though some tenants can earn up to 80% of AMI. Real America has agreed to reserve 48 apartments for low- to moderate-income tenants for 99 years.
This article originally appeared on The Herald-Times: 64-unit apartment building planned at Bloomington's Switchyard Park
