Gilbert, Ariz.—A city at the edge of one of the nation’s hottest retirement communities has made affordable housing for seniors a vital part of its downtown expansion—and it has put its money where its mouth is.

This Phoenix suburb, one of the fastest-growing municipalities of its size in the nation, agreed to donate 3.3 acres in its historic downtown Heritage district for a 100-unit, independent-living seniors housing project with limited supportive services after the developer showed officials how well its previous projects were working.

Developer Mercy Housing, a Denver-based national nonprofit organization, convinced the town to contribute to the affordable housing project through its proven track record. City officials “saw Mercy’s work in the neighboring town of Mesa where we already have two projects,” said Lori Rossi, a senior developer for Mercy Housing. “They had taken tours of it. They wanted to see the Sec. 202 and tax credit projects there, and it led to a vote of confidence for the town.”

Opened in October 2005, the 100-unit Page Commons development is one of the first projects of its kind in Gilbert, which is seeing a creeping effect from Phoenix’s double-digit jumps in housing prices.

“More and more low-income families are being pushed into the exurbs of Maricopa County,” said James Mercado, regional vice president of housing development for Mercy Housing. He added that housing prices in the Phoenix metropolitan area have been appreciating by as much as 30 percent a year. In addition, developers are eager to convert affordable seniors apartments into condominiums.

Last year, more than 7,000 seniors apartments in the area converted to condos, said Mercado.

Page Commons offers one- and two-bedroom units ranging in size from 650 square feet to 800 square feet. They are reserved for seniors who have incomes ranging from up to 30 percent of the area median income (AMI) to up to 60 percent of AMI. The rents range from $277 to $698.

By securing roughly $10,000 in public subsidy and $56,000 in low-income housing tax credit equity per unit, Mercy Housing was able to price the units nearly a third below market prices.

These apartments feature full kitchens, laundry facilities, and private patios and balconies. The property has a clubhouse and an exercise room, and is located near a community theater, the Gilbert Senior Center, and a Boys and Girls Club.

Page Commons represents a major reinvestment in the infrastructure needs of the oldest part of town. Its development has spurred a multi-million dollar expansion of an adjacent seniors center.

On-site resident services include volunteer opportunities, a resident advisory board, social events, computer training, life skills training, exercise and nutrition classes, and assistance with Medicaid and health insurance.

Mercy Housing won $657,180 in a Federal Home Loan Bank of San Francisco Affordable Housing Program grant for Page Commons, one of the largest ever awarded by the bank. The grant sponsor was Johnson Bank.

Other financing included $5.7 million in tax credit equity from Apollo Housing Capital, a $1.9 million permanent loan from U.S. Bank, and a $360,000 forgivable HOME loan from the Arizina Department of Housing.

“The land donation made the project viable,” said Mercy Housing’s Rossi, noting that the project site is in the heart of a redevelopment area. "Once [the town] understood the impact of the land donation and how successful it would be, they were there.”