Gorman & Co. has broken ground on the first affordable housing community financed with the new Arizona state low-income housing tax credit.
The 368-unit development will bring new mixed-income housing to Glendale near Phoenix.
“Centerline on Glendale is a shining example of how sound public policy in Arizona can lead to amazing results for our community! The state housing tax credit, passed by the Arizona Legislature in a bipartisan fashion in 2021, is the sole reason this project was able to move forward," said Brian Swanton, president and CEO of Gorman & Co.
The firm has leveraged the tax credit investment into $120 million in financing, 90% of which is coming from the private sector, according to Swanton.
“I couldn’t be more pleased to welcome this development to Glendale. At a time when affordable housing is hard to find across the Valley, these units will fulfill a critical need for Glendale residents. This alone will not solve the problem, but it is a step in the right direction," Glendale mayor Jerry P. Weiers said.
Centerline on Glendale will be the single-largest private investment in Glendale’s Centerline redevelopment area since it was designated for redevelopment in the 1990s.
A leading affordable housing developer, Gorman & Co. secured $86 million in critical private investments from U.S. Bank, which is purchasing both the state credits as well as federal low-income housing tax credits and providing construction financing to the development. Other financing partners include Cedar Rapids Bank & Trust and the Arizona Industrial Development Authority.
The housing tax credits were competitively allocated to the project by the Arizona Department of Housing, which is also providing gap financing from the national Housing Trust Fund and the federal HOME program. The Maricopa County Human Services Department also allocated $6 million in Coronavirus State and Local Fiscal Recovery Funds, a part of the American Rescue Plan Act to make the project possible.
A project-based rental subsidy is being provided to certain units in the development through both the city of Glendale Community Services Department and the Arizona Health Care Cost Containment System with waitlist preferences for formerly homeless households and individuals suffering from mental illness, making Centerline on Glendale one of the largest permanent supportive housing developments in the nation, according to the developers.
Centerline on Glendale is tailored to a diverse population of residents, including single individuals, families with children, the elderly, disabled, veterans, formerly homeless, and households with special needs. The units in the development will be fully accessible for the physically disabled and sensory impaired through the utilization of universal design principles for accessibility.
The project will serve households earning up to 80% of the countywide area median income, equating to rents for the one-, two-, and three-bedroom units ranging from $497 per month for the most affordable one-bedroom to $1,837 per month for the most expensive three-bedroom unit.
Residents will have access to on-site wraparound supportive services, a splash pad, a dog park, a business incubation space, a fitness and recreation center, a 13-acre walking path, and electric vehicle charging stations.
The project will be one block from the soon-to-be-constructed Mountain Park Health Clinic. It also will contain an on-site commercial kitchen operated by Local First Arizona to serve entrepreneurs running small food-based businesses in the West Valley.
The development will generate an estimated $2.5 million in permitting and impact fees for Glendale, $4.3 million in construction sales tax revenue for the state, and nearly $400,000 in annual property taxes over the next 10 years, 75% of which goes to the local school districts. In addition, the project will create hundreds of local construction jobs through this innovative public-private partnership.
