Construction is expected to begin early next year on the Centerline on Glendale development, which will bring a mix of one-, two-, and three-bedroom units to Glendale, Arizona.
Gorman Architectural Construction is expected to begin early next year on the Centerline on Glendale development, which will bring a mix of one-, two-, and three-bedroom units to Glendale, Arizona.

The Arizona Department of Housing (DOH) has made its first reservation under the new state housing tax credit program, awarding $2 million in credits to assist Gorman & Co. in the development of a key project in Glendale.

The much-anticipated development will feature 368 units of affordable housing with wraparound supportive services provided on-site.

“Centerline on Glendale I and II will be an integral part of the comprehensive revitalization strategy for the Glendale Centerline redevelopment area,” says Brian Swanton, CEO and president of Gorman & Co, noting that it will also be largest new construction project in firm history.

Brian Swanton
Brian Swanton

The new state housing tax credit program, which will finance a portion of the costs, was adopted by the Arizona Legislature and signed into law by Gov. Doug Ducey in 2021. The tax credits will be sold to institutional investors, and the equity raised from the sale of the credits will be used to construct the development.

The program provides $4 million annually in state credits, with DOH awarding half in the recent first round. The other half, which targets projects in rural regions, will be awarded later this year.

The new financing tool is critical for Centerline on Glendale I and II, according to Swanton.

“The state credit on that project will generate about $14 million in equity,” he says. “This project wouldn’t happen without it.”

The approximately $104 million project between the two phases will provide affordable housing to low- and moderate-income households, will create hundreds of jobs, and will be the single-largest private investment in Glendale’s Centerline redevelopment area since established. “This project truly took all levels of government working together to collaborate with the private sector and surrounding neighborhood residents to bring Centerline on Glendale to fruition,” says Swanton.

The development team originally split the project into two phases with the idea of doing one phase as a 9% federal low-income housing tax credit (LIHTC) project and the other as a 4% LIHTC deal. This was because the numbers for a single 4% LIHTC transaction weren’t working out.

The passage of the state credit program provided a new option for the development team. Now, with Glendale I and II being awarded state credits, Gorman can essentially treat the development as one project although there will be still be separate partnership agreements and other distinctions, according to Swanton.

Centerline on Glendale will be designed and built at the same time. The developers recently received the necessary entitlements and will soon be selecting its debt and equity partners.

“Glendale is excited to welcome Centerline on Glendale, the third Gorman & Co. project, to our community,” said vice mayor Jamie Aldama, who represents the Ocotillo district where the project will be located. “Our support for quality, affordable housing with on-site services and amenities is not only the right thing to do, it is the action that unites us as a community. All of our residents deserve to have access to safe places to live where loved ones can grow and thrive. With the growth we are experiencing in Glendale, public-private partnerships like this are crucial to improving the lives of all our residents.”

The development will be a mixed-income project, with all units affordable to residents earning no more than 60% of the area median income (AMI) and about 80 units targeting residents earning no more than 30% of the AMI, so it can reach the neediest.

The recent point-in-time count found more than 5,000 people experiencing homelessness in unsheltered situations in Maricopa County, a 35% increase since 2020. In Glendale, there were 406 individuals who were unsheltered, a 139% jump from the 2020 count.

The new Gorman property will be receive project-based Section 8 vouchers from the city as well as rental subsidies from the Arizona Health Care Cost Containment System to support permanent supportive housing units alongside health services to people with special needs.

In addition to the Section 8 vouchers, the city is providing $500,000 in Community Development Block Grant funding. DOH is also providing $4 million in HOME funds, and Maricopa County is supporting the project with $6 million in American Rescue Plan Act funding. The Arizona Industrial Development Authority is issuing the tax-exempt bonds.

Centerline on Glendale will include a community kitchen to support 60 to 80 food entrepreneurs. There will also be a large fitness center that’s open to the public, an important feature in a neighborhood that lacks recreational opportunities.