Light rail spurs fourth housing proposal for Mesa

Courtesy of Gary Nelson The Republic | Feb 7, 2013

Sycamore station complex in works

Mesa is on the verge of bagging its fourth new housing project with close proximity to light rail.

Amcal Multi-Housing Inc. of Agoura Hills, Calif., is proposing a four-story, 82-unit apartment complex immediately adjacent to the Sycamore Street light-rail station.

Like the three others, which broke ground last year, Sycamore Station Apartments would be financed by federal tax credits that are designed to encourage development of low-income housing. The tax breaks allow developers to charge lower rents and still make a profit.

Amcal is applying to the Arizona Department of Housing, which issues the tax credits on a competitive basis and will decide this spring which projects to support.

The department has focused in recent years on developments with access to public transit. That criterion resulted last year in a mother lode of projects for Mesa, which had gone for years without seeing much interest in tax-credit housing.

The three projects under way will:

Create 81 units of low-income senior housing near Center Street and First Avenue. It is the first privately financed major construction in downtown in a quarter of a century.

Replace the vacant Escobedo Apartments on the north edge of downtown with a 124-unit development called Escobedo at Vista Verde.

Replace most of the La Mesita Family Shelter on West Main Street with 80 units of workforce housing.

Councilman Dennis Kavanaugh, in whose district the project would be built, said Sycamore Station Apartments appears to be a prime candidate for state approval. “It has many of the elements that are prized in such applications,” he said.

Amcal, a powerhouse in California’s affordable-housing industry, would be making its first foray into Arizona.

The company has been in business for 35 years and since 1998 it has completed 3,900 units from San Diego to the Bay Area. It has an additional 520 units in the planning or development stages.

Kavanaugh has met with Amcal and called it “a very reputable company” that has worked well with city staffers, adding, “I think it’s a very good transit-oriented development.”

“We’re always looking to follow opportunity,” said Dayna Ranger, an assistant project manager with Amcal. “Our mission is to bring affordable housing to residents that need it.”

She declined to discuss details of the Mesa project until the necessary approvals are in hand.

But in a lengthy zoning application filed with Mesa, Amcal said it often “builds on urban land that is vacant, requires environmental remediation or has obsolete uses, and transforms them into livable homes with attractive architecture and high-quality construction.”

Amcal’s Mesa project would occupy most of an unused parking lot that once was part of the defunct Tri-City Mall. In addition to rail access, residents would be within walking distance of a Safeway-anchored strip mall, Mekong Plaza, medical care and East Valley Institute of Technology.

It would be another step on the way to realizing the redevelopment potential that has long been touted by light-rail advocates.

That potential has been slow to come to fruition in Mesa, however.

By the time the first leg of light rail opened in 2008, the Great Recession had already deep-sixed two rail-oriented projects in the city.

One, called the Element at Tri-City Pavilions, was planned just north of the Safeway store at Main Street and Dobson Road. Nine five-story buildings would have offered condos designed for childless couples in their 20s and 30s.

The other, West Main Station Village, was planned on the site of a former boat dealership at 1350 W.Main St., with 56 townhouses and 13 shops.

Both would have been what are called market-based projects, with standard rents or purchase prices.

That the first iterations of light-rail development in Mesa are aimed at low-income residents caused some heartburn last year when the council was discussing the three projects then on the table — especially the downtown senior housing, which never did receive a unanimous council vote.

Kavanaugh said market-based projects will arrive in due course.

Right now, low-income projects have the edge because tax credits make them attractive to lenders, Kavanaugh said. “Conventionally-financed projects haven’t been able to get their financing. … It’s really a question of timing.”

In the meanwhile, Mesa’s experience with the three — and now possibly four — tax-credit developments should make the city attractive to other builders, Kavanaugh said.

“What I hope other developers do see is that the city, at least on the three tax-credit projects that are under way, has worked closely to move it through permitting,” he said. “We are a good place to build housing like that.”

In addition to state approval of the tax credits, Sycamore Station Apartments needs council zoning approval. That vote is scheduled for Feb.25; the Planning and Zoning Board recommended approval in January.

The final design also would need clearance from the Design Review Board.

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