Even though members of the Community Redevelopment Agency had previously indicated they would not fund any more student housing projects, the members voted 6-1 at their last meeting to give grants totaling $325,000 to two student housing projects.
Grants are monies that do not have to be repaid.
Roxanne Manning, director of the CRA, told elected officials that the local nature of the projects makes them different than the previously funded multi-million dollar student housing projects.
Leon County Commissioner Kristen Dozier, noting the previous comments to not fund future student housing projects, said “I love these two projects.”
Dozier noted the projects are redevelopment and on a smaller scale in areas that will benefit from new investment.
City Commissioner Scott Maddox voted against the grants based on his longstanding belief that “CRA funds should be used for infrastructure and not for the interior of privately owned projects.”
Leon County Commissioner Nick Maddox voted for the grants and said that he was moved by the the local ownership and the fact that the projects are located in “communities of blight that have people of color.”
Project details are listed below.
The project on 712 Gamble Street, which is being developed by Rhettro Development LLC, was approved for a $275,000 grant.
Public records show that the development company purchased the property for approximately $45,000.
Phase 1 of the development which will include the construction of seven (7) three-story, four-bedroom, four-bathroom student apartments with on-site parking. The units will have granite counter-tops, stainless steel appliances, wood plank style flooring, and washers and dryers. The anticipated rental rates are $700 per bedroom per month, and will include utilities.
Phase 1 of the development is projected to cost $1,601,804. Assuming the project has a post-development value of $1.7 million and an annual increase in taxable value of 1.5 to 3.0 percent over the life of the CRA District, it will take between 14 and 18 years before the tax increment generated by the new development exceeds the CRA grant investment.
Greenleaf, a locally-owned real estate holding company, purchased 710 Wailes Street in January 2017. At the time of the purchase, the property was in foreclosure, had been vacant and abandoned for several years and was in a significant state of disrepair/deterioration.
The CRA approved a $75,000 grant.
Greenleaf is in the process of conducting major exterior and interior renovations to the two on-site structures. The developer intends to market the rental units to college students, with an emphasis on older students, graduate students and/or married students.
All the units will be renovated and will have granite counter-tops, stainless steel energy efficient appliances, new flooring, and washers and dryers. The on-site parking area will be resurfaced and the landscaping improved. The anticipated rental rates are $675 per bedroom per month for the two bedroom units and $700 per month for the one bedroom, stand-alone apartment.
With an annual taxable value increase of 3.0 percent, the return to the CRA would be $72,912 in FY 2038 (the final year of the CRA District), which is only $2,088 less than the $75,000 grant investment and is an amount that could easily be captured with minor taxable value increases.
With an annual taxable value increase of 5.0 percent the CRA would realize a full return of its investment in FY 2036, with an additional $16,772 returned to GFS District by FY 2038.