The Housing Authority of New Orleans will provide a $13.7 million loan to HRI Properties to complete the third phase of redevelopment of the former Iberville public housing complex.
HRI, the “master developer” on HANO’s ambitious, multimillion-dollar Iberville redevelopment, will add the loan to the roughly $18 million it has raised from other sources for the latest phase of a project that is intended to help revitalize Canal Street, the Central Business District and the Treme neighborhood.
The first two phases of the Iberville redevelopment are expected to be completed in March. With the financing in place, work on the third phase began this week.
HANO’s board voted unanimously last week to make the award to HRI, which for this project is doing business as Iberville Revitalization Co. LLC.
HANO began the makeover of the Iberville complex last fall as part of the U.S. Department of Housing and Urban Development’s Choice Neighborhoods Initiative, a program aimed at transforming distressed urban areas and traditional public housing into mixed-income neighborhoods with links to schools, transportation and jobs.
As part of the plan, HANO must replace the 821 units in the old Iberville development with new or renovated multiple-family buildings and townhouses, either on the Iberville footprint or in the surrounding neighborhood.
HANO and the city received a $30.5 million grant from HUD in 2011 to help fund the massive redevelopment project. The grant will cover only a portion of the full plan, but it has helped to encourage other investments.
The first two phases, now nearing completion, include 227 rental units. Of that total, 81 are public housing units, 97 are market-rate apartments and 49 are “workforce” units, which are affordable housing for households with income of less than 60 percent of the area’s median family income.
The $31.7 million third phase calls for construction or redevelopment of four buildings with 105 units, 36 of them public housing units and six of them for use by tenants who receive housing vouchers from HANO. The remaining units will be rented at market rates. About 4,000 square feet of retail space also will be included on the ground floor of one of the buildings.
A fourth and final phase of construction, which is expected to include 550 units, may be broken up into as many as three additional phases.
The $18 million HRI already raised for the third phase includes about $10 million in low-income housing tax credits, $2 million in state and local historic tax credits, $5.1 million in debt and a $1 million loan from the state.
The $13.7 million HANO loan, with a 1 percent interest rate, will come from several sources, including $7.4 million in money HANO receives from HUD specifically for the construction of housing to replace demolished structures and $4.2 million from the Choice Neighborhoods grant.
Financing for the project closed Dec. 16.