Sheldon S. Shafer

@sheldonshafer

An Ohio developer has secured a major tax break on two large apartment projects set for east of downtown, while at the same time, appeasing affordable housing advocates.

Edwards Cos. intends to invest $80 million in developing 197 apartments on East Broadway at the former site of Mercy Academy and 260 units nearby, just northwest of Broadway and Baxter Avenue at a site that includes the old Phoenix Hill Tavern.

The Louisville Metro Council's Economic Development Committee voted without opposition Tuesday afternoon to recommend that the full council, when it meets July 28, approve the creation of special tax districts for the company at the two apartment sites.

Under the incentives, called tax-increment-financing districts, Edwards will be rebated a maximum of $2.6 million over 20 years at the Mercy Academy site and up to $4.9 million for the Phoenix Hill project, also over 20 years.

Edwards, based in Columbus, locked in the incentives with city officials by agreeing to set aside 19 of the apartments at the Mercy Academy site as "affordable" units that would have rents that might draw minority or low-income tenants.

And, at the Broadway-Baxter site, Edwards is saving five houses that will be turned over to a nonprofit organization -- yet to be identified -- for possible renovation as affordable housing, city officials said.

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The agreement by Edwards was good news to Cathy Hinko, executive director of the Metro Housing Coalition, a local agency that advocates for fair and affordable housing.

In addressing the council committee Tuesday, Hinko noted that census tracts near the two Broadway-corridor sites are around 90 percent white. She said that development of all the apartments as market-rate units might violate federal fair-housing regulations and also put the city crosswise with U.S. Housing and Urban Development guidelines.

Hinko urged that at least 10 percent of the apartments be designated as affordable, and thus more available to minorities, Hispanics and households headed by single females.

Edwards recently cleared the former Mercy Academy property in the 1100 block of East Broadway and plans to clear the old tavern and several other buildings at the Broadway-Baxter corner, near the entrance to Cave Hill Cemetery. Both developments are to include large parking garages. And the Baxter-Broadway project is to include 33,000 square feet of retail space.

Edwards officials initially said they wanted the tax incentives to total around $10 million, and they raised the possibility of abandoning the projects without that much financial assistance.

But in a recent open letter "to the citizens of Louisville," the Edwards officials said they had accepted the lower financial incentive package offered by the city's development arm, Louisville Forward.

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"This package is an essential part of enabling the development of our two projects in Phoenix Hill and the Original Highlands. This partnership will enable us to continue to progress forward with these transformative projects," the letter said.

The company said that for the last 18 months, it has "worked diligently and continuously to: assemble and place into contract the various properties; conduct numerous meetings with neighborhood associations and preservation groups; design the buildings; and conduct various engineering studies, all while working through numerous levels of governmental approvals."

Tax-increment-financing districts have been established for a dozen or more local projects over the past decade. In most cases, the developers are eligible for getting a rebate on a portion of how much their projects increase the tax base in the district.

Reporter Sheldon S. Shafer can be reached at 502-582-7089, or via email at sshafer@courier-journal.com.