WILMINGTON –– Wilmington City Council will consider using $3.5 million of the city’s American Rescue Plan allocation to help push forward an affordable housing project.
Tuesday night, council members will consider entering the city into an agreement to grant gap financing to Bradley Housing Development and Kelley Development Company.
The developers are behind the proposed Starway Village project, located at 2346 Carolina Beach Rd., where the current flea market exists.
Historically a drive-in theater, the site is proposed to turn into 278 workforce units. The land spans 15 acres and is within walking distance to retail shops, businesses, medical facilities, schools and bus stops.
Monthly rents will range from $754 for a one bedroom, to $900 for a two bedroom, to $999 for a three bedroom. Twenty units will qualify as Americans with Disabilities Act accessible, and 44 planned for the ground floor are partially accessible, according to city documents.
The community is expected to comprise local workers who earn between $27,634 to $47,550 a year, under the area’s 60% median income. The project is intended to fill an affordable housing void for nurses, teachers, law enforcement officers, and hospitality workers, among others.
The City of Wilmington is collecting $25.9 million from the ARPA to spend for Covid-19 pandemic response and recovery. Since the beginning of mapping out its spending framework, city staff has recommended dedicating a portion of the funds to affordable housing initiatives, an identified priority of the current council members.
New Hanover County is facing a significant shortage of affordable housing. The issue is intensifying as the population grows and living costs outpace stagnant wages. Countywide, half of all rental households are cost burdened, spending 30% or more of their income on housing expenses; 60% of rental households are annually earning below $40,000.
This multi-family housing project, which the council recently approved for rezoning, is receiving $53.9 million through a 4% tax credit from the North Carolina Housing Finance Agency and HUD financing.
In October, New Hanover County commissioners unanimously agreed to grant $1.8 million in gap financing for the workforce housing project. The county moved ARPA money proposed for water and sewer projects to prioritize the gap financing.
“Unlike the [9%] tax credit projects that we generally see in the county, these 4% projects receive less of a tax credit subsidy,” New Hanover County Planning and Land Use Director Rebekah Roth told commissioners. “And so that’s one of the reasons why gap financing is generally associated with these projects.”
The project has received some pushback from neighbors who do not want to see Maryland Avenue extended through the development. However the project is still going through the permitting processes.
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