Wednesday, March 25, 2009

Dallas City Council approves tax credits for low-income housing at former Plaza Hotel

The proposed conversion of a vacant downtown hotel to affordable rental housing secured Wednesday a crucial endorsement from the Dallas City Council.

Hamilton Properties Corp. has applied to the state for low-income housing tax credits to help finance renovation of the former Plaza Hotel.

The council had to approve the request as well and did so Wednesday without comment, after neighborhood opposition to the project had faded.

The vote was only the first hurdle for Hamilton Properties, owner of the 12-story Plaza property at 1011 S. Akard St. near Interstate 30.

The tax credits, to be awarded in July, would be sold to investors. Other funding would come from private loans and donations. Larry Hamilton, the company’s chief executive, says he also will apply for a city grant and may seek a low-interest government housing loan.

Even in a tough economy, he is confident the $20 million to $25 million project will land the necessary funding and attract tenants, most of whom would have to meet varying income limits.

“There’s a dearth of housing for people on the lower end [of the income scale] working downtown,” said Hamilton, whose company owns three upscale apartment buildings in the central city.

The company’s tax credit application calls for providing 140 apartments to tenants who would pay restricted rents ranging from $349 a month for efficiencies to $898 for two-bedroom units. Annual income limits for individual renters would range from about $14,000 to $28,000.

Another 12 apartments would be rented at market rates, and the project could grow to more than 200 total units, Hamilton said.

The council vote boosts a project that nearly died a month ago.

Hamilton had hoped to redo the property as a boutique hotel. But when he couldn’t get financing, he approached Central Dallas Ministries about buying the building for affordable housing, a project that came to include apartments for the previously homeless.

That plan drew opposition from residents of the nearby Cedars neighborhood, who raised a variety of concerns: The project was being rushed, its estimated rental costs were too steep, not enough units would be offered at market rates and Central Dallas Ministries didn’t have the experience to undertake such a large project.

Responding to residents’ opposition and the lead of council member Pauline Medrano, who represents the area, the council’s housing committee last month voted to oppose the Plaza’s tax-credit application.

Hamilton, not wanting the building to sit vacant, took on the project alone. And before last month’s council vote, Mayor Tom Leppert and Medrano persuaded opponents to give Hamilton a month to work out an agreeable plan.

One was reached in part because housing for the homeless was removed for the project, said Hamilton and Phillip Robinson, president of the Cedars Neighborhood Association.

“We’re hoping we can add that component,” Robinson said. “We just want to see it up and running,” as in the City Walk at Akard affordable housing project.

Central Dallas Ministries is setting aside 50 apartments for the formerly homeless in its redevelopment of a former office building at 511 N. Akard St. Opening is planned for this summer.

The Cedars neighborhood supported Hamilton’s Plaza project because of the housing options it will provide, Robinson said.

“We want affordable housing,” he said, “housing people with real working class jobs could afford.”

The Dallas Morning News