A Cleveland development company will take a second crack at building 48 new single-family homes in Lackawanna’s 1st Ward – many of them on city-owned lots that have been vacant for years.
The City Council on Monday unanimously approved the sale of 32 properties to NRP Group, which plans to seek federal low-income housing tax credits in moving forward on the more than $10 million project.
The total price of the properties, which are scattered across the 1st Ward, was $150,000. Council members also agreed to donate two additional properties that will be used in the development.
“This could be a game changer for the 1st Ward,” City Council President Henry R. Pirowski said after the meeting.
NRP, working with the Lackawanna Housing Development Corp., applied in 2011 to the state Department of Homes & Community Renewal for the tax credits but was unsuccessful.
The company will reapply later this month in the competitive process, and improvements to the plan should make it more attractive in winning tax credits this time around, said NRP Vice President of Development P. Christopher Dirr.
The two-, three- and four-bedroom homes will be 1,128 to 1,315 square feet and have net rents of $370 to $700. The homes will be available for sale after 15 years, with long-term tenants receiving discounted prices depending on their length of occupancy in the home.
Area residents with incomes at or under 60 percent of the area median income will be eligible.
Lackawanna’s 1st Ward is the poorest census tract in Erie County, outside of Buffalo.
Each house will cost $150,000 to $160,000, with 70 percent of the expense being paid through the tax credits, which are sold to investors.
The other 30 percent will be borrowed – which ultimately means that purchasers will be expected to pay around $50,000 to $60,000 when buying the homes after 15 years, according to Dirr.
Potential homeowners also will be required to participate in homeowner training, including credit counseling, financial planning, budgeting and home maintenance and repair.
The company was aiming for approval of the tax credits next spring. Work could start as early as next fall, although spring 2014 was more likely, said Dirr.