FORT WAYNE, Ind. (WANE) - Drawing in developers to build and renovate homes on Fort Wayne's southeast side is the goal behind a new housing market study.
"We know there's a market for development of housing and retail. We know that because we've had several developers approach us about projects," Heather Presley-Cowen, the deputy director of community development, said. "We're undertaking our own market study so we can be informed and make good decisions."
Presley-Cowen's department is currently taking proposals from companies to do the study.
"We've budgeted funding for it, but we want to get the best price for the taxpayer," she said.
Entitlement money from the federal government will pay for the analysis. But, the job won't necessarily go to lowest bidder. Presley-Cowen said they also look at a firm's experience and how quickly it can finish the study. She wants to have it done by the end of October.
"What we want to do is understand the whole southeast and what the housing needs are, what desires are. What would marketable housing look like and what would it cost," Presley-Cowen said. "Then there's also a market potential study which says who wants to live here and can't find what they want to buy or rent."
The study will look at all of the southeast quadrant in the city limits, which is 10,829 acres or 17 square miles. Extra focus will be given to the Renaissance Pointe Neighborhood, 242 acres around Hanna Street and Creighton Avenue, and the former McMillen Park Apartments land, which is 29 acres near McKinnie Avenue and S. Anthony Boulevard.
According to the city's request for proposals, those two areas will both "be analyzed to illustrate the need and or impact of additional/future affordable housing units in these specific areas and how such need or impact relates to the entire study area."
"[The southeast side] is a place where people want to live. It's undeniable that there are people who want to live there and just need the product to make that happen," Presley-Cowen said.
Renaissance Pointe Vision
The Renaissance Pointe Neighborhood has around 80 homes. All of them are occupied and there's a waiting list, Presley-Cowen said. Property values also spiked in the area around the neighborhood. Presley-Cowen said when the homes were first being built, the median value was $25-35,000. Five years later, the comps are now in the $80-90,000 range.
"We want to continue that growth. Renaissance Pointe is a catalyst, so it has expanded on its own. We've seen $150-300,000 of investment around it and we had nothing to do with it," she said. "There were homeowners in the neighborhood who had the money to invest in their home, but because maybe the house across the street was abandoned and falling down they weren't willing to invest. Now, because of our investment, we're seeing others jump on board."
Kevan Biggs, president and CEO of Ideal Suburban Homes, is behind more than 66 of the homes in Renaissance Pointe. Four more are already planned for construction in the next few months.
Biggs created a unique way of getting people into the affordable housing. When the neighborhood was first getting off the ground in 2007, the housing crisis hit. Many people weren't able to get a mortgage and buy the homes.
"What we found is a lot of people wanted to be in the homes, but they were in a position to rent not buy," Biggs said.
That's when Biggs developed a lease-to-purchase plan using the Housing Credit Program, also called Section 42 of the IRS code. It allows private investors to make an investment in the housing development in exchange for an income tax credit.
"It entices investment into neighborhoods and areas that would typically be overlooked for development and it provides housing for people in certain income levels," he explained.
The private investor equity pays for the construction of the homes. The tenants then pay rent and can buy their home after 15 years at a much lower cost than when it was first built. Using this plan, Biggs built 66 homes in Renaissance Pointe last year.
"We are in fact delivering home ownership. It's just a little different method but it was right for the time with the housing market," Biggs said.
People who rent a home in Renaissance Pointe also get financial classes so they will be able to qualify for a mortgage. Some people fix their credit in a few years and are able to move out of the rental and build a new house in a nearby lot.
"Then the area gets a new home that's owner-occupied ... sooner than waiting the 15 year period," Biggs said. "People who visit our homes now find it to be a completely different neighborhood than it was 24 months ago. We feel over the next not only 24 months but 24 years, that neighborhood will continue to gain traction and have a stronger foothold and be the self-sustaining neighborhood that it once was."
McMillen Park Apartments Lot Vision
The other area of focus for the housing market study is the land where the McMillen Park Apartments once stood. The city bought the land and tore the complex down in 2011.
"The people in that area want a place that's safe. Somewhere that serves the community. They want more single family detached homes but more of the suburban style in the traditional style," Presley-Cowen said. "People also want more sit-down restaurants and we know rooftops beget retail. So, we would hope that would be part of the mix too."
Biggs said he hasn't looked into that property.
"But, as a developer with a lot of relationships in Fort Wayne, we'd like to take a look at that sometime in the near future," he said.
Presley-Cowen said the housing market study will help Biggs and other developers know what would work on the property.
"As we continue to take steps forward, we also need to make sure the steps are appropriate. There needs to be guidance to the city and developers as to what the next step is," Biggs said. "Having a third party market study for other developers now provides a good document of reliance of what decisions to make and move forward."
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