Developers seeking to turn a blighted downtown block into new apartments for university students plan to start construction as soon as possible after getting approval Monday, their attorney said.
The redevelopment agreement between Campion LLC to erect a seven-story building at Ninth and M streets received unanimous approval from the City Council, but two councilmen objected to granting the project $5.5 million in tax-increment financing for yet another apartment building targeted at University of Nebraska-Lincoln students.
"We don't want to stop the development because it's been a good thing, but we'd also like to encourage the planning department, future developers and this council to look at how we use TIF and how we encourage housing in the future," said Councilman Bennie Shobe.
Along with Councilman James Michael Bowers, Shobe voted for the redevelopment agreement between the city and Campion that outlines the TIF, but then they voted against the city formally adopting the TIF into its capital improvement program.
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Both expressed concern with the city granting TIF for the $37.5 million project that would put student-oriented development within a block of two others. The block was home to Red 9, which closed in 2014, and the former P.O. Pears.
Bowers said he's worried about the market for these kind of apartment buildings on the heels of two years of declining enrollment at UNL, and he worries the city's TIF authority won't be producing affordable housing.Â
"I would like to incentivize affordable housing," said Bowers, who fears students will pay for the housing with their student loans.Â
Campion officials believe the occupancy rates at other student apartment buildings in the downtown area are high enough there will be undergraduate and graduate students who want to live in their apartments, proposed to have per-person rents ranging from $650 per month on a four-bedroom unit to $1,050 a month on a one-bedroom unit.
for Lincoln concluded the city needs 17,000 new residential units in the next decade and 5,000 of them should be apartments renting for less than $1,000 a month.Â
Campion's 575-bed building would occupy most of the city block bounded by Ninth and 10th between L and M streets, according to project officials.
The Downtown Lincoln Association Board of Directors took a neutral position on the project, according to a letter from Executive Director Todd Ogden and board Chair Ken Fougeron. Â
While the board praised Campion's plans to invest in a blighted block that has been difficult to develop, members said the project doesn't provide the housing diversity sought in the downtown master plan and points to the need for the city to reward more varied housing development.
Students comprise two-thirds of downtown residents and although the association doesn't oppose student housing, it believes there is an imbalance between student and nonstudent housing.
"The board would also like to see the city provide an incentive for the development of housing that will diversify our current mix, especially given that our neighboring university has already experienced strong signs of oversaturation as it relates to student housing," the board's letter said.
Council Chair Jane Raybould said while she too has concerns about the need to build affordable housing in Lincoln, the TIF for this project helps that cause by generating $78,500 in administrative fees the city can use toward a future affordable housing project.Â
The $5.5 million in TIF would also pay for energy-efficiency features, facade enhancements, improved streetscape around the project and work to enhance the sidewalks along Ninth and 10th streets north to O Street.
The project's first two floors would feature townhouses with street access.
Campion officials hope to open the complex before the start of the 2022 school year.