RDC hears from two more developers

Wade’s proposal is to build an apartment complex featuring 208 total units on Bierhaus Boulevard behind Kohls. Thirty of those units would be single-level, 2-bedroom homes while the majority, or 178, would be larger, two-story, 3-bedroom units.

Wade said upon hearing of the RDC’s efforts to spur housing projects, RJ Community Developers began doing their own research and “due diligence” to confirm that there is, in fact, a significant need here.

And while he agrees that this area does need homes, projects of this scope and size are only profitable here, Wade told the RDC, by way of some kind of public/private partnership, which is exactly what the RDC is proposing.

RDC members worked with Ice Miller, a legal firm in Indianapolis, in developing the official Request for Proposals, which highlights some of the findings from a housing study completed by Knox County Indiana Economic Development, in partnership with several other local entities and elected officials, that found nearly 1,800 units will be needed within the greater Vincennes area by 2025 to keep pace with other Hoosier communities.

The RFP said the city is poised to absorb as many as 720 apartments in the next 3-5 years.

But given the median income, rent must be affordable to those who live here, hence the difficulty in turning a profit.

The public/private partnership would help to close the gap. For instance, bonds could be sold, whether by the city itself or the developer, and a new Tax Increment Finance zone drawn around the development’s border, a vehicle by which to capture the incremental increase in property tax revenue and use it to pay off the bonds.

A similar process was used by county officials to help build the Duke Energy power plant in Edwardsport.

Tax abatements, too, are possible, although it would take partnership with the city council to do so.

And Wade indicated it will take both to get the project off the ground.

If that happens, he told the RDC that he “feels strongly” he can execute the plan to build the 208 units in as little as 18-24 months.

Clearly interested in lending a hand, RDC members said they would begin immediately the process to pull the designated area out of the existing TIF zone and, essentially, re-TIF it, thereby extending the amount of time it can generate money.

The current TIF is set to expire in less than three years.

RJ Community Builders will then need to go before the city council to seek the tax abatement. RDC member and at-large city council member Marc McNeece said while he could only speak for himself, he thought the council would be open to the idea.

“It’s about speed for you guys and for us; building season is here,” McNeece said. “And I believe the council would be receptive to the discussion of an abatement.”

There is other red tape to navigate as well, however.

The entire area is zoned as commercial, so Wade said they will look to begin the process of rezoning it as residential. The multi-family units, too, will require a conditional use permit.

And all of that will take time.

Too, a previous agreement struck with Kohls allows for only half the targeted area to be developed into residential units.

“But we are currently pursuing that amendment,” Wade told the RDC.

All of that could take upwards of three months, likely more, “and still no guarantees we’ll get a yes,” he said.

RDC members, too, said establishing the TIF is likely to take about the same amount of time, so both parties parted ways hoping for the best, most expedient outcome.

Then in other business, John Jones went before RDC members with the resurrection of a previous planned development near Franklin Heights, one still of the same name, Julius Heights.

Retired developer and builder Jerry Memering last year went before the RDC seeking financial assistance to build about 14 homes on property he owns there.

At the time, the RDC was still exploring funding methods and eventually, Memering decided he didn’t want to pursue the project after all.

He’s now entered into a purchase agreement with Jones for the ground, and Jones is proposing a development there of as many as 17 homes.

He’s asking the RDC for $450,000, money he says will help to keep the cost of the lots down, or around $30,000 apiece.

This development is slightly different, however, than others for which the RDC has helped with infrastructure costs.

Jones said they while they will build a spec home to “set the tone of both design and size,” he doesn’t plan to build the rest. He will, instead, look to sell the lots, either to individuals or to other developers interested in building homes to sell.

“We don’t plan to hold this as an exclusive subdivision,” he told the RDC. “We just don’t have the manpower to build on all 17 lots.

“But doing it that way should help with quicker development,” he argued.

Without the RDC’s assistance, however, Jones said none of it was “feasible.”

And RDC members did like many aspects of the project.

For instance, as designed it adheres to the city’s Complete Streets Ordinance, something other developers have been reluctant to do. That means Julius Heights would have lighting and sidewalks; Jones, too, would like the city’s cooperation in using some right-of-way to create a walking and bicycle path from the development through to Prospect Drive, thereby creating access to the YMCA of Vincennes and nearby Hart Street development.

But they worried about how fast the homes would be built, since Jones isn’t planning to do it himself.

“The money would only be offered as reimbursement,” RDC president Tim Smith reminded him. “And we would ask for a tight timeline.

“We would allocate money, and if it’s not used within a certain amount of time, it would be withdrawn.”

Jones said he couldn’t be sure how long it would take for the area to develop. Design plans take time. Fall could be wet.

“Then we head into winter,” he said.

But in response, Smith said RDC members understand those pitfalls so common in construction. They can be “reasonable,” he said.

There would, however, still be benchmarks to meet.

“The whole reason we are doing this is because we need housing today,” Smith said. “And we believing in the developer keeping some skin in the came in order to move things along.”

Smith, too, pointed out that this area was included in the recent development of a new residential-specific TIF zone, a vehicle by which they hope to collect revenue from the construction of new homes, money they can then use to incentivize other developers to do even more.

Too, Mayor Joe Yochum committed $1 million in ARPA funds specifically to incentivize housing efforts, so there are options when it comes to funding Jones’ request.

But the RDC didn’t have immediate answers. They have, however, looked to their financial advisors with Reedy Financial Group in Seymour for guidance.

Smith said he would be interested in holding a special meeting to give Jones an answer since he expects information from Reedy to be forthcoming.

RDC member Greg Parsley said he loved Jones’ proposed project, and that he, too, was interested in keeping momentum.

“When Jerry (Memering) came to us with this project, we kept kicking the can down the road because we were unsure of our finances.

“There is opportunity here,” Parsley said. “It’s a phenomenal project, and I do hope we can move it forward. I’m tired of seeing everyone around us build. We’ve got to get some things going.”

Other developments in which the RDC has invested in previous years include $342,000 awarded to REM Development Group, a trio of local families looking to transform the Oliphant Building at Second and Main streets into condos and erect new construction, a mix of retail and commercial properties, on the adjacent Gimbel Corner.

The RDC also awarded $218,000 to Sure Clean as they look to build 14 homes off the 1600 block of Hart Street, near Broadway Street, a project well underway, as well as $250,0000 for Matt Hendrixson and Chad Beard, operating together as DC Developers, to help cover the infrastructure costs associated with nine homes they plan to build off Thompson Drive.

Hendrixson reported to RDC members Thursday that his plan for that project will go before the Area Plan Commission for approval in July. He hopes to be able to turn dirt sometime shortly thereafter.

Smith took a few minutes at the culmination of this week’s meeting to thank everyone for their interest, and investment in Knox County.

“Things are moving along,” he said with satisfaction. “It’s been a long time getting here, but we are going forward in taking care of our residential housing needs.

“It’s one of the first things we have to do if we are going to grow.”