City seeks developers for affordable housing
Phoenix is seeking proposals for developers to create a high-rise development on city-owned land downtown, with a goal of adding affordable housing.
The city is looking to lease about 1.5 acres of land near First and McKinley streets to a developer, according to a request for proposals released by the city.
Developers who are interested must submit a proposal that includes a lease term, and a plan for a mostly residential project on the site.
The project must be at least 10 stories tall. At least 10% of the units must be designated for affordable housing and another 10% must be designated for workforce housing, according to the request. The affordable units will be required to have a restrictive covenant for a period of 40 years.
Affordable, workforce housing requirements
The designated affordable units must be priced so they are affordable to those earning under 80% of the area median income. According to the U.S. Department of Housing and Urban Development, a couple earning up to $65,800 per year would be earning at or below 80% of the area median income. A single person earning up to $57,600 per year would qualify.
Housing is generally considered affordable if a person does not spend more than one-third of his or her monthly income on it.
The “workforce units” must be priced so they are affordable to people earning between 80% and 120% of the area median income.
The remainder of the units can be “market rate” meaning there is no pricing restriction for the rents.
According to the request, the ground floor of the project should be commercial or civic space, with spaces to accommodate small business or other public-facing uses.
Proposals from developers interested in building on the site are due July 9, and a developer is expected to be chosen for
the project in December.
City has sought high-rise projects on other sites
Phoenix has encouraged high-rise development on city-owned sites before. In late 2023 the city issued a request for proposals for a 0.4-acre site on Second Street north of Roosevelt Street.
That request also required developers to set aside 20% of the units for affordable or workforce housing.
Central Station, which is under construction on Central Avenue and Van Buren Street, is a city-owned site that the developer is leasing for a 99-year term.
That project, which includes two residential towers, one reaching 32 stories, will begin to open this year, with the second tower opening in 2025 or 2026, project leaders said in October. The Central Station development will include about 70,000 square feet of office space, with ground-floor retail and restaurants.