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Council reaffirms 319 Biltmore redevelopment plan and authorizes gap loan and tax grant for mixed‑income project
Summary
Council reaffirmed prior disposition authority and authorized staff to negotiate a development and lease agreement with Laurel Street Residential for a phased 221‑unit redevelopment at 319 Biltmore Avenue, including a $3 million housing trust fund loan for phase one and a possible tax grant up to $100,000 per parcel per year for 20 years.
The Asheville City Council on June 24 reaffirmed its prior August 2022 disposition resolution for the city‑owned site at 319 Biltmore Avenue and approved a new development approach with Laurel Street Residential that includes a phased mixed‑income development, a $3 million housing trust fund loan for phase one, and a tax grant request to support long‑term operating pro forma.
City staff presented a revised deal for the 221‑unit project that breaks construction into two phases. Phase 1 would include 109 units with 33 project‑based vouchers and would rely on a $3,000,000 loan from the city’s housing trust fund. Phase 2 — a separate tax‑credit phase with 112 units — would be pursued using Low‑Income Housing Tax Credits and other funding sources. In the new agreement the city would not sell the land outright; instead staff negotiated a long‑term ground lease (treated similarly to a sale under North Carolina law) that includes a 40‑year affordability period and potential ground lease term up to 99 years, with benchmarks tied to phase completion.
Sasha Burtynsky described how the affordable‑housing landscape has changed since the city purchased the site in 2019 and emphasized the need to move projects forward amid rising costs and fewer county funding cycles. Staff said the revised deal increases the number of affordable units over earlier proposals: overall the project would include 73 affordable units (about 29% of the total), with 29% of total units serving households at 30% AMI and below.
Laurel Street Residential representatives said the developer has experience in the region; the council received a staff analysis comparing subsidy levels and cost per unit with similar recent projects and recommended the package. The council approved a motion that authorizes the city manager to negotiate and enter into a development and lease agreement, authorize a $3,000,000 housing trust fund loan for phase 1, and approve a tax grant up to $100,000 per parcel per year for up to 20 years. The motion passed following a second and consent vote with no public opposition during the council hearing.
Next steps: staff to complete negotiations, close on the phase 1 loan, and assist developer with tax credit and other funding applications for phase 2. Construction on phase 1 is estimated to start in 2026, with phase 2 following after tax credit allocation and additional funding procurement.
