Las Cruces council pre-commits up to $4.7M to Royal Crossing affordable housing project
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Summary
The city council approved a pre-commitment of up to $4.7 million in city funding for Royal Crossing Apartments, a proposed 108-unit affordable senior-and-family complex, contingent on Low-Income Housing Tax Credits and developer qualification; councilor Matisse voted no on the measure.
The Las Cruces City Council voted Nov. 3 to pre-commit up to $4.7 million in city funding for Royal Crossing Apartments, a proposed 108-unit affordable housing development in the Royal Crossing subdivision north of Apodaca Park.
Jen Lauterbach, housing and neighborhood services coordinator, told the council the proposed funding would be provided as a 20-year residual-receipts loan at a 3% interest rate to strengthen the project's Low-Income Housing Tax Credit (LIHTC) application. She said the award of state LIHTC funding and the developer's certification as a qualified grantee under state and city rules are conditions of the city's commitment.
"The request for a pre-commitment of funding is subject to the project receiving the award of low income housing tax credits and the developer being certified as a qualified grantee," Lauterbach said.
Developer Colin Krueger described the site plan and financing context, saying Royal Crossing would include 24 one-bedroom, 52 two-bedroom and 33 three-bedroom units for seniors and families. Krueger gave an estimated total development cost in the meeting of roughly $31 million and said hard costs were about $185,000 per unit. He said the developer has worked with Tierra del Sol Housing Corporation but noted the state finance agency (Housing New Mexico / MFA) restricts awards when related nonprofit affiliates have multiple applications in a funding round.
Council discussion focused on LIHTC mechanics and unit counts. Councilor Curran asked about 4% versus 9% tax-credit financing; Lauterbach and Krueger explained that 9% awards are competitive and typically provide a larger share of construction costs (they said roughly 70% under 9% vs. about 30% under 4%), making a 9% award more advantageous for maximizing unit counts.
On the roll-call vote, Councilor McClure, Councilor Graham, Councilor Curran and Councilor Flores voted yes, Councilor Matisse voted no, Councilor Bencomo was absent and Mayor Eric Enriquez voted yes. The motion passed.
What happens next: Lauterbach said staff will return to council for a formal loan-agreement approval if the project receives LIHTC awards and the developer meets qualification requirements.