The Clifton Plaza Apartments, a 10-story multi-family building for seniors who receive housing subsidies, is set to get a new $20 million lease.
Owned by an affiliate of Renewal Development Associates, the 107-suite apartment received a new round of low-income housing tax credits that forced the Portland, Maine-based specialist to buy out the property and refinance it for $6 million.
Renewal Development has owned the structure since 2005, when it acquired the property from the late property developer and radio station owner Xenophon Zapis.
The structure, which includes one- and two-bedroom suites and views of Lake Erie and a site near neighborhood businesses, dates from 1974.
Rich Galicz, a Willoughby-based development partner with Renewal Development, said in a telephone interview that the new project completes work the company could not afford in an earlier renovation. The work is essential but not cosmetic.
“We’re adding sprinklers throughout the building, which is a major feature, as well as new boilers,” Galicz said. “We will convert six suites to full (Americans Disability Act) compliance.”
A presentation from the Ohio Housing Finance Authority said the project will also include updating heating and ventilation equipment and elevators. The agency is the channel for allocating tax credits for low-income people in Buckeye State.
The capital stack for the project includes $3 million in low-income tax credits and a $10 million construction loan, which was not filed for public record as of last Thursday, May 5.
Cleveland’s Drake Construction will do the work, according to county records and the Ohio Housing Finance Authority.
The property’s tenants are in the federal Section 8 program, which limits their rent to 25% of their income.
The federal government pays the rest of what the landlord calculates as market rent for the building.
The project dates from a time when the federal government was dramatically funding and underwriting loans to expand the supply of senior housing. Now the properties are showing their age. They also predate the last round of senior housing projects that were adopted by private developers using market rate loans.