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Thursday, May 30, 2019 12:08 am

A big box checked off

Poplar Place redeveloper wins tax credits

Redevelopers hope to convert Poplar Place from duplexes into single-family homes like this.

 

A dilapidated Springfield housing development cleared a hurdle this month with the award of tax credits by the Illinois Housing Development Authority.

It is, project backers say, the biggest step toward making Poplar Place an asset instead of a blight that has attracted nationwide attention via a recent series of articles in Governing magazine, which pointed to the crumbling collection of duplexes, many vacant, as an example of housing segregation and poverty on the capital city’s east side.

“There’s still a couple of pieces that need to come in,” says Mayor Jim Langfelder. “The largest portion is the tax credits. … For myself, I think it’s 90 percent of the way there.”

Fixing Poplar Place will cost $22 million, according to estimates from the redeveloper, which dubbed the project Livingston Homes in applications for tax credits that would be sold to generate funds for demolishing some structures and renovating others. The state awarded $15 million in credits, says Virginia Pace, president of Lightengale Group, a Chicago firm that helps find money for affordable housing. Iceberg Development, an Iowa company that redevelops blighted properties, would oversee development that includes razing existing units and renovating remaining ones in a less-is-more plan that hinges on reducing living density by reducing the number of living units. Pace estimated that $3 million in private money still must be found to complete financing.

“The credit award is the most important,” Pace says. “The typical deal closes in February or March of the following year. … The work, really, begins at this point.”

Poplar Place now has more than 200 living units; the number would be cut to 99, with nearly a third of the existing buildings demolished and townhomes converted to single-family homes.

The city council in February approved $1.2 million in tax increment financing funds for road repairs, but the award was contingent on redevelopment. The roads aren’t publicly owned, and the city wasn’t compensated when it fixed potholes in 2016. Poplar Place and its roads are owned by Related Companies, a multinational real-estate firm that boasts luxury properties in Abu Dhabi, Chicago, Shanghai and Washington, D.C. In New York, the company is developing Hudson Yards, the nation’s largest private real-estate project as measured by area. As part of the deal in Springfield, Related no longer would own Poplar Place, which has been the subject of litigation as the city has taken the company to court in an effort to force improvements.

Built nearly 70 years ago, Poplar Place has gone through a series of names and owners, including political power broker William Cellini, who acquired the development in the mid-1980s and christened it Evergreen Terrace. He unloaded it after barely more than a dozen years, receiving $7.3 million in 1998 from a company soon acquired by Related while complaints about crime rose.

The Springfield Housing Authority has skin in the latest redevelopment plan, having committed to providing vouchers tied to between 20 and 25 units in the planned project, said Jackie Newman, housing authority executive director. The commitment is different from Section 8 vouchers granted to tenants who can use such vouchers to live anywhere they please. “It’s a small percentage, when you talk about, in the scheme of things, a $20 million-plus deal,” she said.

Newman said she doesn’t know how many Section 8 tenants now live at Poplar Place, but the housing authority currently has no unit-based vouchers at the development. “It just wasn’t a partnership that we pursued or that they (the owners) pursued with us,” Newman said. Redevelopment is important, she said.
“What we are interested, always, in the housing authority is how do we partner with other people,” Newman said. “What I can say is, there is a huge need for affordable housing in the city. How do we transform that area?”  

Contact Bruce Rushton at brushton@illinoistimes.com.

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