State tax credits mean more affordable housing is coming to South Bend

SOUTH BEND, Ind.-- Two developments are coming to South Bend, thanks to low-income housing tax credits granted by the state. Both projects will add a total of 114 units of affordable housing to residents, at a time when demand is very high.

This is the first time in seven years the City of South Bend has been awarded low-income housing tax credits.

"We got a need across-the-board for housing of all types but particularly at a very low-income level there's a pretty significant demand for affordable housing and so these units 114 between the two projects really hit those very low-income residents and in those residents are able to qualify for these units at work we're really excited about that and excited to see these projects and forward," said Caleb Bauer, executive director of community investment for the city.

The Diamond View Apartments will be built across from Four Winds Field on a now vacant piece of land the city is selling to developers.

Along with 60 low-income units, there will be 60 market-rate apartments and 7 townhomes,  expected to be finished by 2025.

According to the city's Department of Community Investment, the low-income units will be based on area median income (AMI). Thirty units will be for residents below 60% AMI, 12 units will be for residents below 50% AMI, and 18 units will be for residents below 30%.

For context, Bauer said 30% of area median income is $16,000 or less a year.

The developer is partnering with the Logan Center, which assists people with disabilities, to reserve 12 units for clients to have a safe, stable place to live.

The other development granted the tax credit is the SB-Thrive Apartments, which will be located on an empty lot off McKinley Avenue in South Bend's East Side.

The $14.5 million project is expected to break ground this summer and be finished by next year.

The development will consist of 54 affordable housing units. Ten units will be for residents below 60% AMI, 20 units will be for residents below 50%  AMI, and 24 units will be for residents below 30%

Builders say a market study of South Bend showed nearly 99 percent of affordable units in the city are occupied, meaning this is much needed.

"The demand has consistently been there before the pandemic, and really I think it only increased the demand throughout the pandemic," said Mark Surak, developer and owner of RealAmerica Companies.

Because of interest rates, the applications for the low-income housing tax credit were actually pushed back from November to this month and were awarded Thursday.

"There's a lot of projects that had been in the pipeline or plant that were put on hold because of different reasons. You know, material costs increased across the board. Labor costs are, were higher than typical. And then, of course, more recently, in the last year, the increase in interest rates has made a lot of projects a little more difficult as well," Surak said.

Two additional south bend projects lost out on the tax credits, but the city says one of them is still under consideration for a separate grant.