Here are 3 Tacoma apartment projects seeking tax exemption for building affordable units

Three Tacoma apartment projects are seeking approval of development tax exemptions at Tuesday’s City Council meeting, with each offering rent-restricted units.

The three have applied for the city’s 12-year multifamily tax exemption, which calls for 20 percent of the units to be affordable at 70 percent of Pierce County area median income ($49,882 for a single person as of April, for example) for 12 years.

“Affordable” is considered housing for which a household does not pay more than 30 percent of its gross income for housing costs, adjusted annually.

According to the city’s 12-year MFTE rules, the developer is exempted from property taxes on the assessed improvement value for the 12-year time period. A minimum of four new units must be constructed, rehabilitated (if vacant for a year or more), created through conversion of a commercial structure, or added to existing occupied multifamily housing, be located within an eligible area.

The projects and proposed rent rates are as follows:

▪ Lear Group, LLC, representing a group of local developers affiliated with Raygor Construction, is proposing 40 new units at 7431 Pacific Ave. The site calls for 32 market-rate and eight affordable units, with market-rate rents ranging from $1,300 for 555-square-foot one-bedroom, one-bath units, to $1,550 for 847-square-foot two-bedroom, one-bath units.

For those listed as affordable, rents range from $1,425 for 555-square-foot one-bedroom, one-bath units, to $1,603 for 847-square-foot two-bedroom, one-bath units. Utilities are included in the rent-restricted rates.

The project, known as Packard Apartments in the city’s permit system, will include 47 parking stalls and 1,700 square feet of commercial space. Construction is estimated at $8.2 million. The site, a vacant lot, is between Avamere Heritage Rehabilitation of Tacoma and Zurich Townhomes (Zurich House).

The MFTE application lists an estimated completion date of February 2024, but that’s subject to change.

Plans Packard Apartments were first submitted to the city by different developers in 2019, according to permit records on file. The site sold to the current owners in July for $2.2 million. The original developers purchased the property in 2019 for $525,000.

▪ Two properties near the Tacoma Dome Station also seek the 12-year exemption.

Project S29 LLC, 201 E. 25th St., and Project S30 LLC, 209 E. 26th St., are being developed by Bode, formerly the Stratford Co. of Seattle.

The 25th Street project calls for 164 apartments to replace vacant commercial buildings and a parking lot, while the 26th Street site calls for 141 units to replace parking and storage at the site.

The projects have been in the works for while, with plans dating back to September 2019 in the city’s permit system.

Project S29 on 25th Street will include 131 market-rate units with rents ranging from $1,372 for 346-square-foot studios to $2,295 for 1,153-square-foot three-bedroom, three-bath units.

The 33 affordable units will have rents ranging from $1,247 for 346-square-foot studios to $1,782 for 1,153-square-foot three-bedroom, three-bath units. Those rents include utilities.

The estimated $31 million project will have 22 parking stalls.

Project S30 on 26th Steet will include 112 market-rate units with rents ranging from $1,495 for 534-square-foot one-bedroom, one-bath units, to $2,995 for 784-square-foot three-bedroom, four-bath units.

It will include 29 affordable units with rents ranging from $1,425 for 534-square-foot one-bedroom, one-bath units, to $1,782 for 1,153-square foot three-bedroom, four-bath units. Utilities are included in the rent-restricted rates.

The estimated $39 million project will have seven parking stalls. Both projects list an estimated completion date of April 2024.

Bode has a third 12-year MFTE proposal in the wings, according to the city’s online permit system. Bode S39 Multi-Family Development, at 304-316 S. 29th St., and 2912 S. C St., is slated for 184 units, with 37 of those rent restricted. The MFTE application lists nine parking stalls for that project.

Its site proposal submitted in November 2021 described it as a “multifamily development with residential units and live/work units in 5 levels of residential floors over 2 levels of live/work floors at ground level, along with associated site, utility, and right of way improvements.”

The proposal has not yet been scheduled for a council agenda.

Tacoma’s MFTE program has seen more projects seeking the 12-year exemption, with nearly 20 coming to council so far this year, compared with around 10 so far seeking the eight-year version. Under the eight-year MFTE, all units are allowed to be market rate. One development, Cornus House at 2502 Pacific Ave., reversed course in September and gained approval to switch from a 12- to eight-year MFTE, with all market rate units, citing rising interest rates and construction costs.