NEW ALBANY — A $3.3 million state tax credit could lead to the construction of a 157-unit, upscale apartment complex on the former Coyle Chevrolet property along Spring Street in downtown New Albany.
The Indiana Economic Development Corp., or IEDC, preliminarily awarded the credit to Indianapolis company Flaherty & Collins Properties on Friday, Jan. 30. A final decision by the IEDC will be rendered following a March 12 hearing, but city leaders are confident the project could start later this year.
It’s an estimated $16 million development that would include multiple five-story apartment buildings and a renovation of the Coyle showroom into restaurant and office space.
The Coyle showroom was most recently used by the Vintage Fire Museum and Education Center, but has been empty since the organization moved to Jeffersonville in 2014.
The financial firm Crowe Horwath administered an economic impact study for the city based on the project, and they are estimating the development would spur $30 million in investment within five years while creating 100 jobs.
New Albany Mayor Jeff Gahan said the city has been targeting ways to bring more residents to downtown, and added discussions with Flaherty & Collins have been ongoing for about a year.
It feeds into what Gahan calls “the business of residency.”
“It’s all about attracting a population that will come to New Albany, that will spend their time and resources in New Albany and who appreciate a great place to live,” he said Wednesday. “These are the kinds of developments that cities all over the state and country are fighting for.”
The for-lease apartments will be generally targeted to families making about $50,000 to $60,000 annually, and the complex would include several amenities geared toward young professionals. Estimates call for about 200 people to live in the complex, and that would generate more consumer spending downtown, city officials said.
“It’s really all about the ripple effect on this,” said David Duggins, director of economic development and redevelopment for New Albany.
The apartment complex is likely to include a pool, a park area for tenants to walk their dogs and an outdoor kitchen with flat screen televisions.
“We’re real excited to be part of the overall economic transition of downtown New Albany,” said Austin Carmony, a developer with Flaherty & Collins. “New Albany is a great example of a city that has made great strides in economic development, but downtown doesn’t have any new, good quality housing.”
The project would be a significant gain for New Albany, according to Uric Dufrene, finance professor at Indiana University Southeast.
“Nationwide, there is a movement of people moving to downtown areas,” he said. “This will certainly provide additional living opportunities for residents, and will support the existing downtown development.”
Flaherty & Collins is respected as a “top-notch” residential development firm, Duggins said. The Axis and Market Square are two recent developments Flaherty & Collins completed in Indianapolis, and they have several other similar projects in the Midwest.
Unlike the defunct Riverview project, the city isn’t being asked to construct a major piece of infrastructure. The Riverview development called for the city to build a parking garage to be paid back with tax-increment financing revenue.
There will be on-site surface parking and likely some canopy-covered parking for the apartment complex.
But the Coyle property development will likely require the city to issue a tax increment financing bond on behalf of Flaherty & Collins. According to Duggins, the bond would be paid back only with TIF revenue generated by the project.
The New Albany City Council and Redevelopment Commission would have to cast votes before a bond could be issued.
While tying up TIF funds isn’t something city officials favor, Council President Pat McLaughlin said the apartment complex could be a key component to furthering development downtown. Not only would the additional residents help bolster commerce for existing businesses, but they could encourage more service-oriented types of establishments to open, he continued.
“I think it’s definitely a viable situation,” McLaughlin said.
He added the project would heighten conversations about shifting Spring Street to two-way traffic, which was also mentioned by Carmony when speaking about Flaherty & Collins’ vision for the development.
New Albany Realtor Paul Kiger said if the apartments are constructed with quality and the finished product is worthy of the tax credit, the development could be a great benefit to the city.
“Will it be a success? Could it sell? Of course it could,” Kiger said. “I’m confident our city will do it right.”