Boston officials approved a tax break Thursday for a proposed apartment building near North Station where all 239 units would be priced at below-market rents.
The deal, however, is missing one key figure: the size of the tax break.
The administration of Mayor Martin J. Walsh is still negotiating with the developer, Related Beal, over how much property tax the building would pay over a 15-year period.
Related Beal plans to build a $230 million complex with apartments for low- and moderate- income tenants and an adjacent hotel on an empty rectangular parcel above Interstate 93 near TD Garden. The project itself received approval from the Boston Redevelopment Authority Thursday. Related Beal said the tax deal is key to financing the project.
Neither Walsh’s office, the Boston Redevelopment Authority, nor Related Beal would put a specific dollar figure on the incentive. But Ted Lubitz, who heads affordable housing at Related Beal, said having the project’s property taxes set for 15 years would help attract investors. “Predictability is essential to securing financing,” he said.
The unusual project comes as Walsh has called on developers to build more lower-cost housing in a city where much of the residential construction has been at the high end of the market. At the Related Beal building, rents would be set at 30 percent of the incomes of tenants who’d qualify to live there, which would keep the revenues far below what Related could fetch on the open market. Related Beal intends to use proceeds from the hotel operation to subsidize the housing.
About half of the units would be reserved for middle-income residents, those earning up to $78,800 for a two-person household. The remaining would be for lower-income residents. And in a city where apartment towers pop from the ground with barely anything bigger than two-bedroom units, Related Beal is offering a rare thing: 24 three-bedroom apartments.
A spokeswoman for Walsh said that City Hall hopes to wrap up the tax agreement “in the next few weeks,” and that the project supports Walsh’s goal of creating more affordable housing.
The tax break would be just one ingredient in a long menu of incentives Related Beal is trying to cobble together to finance the apartments. In addition to its own capital, the developer is seeking state tax-exempt bonds and state and federal housing tax credits.
The company also plans to put $6.75 million in affordable-housing payments from its other projects toward the apartments.
And it is discussing with the BRA about tapping into the city fund that collects similar payments from other developers.
“It’s about keeping investments in the neighborhood,” Lubitz said.
Lubitz said his company hopes to start construction in November, which would allow the building to open in 2018. But, he said, “we have a long way to go.”