(The Center Square) – The Tacoma City Council has approved an 8-year multifamily housing property tax exemption agreement for the development of 171 multifamily market-rate units and eight live-work units in the Tacoma Mall Mixed Use Center.
The projected completed assessed value of the apartment complex is estimated to be $75 million, with the projected total property tax to be exempted over the next eight years at $6.9 million. Tacoma is expected to lose out on $1.4 million in potential property tax revenue for the development of multifamily housing. units.
In turn, the projected total sales tax generated for the city is $2.4 million, leaving the tax-exempted apartment building with a net positive impact of approximately $1 million.
AVA 200 LLC proposed to develop the 171 market-rate rental units in the Tacoma Mall Mixed Use Center. The 171 units would be divides as follows: 15 studio apartment units at an expected rental rate of $1,515, 70 one-bedroom units at an expected rental rate of $1,650, 53 larger one-bedroom apartment units at $1,795 and 33 two-bedroom apartment units set at $2,600 a month.
The eight live-work spaces allow small businesses to operate on the bottom floor, while also having a separate living space for the business owners.
According to a recent report from ApartmentList.com, the overall median rent in Tacoma is $1,488, after rising 0.9% last month.
When the city conducted outreach to multifamily properties in June, the results showed a 4% vacancy rate in rental housing. The low vacancy rate indicates that there has been a decrease in available homes. New projects coming on line are still quickly being filled, meaning that demand is not slowing.
“As we add additional units pressure on the market should be relieved and prices should reflect less upward pressure,” the resolution states.
Tacoma Economic Development Services Division Project Manager Debbie Bingham presented the proposal to the city council on Tuesday. According to Bingham, the construction of the apartment complex is estimated to cost $75 million and will provide 350,000 labor hours.
