Developer Seeks Tax Credits for $9.2M Salem Project
SALEM, Ohio — Forty apartments to house seniors at an affordable price could be coming to Salem as soon as 2019, John Ginocchi and Michael Mancuso said Monday.
Ginocchi is vice president of development at Pittsburgh-based Development GroupTrek, Mancuso executive director of the Salem Area Sustainable Opportunity Development Center.
The $9.2 million project would be developed, owned and managed by Trek, they said.
The project is proposed for 6.5 acres on Bentley Drive, which would offer 40 cottages around two common green spaces in a wooded area.
“It’s ideal for this type of project,” Mancuso said. “It’s zoned properly for multifamily use already, so the zoning is in place. The infrastructure is in place. Water, sewer, power is all there.”
The units are restricted by income. A resident would have to fall below 60% of the area median income. The project will enter a competition for tax credit financing through the state of Ohio in March — the first step on the road to development.
Trek, with 25 years of development experience, has completed 70 projects in Greater Pittsburgh that include residential, commercial and mixed-use properties. Most are within a 150 miles radius of that city.
Low-income housing tax credits constitute the majority of its funding.
“Tax credits usually fund about 75% to about 80% of a project,” Ginocchi said. Borrowing or other forms of financing are used to cover the remainder. Rents at the Salem development would run from $520 to $620 a month for a one-bedroom unit and $650 to $750 for a two-bedroom unit. Twenty-six are planned as one-bedroom.
“If you look at our demographics, there are over 12,000 people that live in the city of Salem, and the majority of those folks are older,” Mancuso said.
By providing such housing, Salem would help seniors looking to downsize and stay in the city while freeing up housing stock for younger families, he said.
“In the past, seniors looking to downsize left the city due to lack of options,” he said.
The presence of a “strong senior market” drew Trek to the Salem area, Ginocchi said. This is his company’s first project in Ohio.
John Conglose, president of J.B. Conglose & Associates LLC, helped the company select the site from 34 communities.
In March, Trek will apply for tax credits through the state of Ohio. “It’s extremely competitive,” Ginocchi said. “The state of Ohio will fund about 30 projects a year and they might receive 200 applications or more.”
He estimates that about half of Trek’s projects are approved for tax credits.
The state awards tax credits in July. If approved, design would begin immediately. Ginocchi said construction could take 12 to 15 months and residents could begin moving in around May or June 2019.
Should the state deny the Trek application, it could reapply as early as next year. “The options they have on the property extend far enough for them to apply again in the next cycle,” Mancuso said.
Pictured: Michael Mancuso, executive director, Sustainable Opportunity Development Center; John Conglose, president, J.B. Conglose & Associates LLC; John Ginocchi, president, Trek Development Group.
Copyright 2022 The Business Journal, Youngstown, Ohio.