A local developer has secured state and federal tax credits that will allow him to proceed with a $15 million housing project in a former mill in downtown Biddeford.
Nathan Szanton said The Lofts at Saco Falls will add 80 new apartments in the city’s mill district at a time when several other former mills are being actively redeveloped into mixed-use projects and demand for apartments is high. The project is being funded primarily through a mix of affordable housing and historic tax credits.
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The Lofts at Saco Falls received approval from the Planning Board in 2013, but the project was delayed as Szanton and partners Robert C.S. Monks and Amy Cullen sought tax credits from both the state and federal governments. The building will include some market rate units, but the majority of apartments will be reserved for affordable workforce housing for income-qualifying tenants.
The project in two buildings in the Riverdam Mill complex will be funded by $7.5 million in tax credits from MaineHousing, $3.3 million in state historic tax credits, $2.4 million in federal historic tax credits, a $1.4 million mortgage from MaineHousing and a $500,000 bank loan. The city has approved a tax increment financing agreement that will return 75 percent of tax proceeds to the developer for the next 15 years, then smaller amounts during the following 15 years.
Szanton’s housing project comes as Kennebunkport developer Tim Harrington seeks permission for a $50 million hotel and apartment project in the former Lincoln Mill. Harrington appeared before the Planning Board Wednesday night to present his proposal for 101 market-rate apartments, an 80-room boutique hotel and two restaurants.
Both Szanton and Harrington say they would not have invested in the mill district if the city had not purchased the Maine Energy trash incinerator, which operated for about 25 years on a lot adjacent to the mill buildings. The City Council bought the Maine Energy property for $6.65 million two years ago.
“These two projects combined are $65 million worth of new investments. I think the City Council took a very brave and very strategic investment by purchasing Maine Energy,” said Daniel Stevenson, the city’s economic development director. “We wouldn’t have these developments but for that decision.”
Szanton previously created 66 apartment units at the Mill at Saco Falls, which opened in 2010. When Maine Energy closed, Szanton decided to move ahead with a similar project in two adjacent Riverdam mill buildings where workers at one time built the machinery used in the city’s textile mills.
“(Maine Energy’s closure) had a catalytic effect on our interest in this site. There’s no way we would have attempted this project if a trash plant was right next to our project,” Szanton said.
Plans for The Lofts at Saco Falls call for 64 one-bedroom apartments, 15 two-bedroom units and one studio apartment. Rents for workforce housing units will range from $568 to $829 monthly for tenants who earn 50 or 60 percent of the area’s median income. Market rate apartments will rent for $780 to $925 per month.
Szanton said he is not worried about filling the apartments. Since the Mill at Saco Falls opened four years ago, building management has received at least 50 calls each time a unit is available, which he said is rare. City officials say all apartment buildings within the mill complex are fully occupied.
“Each one of our residents is like a little economic engine driving Biddeford forward,” Szanton said. “They shop in local stores, do their banking downtown and eat in the local restaurants.”
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