Green Mills Group plans Lofts on Sixth, an eight-story mixed-use development near downtown Fort Lauderdale, with 90 affordable housing units for low-income seniors and a new home for a local food bank catering to the elderly.
“We’re hoping to close financing and put shovels in the ground in the second quarter of next year,” Mitch Rosenstein, a founder and principal of Fort Lauderdale-based Green Mills, told The Real Deal. He said construction of Lofts on Sixth will take 14 months to complete.
Each senior housing unit will have one bedroom and one bathroom. Apartments will span about 600 square feet, with a monthly rent of about $1,300, Rosenstein told TRD.
Eligibility to rent an apartment at Lofts on Sixth will be restricted to seniors 55 and older with 30 percent to 80 percent of the area median income in Broward County. Broward County’s annual median income is $89,100.
Measuring about three-fourths of an acre, the two-parcel development site is at the intersection of Northwest Sixth Street, also known as Sistrunk Boulevard, and Northwest Third Avenue in the city’s Progresso Village neighborhood, just west of the Florida East Coast railroad and the Flagler Village area.
Green Mills has a 99-year ground lease on the parcel at 610 Northwest Third Avenue. The parcel’s owner is a company controlled by the Pantry of Broward, a charity with an existing home office and warehouse on the site. Started in 2008, Pantry of Broward provides food to seniors facing financial strain. Green Mills executed the ground lease and made a capitalized lease payment of $1.8 million to the food bank about four years ago, Rosenstein said.
The 130,000-square-foot Lofts on Sixth development will include 9,000 square feet for a new warehouse and headquarters for Pantry of Broward as well as a cold-storage facility and grocery store operated by the nonprofit organization.
After securing a ground lease on the Pantry of Broward parcel, Green Mills made an unsolicited offer to buy an adjacent parcel on Northwest Sixth Street from the city of Fort Lauderdale. Green Mills then emerged as the winning bidder after the city issued a request for proposals to buy the site.
The Fort Lauderdale City Commission voted Tuesday to sell the parcel at 221 Northwest Sixth Street to Green Mills for $560,000 and to designate the parcel, a former gas station, as a brownfield site. The brownfield designation provides developers with incentives including property tax rebates to clean contaminated soil, Rosenstein said.
In its original purchase agreement with the city in 2020, Green Mills agreed to pay $668,100 for the parcel. But the city later reduced the price by $108,100 after the developer discovered six underground gasoline storage tanks on the property and started remediation work to clean the soil, Rosenstein said.
The total cost of the Lofts on Sixth development will be about $40 million, he said, and about $30 million of the development’s funding will come from financial institutions whose equity investments qualify for the federal government’s 9 percent low-income housing tax credits, which are allocated periodically by the Florida Housing Finance Corp.
“Our tax credit equity is spoken for. Raymond James and TD Bank are our limited-partner investors,” Rosenstein said. “We had to apply [to the Florida Housing Finance Corp.] for a couple of funding rounds successively until we had a winning lottery number.”
TD Bank also will provide about $20 million of construction financing for the Lofts on Sixth development, Rosenstein said. “The reason we need such a big construction loan is because the tax credit equity, that $30 million, is funded over time at major milestones,” he said. “So really the construction loan is used like a bridge [loan], if you will.”
In addition, the Fort Lauderdale Community Redevelopment Agency has provided a $640,000 loan to Green Mills to fund the Lofts on Sixth development, and Broward County has agreed to make a $2 million loan to support the development, Rosenstein said.