The planners of the South Square redevelopment project aren't giving up after failing in their funding bid for the $14.8 million project. In fact, they're already preparing to try again.
The Lancaster Alliance and the Housing Development Corp., which are cooperating in the proposed housing project, were passed over earlier this month in their request for $11.7 million in federal tax credits administered by the Pennsylvania Housing Finance Agency.
Lancaster Alliance President Bob Shoemaker said he and Housing Development Corp. representatives met Wednesday to strengthen their application for the next round of PHFA funding.
The Lancaster Alliance, a business group that promotes city revitalization, and HDC, a nonprofit housing developer and manager, announced plans to renovate existing residential properties in the 100 block of South Queen Street, raze additions on the rear of the buildings and construct new apartments.
When completed, South Square would have 62 spacious one-, two- and three-bedroom apartments in 70,000 square feet of space. They would replace 64 units occupying 30,000 square feet of space, newspaper records show.
The new apartments are intended to provide "work force housing," with monthly rents of $400 to $800.
The housing units slated to be demolished are mostly single rooms being rented by the week.
The Lancaster Alliance, through the Economic Development Corp. of Lancaster County, reached installment purchase agreements on 10 properties last year. HDC stepped in to manage the existing units and would own the new apartments.
According to HDC spokesman Jeff McCloud, South Square was one of 83 projects in the state to apply for PHFA funding. A total of $74 million in tax credits was requested, but only $23.7 million were available. Twenty-eight projects were awarded funding, but none from Lancaster County.
Applications for the next round of funding are due in January. Shoemaker said a preliminary review will occur in November.
He said he'll continue to seek the remaining funding needed from several sources, including government and foundation grants. Some grants require the inclusion of street-level commercial space, but he said discussion about whether to redesign the project to include commercial space is just beginning.
Shoemaker, who has been the Alliance president since May, said he remains optimistic about the project.
"Everybody has been very cooperative, and I don't think there is anyone who doesn't think this project has merit," he said.