New South City mixed-income community under construction in Memphis opens site to celebrate progress.

September 24, 2018 | McCormack Baron Salazar

Memphis, TN – The Memphis Housing Authority (MHA), the City of Memphis, national affordable housing developer McCormack Baron Salazar, Inc., local developer ComCap Partners,  and the non-profit Urban Strategies Memphis HOPE, welcomed dignitaries, former residents, community members and the media to view the construction of the first two phases of the South City mixed-income apartment community. Located just south of Downtown Memphis, South City is the keystone in MHA’s efforts to transform public housing across Memphis by creating communities in which families from all income levels can live together and thrive.

“South City, which is partially funded by a competitive Choice Neighborhood grant from HUD, demonstrates what a strong public/private partnership can achieve,” explained Marcia Lewis, CEO of the Memphis Housing Authority.  “This City, the State of Tennessee, former residents, McCormack Baron Salazar, RBC and Chase banks, non-profits like Urban Strategies and the Women’s Foundation for a Greater Memphis have diligently collaborated to make the vision of our residents a reality.”

The first phase, which is partway through vertical construction, will have 114 apartments in garden buildings and townhouses.  Offering one- to three-bedroom apartments, Phase 1 has 55 units set-aside for former Foote Homes and other public housing residents.  46 of the units will be market rate and the remaining unit will be rented as low-income workforce units.  The second phase, which is beginning construction, will have 134 total apartments, also in gardens and townhouses, with 67 units reserved for public housing residents, 44 market-rate and 23 workforce. The community features market-rate amenities, including in-unit washers and dryers, a community fitness center, a business center, community spaces and green energy-saving design through Enterprise Green Communities and LEED for Neighborhood Design.

Public Housing residents also benefit from an integrated case management program led by Urban Strategies Memphis HOPE.  The program includes results-based strategies for increasing the number of children in early education programs, increased resident access to quality physical and mental healthcare, connecting ex-offenders and working age adults to a coordinated pathway of economic mobility and neighborhood revitalization, and increasing adult financial empowerment skills among other critical supports.

“The key to the success of our communities across the country is the integration of the “people” program with the housing program,” explained McCormack Baron Salazar Chairman, Richard Baron. “By partnering with service providers and philanthropic organizations within the community, like the Women’s Foundation for a Greater Memphis, we are able to identify the programs and services that meet the needs of our residents.”

“The South City Choice Neighborhood is not just a redevelopment of the Foote Homes site,” explained Esther Shin, President of Urban Strategies. “It will complete the revitalization of this area of Memphis, opening up new opportunities for residents, businesses, and visitors in this dynamic community just south of Beale Street. The combination of physical programming with human capital development is catalyzing this change.”

A core component of the McCormack Baron Salazar/ComCap development approach is layering public and private funds to transform communities across the country. For South City, the $30 million Choice Neighborhood Implementation grant from the U.S. Department of Housing and Urban Development leveraged funds from MHA, the City, and private debt from Chase. The Tennessee Housing Development Agency provided low-income housing tax credits that generated equity from RBC Capital Markets.  Chase serves as the construction lender. LRK provides planning and architectural services. The general contractor for the redevelopment effort is Capstone Building Corp.  In total, $35.5 million was invested in Phase 1 and $41.8 million was invested in Phase II.  In total, 604 units are planned for the site, including a 100+ unit senior building.