ANDERSON – The newest owners of the Cottages of Anderson received preliminary approval to issue a tax-exempt $5 million bond through the city of Anderson.
The Anderson Economic Development Commission and the Anderson City Council on Thursday approved resolutions to allow Cottages of Anderson Housing Partners to issue the $5 million in bonds to purchase the property on Marine Drive and to remodel the 120 units.
The bonds are expected to be repaid in 18 months.
The city of Anderson is not liable for the repayment of the bonds and it won’t impact the city’s capability to bond in the future or the city’s credit rating, City Attorney Tim Lanane said.
Lanane said Mayor Thomas Broderick Jr.'s administration supports the project, adding the tax-exempt bonds is a good economic development tool for communities.
“This is a win-win,” he said. “There is a need for this type of housing in Anderson.”
Lanane said the city has participated in more than a dozen “pass through” bonds over the years for Anderson University, housing projects and small businesses.
Buckingham Properties of Indianapolis purchased the property and plans to spend $22,000 in each of the housing units for new appliances and heating and cooling systems.
The residents will not be displaced during the remodeling work.
Greg Winkler, executive director of the Anderson Economic Development Department, said the tax-exempt bonds are a part of the financing package.
The Buckingham Foundation will own the housing complex that opened in 2002.
The purchase price and the remodeling costs are estimated at $8.9 million.
Justin Brown of Buckingham Properties said the company has been managing the Cottages of Anderson for several years. He said the Buckingham Foundation decided to purchase the property when the original developers decided to sell the housing complex.
Brown said the Cottages of Anderson has provided low-income housing for people over the age of 55.
Although the age restriction is being removed, the complex will continue to be for those aged 55 and older, he said.
“We decided not to raise the rates to market value,” Browning said. “We’re upgrading the units for another 15 years of life.”
The Buckingham Foundation will develop programs for the residents.
He said the current occupancy rate is at 96 percent, Browning said.
Follow Ken de la Bastide on Twitter @KendelaBastide, or call 640-4863.