LEBANON – Two Northern New England real estate developers are teaming up on a 204-unit housing complex proposed along Route 120 and designed for middle-income tenants

Dick Anagnost, of Manchester, who has developed other residential and commercial projects in Lebanon, and Ken Braverman, a partner in residential complexes in the Burlington area who in recent years has expanded into Lebanon, said that the four-building project proposed on Mount Support Road near the Dartmouth-Hitchcock Medical Center campus would be designed for residents earning 60% of the area’s median income.

The apartment complex would be meant to address the Upper Valley’s acute shortage of so-called “workforce housing,” the segment of the market that is between low-income subsidized housing on one end and housing for high-earning professionals on the other and geared toward people who earn between $35,000 to $80,000 annually, the developers said.

And to secure the necessary financing, the developers held out the possibility that they may seek a tax break with the city, depending on how their fundraising efforts go with other public sources.

“We’re targeting nurses, we’re targeting technicians, we’re targeting police officers, all of those,” Anagnost told the Lebanon Planning Board in presenting the site plan earlier this week.

Situated on the east side of Mount Support Road in the city’s high-density residential district directly across from where Dartmouth College is building a 209-unit graduate student housing complex, the project calls for the developers to acquire and merge two lots into a single 14-acre property where four three-story apartment buildings will be constructed.

“There is no greater need in the Upper Valley and New Hampshire than for workforce housing,” said Anagnost on Tuesday, explaining that the project is possible thanks to the federal and state financing programs the developers plan to tap in addition to the higher-density zoning that allows costs to be spread across more units.

“The market-rate housing that is being built has very little ability to offer rents that middle-income households can afford,” Anagnost said. Prospective tenants would range from single occupants to three- or four-member families.

Anagnost estimated the total cost of the project is forecast between $45 million and $60 million, depending on cost of building materials, which have escalated sharply during the pandemic.

The developers estimated that a three-member family might expect to pay $1,200 per month in rent, although the amount would vary depending upon income level. That is significantly less than many Upper Valley landlords are today charging and made possible by knitting together a package of financing through both federal and state housing programs, they said.

The complex would have 120 one-bedroom units, 72 two-bedrooms units and 12 three-bedroom units. There would be parking spaces for a total of 390 vehicles, including 206 spaces outside and 184 under the structures.

“If you think about what you hear about rents these days, that’s quite a bit less than what would be considered market rate at the moment around here, especially for the newest units,” Braverman told the board on Tuesday.

The Mount Support Road project was initially pitched by Braverman to the planning board in 2019. At that time, it was envisioned to comprise only two buildings of about 50 units each. Anagnost, who also built the five-building, 153-unit Altaria apartment complex on Route 120 — where rents are currently listed at $1,900 to $2,900 per month — and the new New Hampshire Liquor and Wine Outlet in West Lebanon, joined the project later.

The developers said if they win all approvals, they could break ground in April or May, and the first building would be ready for occupancy in March 2023, with the other buildings coming online within months.

“We have somewhat of an aggressive timeline. And the reason for the aggressive timeline is because of the demand in the marketplace and the need for this type of housing,” Anagnost said.

Braverman described the workforce housing concept as “super-important to us” and said the developers expect to tap tax-exempt financing along with low-income housing tax credits to finance building of the project.

Specifically, the developers said they are in discussion with the New Hampshire Housing Finance Authority, which sponsors multifamily housing projects throughout the state, that would allow them to issue tax-exempt bonds to raise financing. Such financing also comes with restrictions on who is eligible to rent and how much rent the developer is allowed to charge.

Planning board members pressed Anagnost and Braverman on this point, seeking clarification about what percentage of the apartments would be “affordable.”

Braverman replied it is the “goal” is for “100% of the project to be affordable” apartments, although he noted “that’s subject to us getting the funding that’s necessary to achieve that goal.” He said that “rigid” federal and state rules dictate renter eligibility requirements — for example, “unemployed (Dartmouth) students” would not qualify — and what can be charged for rent.

“In order for it to be successful, we need to bring in as many people under the tent as possible, including at a certain point we may come to the city and say, ‘We need some help to hit our affordable housing objectives as well,’ ” he said.

Which led planning board member Laurel Stavis to ask “and that help would be in the form of tax exemptions?”

“That’s correct,” Braverman answered.

(According to a fiscal impact analysis provided by the developers, gross yearly taxes from the property are estimated to yield $422,000 in revenue to the city with an “anticipated fiscal impact” of $108,000, leaving the city $314,000 in the black).

In any case, the developers expect demand for the rental apartments to be brisk given the interest since the first meeting about the Mount Support Road project with the planning board last month

“We actually have nine calls to reserve units already,” Anagnost said. “We haven’t even got through the public hearing stages yet, and we’re receiving calls for these units.”

Contact John Lippman at jlippman@vnews.com.

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