The evolution of the Front Street district in downtown Missoula will continue with the construction of two new housing projects, including five condominiums and as many as 20 new apartments.

The Missoula Redevelopment Agency's board of directors on Thursday agreed to reimburse the developer's cost to make improvements in the public right-of-way during the project's first phase, which includes the construction of five attached, three-story townhomes.

Reimbursement to cover the cost of demolishing the property's three aging apartments would be paid after Levasseur Street Townhomes provide a building permit for the project's second phase, which includes 27 studio and one-bedroom apartments in a new three-story structure.

The total reimbursement package totals roughly $221,000.

“When we look at the Front Street Urban Renewal District plan, it talks about how 85 to 95 percent of this area is rental,” said Chris Behan, MRA's assistant director. “To make it a real neighborhood, there needs to be some homeownership opportunities. This is a start, and it increases the number of owner-occupied homes in this area.”

The property, located at 304 Levasseur Street in the downtown district, is currently home to several older homes that were long ago converted to apartments. MRA said all three buildings are in an advanced state of disrepair, though they remain home to several tenants.

The three buildings include roughly 10 apartment units. As part of the agreement, Behan said, the developer has been required to provide relocation assistance to the few tenants who remain, most of them identified as college students.

“We've worked really closely with the tenants to make sure they find suitable housing,” said Reghan Brandt, a representative of the developers. “At the time of submitting the application, there were four, and we're now down to two tenants. One actually gave notice today that they'll be moving out as well. Most of them had already moved out on their own.”

According to MRA, the developer proposed two relocation options, and most tenants settled on option one.

That included a full refund of security deposit, payment of reasonable moving expenses not to exceed $500, and identification of at least one available apartment that was considered a “suitable replacement” for housing.

Behan said it was more cost-effective to require the developer to provide relocation assistance rather than MRA doing it on its own.

“If MRA had undertaken relocation in this case, the whole project would be unaffordable,” Behan said. “The owner has put together a relocation plan and it seems reasonable. They've been working with them (the tenants) to find appropriate, suitable housing, and providing assistance to get them into equivalent housing.”

The total cost estimated for Phase 1 stands at $2.3 million, which includes both construction and land costs. While the design and financing for Phase 2 is not finished, the construction budget anticipates a cost of around $1.5 million.

Don MacArthur of MMW Architects said the 27 apartments included in the project's second phase would replace the property's 10 aging apartments, which rent from $575 to $695 a month.

While the proposed rent in the new apartment complex wasn't revealed, MacArthur said the units would serve a similar population while the townhomes fetched a higher price.

“This is a way to take blighted student housing and create some ownership product down there, but also do some apartments that won't be blighted that serve the same tenants,” MacArthur said. “It's a mixed-stream income approach, and it will bring some density to the downtown area I think we're all hoping for.”

The Levasseur Street townhome project joins a growing list of changes taking place in the Front Street district. A new Marriott Hotel is under construction on the 100 block of East Front Street, as is a new student housing complex and 308-stall parking garage on the 300 block.

The Missoula Public Library is also building a new facility on the 500 block of East Front Street. The property currently occupied by library, now located on the 400 block of East Front, is also slated for redevelopment in the coming years.

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