Juneau Assembly OKs $3M loan for 60-unit apartment complex in Mendenhall Valley

The Juneau Assembly approved a $3 million loan Monday night to help a local developer construct a 60-unit apartment complex in the Mendenhall Valley.

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The money comes from the city’s Affordable Housing Fund. The two three-story buildings, called the Creekside Apartments, are slated to be built across the street from the Mendenhall Mall near Pucker Wilson’s food truck. The developer is Tower Legacy II LLC. 

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According to its loan application, the developer says the location’s proximity to grocery stores, health care centers and public transportation will help reduce some of the barriers people with lower income face when trying to find housing in Juneau. 

The City and Borough of Juneau created the Affordable Housing Fund to address the shortage of low and middle-income housing and uses the money to help developers create more rentals and single-family homes. 

The city typically uses 80% AMI to determine eligibility for affordable housing programs. It refers to a household or individual income that is at or below 80% of the Area Median Income, which is categorized as “low-income.” In Juneau in 2024, 80% AMI for a single person is $67,700 and $120,800 for a household.

Last year, the fund had $4 million available for projects. The Assembly already approved $1 million of that to help renovate the downtown Gross-Alaska Theatre building into an apartment complex. The remaining $3 million in the fund will go toward this new development, which is expected to cost about $8 million in total. 

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By accepting the city’s low-interest loan, Tower Legacy II agrees to make roughly a third of its units meet certain affordability requirements laid out by the city. 

At least 18 of the studio apartments must be available for $1,150 per month and three of the two-bedroom apartments must go for $1,600 per month. During the term of the loan, the apartments can’t be used as short-term rentals. 

The developer’s application outlines a timeline to have all 60 units completed by May or June of this year. 

This story has been updated with more information about how the city determines affordable housing prices.