A cluster of empty lots and run-down houses at the intersection of 18th and I streets in Merced will soon become part of the city's pilot project to revitalize downtown with new, denser, housing.
"We're trying to make it more urban," said Daniel Ainslie, a development coordinator with the city's redevelopment agency.
The Great Recession and the foreclosure crisis have given the city's redevelopment agency a rare chance to pick up currently inexpensive houses and lots downtown. They'll now be turned into high-density, low-income housing. Not only will the project improve the area's housing stock, but it will also increase density in downtown, officials said.
"That area is ripe for some more urban-style housing that will contribute to the revitalization of downtown," said Bill Cahill, the city's assistant city manager.
During the next 18 months, the city hopes to move forward with the first phase of the project. That will fulfill part of the "Downtown Strategy," a plan to revitalize downtown Merced adopted by the City Council in 2007.
If the housing element of the plan is successful, the RDA hopes to replicate it in other downtown neighborhoods.
The project focuses on a neighborhood north of Main Street bordered by Martin Luther King Jr. Way, G Street and 19th Street.
So far, the RDA has spent $400,000 on eight lots and homes in the area. The RDA has an additional $700,000 for similar purchases, said Ainslie.
The city plans to sell each property to a developer for a reduced price so the developer can then build low- and moderate-income homes for sale and rent.
Ainslie emphasized that it isn't a "gentrification" effort, since most, if not all, of the units will be low or moderately priced.
While the plans are still on the drawing board when it comes to what exactly the homes will look like, said Ainslie, the idea is to build row houses similar to some on the East Coast.
This high-density housing will draw more people to businesses in the central part of the city and help stabilize the neighborhood, said Ainslie. Now the area is about 80 percent renters. That means few in the area stay for long. The new units for sale will increase the number of owners in the area, said Ainslie.
Along with building new housing, the RDA has a program that aids homeowners in the area who want to fix their homes. The funds can be used on new doors, windows and roofing, among other parts.
The downtown neighborhood that is the focus of the new effort is just one such project in Merced. There are similar homebuilding and facade-improvement efforts in South Merced, said Ainslie.
John Shirey, executive director of the California Redevelopment Association, said efforts like Merced's are useful ways to take advantage of the bad economy and aid blighted downtowns. It's a common tool used by cities, he added. Modesto, Stockton and Fresno have all been doing similar work in their downtowns.
Now is an ideal time for RDAs when it comes to projects like this, said Shirey. "This is an excellent time for agencies to be buying land for projects because land values have gone down," said Shirey. Material costs have also finally leveled off, he said.
But the recession is not all good for RDAs. Financing such projects has become more difficult, said Shirey. Since RDA projects like this one are often public-private collaborations, the lack of credit can make it hard for builders to move ahead.
Reporter Jonah Owen Lamb can be reached at (209) 385-2484 or email@example.com.