Local builder questions Baxter building project

HARLINGEN — Questions have arisen over a $4.5 million project to renovate the city’s tallest building to include affordable housing units.

Last night, city commissioners approved a resolution supporting developer MRE Capital’s plan to apply for affordable housing tax credits to help fund the $4.5 million renovation of the Baxter Building into an apartment complex that would include at least some affordable housing units.

The Texas Department of Housing and Community Affairs requires the developer submit the City Commission’s resolution as part of its application for financing.

During the city’s presentation, builder Desi Martinez argued the proposed development would accept Section 8 vouchers.

“This project is not affordable housing. This is for low- to moderate-income,” Martinez, who said he builds affordable housing developments, told city commissioners.

But Mayor Chris Boswell strongly denied the claim.

“It does not involve Section 8 housing,” Boswell told Martinez. “That’s completely wrong and incorrect.”

Martinez disputed Commissioner Tudor Uhlhorn’s previous statement the developer plans to rent to “young professionals and retired couples.”

Martinez said the Baxter Building’s downtown location would not give the proposed development a family atmosphere.

“It’s not for family quality-of-life,” said Martinez, a former board member of agencies that include the Harlingen Economic Development Corporation and Harlingen WaterWorks. “There are a lot of bars, railroad tracks.”

Boswell said market rents would help fund the proposed development.

“It’s going to be a market-driven issue,” Boswell said after the meeting. “MRE Capital is an experienced developer of this kind of project. I don’t think they’d invest $4.5 million in a project that’s not feasible.”

Daniel Sailler, MRE’s co-founder, has said the proposed development would be made up of apartments that would rent at market value while others would rent to lower-income residents.

Based on the amount of tax credits the company would use, he said, MRE would determine the number of apartments that would be rented at market value and the number that would rent to lower-income residents.

But Sailler said MRE has not determined the number of affordable housing units it would offer.

Under the program, applicants with family incomes of about $35,000 and below could qualify for housing, Sailler said.

Sailler said MRE would determine the applicants who would become tenants.

The project to renovate the vintage 1927 building likely will hinge on developers’ success in their application for affordable housing tax credits.

On the condition the company qualifies for state and federal tax credits, MRE would pay the Harlingen Community Improvement Board $250,000 for the building while investing $4.5 million to renovate it to its original condition.

The city paid $300,000 for the building a few years ago.