A rendering of TWG's planned apartment complex at 412 W. McCarty St. (Rendering courtesy of the city of Indianapolis)
A local developer with plans for a $73 million apartment building just south of Lucas Oil Stadium is seeking a $6.4 million break on property taxes for the project from the city.
TWG Development LLC is seeking a 10-year tax abatement for the project at 412 W. McCarty St., which is across South Missouri Street from the stadium’s southern parking lot.
IBJ first reported in April that the Indianapolis firm was advancing plans to build 270 apartments and a parking garage on the nearly 2-acre site.
TWG has already rezoned the site from industrial uses to a commercial designation that allows for the six-story apartment building. But the firm is set to return to the Metropolitan Development Commission—and potentially the City-County Council—later this month to ask for the abatement.
As part of the request, TWG is pledging to make 41 of the units—or 15%—available to individuals and families making up to 70% of the area’s median income.
A representative for TWG did not return calls requesting comment Friday or Monday.
The firm plans to spend $73.4 million on the apartment project, which will consist of a single 376,000-square-foot building with parking for up to 203 cars. The complex will also feature about 1,500 square feet of retail space along South Missouri Street.
The development will occupy the full block that is bounded to the west by Chadwick Street and to the north by West Norwood Street, totaling about 1.93 acres.
TWG officials have told IBJ the four parcels comprising the site are under contract. They have not yet been sold to the company, according to online property records.
The project is expected to consist of studios and one- and two-bedroom units, as well as a two-floor, 203-space parking garage for resident use. An initial plan included access to the garage along Chadwick Street.
The tax abatement would reduce property tax liability on the project by 80% for a decade, according to filings with the city. The Department of Metropolitan Development estimates the project would increase the tax base by about $29 million in assessed value, with savings to TWG of $6.43 million over the life of the abatement. TWG would still be required to pay $1.59 million in real property taxes for the improvements over that span, in addition to about $17,334 annually for the value of the land.
TWG would be expected to pay $819,827 annually after the abatement expires, not including the taxes to be paid on the land.
The set-aside for individuals and families making less than the area median income accounts for 15% of the building’s proposed total units, for a 15-year period. Nine of the units will be studios, along with 17 one-bedrooms and 15 two-bedrooms.
The building is expected to create five new jobs with an average wage of $22 per hour.
The company said in a July 3 slideshow presentation to the Metropolitan Development Commission that if it is not awarded the abatement it “would result in TWG not being able to move forward with this project, as the financial feasibility would diminish.”
City staff is recommending approval of the abatement, which will be considered by the commission on July 17. If approved, the request would advance to the City-County Council.
The abatement is a less common incentive mechanism than what’s been provided to downtown apartment projects in recent memory. The city often issues developer-backed tax-increment financing bonds to support projects, which typically are repaid via increases in taxes generated by the finished property. Such deals are often made with developers in exchange for meeting steeper affordability requirements—either 10% of all units at 50% AMI or 5% at 30% AMI.
“TIF is a more substantial tax tool and therefore we require deeper affordability on those projects,” DMD Director Megan Vukusich told IBJ in an email.
She said for abatement requests, the ask is typically a portion of units at anywhere from 60% to 80% of the area median income.
Several housing projects have cropped up on the south end of downtown in recent years, including a few near the stadium.
TWG’s 269-unit Rise on Meridian is starting leasing this summer. Last year, IBJ reported that a Greenfield-based developer plans to build a 21-unit project at the former Stadium Tavern site at 802 S. West St. In May 2023, plans were unveiled for Meridian Enclave, a townhouse development southeast of the intersection of Sycamore and Charles streets, about four blocks from the venue.
TWG is also continuing to work on redevelopment of Old City Hall and an adjacent parcel within the Mile Square.
Construction on the new project is set to begin in March 2025, with a 24-month development timeline. Denver-based Studio Architecture is the design firm on the project.
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