Developer Plans Huge Affordable Housing Complex

A Boston developer plans to build a block-long $225 million residential building directly above the Interstate 93 tunnel, a site between TD Garden and the North End that was left over from the Big Dig. Related-Beal is proposing to construct the 14-story tower with 239 apartments, each priced at rents well below the going market rates. The project would also include 10,000 square feet of retail space on the ground floor and a 220-room Courtyard by Marriott hotel.

Construction in booming Boston has fallen into a familiar pattern: large mixed-use buildings stuffed with expensive apartments, with developers kicking in only a handful of units as affordable housing. Advocates and officials worry that if the trend continues, Boston will become a city of the very wealthy and the publicly subsidized poor.

Developer Related-Beal recently unveiled a dramatic proposal that bucks the trend: a 14-story, block-long $225 million building on a prime downtown parcel near TD Garden with 239 apartments, each priced at rents well below the going market rates.

A little more than half of the units would be so-called workforce housing for middle-income tenants, with the rest aimed at low-income residents.

“This is a new model we hope will be replicated in Boston and other cities around the country,” said Peter Spellios, the company’s executive vice president. “We had an opportunity to do something unique and creative to address the extreme lack of affordable and workforce housing downtown.”

The average cost of the apartments would be $2.50 per square foot each month, the company said, compared to a market rate of around $4.50. Unusual for downtown, the project would include three-bedroom apartments to accommodate larger families.

To qualify for the 132 workforce apartments, residents would have to earn between 120 and 165 percent of the median income, which for a two-person household in Boston is $78,800, according to the Boston Redevelopment Authority. The remaining units would be reserved for residents earning between 30 percent and 120 percent of the median income.

The location, a vacant lot directly above the underground Interstate 93, between TD Garden and the North End, is a leftover from the Big Dig.

The project would also include 10,000 square feet of retail space on the ground floor and a 220-room hotel, most likely a Courtyard by Marriott.

The surrounding Bulfinch Triangle neighborhood is as hot as any in Boston; just glance across Causeway Street to where the company is building Lovejoy Wharf, a $230 million complex featuring a new headquarters for Converse and 100 luxury condos.

Related-Beal is able to make the numbers work at lower rents because of the unusual nature of the property. The company owns a sliver of the site, while the bulk is controlled by the state Department of Transportation, which can lease it out for less than what a private owner might charge.

Secondly, the companyl has loaded a significant portion of the cost, including the lease, onto the hotel portion of the development.

And finally, the company shrewdly tailored its proposal to qualify for a laundry list of federal, state, and local tax credits.

The developer is even planning to use the $6.75 million it promised to put toward affordable housing during approval of its Lovejoy Wharf project in this new development.