Raleigh and Wake County approve millions more to cover rising costs on affordable housing


North Carolina Construction News staff writer

Raleigh City Council and the Wake County Board of Commissioners have approved an additional $2.3 million to cover rising costs on the 156-unit Preserve at Gresham Lake apartment complex in northeast Raleigh.

According to a staff report presented to Raleigh council, “Preserve at Gresham Lake currently faces an unanticipated funding gap due to increased material cost and labor shortages, and the developer LDG requests $2,312,118 in additional funds to help fill the gap and allow the project to move forward.”

$3.3 million was approved last spring by Raleigh and $2.8 million to be paid by Wake County.

“Rising construction costs and interest rates have led to a funding gap,” Erika Brandt, the city’s housing programs administrator, said at a council meeting this week. “Construction costs have risen from about $185,000 per unit to $234,000 per unit which is a 25% increase.”

Rising costs include inflationary pressures on material prices and labor shortages as well as rising interest rates on permanent loans from 3.925% to 6.38%, staff confirmed.

LDG Development, has increased its bond allocation and requested additional funds from Wake County to help cover the increased cost. This will be the Kentucky-based company’s first development in North Carolina, according to its website.

Wake County commissioners also approved $1.3 million additional funding for the Rock Quarry Landing affordable housing development, a 188-unit building in southeast Raleigh.


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