The city of Urbandale will press ahead with efforts to place a mixed-rate apartment building at Merle Hay Mall as part of a plan that could provide housing for mall shoppers and workers and help the city fulfill a goal of creating workforce housing.

Plans for a four-story, 43-unit apartment building set up with two to three bedrooms to accommodate families are on the table for the west side of mall property near Douglas Avenue. Anawim Housing has presented the $10 million project, but hopes eventually to acquire and then sell the property to a developer. It is possible, but not a given, that Anawim could serve as a property manager for the project.

City Manager A.J. Johnson told the City Council that his staff has sought out Anawim in the past in efforts to develop affordable housing in a city that has not hosted such a project in several decades. The council has attempted to promote senior housing developments, but also has worked with housing agencies to develop what often is called workforce housing.

Anawim Executive Director Russ Frazier said 10 percent of the units at the proposed apartment building would carry market rate rents, while the majority of units would be reserved for families with incomes at 60 percent of area median income. The U.S. Department of Housing and Urban Development set that number at $49,320 for a family of four in 2017. It is possible that 10 percent of the units could be for families earning 40 percent of the area median income.

Frazier stressed that to proceed, the roughly 2 to 3 acres needed for the project would have to be rezoned or made part of a Planned Urban Development. The ask for the rezoning is at the top of the list for the project, he said.

There is a need to move utilities that run through the site, and that process has created a $150,000 shortfall in funding. However, that gap does not have to filled to start the project, Frazier said.

If the council does decide to provide financial assistance, Frazier suggested a tax abatement of $10,000 a year for 15 years. He said the building should generate an annual property tax valuation of about $68,000.

Johnson said the apartment project arose after city staff reached out to mall ownership to find out whether it could provide assistance in securing a tenant for the vacated Younkers building.

Within a few months, Merle Hay Mall was struck by the closings of the Younkers and Sears stores after their parent companies filed for bankruptcy.

The Polk County supervisors have approved two loans, one for $2 million and the other for $500,000, to help mall owners buy both buildings.

Attorney William Lillis, who represents the mall owners, said plans are to raze the Sears building, while efforts are underway to find a tenant for the Younkers building.