Residents of the neighborhood around the former St. Joseph’s Hospital on Lancaster’s west side got a first look Thursday evening at HDC MidAtlantic’s plans to redevelop the hospital’s “Delp Wing” into affordable housing.
What they were seeing is an initial concept, not a final product, HDC Executive Director Dana Hanchin cautioned. The project will be subject to multiple rounds of refinement and revision, she said, adding that HDC welcomes community input as it unfolds.
“This is an iterative process,” she said.
Joining Hanchin and other HDC team members were project architect Gary Weaver of Tippetts Weaver and Christina Duncan, executive director of Milagro House, which will own and manage one of the Delp Wing’s three residential floors. They presented to a standing-room-only audience of more than 50 people who crowded into The Sanctuary at West Art, a block away from the project site.
Current plans
The Delp Wing is a three-story structure built on pillars above a roughly 50-space parking area, with a ground-floor entry and lobby on the north side. HDC is planning to build 49 affordable apartments on the top two levels: 20 studios, 27 one-bedrooms and a pair of two-bedrooms.
They will be made available to households with incomes from $22,050 to $56,700. The third or top floor, currently a partial level, will be expanded.
Thirteen of the units (See Editor’s Note), or 25%, are to be set aside as permanent supportive housing for individuals who are homeless or housing-insecure. HDC will partner with a housing agency, which will refer clients and provide case management and other “wraparound” services, HDC Senior Development Officer Benjamin Van Couvering told One United Lancaster.
While the building’s fundamental form and exterior walls will remain, the project team is exploring ways to make it look more residential and less institutional.
Milagro House will own the first level, directly above the parking area. It is a nonprofit serving housing-insecure mothers and their children, providing them stable living arrangements and other supports while they pursue the education or job training they need to become self-sufficient.
It currently has nine residential units at its headquarters at 669 W. Chestnut St., across from the hospital. All nine are full and there are 50 active applications from women waiting for a spot to open up, Duncan said.
The Delp Wing is “the perfect solution,” Duncan said. Milagro House will have roughly 20,000 square feet there, enough for 18 to 20 units. At minimum, that will double its capacity, and it plans to cluster some of the units to accommodate women with larger numbers of children.
Moving its residential program across the street, meanwhile, will allow it to overhaul its headquarters, expanding its space for education and programming and adding “much needed storage and office space.”
Roughly speaking, HDC will handle the overall building redevelopment and the renovation of its two floors, while Milagro House will be responsible for its floor. They will have separate lobbies and elevators, Weaver said.
The two nonprofits will be drafting a condominium agreement to cover the legal details, including each other’s property rights, any shared costs and so on.
Cost & financing
The Apartments at College Avenue were the first phase of HDC’s redevelopment on and around the hospital campus. Groundbreaking on the $23 million, 64-unit, 64-unit building across the street from the hospital took place early this year and it is on track for completion and occupancy next summer, HDC said.
There are more than 260 people on the “interest list” for The Apartments at College Avenue, said Kimberly Krauter, HDC’s senior vice president of real estate development — an indicator of the strength of demand for affordable housing.
The Delp Wing is Phase 2, and HDC estimates its cost at $18 million. As with Phase 1, the nonprofit plans to seek low-income housing tax credits, LIHTC, through the Pennsylvania Housing Finance Agency. Applications are accepted once a year, in December; HDC is hoping to submit its application in the upcoming round.
To do so, it must have the rest of its financing, about 30% of the total cost, or $5.4 million, lined up. So far, it has $500,000: $300,000 from the city for initial professional costs and $200,000 from the Wells Fargo Foundation.
To secure the rest, HDC is reaching out to a range of funding sources, including local foundations and the Lancaster County Redevelopment Authority, which oversees the distribution of federal HOME funds.
Whether HDC can secure commitments for the necessary funding in time to apply for the tax credits remains to be seen, Hanchin said: “If we can do it, we will.”
Duncan said the planning for Milagro House’s project has not yet advanced far enough for a cost estimate to be available. It will be fully privately funded, she said: The nonprofit anticipates launching a capital campaign late this year or in early 2025.
LIHTC is a competitive program, and it often takes several rounds of applying to secure an award. If HDC obtains the credits in the upcoming round, and everything else falls into place without any delays, construction could start in as little as 18 months, Krauter told One United Lancaster.
On the other hand, The Apartments at College Avenue took four years to go from concept to the start of construction. While there were a number of complications, including the pandemic and a legal challenge filed by neighborhood opponents, lengthy timelines for affordable housing projects are the norm, not the exception, Hanchin said. So are complex financing packages: It took 17 funding sources to underwrite the construction of The Apartments at College Avenue.
“It’s a long road ahead,” she said.
Among other things, the Delp Wing project will need to go through city government’s review and approval process. The project team is reviewing the zoning code and is planning to go before the Zoning Hearing Board later this year to seek any necessary variances, HDC’s Van Couvering said.
The presentation did not include a Q&A: Instead, attendees were invited to talk with the project team during a breakout session afterward. The questions touched on parking and traffic, security, and how long all the successive phases of construction would take.
It was clear that audience members recognized the “neighborhood-scale transformation” that the redevelopment represents, and their questions reflected that, Van Couvering said.
HDC is confident it will be able to provide the necessary parking on-site, Krauter said, noting that most of the households will likely be one-car households and some may have no car at all. As for traffic, residences generate fewer trips and less congestion than would other potential uses of the property, such as retail or commercial, she said.
Other development
Eventually, HDC plans to follow the Delp Wing with Phase 3: An affordable apartment building of 50 units or so at 838 Marietta Ave. HDC bought the property, currently a parking lot, in 2021, using $1 million in American Rescue Plan Act funds provided by Lancaster city.
HDC had previously envisioned a Phase 4, involving a parking lot at 913 Wheatland Ave. In 2022, it announced the property would instead be developed by Lancaster-Lebanon Habitat for Humanity, which is planning an 8-unit townhome project there.
Meanwhile, Washington Place Equities, a for-profit company based in Baltimore, is building 185 market-rate apartments in the main hospital building north of the Delp Wing, along with 2,000 square feet of retail space. Groundbreaking took place in July.
Between that project and HDC’s efforts, more than $100 million is being invested in and around the campus, Hanchin said.
Washington Place Equities had also planned to build townhomes behind the hospital building on the campus’ west side. That component has been paused and the company is trying to sell it, LNP reported earlier this year.
(Editor’s Note: At the meeting, HDC representatives told One United Lancaster there would be five supportive housing units. The nonprofit issued a correction on Sept. 18. Return to article.)
