Developer seeks workforce housing tax credits for proposed Ellis Boulevard NW townhomes

CEDAR RAPIDS — A developer is seeking workforce housing tax credits to transform city-owned land on Ellis Boulevard NW into seven newly built townhome units.

After the city in October issued a request for proposals to sell and redevelop the property at 1319, 1323, 1327 and 1333 Ellis Blvd. NW, Mods Enterprises proposed a $1.5 million project to construct a pair of two-story buildings that would add seven units — a mix of market-rate rentals and owner-occupied homes.

City Planner Jeff Wozencraft said most of the properties were acquired after the 2008 flood and one was acquired in a tax sale.

One three-unit townhome building would have high-end finishes and rear balconies, and would be for sale. The other four-unit building would be rentals. The 1,560 square-foot townhomes would be two-bedroom and two-and-a-half bathroom units with two-stall detached garages.

The developer, Mods Enterprises, was formed by Modteet Williams, who owned the now-defunct Taboo Nightclub and Lounge in downtown Cedar Rapids. The club closed after a shooting in April 2022 left three people dead and injured others.

Two lawsuits naming the Taboo club and a part-time employee there, Timothy L. Rush, have been filed — one alleging the wrongful death of one of those killed and the other alleging negligence in the wounding of a patron. Neither petition has been set for a trial.

Rush pleaded to involuntary manslaughter and other charges in two of the killings; Dimione Walker of Coralville, who was in the club that night, was convicted of first-degree murder in the other fatal shooting.

Williams also previously owned a now-closed convenience store that was on the first floor of the Roosevelt Building in downtown Cedar Rapids.

Mod Enterprises is looking to apply for workforce housing tax credits through the Iowa Economic Development Authority, which requires a local match. The City Council signed off Tuesday on a local match of a 10-year, 100-percent reimbursement of the increased value of the project. City staff estimate the project would generate $192,000 in taxes over those 10 years, of which $149,000 would be reimbursed.

The state authority will review workforce housing tax credit applications after a June 10 deadline.

A local review panel made up of a member of the Northwest Neighbors Neighborhood Association, a financial lender and a non-competing developer reviewed the proposal for the project. The panel and city staff recommended the proposal to the council.

“All of them came together to say, is the proposal financially feasible, market feasible and the right fit for the neighborhood?” said Community Development Director Jennifer Pratt. “That is the only part of the process we’ve done so far.”

This proposal does not constitute a development agreement, which would outline terms of a city-incentivized project and expectations for the developer. The council’s action Tuesday signals receipt of the proposal and allows further discussions, as well as the state tax credit application, to move forward.

“Each step of that process, the appropriate issues are addressed,” Pratt said.

Pratt said Williams has no existing projects with the city, but previously submitted a proposal for a project in the New Bohemia District. He was one of four who provided a proposal for that project. The city awarded the proposal to High Development to build a $23.7 million residential and mixed-use facility on city-owned land at 116 16th Ave. SE.

Williams said his company since 2019 has renovated five single-family homes in Wellington Heights, two of which he’s sold. This project on Ellis Boulevard NW would be his first new build.

“For me, living in Chicago most of my entire life, I’ve seen what neighborhoods look like and I’ve seen what they look like after you have some attention to those neighborhoods where people want to develop them and get better housing,” Williams said.

Council member David Maier asked about the low level of interest in redeveloping the Ellis Boulevard NW properties — the city only received one proposal. Wozencraft said the disposition goes out to the city’s prospective developer list, and there was interest that didn’t translate into proposals.

“There are difficulties of developing in this area,” he said, acknowledging the flooding risks that come with building in an area still waiting for permanent flood protection.

Council member Scott Olson these units will be a “nice addition to that area” with a mix of ownership.

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