Cedar Rapids loses $2.7 million in housing funds to Council Bluffs

CEDAR RAPIDS - Nearly $3 million in grant funds awarded in January to a downtown housing proposal that fell apart won't be staying in Cedar Rapids for another project, as city officials had hoped.

The Iowa Economic Development Authority, which dispenses the federal disaster funds for multifamily housing projects statewide, said this week that it has decided to award the money instead to the Linden Place Apartments project in Council Bluffs - not to one of several Cedar Rapids projects that had been competing for it.

Tina Hoffman, spokeswoman for IEDA, said three projects had tied in the agency's scoring system for the money, but she said Debi Durham, the agency's director, picked the Council Bluffs project to achieve a better geographic distribution of this sixth round of funding for multifamily housing projects.

In January, six housing projects in Cedar Rapids secured a total of $15.66 million in awards.

Those included an award of $2.7 million to Hobart Historic Restoration of Cedar Rapids and its plan to transform the three-story Kubias Building at 307-311 Third Ave. SE from an office building into 18 apartments with retail/office space on the first floor.

Two weeks ago, Hobart withdrew its plans after the partners who own the Kubias Building decided to keep it. One of the partners, Jon Dusek, president and chief executive officer of Armstrong Development, said he had secured a new business to move into the building. so he decided not to sell to Hobart.

B.J. Hobart, an owner of Hobart Historic Restoration, said at the time she was 'disappointed” that the owners of the Kubias building had changed their mind.

At the time, too, Mayor Ron Corbett said 'it kind of stings” to give back a substantial grant intended for a Cedar Rapids project.

Jennifer Pratt, the city's development director, said Thursday that one of the three projects that had been tied in the scoring system and was competing for the Kubias Building funding was developer Steve Emerson's project to renovate the former Cedar Rapids school administration building at 346 Second Ave. SW into housing.

Of the five Cedar Rapids projects in addition to the Kubias Building that won funding in January, an Emerson project obtained the largest award, $3.12 million. He will use the money to renovate the vacant, six-story former Iowa-Illinois Gas & Electric Building at 323 Third St. SE. Emerson plans to turn the building into 32 apartments with a first floor of retail/office space.

The other four projects that won funding are: Village West Apartments, a seven-unit development at 100 16th Ave. SW in Czech Village; Cedar Point Apartments, a 30-unit project at 1427 Center Point Rd. NE; Creekside Apartments, a 30-unit project at 1415 Center Point Rd. NE; and Kingston Pointe, an 18-unit project at 210 Fifth St. SW in Kingston Village.

Projects in Cedar Falls, Davenport, Des Moines, Waterloo, West Des Moines, Burlington, Ottumwa, Hampton, Clinton, Iowa Falls, Fort Madison, Woodbine, Windsor Heights, Mount Pleasant and Marshalltown also received funding in January.