Mercy Housing Southeast Sits at Revitalization Forefront

September 7, 2011

By Edward O. Henneman, Jr., published on September 7, 2011, in Business in Savannah.

A non-profit real estate development company that excels at creating affordable housing communities, Mercy Housing Southeast is committed to developing affordable, program-enriched housing for low-income families, seniors and people with special needs who lack the economic resources to access quality, safe housing opportunities.

Beginning with its adaptive reuse and historic preservation of the Florance Street School and Charity Hospital in 2002, which was converted into an 88-unit affordable housing development, Mercy Housing has played a prominent role in the development of affordable, multifamily housing in Savannah. Mercy’s initial development projects in Savannah concentrated on the Cuyler-Brownsville neighborhood.

The company followed its Florance Street School/Charity Hospital redevelopment project with the development of the Heritage Corner and Row Apartments in 2005, which generated another 70 affordable units in the Cuyler-Brownsville neighborhood. In 2007, Mercy directed its efforts on the National Landmark Historic District and rehabilitated the Rose of Sharon Apartments, located on Habersham Street, which now provides 207 units of affordable senior housing.

Mercy Housing has now turned its attention to Savannah’s east side. Through a joint venture between the City of Savannah, Mercy Housing and another local non-profit organization, CHSA Development, Inc., Mercy is participating in the redevelopment of the site of the former Strathmore Estates into a multiphase affordable housing project known as Savannah Gardens. When it is complete, Savannah Gardens will consist of at least 5 phases of multifamily housing, providing as many as 450 units of high-quality,
affordable housing for area residents.

Like all of Mercy’s prior projects in Savannah and elsewhere, Savannah Gardens will have income and rent restrictions, and therefore will provide affordable housing to those residents who need it most. Mercy develops properties through the use of federal tax credits. The federal tax credit program mandates income and rent limitations on all units funded through the program. In the Savannah Gardens project the majority of units will be restricted to households that earn no more than 60 percent of the area median income. Rent will also be restricted by a percentage of area median income.

At build-out, Savannah Gardens will include affordable apartments, senior-designated apartments and single family homes as well as limited commercial uses. The community will include ample green space, bike paths and connectivity to surrounding neighborhoods. Housing will feature energy-efficient design and products, including and the use of geothermal heating systems. The ultimate goal is for Savannah Gardens to obtain EarthCraft Coastal Community certification as a green and environmentally sensitive community. The end result will be a vibrant and diverse neighborhood.

Savannah Gardens is part of a larger trend in Savannah, which reflects a commitment to improving public local housing options with an emphasis on community revitalization and environmental sustainability. In light of the success of Sustainable Fellwood on the city’s west side, Savannah Gardens is expected to have a positive effect on the eastside community, transforming a once-dilapidated 45-acre site into a showcase

Mercy Housing closed the financing of Phase 1 of Savannah Gardens at the end of 2010 and that phase is currently under construction. Upon completion, Phase I will consist of 115 units which are already available for leasing. The closing of the financing for Phase II, consisting of 40 units, will occur this month and construction will commence immediately. Phase III is expected to close by the end of September and will consist of 94 units. By the end of 2012, a total of 249 rental units will be fully constructed and ready for occupancy.

A number of city, county and community leaders have stated that Savannah Gardens will revitalize the Pennsylvania Avenue corridor south of Savannah High and have supported the redevelopment of the Strathmore Estates site. Savannah’s business community should be proud of the foresight, quality and collaboration that define Savannah Gardens.

This strategic partnership between the City of Savannah and two private non-profit organizations demonstrates the power to work together to improve communities, to have a positive impact on the local economy and to chart a brighter future for residents on the city’s east side.
Ted Henneman is a partner at HunterMaclean whose practice focuses on affordable housing and financing through the use of I.R.C. § 42 Tax Credits as well as real estate development and commercial real estate law. He can be reached at 912-236-0261 or

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