Gov. Katie Hobbs joins groundbreaking for 168-unit affordable housing project in south Phoenix

PHOENIX – Arizona Gov. Katie Hobbs joined Ulysses Development Group and housing partners Wednesday to break ground on Salt River Flats 2, a 168-unit affordable housing community in south Phoenix aimed at families and individuals earning up to 60% of the area median income.

The complex is meant to help with Phoenix’s affordable housing shortage, which is made more demanding by Arizona’s population growth.

“The State of Arizona is proud to support the development of Salt River Flats 2 with federal low-income housing tax credits and State Housing Trust Funds,” Hobbs said in a statement. “Our state’s population has grown extensively over the last few years, and ensuring all Arizonans have a safe place to call home is the critical first step to stability.”

Arizona is helping subsidize the affordable housing complex

The project is being financed through a mix of public and private funding, including $34.5 million in tax-exempt bonds from the Arizona Industrial Development Authority, $23.5 million in federal low-income housing tax credits and $2.5 million in State Housing Trust Funds through the Arizona Department of Housing.

U.S. Bank is investing $23.5 million in housing tax credit equity and $700,000 in solar investment tax credits, while Merchants Capital is providing $30.8 million in tax-exempt construction financing, $15.6 million in taxable bridge loan debt and $28.7 million in permanent debt, according to the developer.

Dirk Swift, executive director of the Arizona Industrial Development Authority, said the agency was “thrilled” to support the project.

Salt River Flats 2 will be built directly west of Salt River Flats, a 196-unit affordable housing development that opened in spring 2024.

The development at 4027 S. 13th Street is expected to be completed in the first quarter of 2028.

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