Overhaul of Norfolk Complex to Benefit Low-income Households

An aging public apartment complex on Virginia’s seaboard is being upgraded with help from a multi-layered financing package from VHDA.

The Diggs Town public housing development was built in 1952 and renovated in the 1990s, but is now in need of another renovation. VHDA’s financing will allow the property’s owner, Norfolk Redevelopment and Housing Authority, to restore it both functionally and aesthetically.

The renovation of Diggs Town is part of a HUD program known as RAD, which seeks to preserve affordable housing. The project will restore a nearly 70-year-old complex, and provide many quality-of-life improvements for residents:
• VHDA construction standards will improve grading to prevent flooding and allow for increased walkability, as well as provide asbestos removal and system upgrades.
• New lighting will improve security.
• New appliances and energy-efficient windows will help keep utility bills lower for residents.

When work is completed (scheduled for early 2021), 222 modernized apartments will be occupied by tenants making no more than 60 percent of the area’s median income. A second phase of redevelopment is in the planning stages.

VHDA is providing $10.3 million in permanent financing for the Diggs Town renovation. To attain a low interest rate, the loan uses funds from VHDA’s REACH Virginia program. VHDA contributes a significant portion of our net revenues to this program each year to support housing for low-income families, the homeless, seniors, people with disabilities, and those who live in high-growth or high-cost areas. Money from REACH Virginia also helps support urban revitalization and preservation of small towns.

In addition to the financing, VHDA is issuing federal Housing Credits (sometimes called Low-Income Housing Tax Credits), which incentivize property owners and private investors to build or rehabilitate affordable rental housing. As a result, a certain number of units are set aside for lower-income households, while other units have higher rents and no maximum household income requirement. The property also accepts Housing Choice Vouchers.

Diggs Town is a prime example of how VHDA’s behind-the-scenes work brings state and federal programs together to support housing agencies, property owners and even private investors as they improve Virginia’s housing environment.