Huntingburg takes first step for new housing development on north side

Developers seek five-year residential tax abatement for 126-unit project

Tuesday night, the Huntingburg City Council took initial steps toward approving a tax abatement for a proposed 126-unit apartment development from Kerstiens Developments and S&S Properties called Poplar Ridge.

Developers Ruger Kerstiens and Scott Steinkamp presented plans for the project, which would be built on vacant land at the corner of 19th Street and U.S. 231. The development would include a mix of one-, two- and three-bedroom apartments and townhomes.

Kerstiens said they plan on building 24 one-bedroom apartments, 48 two-bedroom apartments and 24 three-bedroom apartments; 18 two-bedroom townhomes and 12 three-bedroom townhomes; and 12 three-bedroom townhomes with attached garages. A total of 126 units.

Kerstiens said three-bedroom units would likely rent for $1,100-$1,150 per month based on similar projects in other nearby communities.

“This is a market rate apartment community. There’s no income-based restrictions or anything like that,” Kerstiens told the council. “We’re targeting an average rental rate of $995. Sub $1000 on brand new apartments with considerable square footage.”

Kerstiens said the tax abatement is needed to make the project financially viable at those rental rates, given rising construction costs and interest rates. The abatement would last five years for each of the project’s three phases.

The developers are also seeking grant funding through the Regional Economic Acceleration and Development Initiative (READi) 2.0 program administered through the Regional Opportunity Initiatives group. City approval of the tax abatement will help qualify the project for those funds by demonstrating local support.

Mayor Neil Elkins noted that studies show the county will need 189 new apartments in the $500 to $1,500 range over the next seven years to meet the demand. He added that over 12 years, that need grows to 300 new units.

“This fits right in with that,” he said about the affordability of the new units.

Elkins also said the project could help address Huntingburg’s future housing needs.

“Right now it’s estimated that over the next four years Huntingburg can grow by 743 people if we had the housing available,” Elkins said.

The council introduced a declaratory resolution and ordinance that would designate the property as an economic revitalization area and economic development target area. These designations are necessary for the project to qualify for residential tax abatement and will be considered at future meetings for final approval.

“I love the idea that first you guys are interested in developing a project like this,” said Councilman Jeff Bounds. “Both of you have been friends to Huntingburg a long time and I certainly don’t want to stand in the way of the first phase of your application not being approved because we didn’t get around to getting stuff like this done.”

Some council members noted past skepticism about other housing developments that ended up being successful.

Steinkamp said that through the years as they have added developments like Chestnut Gardens, a senior living duplex development on Chestnut Street, and watched it fill up, they have shown the naysayers what can be accomplished and what is needed in the community.

Councilman Bounds echoed Steinkamp’s statement, adding there was skepticism over the Hunters Crossing development. Hunters Crossing is a few homes from being completely full now, he added.

“You’ve got the data that these are not going to sit empty,” Bounds said about the new development. “There is a need.”

The city is concerned about water discharge from the new development and is waiting for engineering to be completed to meet the unified development ordinance requirements. Elkins told the council that the project would not move forward without proper water controls.

City Attorney Phil Schneider explained that approving the resolutions does not finalize the tax abatement. A public hearing must be held before final approval. The council voted to introduce the declaratory resolution and ordinance. They set a public hearing date of January 28, 2025, for the abatement.

The developers said they hope to break ground in March if approvals are obtained. The project will be completed over multiple phases. The first phase could be ready for leasing by June 2026.