A $1.35 million city loan will help finance Paseos Verdes, where construction is expected to begin this fall and residents of 36 aging public housing units could eventually relocate

Damien Willis, Organ Mountain News

LAS CRUCES - An 80-unit affordable housing development approved for city financing Tuesday, Aug. 8, is expected to become the new home for residents of an aging Las Cruces public housing complex, clearing the way for redevelopment of the San Pedro Place property.

The Las Cruces City Council approved a $1.35 million Housing Trust Fund loan for Paseos Verdes Phase I, a roughly $23.4 million development planned at 905 Campo St.

Construction is expected to begin this fall.

Paseos Verdes will include 80 apartments for households earning up to 60% of the area median income. Twenty units will be reserved for veterans and five will be set aside for households earning less than 30% of area median income.

The development is also intended to serve as the first step in replacing the 36 older public housing units at San Pedro Place.

City staff told council residents of San Pedro Place will be able to relocate to Paseos Verdes, allowing the existing site to be opened for future redevelopment that remains in the planning stages.

City loan leverages larger development

The city originally committed the $1.35 million in December 2024, contingent on the project receiving Low-Income Housing Tax Credits from Housing New Mexico.

The project subsequently received the tax-credit award, allowing the city to move forward with the loan agreement and putting the remaining financing in place for closing.

City staff said the $1.35 million investment will help leverage more than $22 million in additional financing, bringing the total development cost to just over $23.4 million.

The city loan carries a 3% interest rate over 20 years and will be structured as a residual-receipts loan.

The city will also record a mortgage and security agreement against the property, along with a land-use restriction agreement intended to ensure the development remains affordable for 20 years.

Veterans among residents targeted

Plans call for two residential buildings containing 20 and 60 units.

The project will include three single-room occupancy units, 39 one-bedroom apartments and 38 two-bedroom apartments.

Twenty units will be reserved for veterans.

Paseos Verdes is being developed through the Mesilla Valley Public Housing Authority and is part of a broader effort to reposition older public housing while adding newer affordable units.

Council also approved waivers of park and public safety impact fees for the project, reducing development costs.

A portion of federal funding now supporting Paseos Verdes had previously been allocated to the Desert Hope project but was redirected when it was no longer expected to be used there. City documents specify that Paseos Verdes is a separate development and is not affiliated with Desert Hope Phase I.

The council approved Resolution 27-041 on a 6-0 vote. Mayor Pro Tem John Muñoz was absent.

Damien Willis is founder and editor of Organ Mountain News. If you have a personal story to share or a lead we should follow up on, reach out at OrganMountainNews@gmail.com or connect with him on X at @damienwillis.