A newly approved project in Portland’s Libbytown neighborhood is expected to add 120 units of housing, about half set up in a cooperative model in which residents will jointly own and manage the property.

The remainder of the units at Dougherty Commons, which was approved by the Planning Board last week, will be a mix of apartments, mostly affordable, some market rate. Just over half of the total units in the project will be available at rates affordable to households earning either at or below 60 percent or at or below 80 percent of the area median income.

“We’re excited about it,” said Liz Trice, a partner with Maine Cooperative Development Partners, the Portland company that is developing and will manage the cooperative housing part of the project. “We’re excited for the opportunity to do something we feel good about and that we feel will be a good model going forward.”

The project, located at 57 Douglass St., came out of the city’s 2020 request for proposals for affordable housing on the former site of the West School, which was demolished in 2016. Maine Cooperative Development Partners was selected in November 2020 along with the Szanton Company, which will develop and manage a five-story, 63-unit apartment building on the site. They plan to break ground in the spring of 2023.

Maine Cooperative Development Partners is working on a 57-unit limited equity cooperative made up of seven townhome-style buildings. Cooperatives are owned and managed by residents rather than landlords, and proponents say they can help create permanent affordable housing for people who don’t make enough to afford market rates.

In a limited equity co-op, as opposed to a market rate co-op, the buy-in is often lower but there are also restrictions on the amount of profit residents can get from selling their shares.

State law requires that homes in limited equity co-ops be affordable to households making 100 percent of the area median income, which in 2021 was $70,000 for one person and $100,000 for a family of four in Cumberland County, according to Maine Cooperative Development Partners. In addition, the city is requiring that 25 percent of the project – or 15 units – be reserved for households earning 80 percent of the area median income or less.

The current cost estimate for the cooperative at Dougherty Commons is for residents to pay an up-front share price ranging from $5,000 to $30,000 and a monthly amount including utilities ranging from roughly $1,000 to $2,500 – based on the size of the unit, income of the household and the number of people in the household.

“What we’ve been seeing right now for the last five years or so is that for a lot of people who would have had the opportunity to buy a home in Portland, that’s become impossible,” Trice said. “We think that’s a likely market (for our project.) Another market would be people who maybe were happy renting but now they’re realizing monthly rents are just going to keep going up and they may be forced out if they don’t do something different.”

The 63-unit apartment building being built by the Szanton Company will include 46 deed-restricted workforce housing units, to be rented at an affordable rate to households earning at or below 60 percent of the area median income, and the remaining units rented at market rate.

Right now, an affordable one-bedroom unit would rent for about $1,200 while a market-rate one-bedroom would be about $1,500, according to Carl Szanton, development associate with the Szanton Company. Szanton said it’s possible that some of the market-rate units in the building could be flipped to workforce units because of rising construction costs and tax credits that are available for building affordable units.

“Housing in the city of Portland is in such short supply right now, so we’re really excited to build much-needed housing right in the middle of the city that will be affordable to low- and moderate-income Portlanders,” Szanton said.

Zack Barowitz, a member and past chair of the board of the Libbytown Neighborhood Association, said members of the association and neighbors generally have been supportive of the project, though there have been some concerns about an overabundance of parking.

The project is slated to include 78 parking spots, though Barowitz said there is ample street parking. “There are environmental concerns. It constitutes a bit of dead space and it encourages more car usage by having parking included,” Barowitz said.

Ultimately, though, he said members of the association are excited about the project. “Many of the neighbors are quite pleased to have so many workforce housing units in the neighborhood, which will add to the enrichment of the neighborhood and a badly needed workforce for the city,” he said.