A rendering shows the planned 104-unit second phase of the Choice Neighborhoods redevelopment known as the DeWitt project, with Lewiston City Hall shown at left and Kennedy Park in the foreground. The developers behind the $45 million project have received an additional $2.5 million in federal funds toward construction. City of Lewiston

LEWISTON — Lewiston Housing has been awarded $2.5 million in additional Choice Neighborhoods grant funds toward the next phase of housing development planned in the Tree Streets neighborhood.

In a news release this week, the organization announced the additional funding will be used to support the DeWitt project, the 104-unit second phase of the initiative across from Kennedy Park.

The funds are in addition to a $30 million grant from the U.S. Department of Housing and Urban Development that Lewiston received in 2021 in order to implement a downtown “transformation plan” that replaces distressed housing while also boosting other neighborhood needs such as child care and health care.

Earlier this year, Lewiston Housing and its development partner Avesta Housing said the DeWitt project was experiencing a funding shortfall due to stubbornly high construction costs, and requested assistance from the city.

During the talks in February, Lewiston Housing officials said they had already secured $1.7 million in additional funding from HUD due to construction costs “rising drastically across the country, making it near impossible for grantees to develop as planned.”

The DeWitt project, between 40-60 Pine St., will include apartments in two buildings with a total of 15,000 square feet of commercial space on the ground floors. The site plan was approved by the Planning Board in July 2023.

The units will be a majority of one-bedroom units, with 36 two-bedroom units. Most will be limited to a mix of income levels between 50% and 80% of area median income, with 21 market-rate units. Lewiston Housing expects that development to break ground in the next several months.

Chris Kilmurry, executive director of Lewiston Housing, said the additional HUD funding will be  “instrumental in our ongoing initiatives to transform Lewiston’s housing options.”

“It allows us to advance the construction and redevelopment of affordable and mixed-income housing, ensuring that we effectively meet the needs of our community,” he said.

The first phase of development, known as the Wedgewood development, is nearing completion. The 82 units in nine buildings along Pine, Pierce, Walnut and Bartlett streets, and including the historic Wedgewood house, will be ready for leasing late this fall, Lewiston Housing said.

Reached on Thursday, Mayor Carl Sheline said the Choice Neighborhoods grant “represents a tremendous opportunity for our city and in this unfortunate environment of rising construction costs I’m grateful for this additional money from HUD.”

Brian O’Malley, acting city administrator, said addressing Lewiston’s need for “safe homes people can afford is critically important to transforming the Tree Streets neighborhood and strengthening our entire city. This supplemental funding directly supports the investments in housing and infrastructure that we need to grow Lewiston into the community we all know is possible.”

Lewiston Housing officials said the newest grant “underscores HUD’s confidence in Lewiston’s ability to create sustainable and profound community impacts,” especially as the smallest city to ever receive the Choice Neighborhoods implementation grant.