Hillcrest redevelopment: $25M plan targets 2026 groundbreaking, funding still being procured

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Wilmington Housing Authority’s Hillcrest neighborhood is moving forward in reconstruction project. (Port City Daily photo/Alexandria Sands)

WILMINGTON — A low-income housing community in downtown Wilmington is nearing a comprehensive makeover, a process that has been underway for over a decade.

READ MORE: ‘We can’t build our way out of this’: NHC Endowment addresses affordable housing, other questions 

The redevelopment of the Hillcrest community is gaining momentum, according to Wilmington Housing Authority Executive Director Tyrone Garrett. Key aspects such as funding, timeline, and site details are starting to fall into place. 

The reconstruction will cost between $20 to $25 million and will happen in four phases. Each phase will involve rebuilding about 80 units, with new units added later, depending on zoning and density. Wilmington Housing Authority announced Thursday it would receive $5.7 million from the New Hanover Community Endowment; however, it was premature.

“There was misinterpretation — miscommunication in reference to our discussion and some of the correspondence that I was interpreting,” Garrett said. 

First, WHA has to submit an application to the North Carolina Housing Finance Agency by October to qualify for the Low-Income Housing Tax Credit (LIHTC) program. Established by the Tax Reform Act of 1986, this program encourages the development of affordable housing by offering a 10-year tax credit for such projects. While the LIHTC program will cover the majority of the project’s costs, it will still leave an estimated $5.7 million funding gap.

That’s where Garrett hopes to see the endowment step in.

The housing authority has not yet applied for the endowment funding but plans to do so. Garrett said if the authority is not awarded the endowment funds, WHA will seek alternative sources, either state or national, to cover the gap while avoiding permanent debt.

Hillcrest, situated along Dawson Street between 13th and 16th streets, provides housing for low-income families in approximately 251 units across 25 acres. Originally built as temporary housing during World War II, the concrete, one-story houses date back to the 1940s. Since its construction, the neighborhood has undergone few updates. Its aging infrastructure has seen problems with moisture, like mold, and issues with waterlines.

The plan is to demolish the property and build anew. Garrett referred to it as, “one-for-one” reconstruction, meaning every existing unit will be torn down and replaced.

Although detailed site plans have not yet been developed, he said unit count and design will be revealed as the project secures funding. Plans will incorporate open spaces, recreational amenities, greenspaces, and tree and historic preservation. 

The Wilmington Housing Authority contracted Related Urban and TedCo, a joint redevelopment team, for the construction project in its preliminary stages before Garrett’s arrival as director in 2022. The reconstruction has been on the WHA’s docket since 2013 but has seen delays due to changes in leadership and securing a funding source. 

However, progress was made when the Wilmington Housing Authority commissioned a needs assessment done by BBG Assessments, a real estate service, for $177,000 in December of 2023. The assessment identified Hillcrest’s most significant issues as related to infrastructure and the overall outdatedness of the buildings and construction materials.

“In a nutshell … Hillcrest is obsolete, 80 years old, obsolete,” Garrett said, “meaning it’s well past its life expectancy.”

PCD was not able to obtain a copy of the assessment by press. 

Garrett explained, while the buildings and their materials are up to code, they are outdated. For instance, he said the water and sewage lines are likely made of clay, making them prone to collapsing. Additionally, infrastructure materials are not resistant to moisture. 

According to previous PCD coverage, some houses have deteriorated and contained mold. Garrett also shared a couple of weeks ago, a ceiling in one unit collapsed due to moisture. The resident who lived in that unit was not injured and was moved to another apartment in the neighborhood.

“I think also building materials in our climate — where we are in Wilmington — at that time, no one thought about whether or not it was going to hold more moisture,” Garrett said. 

He mentioned the electrical wiring needed to meet modern standards and more energy-efficient materials would be used in the remodel.

Regarding trees, Hillcrest currently has at least 50 mature live oaks and dogwoods on the property that should be preserved, according to an informal inventory conducted by the Alliance of Cape Fear Trees in 2022. Garrett said the site plans will also revolve around keeping as many mature trees as possible. 

Garrett emphasized WHA will prioritize minimizing disruption for residents. The construction of the new units may take place on-site, in the Hillcrest neighborhood, or offsite at another WHA property, depending on costs. Residents will be temporarily relocated to a different unit at Hillcrest or an offsite location owned by the housing authority during the redevelopment process.

“If we do relocate them offsite or to another unit, they will always, always have the opportunity to return to their original location,” he said. “Those are part of our principles; we don’t deviate from that.”

Funding is the biggest hurdle and if everything moves along swiftly, the project is likely to break ground in the first quarter of 2026.

Garrett said the WHA is also preparing to apply for LIHTC funds to rehabilitate 151 units at Solomon Towers, a low-income housing building for disabled seniors on Castle Street. Built in 1972, the apartments have not undergone major renovations since their construction. The project aims to modernize the building’s façade, reinforce balconies, repaint interior walls, update bathrooms to better suit seniors, replace cabinets, and repair infrastructure, including elevators.

Additionally, Garrett said an application for LIHTC funds for the redevelopment of Houston Moore on South 13th Street is also in the works. Both are expected to be submitted this month.


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