A significant housing development could be coming to the area north of the Fairfield Armory, with the city council set to vote on a key piece of the puzzle at its May 11th meeting.
The proposal involves Kading Properties, a developer that has proposed constructing approximately 30 buildings consisting of four, five, and six-unit residential structures on 17.3 acres of land near the Armory — a development Grow Fairfield Executive Director Ed Malloy described as a $30 to $35 million investment. If constructed, it would represent one of the largest housing developments in Fairfield’s recent history.
To make the project viable, the city is being asked to approve a resolution authorizing a land exchange. The city currently holds a $200,000 loan it made to Grow Fairfield, which was to be repaid through lot sales at the Sunrise Trail subdivision. Under the proposed resolution, that loan would be forgiven in exchange for the city receiving the 17.3 acres of development land from Grow Fairfield. The land has been appraised at $350,000 — significantly more than the loan amount. The city would then convey that land to Kading Properties as part of an incentive package to attract the development.
City Attorney John Morrissey told the council the exchange makes financial sense for the city. “We’re not giving anybody anything by release and satisfaction,” he said, noting the land is worth considerably more than the outstanding loan.
The timing is driven by a June 10th application deadline for Iowa workforce housing tax credits. Kading Properties plans to apply for those credits, and having city ownership of the land, completed zoning changes, and a formal letter of city support in place before that date would significantly strengthen the application. “They have chosen us and they have begun their work on it already,” Malloy said. “We just have to keep showing that our community is going to stay interested.”
The council also approved first readings Monday of two rezoning ordinances that would change the parcels from their current M1 Limited Manufacturing and R2 General Residence designations to a Planned Unit Development district — a necessary step before the development can move forward. A neighbor attended the meeting and asked questions about what the rezoning would mean for the surrounding area. City Engineer Melanie Carlson reassured the resident that the rezoning would not bring any additional industrial or commercial uses to the area. “There would not be any manufacturing,” Carlson said. The PUD, she explained, would consist entirely of residential uses — specifically a mix of duplexes, triplexes, and two-story apartments, similar in character to an R3 residential zone.
City Attorney John Morrissey noted that the area has long been understood to be transitioning toward residential use, and that the development is consistent with commitments the city made to the neighborhood years ago. “When we allowed Sky Factory to build, we had meetings with the neighborhood out there,” Morrissey said. “Part of the commitment by the development association by the city back then is that we wouldn’t allow any heavy type of industry in there after Sky Factory.”
He said the focus on the eastern side of the development area shifting toward residential has been the direction since that time, with the Doyle subdivision — where the Habitat for Humanity houses are located — being one example of that commitment being followed through. “We also indicated to the neighbors that the focus out on the bigger area would still be either very light manufacturing or more housing,” Morrissey said. “And this is all consistent with — or more housing.”
Carlson added that Grow Fairfield had already gone through the proper steps to update the city’s comprehensive plan to reflect high density residential for the area before bringing the rezoning request forward. “The comprehensive plan has gone through its proper step of changing it, so that this request for the PUD rezone would be in line with the comprehensive plan,” she said.
The structure of the eventual land transfer to Kading Properties was also briefly discussed, with Morrissey noting there are different ways the deed could be written. One option would include a conditional clause or reversion paragraph stating that if the development does not proceed, the property returns to the city. Another would be a more straightforward fee simple grant with no conditions attached. Morrissey acknowledged that from a developer’s perspective, Kading will likely prefer the cleaner transfer without conditions. “That would be where I would see myself if I was their attorney,” he said.
The specifics will be worked out as part of the development agreement being drafted ahead of the May 11th vote. A representative from Kading Properties is expected to attend one of the next two council meetings. The rezoning ordinances will require two additional readings before taking effect.
If the workforce housing tax credit application is successful, construction could begin as early as 2027, with all units available for rental upon completion.
