The City Council voted unanimously on Nov. 23 to approve a $2.1 million construction loan for Townspeople so the housing agency can buy and rehabilitate a 34-unit apartment building in Normal Heights, which will provide housing to low income people living with HIV/AIDS.

“This is a remarkable project,” said Councilmember Carl DeMaio, adding that he visited the site. “I’m thrilled to support this project.”

Councilmember Todd Gloria made the motion to approve the construction loan and to authorize a $880,000 loan increase for Townspeople, a nonprofit corporation established in 1994 with the mission of developing affordable housing for persons with HIV/AIDS.

“This is a terrific deal the Housing Authority put together,” Gloria said.

The apartment building on is on 34th Street in Gloria’s district.

The completed apartments include 20 one-bedroom apartments and 13 two-bedroom apartments. There are 12 units specifically reserved for households affected by AIDS that can include women with children.

Townspeople was unable to secure tax-exempt bond financing due to the recent credit crisis and economic downturn, according to a report for the San Diego Housing Commission. The loan increase and construction loan would have provided financing to pay costs of development until the rehabilitation is complete.

The sale price of the property was adjusted to a new appraised value of $3.5 million, which is a reduction from the original sales price of $4.19 million. The owner and buyer agreed to extend close of escrow to Nov. 30.

The work on the complex will start on Jan. 15, 2010, and it should be completed by June 15, 2010.

The City Council voted on the project while sitting in its dual role as the Housing Authority.

This project is the third affordable housing project for Townspeople. In 1995, the Housing Commission loaned the nonprofit $257,000 for purchase and rehabilitation of an 8-unit apartment building in City Heights. In 2005, Townspeople obtained a $1.5 million Housing Commission loan to buy and renovate a 24-unit complex also in City Heights.

Townspeople offers listings of HIV-positive friendly landlords and those with apartments who are seeking roommates. For more information about Townspeople, visit www.townspeople.org.