SEDONA, Ariz. — Construction is officially underway on The Villas on Shelby, a long-awaited affordable housing development in Sedona that marks a significant step toward addressing the city’s housing crisis. Wespac Residential Inc., the construction management firm leading the effort, announced the groundbreaking Friday, signaling progress on what will be Sedona’s first affordable housing project to receive federal low-income housing tax credits.

The new community is rising on 1.2 acres of city-owned land, where Wespac will construct a three-story apartment building featuring 24 one-bedroom units and six three-bedroom units. The development is designed with both livability and functionality in mind and will include covered parking, a community room, a fitness area, and a playground, according to a press release.

If construction proceeds on schedule, the apartments will be completed by May 2026, with move-ins expected immediately afterward.

“This project is a testament to what can be achieved through strong partnerships and a commitment to community impact,” said Ian Fawley, Senior Project Manager at Wespac Residential Inc. “We’re proud to bring this development to life in Sedona, where the need is urgent and the outcome will directly benefit residents who help make this city thrive.”

The project’s funding is the result of a coordinated effort utilizing federal low-income housing tax credits and Arizona’s State Housing Trust Funds, making it the first development in Sedona to leverage these public resources for affordable housing.

Addressing Urgent Need in Sedona and Across Arizona

Sedona’s high cost of living and limited rental availability have made it increasingly difficult for local workers, especially those in the tourism, service, and education sectors, to live where they work. The Villas on Shelby is aimed directly at supporting these individuals by providing stable and affordable housing within city limits.

The development aligns with broader efforts across Arizona to expand access to affordable housing amid rising rents and a limited housing supply. The city of Phoenix, for example, has also ramped up investment in affordable housing infrastructure. In April, Mayor Kate Gallego pointed to a series of housing initiatives in the works between downtown Phoenix and Sky Harbor International Airport.

Meanwhile, similar projects are breaking ground throughout the state, including recent affordable housing developments in Maricopa, where developers are using the same combination of public-private partnerships and federal tax incentives to lower the cost of construction and ensure long-term affordability.

As The Villas on Shelby rises in Sedona, community leaders are hailing it as a model for how municipalities can leverage public land and federal support to make real progress on housing needs.

Originally reported by Payne Moses in KTAR News.