Roxy Cinema, the theater tucked away in the Renton Plaza on South Grady Way, permanently closed its doors recently to make way for a new housing development.

RVA Cinema LLC, the company that owns the 24-acre Renton Plaza, is working with the city to build a 2.6 acre multi-family apartment complex on the site where the theater currently sits.

The project, called VIA 405 Apartments, will include eight stories and 270 apartment units, as well as commercial and retail developments on the lower floor and two stories dedicated to parking.

The developer has finished the full entitlement process, and is in process of completing the necessary construction and building permits.

The site is currently underutilized and the need for affordable housing in the city is evident, according to RVA Cinema.

“The development site is an excellent example of underutilization,” read a letter from the developer addressed to the city. “The current cinema building is functionally obsolete. Development of an apartment community at the site is the highest and best use and contributes to residential opportunities.”

About 40 percent of Renton households and 48 percent are considered cost-burdened, according to statistics provided in a previous Committee of the Whole meeting.

“Job growth in Renton is accelerating and quickly creating more demand for market rate and affordable apartment units,” read a letter. “VIA 405 will provide much needed new housing in close proximity to job growth sectors, particularly health care and technology…. (It) will also bring a major land use improvement to one of Renton’s primary entries, South Grady Way.”

VIA 405 Apartments will be considered a transit-oriented development (TOD), the first of its kind in the city. With the relocation of the Metro Transit Center from downtown Renton to the former Sound Ford site and the parking garage that is to be built by Sound Transit, TODs like the apartment complex can “capitalize on the density to increase transit ridership and reduce the need for automobile travel,” according to a city memo.

“When complete, South Renton Transit Center/BRT service and VIA 405 Apartments form a cooperative relationship moderating daily vehicle counts on lower capacity city streets,” read the letter.

Though the site is in a commercial office zone, the city entertained the idea of having a residential project in the area since VIA 405 is a TOD, according to Matt Herrera, senior planner at the city.

The developer has agreed to build a landscaped pedestrian walkway that will link the apartments to the new transit center.

RVA Cinema is asking the city for the multi-family property tax exemption and has agreed to build a portion of the apartments as affordable housing units.

Since 2003, the city has been issuing multi-family property tax exemption for developments in certain geographical areas as a way to incentivize developers to build more market rate and affordable housing units. If built in designated areas, developers can have a certain portion of their property taxes waived for eight years. If 20 percent of a development comprise of affordable units at 80 percent or less of the area median income, taxes can be waived for 12 years.

Initially the city provided the exemption in the downtown area, the Sunset neighborhood and the Lake Washington area. In 2008, the code was amended to remove the Lake Washington area after over 1,000 units were built with the exemption.

RVA Cinema requested the city to add the City Center to the tax exemption areas so it would receive a 12-year exemption.

VIA 405 is estimated to have about 54 affordable units. The cost of constructing 54 affordable units is estimated to be around $13.5 million, which, according to the developer, is a figure that exceeds the value of tax credits received.

There will be a Planning Commission public hearing at 6 p.m., May 9 at the Council Chambers on the topic of considering creating the 115-acre City Center multi-family property tax exemption area.

The proposed amendment will head to the Renton City Council at a later date for approval.

The groundbreaking for the project is estimated to be sometime during the fall of this year.