The developer behind a proposed affordable housing project in West Kalispell is seeking public funding to help finance the project.  

Mach Development is looking to build a 24-unit apartment building that will boast one- and two-bedroom rent-restricted apartments for households making below 50% to 60% of the area median income.  

Called the Outpost at Kalispell, the property at 40 Appleway Drive is located within the West Side/Core Area tax increment financing districts, which aim to address blight and promote economic development in those neighborhoods.  

As improvements are made within the districts, and as property values increase, the incremental increases in property tax revenue head to a fund that is used for improvements within the district. 

Mach Development is requesting $133,700 of those tax increment financing dollars in the form of two loans — one to cover demolition of the existing building and site preparation, and another for boulevard improvements and installation of a sidewalk.  

The district has enough revenue to support the ask, which equates to about one public dollar for every $76, according to Community Development Manager Nelson Loring.   

The Urban Renewal Agency OK’d the request last month. The terms of the loan still have to be ironed out with the Revolving Loan Fund Committee before a recommendation is sent to Kalispell City Council for approval.  

Council in October 2024 unanimously approved workforce housing projects to be eligible for tax increment financing funds. 

The developer is looking for a loan instead of a grant because the property will be exempt from paying property taxes, according to Loring. The tax-exempt status is the result of a partnership with the Community Action Partnership of Northwest Montana, said Grant Schnell from Mach.  

The Montana Board of Housing also awarded $8.3 million in funding through the Montana Housing Tax Credit Program to support construction. The entire project is estimated at $8.75 million.  

The developers had originally planned to break ground in April but now expect construction to begin in early summer, with completion slated for spring 2027.  

Using 2025 Flathead County income data, the units are targeted to one-person households earning up to $40,560 a year and two-person households earning up to $46,320.  

For people making below 50% area median income, nine one-bedroom units will cost around $905 a month at 704 square feet. Eight two-bedroom units will cost $1,086 at 955 square feet. 

For those making below 60% area median income, three one-bedroom units are expected to cost $1,086 a month at 704 square feet. Four two-bedroom units will cost around $1,303 at 955 square feet. 

Three units will be set aside for veterans, victims of domestic violence or youth aging out of foster care.  

Each apartment will include electric kitchen appliances, in-unit washer dryers and balconies or patios. Grilling stations, a playground and indoor gathering space are also planned.  

Schnell hopes the incoming inventory will help fill a shortage of affordable housing in the community.  

“The people that run Kalispell: your firefighters, teachers, police officers, they just don’t have anywhere to live. We want to come in, build something at market rate quality, or exceed market rate quality, and give them a place to live that’s affordable,” Schnell said.  

The city faces a tight and expensive rental market, with vacancy rates at 1.1% as of spring 2025, according to Kalispell’s newly adopted land use plan. The average rent in 2025 was $1,650 a month.  

Mach LLC has two other local projects underway. One involves taking ownership of a 60-unit senior community on Third Street, and the other is a 216-unit rent-restrict development planned near Glacier High School along Timberwolf Parkway.  

Reporter Jack Underhill can be reached at 406-758-4407 or [email protected]. If you value local journalism, pledge your support at dailyinterlake.com/support.