Construction is expected to begin next year on the first two residential buildings of the $400 million Mill Creek Choice Neighborhood Initiative, members of the Huntsville Planning Commission were told Tuesday.

Dennis Madsen, the city’s manager of urban and long-range planning, said $50 million in federal funding for the project was secure. He said the city was already drawing from the funding.

Madsen said the city anticipates moving dirt on the first phase of the project in the first quarter of next year. The first phase is on the southwest corner of the site between Clinton Avenue and Governors Drive west of Seminole Drive.

“The universal design building in phase one will get built first,” Madsen said. “It will be followed closely by phase two, which is a senior housing facility. Those two buildings being erected will allow us to vacate Johnson Towers with the idea that most of those folks will go into one of those two buildings. The great thing about that is that most of those residents will only move once.”

Madsen said once the residents move, it will allow the city to take down Johnson Towers and move on to phase three of the project.

“That’s where a lot of families will move in and we will be able to provide new housing,” he said.

In addition to Johnson Towers, Butler Terrace buildings remain on the site. After radon was discovered in some buildings on the southern portion of the site, they were torn down.

The development area, just west of Memorial Parkway, is a partnership with Huntsville Housing Authority that will result in a $350 million investment into a mixed-income community with workforce housing, medical and childcare services and retail options.

The city formally accepted the $50 million Choice Neighborhood Implementation Grant from the U.S. Department of Housing and Urban Development earlier last year. Under the terms of the HUD grant, the housing must be completed within eight to 10 years.

Madsen highlighted Huntsville Hospital’s plans to build housing on the site for its workforce. He said the piece played a role in helping the city receive the HUD grant. He said a minimum of 125 units were being built specifically for the hospital’s employees.

“As you know from experience, if you go to any community, Housing Authority buildings that had been built in the ‘50s, ‘60s and ‘70s, you can typically spot them,” Madsen said. “They are very recognizable. The idea is this is supposed to look like any market rate housing. It should have quality streetscapes. It should have quality public spaces.”

Madsen said the city is working to create a linear park through the middle of the neighborhood.

The Planning Commission approved a resolution of support for the project, which Madsen said could prove crucial for the city if it sought to apply for more grant funding.

“It’s a great looking plan,” Planning Commission member Kelly Schrimsher said. “I know how much time and energy and effort and public input by the residents have gone into this.”

“It will truly be transformational for that neighborhood,” Planning Commission Chairman Les Tillery added.