INDIANAPOLIS (WISH) — Mayor Joe Hogsett on Tuesday said a 32-story hotel and residential tower next to Old City Hall is exactly what the city needs.

Hogsett and Together, We Grow CEO Tony Knoble unveiled a proposal to build the tower on the site of the parking lot next to the Old City Hall, near the terminus of Massachusetts Avenue.

The tower will contain 150 hotel rooms and 190 apartments and condominiums, along with roughly 8,000 square feet of retail space. Ten of the residential units will be set aside for people making up to 30 percent of the area median income, which currently works out to a little less than $30,000 per year for a family of four. Old City Hall itself would be converted into an art gallery connected to the tower.

Hogsett said this is the third city-owned property to be redeveloped. He said residents need places to live, work, and play, and the project will provide all three.

“Once completed, this development will combine the best of our history with the optimism we feel at the dawn of our next 200 years,” he said.

Affordable housing advocates said the 10 income-restricted units aren’t many but they’re a step in the right direction.

Prosperity Indiana Policy Director Andrew Bradley said restricting them to people making up to 30 percent of area median income is especially important because people with incomes that low are most likely to spend at least half of their monthly income on housing. He said that means something as simple as a flat tire could jeopardize their ability to pay rent.

“It’s good to see the city has built into their plans that there has to be set-asides for that extremely low income, that bottom 30 percent of area median income,” he said. “That really is where the largest gap is, not just in Marion County, but statewide.”

Bradley said the city needs another 39,000 units to house everyone at that income level, so the Old City Hall development shows the need for other strategies in addition to simply building more housing.

Knoble said he plans to preserve as much of Old City Hall as possible, including the rotunda. The art gallery won’t be enough to fill all of the building, so he said the remaining space will be used for other purposes. The Department of Metropolitan Development currently occupies a few offices in the building.

Hogsett and Knoble said the total price tag comes to $140 million, so they plan to ask the City-County Council to approve a 25-year, $15 million tax increment financing district for the entire project. They said they plan to bring all of the legislation needed to approve the project and the TIF before the council in October. Construction is currently scheduled to begin at the end of 2024.