A project to bring affordable apartments to east Lawrence is moving ahead, and now it is working to add affordable arts studios to the neighborhood as well.

Leawood-based developer Tony Krsnich confirmed Wednesday that he hopes to start construction by early October on a $9 million project to renovate the former Poehler warehouse building at 619 E. Eighth St. But he also confirmed that he’ll be seeking about $750,000 worth of financial incentives from the city to help make the project work.

“We’re unbelievably excited about the project,” Krsnich said. “We think we’re laying the groundwork for that entire block to redevelop.”

Krsnich has been working on a plan to redevelop the four-story Poehler building into about 40 apartment units since late last year. But in recent weeks, the project has expanded. Krsnich said his development group also has purchased the Vinegar Building — sometimes called the Cider Works Building — that is immediately south and west of the Poehler building. Krsnich purchased the early 1900s-era building with the idea of putting more apartments in the 15,000-square-foot stone structure.

But now Krsnich said he’s looking for a way to convert the building into 30 to 40 studio spaces for local artists.

“We would really like to make this the place known for where the artists are at,” Krsnich said. “We have heard from so many people that Lawrence needs a nice, cool place for artists to work.”

He said he started exploring the idea after several neighborhood residents suggested it. He said he would like to figure out a way to rent the spaces for about $300 a month. He’s also considering using the upper floor of the building as loft living space, so artists could live and work in the same building.

As for the Poehler building, plans call for 33 one-bedroom units and 16 two-bedroom units. The apartments would have an urban design feel to them, with exposed trusses, polished floors and the type of finishes you would expect to see in downtown lofts. But the project is receiving almost $600,000 in affordable housing tax credits from the state. That means nearly all of the apartments — 46 of the 49 — will have an element of rent control to them. Krsnich said current plans call for one-bedroom apartments to rent for about $500 a month, while two-bedroom units would rent for about $600 per month.

City commissioners ultimately will be asked to give some key approvals to the project. Krsnich said he is hoping the city will help pay for several public infrastructure costs in the area. Specifically, City Manager David Corliss has said the city will look at rebuilding Delaware Street between Eighth and Ninth streets. The project likely would include new pavement, storm water upgrades, curbs and gutters, and sidewalks. Krsnich said he also would like the city to consider providing assistance for off-street parking lots to serve the development.

Corliss has said the city should give the request strong consideration, and he has included debt financing for the project in his recommended 2012 budget. But city commissioners will have to specifically vote on the project at a later date before it could move ahead.

The $750,000 in city money would be in addition to local property tax rebates the development can qualify for. The area surrounding the Poehler building already has been approved as a Neighborhood Revitalization Area, which makes it eligible for property tax rebates of up to 95 percent, with some conditions.

The area received that special designation when Lawrence developer Bo Harris unsuccessfully tried to launch a major renovation of a multiblock area of east Lawrence. Krsnich said he’s optimistic his project can jump-start the redevelopment of several other vacant buildings in the area.

“With what we’re doing, I’m pretty confident the rest will fall into place,” Krsnich said. “Somebody will redevelop the rest shortly after us. Hopefully, it will be us.”