LOUISVILLE, Ky. (WDRB) -- The first residents of a new and improved Smoketown housing development moved in Thursday.

The first phase of the Sheppard Square project just south of East Broadway in downtown Louisville is nearing completion.

The site used to be a housing project, until a multimillion dollar federal grant launched a complete rebuild of the community.

When the project became reality, Janae Thompson said she and her sister were some of the first people to turn in their applications.

"I just stayed on it, found out they were taking applications, called resources, was the first one in line, brought my sister with me and told her 'let's get it,'" she said.

And Thursday, the native Smoketown sisters were celebrating a homecoming.

"I'm happy, I'm grateful, I'm blessed and words really can't explain it. I'm excited," said Jacorya Thompson.

But no excitement could top the moment when they saw their new homes.

"Oh look at it!" exclaimed Janae. Her two young daughters were just as excited, picking out their rooms and referring to it as their "Barbie dream house."

The sisters will now live side-by-side in what is the first wave of residents to move into the new community.

"Those who grew up here, and lived at Sheppard Square, to be able to come back, and have sufficient room for their children, it's exciting," said Tim Barry, Executive Director of the Metro Louisville Housing Authority.

The original complex was built in the late 1940s, and became a hot bed for crime and violence.

In 2011, the city received a $22 million grant from Housing and Urban Development (HUD) which allowed Louisville to begin replacing the 70-year old complex.

The new community is mixed income. There is both subsidized, low income, and market rate housing.

"We're getting a lot of interest from everybody," said Barry. "We've got about 1,200 people on the waiting list already."

And first impressions are saying it all.

"This is perfect. It really is," said Jacoyra Thompson as she walked through her new master bedroom.

Her sister remembers the old projects and how much the neighborhood has improved.

"It came a long way from the projects, concrete walls and everything. It's just beautiful. I'm living in paradise," said Janae Thompson.

Sheppard Square is set for completion December 2015.

Market rate for a three bedroom is $750 a month.

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