cover
TO: Mayor Richard C. Irvin
FROM: David Dibo, Economic Development Director
DATE: February 28, 2023
SUBJECT:
A resolution authorizing approval of a Development Agreement with JH Real Estate Partners LLC for the rehabilitation of the building at 110 Cross (between River and Middle across from the Jimmy John's) for conversion of the historic building into 15 market rate apartments and a brewery on the ground.
PURPOSE:
The RDA will facilitate the development with a 23 year TIF with 70% of the benefit going to the JH plus a forgivable loan of $300,000 to the developer and $75,000 to the first floor microbrewery tenant. The TIF inducement resolution was approved on July 27th, 2021 which permits certain expenses to become eligible for reimbursement after the TIF is approved by the City Council.
BACKGROUND:
110 Cross is a historic building purchased about 4 years ago by JH. Plans to renovate the building have been in the works since then including the recruitment of the well-regarded Foreign Exchange Brewing company. The City had asked JH to table this request until the completion, opening and residential leasing of the Hobbs Project including the renting of the retail spaces on the first floor and partial basement. In addition, Foreign Exchange wanted to affirm that they had properly capitalized this new venture as much of the high costs to create the brewery are being borne by Foreign Exchange as part of the overall lease with JH. Along with other parts of the downtown, there is a vibrant interest in the area from Benton south to at least North Avenue. (Council approved a corridor study/master plan in the 2023 budget for this area.)
DISCUSSION:
While the market downtown is moving to more self-sufficiency, reducing the magnitude of incentives needed to fill the "gaps' between the costs to complete a project and the value of that project at completion, there is still a negative spread in most downtown deals because (escalating) costs are still higher than...
Click here for full text