Written by Jill Nolin
http://www.montgomeryadvertiser.com/arti...ls?odyssey=mod|newswell|text|Frontpage|s
A proposed $20 million apartment complex that would have created 220 new residential units in downtown failed to secure financing and the city has begun the search for a new developer for the site.
The city issued a request for development proposals Wednesday for the properties at
the corner of Columbus and North Perry streets, which is currently a parking lot, and
Bibb and Lee streets, which is where the city’s skate park is located.
The city’s skate park would be moved to another location.
When it was announced in April, the apartment project was heralded as the largest residential development to happen since downtown revitalization started several years ago, but
TJ Williford said Wednesday that
Warehouse District Partners was unable to secure financing in time to satisfy the city.
“The type of financing that is needed for this type of project can take many years,” Williford said. “The lack of lubrication in the financial market is very challenging.” Redeveloping property in an older area of the city also can be more difficult than working with undeveloped land,Williford said. “This is not a former cow pasture. You’re talking about a city with an infrastructure that is 100 years old and challenged with environmental concerns,” Williford said.
The Capital City Plume, which encompasses about 50 city blocks in downtown, remains a proposed Superfund Site. Williford said the plume has created a “perceived contamination” for this property that would require more time for a developer to overcome. “That simple perception is something we’ve got to hurdle. It’s a little challenge,”Williford said. Williford said last April that the goal was to complete the project in two years.
Chad Emerson, who is the city’s development director, said the EPA has notified the city that this particular city block is not in the migration path of the plume. Warehouse District Partners, which opted out of its contract with the city Nov. 29, had agreed to purchase the property from the city for $2.5 million. The transaction also included the vacant building on the other side of Perry Street.
Harvi Sahota, who was part of the development team, said Wednesday that the demanding timetable and the difficulty of finding financing right now were the two main contributing factors to the project’s demise. “Maybe in another time, it would have been a different story,” he said, referring to the economy.
When the project was announced in April, city officials were encouraged that it would satisfy some of the demand for downtown housing and help the city recruit more businesses, such as a grocer.
“We’re not going to be able to hit a home run with every swing,” Deputy Mayor
Jeff Downes said Wednesday.
The city will continue to insist that developers produce results within a certain period of time, Downes said.
“The city cannot take its assets and encumber those and sell them to a private entity without a reasonably aggressive redevelopment plan. Otherwise people would come in, tie up city property for speculative reasons and just hold onto them. That’s just not part of our philosophy,” Downes added.
A housing study that was released in May 2011 showed that the size of the potential housing market increased from 2,630 households in 2006 to 3,260 in 2011, but it also questioned whether there would be enough financing to support the demand. The study said there was a particular demand for higher-density units, such as apartment buildings.
The study, called “An Update of Residential Market Potential,” was done for the city by Zimmerman/Volk Associates of New Jersey. It is the same firm that studied the market in 2006 as part of the development of the downtown master plan.
Although developers will present their own ideas to the city, Emerson said that he still believes the Columbus Street property is ideal for a residential project. Developers have until Feb. 22 to submit their proposals.
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