File #: 15-338    Version: 1 Name: Murray RDA
Type: Ordinance Status: Adopted
File created: 10/1/2015 In control: City Council
On agenda: 10/13/2015 Final action: 10/13/2015
Title: Communication from the City Manager with a Request to ADOPT an ORDINANCE Approving the MURRAY PLACE DEVELOPMENT LLC REDEVELOPMENT AGREEMENT. (1st District)
Indexes: Goal 4 - Grow Peoria, Reinvest in neighborhoods
Attachments: 1. ORD NO 17,269, 2. Ordinance Approving Redevelopment Agreement (Murray), 3. Murray RDA Final

ACTION REQUESTED: 

Title

Communication from the City Manager with a Request to ADOPT an ORDINANCE Approving the MURRAY PLACE DEVELOPMENT LLC REDEVELOPMENT AGREEMENT. (1st District)

 

Body

BACKGROUND:  Murray Place Development LLC is seeking to redevelop an entire block in the Warehouse District.  The block in bounded by Water Street, Walnut Street, Washington Street and the Bob Michel Bridge.  It contains two structures: a four-story, 80,000 square foot building at the corner of Walnut and Water (commonly referred to as the “Murray Building” or “Stuber Building”) and a single-story, 10,000 square foot barrel-roof building on Washington Street next to the bridge.  The development team is investing $13.8 million to convert the primary structure into a mixed-use building that will include ground floor retail, second floor commercial office space, 32 residential rental units on the third and fourth floors and a rooftop patio. This building is already home to the recently renovated and reopened Rhodell’s Brewery. The project also includes the renovation of the single-story structure into commercial office space and/or retail space.

 

This project represents the first major mixed use project in the Warehouse District TIF.  The property sits in a key location along the riverfront and between anchor developments in the 400 and 600 blocks of SW Water Street (including Le Vieux Carre, Water Street Solutions and 401 Water).  The addition of residential units aligns with a key Council priority of increasing the population of downtown.

 

In addition to the redevelopment of the subject property, the developer has also offered to finance the costs of a number of off-site public improvements.  Specifically, the developer is willing to front the funds to underground utilities along Water and Walnut and complete the proposed Water’s Edge Park.  While the Redevelopment Agreement outlines how these improvements are financed and reimbursed, the City must separately authorize the developer to proceed with these projects and approve any plans.

 

FINANCIAL IMPACT:  The developer is not seeking any advance assistance from the City. City staff reviewed the developer’s financial information to determine what incentives would be required to generate sufficient return to attract the necessary investors. The Redevelopment Agreement provides that in exchange for the $13.8 million investment, the developer will be rebated incremental property taxes on a sliding scale: 100% of the increment will be rebated in the first 5 years (2017-2021); 75% of the increment will be rebated between 2022 and 2026; 65% will be rebated between 2027 and 2031; and 50% of the increment would be rebated from 2032 until the end of the Warehouse District TIF, but only if the TIF is extended.  The Agreement also caps the total amount of rebate that can be paid by year and in the aggregate.

 

In addition to the rebate, the Agreement provides that should the City request the developer to fund the off-site improvements that it will be reimbursed for those costs, up to $500,000, over ten years at 0% interest.  Reimbursement for off-site improvements would be paid from unobligated Warehouse District funds.

 

NEIGHBORHOOD CONCERNS:  Redevelopment of buildings in the Warehouse District is a widely held community goal.

                     

IMPACT IF APPROVED: The Redevelopment Agreement will be approved and the project will proceed.

 

IMPACT IF DENIED:  The Redevelopment Agreement will not be approved and the project may be delayed or cancelled.

 

ALTERNATIVES: Council could direct staff to adjust the terms of the Redevelopment Agreement.

 

EEO CERTIFICATION NUMBER: Not applicable.

 

WHICH OF THE GOALS IDENTIFIED IN THE COUNCIL’S 2014 - 2029 STRATEGIC PLAN DOES THIS RECOMMENDATION ADVANCE?

 

1. Vibrant Downtown: Riverfront/ Central Business District/ Warehouse District                     

 

WHICH CRITICAL SUCCESS FACTOR(S) FROM THE COMPREHENSIVE PLAN DOES THIS RECOMMENDATION IMPLEMENT?

 

1. Reinvest in neighborhoods.                     

 

DEPARTMENT: City Manager's Office