ACTION REQUESTED:
Title
Communication from the City Manager with a Request to ADOPT an ORDINANCE Approving the WASHINGTON CORPORATION REDEVELOPMENT AGREEMENT. (1st District)
Body
BACKGROUND: Les Cohen of The Washington Corporation is the owner of a building at 428 SW Washington. The building has been vacant for many years and most recently was an Enterprise Rent-A-Car location. Mr. Cohen has found a tenant for the building, a cross-fit gymnasium that is relocating from his Westlake Shopping Center property. Mr. Cohen intends to spend an estimated $450,000 to prepare and renovate the interior and exterior of the building. In addition to this investment, the building also has enough space for an additional tenant which Mr. Cohen will be working to find. Phase I of this project includes the main interior and exterior renovation to accommodate the current client at a total of approximately $376,000. An additional $75,000 will be invested once a tenant for the remaining space is secured.
The proposed Redevelopment Agreement (attached) is similar to the assistance provided to Running Central. Due to the short remaining life of the Central Business District TIF (ends in 2021) the developer will be rebated 100% of new incremental property taxes associated with the redevelopment. This rebate is intended help offset the cost of code compliance, life-safety improvements and other eligible costs. The work should be completed by the end of the third quarter of 2015.
FINANCIAL IMPACT: In 2014, this property paid $6,332.26 in property taxes based on a 2013 EAV of $69,620. Mr. Cohen is making a substantial investment in the renovation of the property which will raise the value and the taxes paid. After the project is completed, any taxes paid above this amount would be rebated to the developer. While Mr. Cohen would be entitled to being rebated the entire eligible amount, the short remaining life of the Central Business District TIF means that it is ...
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