Downtown apartment proposals from Indianapolis developer clear first bureaucratic hurdle
04/11/2014 6:19 PM
04/11/2014 6:19 PM
An Indianapolis developer cleared the first bureaucratic hurdle Friday to his plan to build 661 new downtown apartments.
Jim Thomas of Cityscape Residential won approval from the Planned Industrial Expansion Authority to begin the process necessary to seek a tax abatement to help finance two projects totaling 386 apartments in the Quality Hill area and a 275-unit project proposed for Crossroads West near Southwest Boulevard and Interstate 35.
The developer will seek a 25-year abatement on the increased value of the improvements, 100 percent for 10 years and 50 percent for the remaining 15 years, to help finance the projects. The taxes currently generated by the properties would continue to be paid. The total cost of the investment is estimated at $125 million.
Though the expansion authority board is not expected to take up the request for incentives until early summer, the subject did come up at the meeting.
Thomas has developed apartments in downtown Indianapolis and Louisville, Ky., and is building apartments in the Prairiefire development in Overland Park. He said even with the property tax abatement, his proposed downtown projects will yield only 80 percent of the return compared with his other developments.
“I have zero doubt the final analysis from the consultant will prove our numbers,” he told board members.
The Quality Hill projects are called Apex on Quality Hill, a 130-unit development between Case Park and the HNTB office building at 715 Kirk Drive, and Summit on Quality Hill, a 256-unit development south of 12th Street straddling Pennsylvania Avenue.
Thomas said all of the land necessary for both Quality Hill projects is vacant and no demolition would be necessary.
The Crossroads West project calls for a six-story building with 275 luxury apartments southeast of Southwest Boulevard and Interstate 35. It would be wrapped around a garage. A total of 400 spaces will be provided, including some surface parking. The project calls for demolition of a vacant Jones Store warehouse at 2311 Jefferson St.
Thomas and his attorney, Roxsen Koch, said the biggest challenge to the Crossroads West plan was acquiring the rights to a billboard on top of the Jones Store warehouse from CBS Outdoor advertising.
“It was a huge feat to accomplish,” Koch said.
Billboard operators enjoy powerful legal protection for the signs themselves and for “perpetual” unobstructed views as well.
For example, the city of Kansas City is considering using eminent domain to acquire a billboard that’s in the way of a proposed $16 million hotel project at 20th and Main streets.
In the case of Crossroads West, Thomas has negotiated a deal for the rights to the billboard on top of the warehouse, a critical step because the building has be demolished. CBS, however, refused to relinquish its interest in the three remaining pole billboards along I-35.
The apartment architect, Jay Tomlinson of Helix Architecture & Design, had to design the project around the three remaining billboards and meet the requirement that their views be unobstructed.
All three proposed apartment projects also will be going to City Hall for review by the City Plan Commission and Kansas City Council. If all approvals are obtained, including the abatement request, construction would begin this fall.
The smaller Apex project would be completed by the end of 2015, and the larger Summit and Crossroads West projects by mid-2016.
In a separate matter, the authority board delayed consideration of a proposal to withdraw a blight study commissioned by the city that targeted three low-income apartment projects on Armour Boulevard owned and managed by Eagle Point Cos. of Maine.
The study concluded that the Bainbridge, 900 E. Armour; Georgian Court, 400 E. Armour; and Linda Vista, 1301 E. Armour, were a “social liability” because of the amount of crime reported.
Eagle Point, however, has challenged the study’s methodology. Officials say the buildings have been well-managed and point out the blight study shows crime reports have dropped at the properties the past couple of years.
Eagle Point executives met with city officials earlier this month and reported progress in resolving the issue. The expansion authority board now is expected to take up the request by the city to drop the blight study at its next meeting in May.