Faced with a high-rise project that is no longer financially feasible but is an integrated part of the city’s planned amenities at Riverfront Plaza, the Downtown Investment Authority has a decision to make on how to move forward with developing the Northbank park.
DIA CEO Lori Boyer laid out the situation to members of the DIA’s Retail Enhancement and Property Disposition Committee on April 11.
At issue was how to deal with the site of the American Lions project, a 44-story residential tower that was designed to help support a walkway to the Main Street Bridge and to provide one wall of a beer garden sited in the southeast corner of the park.
In 2022, the DIA approved a $36.93 million incentive package for the $166.6 million project, but Boyer told the committee that the development had fallen victim to increased costs in construction and financing over the past two years.
“The commitments they made and we made financially are no longer viable,” she said.
With the project stalled, the DIA’s next step would be to put the city-owned parcel where it was sited back up for disposition – another term for seeking new bids for it.
The question before the committee was when to put the property back up for grabs, with Boyer saying that doing it now or holding off until later would both have advantages and disadvantages.
Seeking new proposals soon could help the city stay on schedule on the two-phase construction plan for public improvements for the plaza, she said. The second phase of construction is designed to merge with the start of construction on the private development in early 2026.
But moving forward quickly could result in the parcel drawing fewer bids than it might if the city waits until interest rates come down and cheaper financing becomes available to developers. Waiting, however, would force the city to build supports for the walkway and a wall for the beer garden to stay true to its plans for the park, which has been fully designed and is under construction.
Boyer said American Lions is still interested in developing the site. She said two other developers also had communicated with the DIA about it.
“I would not say there is just widespread national interest, but we haven’t marketed it,” she said.
Boyer told the committee she was seeking its consensus on how the DIA staff should proceed.
She didn’t get it, as committee members disagreed on the best path.
Committee chair Patrick Krechowski, a real estate attorney, said he preferred not to wait, citing uncertainty in how long it might take for market conditions to improve.
“It’s hard for me to look at a cloudy crystal ball and wait for it to clear up,” he said. “So I’d like us to keep doing our job, keep moving forward on this and keep trying to make it happen.”
Jim Citrano, a commercial real estate banker and chair of the DIA board, favored keeping the parcel off the market while proceeding on the park build-out.
“I think if we did put this on the street now, we’d have capable, viable developers who would not bid on it,” he said.
With Citrano’s support, Boyer said she would put the issue on the agenda for a full board discussion during its monthly meeting in May.
Construction for both phases of the park is under contract with Haskell. Work began on Phase 1A in the summer of 2023 with the removal of a portion of Independent Drive. In January, crews started work Phase 1B, which includes bulkhead improvements and construction of park features such as a cafe with a rooftop playground.
Phase 2 of the project has yet to be funded by the city. Boyer told the committee it was not unusual for the city to enter contracts with the idea that funding for them will become available in a subsequent year.