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VOL. 113 | NO. 159 | Thursday, August 19, 1999

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CCDC grants extension, CCDC grants extension, balks on two loan requests By KATHLEEN BURT The Daily News To grant or not to grant, that was the question before the Center City Development Corp. at its meeting Wednesday. Seven items relating to development loans were considered at the meeting, six of which involved Memphis developer Gary Garland. Two loans on which Garland was the project representative were not approved because they failed to meet the basic scoring criteria. One reapplication was withdrawn after it was determined Garland got work got underway within the six-month time limit. Another reapplication received a development loan after Garland agreed to drop the number of years awarded in a payment-in-lieu-of-taxes from 15 to 10. Two other Garland projects were not granted six-month extensions but an unrelated project associated with the renovation of the Tennessee Trust building was. Shurgard Storage Centers Inc. through the Freeman Management Corp. requested $50,000 development loans for projects at 390 and 415 S. Front St. Neither project scored the base of 50 points in order to be considered for a loan. Garland was the representative for the application. The Seattle-based company plans to renovate the two buildings into climate-controlled, self-storage space. The Center City Revenue Finance Corp. approved both projects for nine-year PILOTs earlier this month. CCDC board members expressed concerns that the redevelopment of these vacant buildings into self-storage, though needed, might not be the best use of development loan funds. In addition, CCDC chairman John Stokes wanted assurances that the projects would be complete based on Garland's recent track record. "When we approve that loan that is money out of our pool. You have a history with us of not completing projects. We need assurance, the best we can get it, that these projects are going to be done," Stokes said. Both Shurgard applications could be considered again at the end of the quarter. Additional points could be earned through altering the project to meet more of the criteria used in scoring. If Shurgard moves ahead with the self-storage project, another Garland project would be tied in with it. The Shurgard offices would be located in 421 S. Main St. CCDC board members at first considered the Main Street project as a reapplication of a lapsed loan. After much discussion, it was determined construction had begun within the six months allotted, and the project stood with a $50,000 development loan and a 15-year PILOT tax freeze. A similar Garland project at 409 S. Main St. had not gotten underway and was deemed a reapplication. The project graded out for a $50,500 loan and had a 15-year PILOT approved in December. Since the loan and PILOT were approved, the criteria for awarding both have changed. Under new guidelines, a project cannot receive a development loan if a PILOT of more than 10 years has been awarded. In order to receive the loan, Garland agreed to drop the number of years on the PILOT to 10. Garland also gave updates on two loans due to lapse Sunday. Loans were approved at the Feb. 22 CCDC meeting for projects at 115 S. Front St. and 111-117 N. Parkway. The South Front Street project was designed to convert the F.G. Barton building into a 27-room boutique hotel. "When I applied for this loan, the climate for boutique hotels was in its heyday. Shortly after, the climate changed and there was not a bank anywhere that would lend money for one," Garland said. He said plans are in the works now to convert the building into 18 multi-family apartment units. Because the land use has completely changed, the loan application will have to be resubmitted, the board ruled. The Parkway project was designed to bring a retail development Downtown that would include a hardware store and other supporting retail shops. Garland said the cornerstone tenant backed out of the deal "at the 11th hour," causing unmanageable delays in getting the project underway. The board voted not to grant an extension on the project since there is little chance it could get underway in another six months. Garland intends to reapply for the loan and is still working to secure the hardware store for the development, he said. "It's potentially a great project and a retail project that is sorely needed and needed more everyday. I hope he would reapply," said Jeff Sanford, Center City Commission president. A six-month extension was granted to Walter Broadfoot, who is working to redevelop the Tennessee Trust building into a 110-room hotel. The project involves buildings at 9 and 11 S. Main St. and 79 and 83 Madison Ave. An $85,000 development loan was granted in February. Three Chicago banks have committed to financing the project after a local bank backed out, Broadfoot said. A snag in the financing prevented the architect on the project from getting measurements, putting the final drawings on the project behind schedule. Those should be completed soon, Broadfoot said. About $2 million in expenditures have already gone into the project, he said. "The barriers of entry in the Downtown market are really tough. I've been working on this project since April of 1997.You talk six months, I talk years," Broadfoot said. "These projects do take forever," board member Christine Munson said in making the motion to grant a six-month extension. In other business, board member Richard Grantham was elected treasurer of the CCDC. The next scheduled meeting was moved from Sept. 15 to Sept. 8.
PROPERTY SALES 62 288 2,619
MORTGAGES 52 197 1,783