HomeMy WebLinkAboutIR 8509 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 8509
Date: July 29, 2003
To the Mayor and Members of the City Council
Page 1 of 2
ins Amended Brownfields Economic Development Initiative (BEDI) Grant
and Section 108 application for Montgomery Plaza Shopping Center
Overview
In May 2001, the City, in partnership with Himmelrich Associates, submitted a request for
$2,000,000 BEDI grant funds and accompanying $13,000,000 Section 108 loan guarantees to
renovate the site. In September 2001, HUD awarded the City the BEDI grant with the stipulation of
applying for the requisite Section 108 loan by November 2001. Due to the failure of Hirnmelrich
Associates in securing site ownership and the subsequent failure of three additional attempts to
secure a development partnership, the City has sought and obtained four extensions from the
Department of Housing and Urban Development (HUD). The fourth (and final) extension deadline is
August 28, 2003.
A development team, led by Weber and Company (Dallas, TX), has requested the use of the
$2,000,000 in BEDI grant previously awarded by the Department of Housing and Urban
Development (HUD) for the Montgomery Wards site and $13,000,000 in Section 108 Loan
Guarantees. The proposal seeks to leverage a $110,000,000 investment in a mixed-use retail and
residential development that preserves the historic Montgomery Ward catalogue building. The
F/r deadline for submitting an amended BEDI grant and Section 108 application for the redevelopment
1,
of the property is no later than August 28, 2003.
This IR provides Council background on the award of the BEDI grant/Section 108 loan and the
redevelopment opportunity to assist Council in meeting the submittal requirements. To meet the
submittal deadline, City Council is required to hold two public hearings to be schedule for August
12'h and August 26th in compliance with the public input requirements of the City's Consolidated
Plan. Submittal of the application does not obligate the City in participating in an economic
development agreement for the project.
Project Proposal
The disposition of the vacant and blighted 45-acre site serves as the linchpin of the future economic
vitality of W. 7"' Street, the Montgomery Park urban village and the Cultural District. Since 1999 the
property has stood vacant, damaged by the March 2000 tornado, and for sale after Montgomery
Wards assets where placed in receivership. Weber and Company (Dallas, Texas) has recently
prevailed in obtaining site control of the property and is seeking the City's participation in a
redevelopment partnership through the awarded BEDI grant and requisite Section 108 Loan
Guarantee.
Upon securing site control of the property two months ago, Weber and Company has undertaken
over $500,0000 in environmental assessment, project planning, and project feasibility activities
resulting in a formalized redevelopment plan for the site. The proposal calls for the renovation of the
existing 850,000-square foot eight-story catalogue building into a mixed-use retail/residential
community and conversion of the blighted warehouse portion of the property into a 500,000 square
foot mixed-use retail center. Weber and Company has tenant pledges consisting of a Super Target
11 rr"I"
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS
INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 85o9
Date: July 29, 2003
To the Mayor and Members of the City Council
Page 2 of 2
Amended Brownfields Economic Development Initiative (BEDI) Grant
and Section 108 application for Montgomery Plaza Shopping Center
and Home Depot, employing a minimum of 429 individuals. In addition to these credit tenants, the
site will also include 195,841 square feet of junior anchors, retail and restaurants that will serve the
Linwood neighborhood, Downtown residents and Cultural District,
Weber and Company requests the City's participation in addressing the substantial environmental
and development challenges to the property in order to make possible the $110,000,000 investment
an economically feasible proposition. The $2,000,000 in BEDI funds will be used to demolish and
clear the dilapidated warehouses and to remediate underground environmental contamination. The
$13,000,000 in Section 108 funds will pay for the necessary site preparation, basic infrastructure,
and additional environmental remediation.
To maintain this funding source as a financing option for the project, the City must submit an
amended BEDI grant and Section 108 loan application related to the Weber proposal by the August
28 deadline. Upon HUD's formally approval of the City's application for the amended BEDI grant
and Section 108 loan, the BEDI grant and Section 108 funds will be negotiated as part of a
comprehensive package of incentives for City Council's future consideration. Submittal of the
application does not obligate the City in participating in an economic development agreement for
the project.
Future City Council Consideration/Action
In compliance with the public input requirements of the City's Consolidated Plan, the City Council
must hold two public hearings prior to submitting the amended BEDI grant and Section 108
application. Additionally, the public must be granted 30 days to comment on the completed draft
application as initiated through public notice. The City has issued notice as of Friday, July 25, 2003
on the draft application on file in the City Secretary's office. Staff will brief the Central City
Revitalization and Economic Development Committee during the August 12 meeting,
Should you have any questions or comments on this matter, please contact Christine Maguire,
Economic and Community Development Department, at 817-871-8187.
-Gary Jackson
City Manager
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS