The city and its developer partner are delaying a property transfer for the multifamily urban project.
The anticipated closing date has shifted to Jan. 24, said Redevelopment Director Heather Pope at a recent meeting of the Columbus Redevelopment Commission.
“We were planning to close on the bonds and transfer the property over…,” she said. “However, the construction cost bids for that project came in, and they are significantly inflated.”
Pope said that with this in mind, Flaherty &Collins requested a later closing time, which will give them the chance to seek lower cost estimates.
However, Deron Kintner, general counsel with the company, said the delay has more to do with timing.
“It was determined by us and the city that it did not make sense to rush a closing at the end of the year with some open items, especially since we would not be starting construction until March anyway, once the ground is generally thawed and earthwork can commence,” he said.
Kintner did note that costs are high “across the board in all walks of life,” including construction. The company is still in the middle of its bid process, with bids constantly coming in and “continually being refined,” he said.
According to a previous memo from Pope, the estimated cost of the mixed use development is about $40 million and the developer will pay about 71% of the cost.
The city agreed to invest $11.8 million into the development under the project agreement, said Bruce Donaldson with Barnes &Thornburg earlier this year. City officials have said in the past that the development’s property tax dollars will reimburse the city for its contribution. The redevelopment commission has also committed to selling property for the development at minimal cost to the developer.
The multifamily urban grocer development will include approximately 200 market rate apartments and an urban grocer facility at the southeast corner of Lafayette Avenue and Second Street.
The endeavor started out as part of a larger joint project. Originally, when the city was considering developers for its hotel conference center project, companies were told that they could get “bonus points” if they brought a multifamily urban grocer partner to the city as well.
For the hotel conference center development, the city chose Sprague Hotel Developers, who partnered with Flaherty &Collins (with the latter company providing the multifamily urban grocer piece).
However, because of the pandemic, the multifamily urban grocer project and the city’s plans for a hotel conference center were later split off into two separate projects, rather than taking place simultaneously.