Project proposal includes commercial space, luxury apartments
By Shereen Siewert
WAUSAU — Wausau leaders this week will consider a proposal for for a mixed-use development across the street from the Dudley Tower, a plan that includes more than $1.4 million in requested incentives from the city.
The $6 million proposal by Lokre Companies calls for construction of a 48-unit high end apartment building at 120 Scott Street with underground parking and ground floor retail space. The initial proposal requests the city sell the land to Lokre for $500,000, provide a $250,000 grant for site work, and provide a $99,000 reverse TIF payment annually for 12 years, according to city documents.
The city purchased the property from McDevco in April 2016 for just over $1.6 million.
From 2005 to 2008, McDevco and the Alexander Foundation worked together to raze the buildings fronting the 100 block of Scott Street. When the demolition was complete, the city entered into a long-term parking agreement with McDevco to operate a public parking lot on the property. The long-term expectation for the property was for the city to purchase the parcel from McDevco to facilitate redevelopment, according to a March 2, 2016 memo to the economic development committee written by Finance Director MaryAnn Groat.
In a reverse TIF cash grant, when project taxes come in, the city would return a portion of those funds back to the property owner. A reverse TIF payment at $99,000 annually for 12 years means the city would provide the developer with more than $1.12 million over the course of the agreement, bringing the total aid package to more than $1.4 million, a figure that does not include the city’s $1.1 million loss on the purchase of the property.
Under the terms of the financing agreement with the Alexander Foundation, the city agreed to make 10 annual interest-only payments on the property, with a balloon payment of $1,702,341 due June 1, 2026. The city made its first payment on the promissory note June 1 for $44,269, and would be required to pay the $1,609,779 loan balance upon selling the property to Lokre, along with any interest that has accrued since the June 1 payment. The annual interest rate for the first five years is 2.75 percent, according to city documents.
City leaders in March nixed a proposal for a four-story Cobblestone Hotel & Suites on the property amid concerns that the $1.5 million aid package requested by the developer was too high. The proposal called for a 61-room 9,929-square foot hotel that would have included a bar and restaurant, according to city documents.
The proposed Scott Street Apartments development includes 25 1-bedroom units that would be leased for $895 per month and 23 2-bedroom units leased at $1,095 per month, plus a rooftop workout room and community room. The first floor includes 3,000 square feet of space and could be geared toward coffee shops, restaurants, or other retail businesses, according to city documents.
Members of the city’s economic development committee will review the plan on Thursday.
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