By Shereen Siewert
WAUSAU — City leaders are seeking a new developer to spearhead the troubled Riverlife development project, which has become mired in a legal snag that ground the project to a halt earlier this year.
A request for proposals (RFP) dated May 25 assumes the current development agreement with Barker Financial, LLC, will be terminated, though Barker still has a limited window to cure the default. The much-anticipated riverfront project has been facing intense scrutiny in recent months.
On March 13, former Quantum Ventures CEO Jason Sharkey pulled out of the project after a Wausau Pilot and Review investigation that revealed Sharkey’s role in a 2006 real estate Ponzi scheme in Denver, for which Sharkey is continuing to pay restitution after a two-year diverted sentence. Days later, the state Department of Revenue filed a delinquent tax warrant in Milwaukee County Circuit Court against Sharkey for unpaid income taxes of $32,374, according to court records.
Then on March 27, Frantz introduced a new co-developer and financing partner, Rainy Investments, LLC, to join the project. The announcement spurred optimism among some city council members who remained hopeful that Frantz would succeed in securing financial backing for the project.
But the financial stack never materialized and construction stalled when contractors began demanding payment for unpaid bills associated with the project. Four construction liens totaling more than $2.7 million were filed earlier this month in Marathon County Circuit Court surrounding the Riverlife Village project, with an additional $134,149 lien expected in the coming days. City Council members also learned in early March that Barker, not Frantz, remains the developer of record for Riverlife, a revelation that took some council members by surprise.
According to the RFP, signed by Mayor Robert Mielke, the marketability of the area appears strong “due to its pre-leasing momentum and heavy local interest.”
But critics say the “pre-leasing momentum” has been overstated, making the project appear stronger than it truly is. The project currently has letters of intent for seven of the 57 residential units and about 18,000 square feet of the nearly 60,000 square feet of commercial space planned, according to the most recent figures supplied to the city by Mike Frantz.
In am email to Wausau Pilot and Review, Council President Lisa Rasmussen said the RFP release is in parallel to the legal time frame that Barker has to cure the defaults in a proactive step, so the responses will be ready if Barker is unable to proceed.
“While we remain hopeful that Barker Financial is able to cure their defaults and complete their project in accordance with the agreement, if that is not the case, the RFP will allow us to consider other interested parties and options to develop the area to its highest potential,” Rasmussen wrote. “I am also glad that the new vetting concepts are included in the RFP to insure that we are getting the best information possible from any future proposers.”
The RPF is seeking developers interested in taking over the current Phase 1 project or proposals for developing other areas of the land. Under the terms of the current developer agreement, the city maintains ownership of the architectural renderings created by Mudrovich & Associates and would retain ownership of the land itself.
Proposals will be scored on the basis of set criteria that includes points for the developer’s credentials, financials and track record, according to city documents. Consideration will be given to cost, level of investment, functionality and other factors. A selection committee will oversee the final selection, and the developer or team must also complete a city Tax Increment Financing application if city resources are requested.
“One thing residents should know is that the path forward will require careful consideration of all options available to the city,” Rasmussen wrote. “Key to that is using development agreements which provide protection for taxpayer investment in projects, as was done on the Riverlife plan, as well as following legal advice. It does not involve knee-jerk reaction or over-simplified theories from recent op-ed writers making
Proposals are due Aug. 3, with an initial review by a selection committee slated for Aug. 7.
