Damakant Jayshi
Negotiations are continuing between city officials and developers proposing a concert venue near downtown Wausau, with an array of questions about the cost, location, timeline and viability of the venture.
Sean Wright, the executive director of The Grand Theater, termed the project a “pipe dream.”
Members of the Wausau Economic Development Committee on Tuesday directed staff to hold talks with VY Properties, LLC to firm up details on specific information sought. City officials are also seeking an independent study on the demand for and sustainability potential of The River, a 3,500-capacity concert venue. Wausau resident Joe Ellis, of JEM Productions, and Anna Herman are co-owners of the proposed venture.
The proposed 58,000 square foot facility includes up to 10,000 square feet of commercial retail and rental space, a 7,000 square foot lobby reception area and a multi level concert hall in a mostly standing room format with the exception of limited premium seating in the VIP balcony.
The development would rely on taxpayer investment of about $2.6 million, or 20 percent of the anticipated $13.1 million assessed value of the final project. Some of the city’s investment would come in the form of “reverse tax increment financing,” though some would be paid up front. That amount is subject to negotiation.
A reverse TIF does not require a municipality to provide up front monetary support to a project – unlike in a regular TIF district – but pays a developer or developers a part of the revenue generated through additional tax collection in the tax incremental district, or TID. The developers also propose purchasing the land for $50,000, and are seeking “agreeable parking solutions.”
Ellis and Herman say they expect an annual attendance of about 250,000 at The River, which will cost about $15 million to build and bring in an estimated $53 million in annual spending.
Concerns about viability
Not everyone is convinced that The River is a viable option for Wausau.
Wright questioned the proposal’s figures which, he said, were not realistic. Large-scale entertainment and show companies like Live Nation and AEG are grabbing the top artists and concert venues, with local promoters and directors competing with industry giants. He questioned the claim that The River could draw top artists to the city as well as projected annual sales of 250,000 tickets, a number he called “outrageous.”
Wright cautioned that if the developer did not make money, the city’s investment would “go down the drain,” and said the area does not have enough money or population to support two concert venues. The only way the new project could succeed “is through a negative, substantial impact to The Grand,” he said.
Wright urged the committee not to provide taxpayer support to the project, saying the industry is in upheaval.
Alders Carol Lukens and Tom Kilian also expressed concerns about the idea of the city contributing to the project through TIF.
The independent study was proposed by Finance Director Maryanne Groat. She also questioned the developer’s projection of number of visitors to The River and the demand for it. She said an independent study is needed given the cost and risks involved, and said the city should not have to pay for it.
Alders Lisa Rasmussen and Kilian backed the suggestion for the study.
Rasmussen, however, said that she did not believe that the new concert venue would come at the cost of The Grand, and said the city should examine whether one is needed.
Ellis and Herman say project would boost tourism
During their presentation, Ellis and Herman emphasized their local roots and said Wausau needs the concert venue to boost tourism and the city’s economy. Ellis said there are 1.8 million people within 100 miles of the city. Shows at The River could draw them to the city and entice them to stay. The space could also host corporate conferences and will be home to additional retail and dining experiences on the riverfront.
Herman said they will donate 5% of the annual profits to the local charity.
The aggressive timeline of the program, slated for completion by fall of 2024, was questioned by alders, but defended by the developers. Ellis said another outside company could buy land and build a venue themselves if they didn’t act quickly.
Former Wausau City Council member Tom Neal also spoke, urging the committee to exercise caution and thoroughly examine the proposal before making a decision. He said he is not suggesting a rejection, but is cautioning officials to examine all aspects of the plan.
In a news release, Herman said a venue of this size and type would fill a massive gap in Wausau’s ability to serve the large touring market. Now, those types of concerts draw millions of dollars out of the central Wisconsin area for attendees who spend their money on entertainment in larger markets like Minneapolis, Milwaukee and Green Bay.
“We would like to see that money, and those fans, stay right here,” Herman said.
