Iowa City’s Peninsula Neighborhood seeks delay

Iowa City's Peninsula neighborhood needs more time.

That's what the developer and city staff are asking from the City Council.

Specifically, Peninsula Development Co. wants an 18-month extension to a Jan. 1 deadline to build a certain number of homes in the north Iowa City neighborhood. The council already granted a two-year extension in 2007.

The council is to vote on the request at its Dec. 1 meeting.

The Peninsula neighborhood is designed with a traditional feel - homes with front porches, no aluminum siding, small lots. Though stylish, it has its detractors, with some critics saying from the start the concept wouldn't work. It also had trouble finding financing.

The city initially owned all the land, and its agreement calls for it to sell portions to the development group every two years. At least 50 percent of a phase must be finished before the next phase can be purchased.

The next phase is scheduled to start Jan. 1, but only 18 of 61 dwellings in the current phase are finished, said Jeff Davidson, the city's director of planning and community development. Since homes first opened in 2003, 84 units have been built in a combination of single-family homes, condominiums and apartments.

The economic downturn and last year's flood, which cut off access to the neighborhood, contributed to the slowdown, Richard Gibbs, chief financial officer with Michigan-based Peninsula Development Co., wrote in a letter to the council this week.

Additionally, Gibbs, who did not return a phone call seeking comment Wednesday, wrote that landscaping and maintenance upgrades have been made. Other changes include a new management team, more advertising and better pricing. Some condo units have dropped by more than $20,000, he wrote.

The company, with the support of city staff, also is asking that the agreement be changed so that it can purchase the next phase when 50 percent of the total lots it owns are developed, rather than 50 percent of the lots in each phase. It has developed 52 percent of all lots.

Davidson said homes in traditional neighborhoods sell better when the development is filled out because the character is more clear. He said he still believes Peninsula can be a success.

“We don't see this concept being done anywhere else in Iowa City, and we think it should be an alternative that's available to people,” he said.