Government

Cedar Rapids downtown tower passes first test

'Project terms' sheet added to negotiation process

This rendering shows the proposed 25-story building in downtown Cedar Rapids adjacent to the Paramount Theatre. The City Council on Tuesday directed city staff to begin negotiations on the project with developer Steve Emerson. (City of Cedar Rapids)
This rendering shows the proposed 25-story building in downtown Cedar Rapids adjacent to the Paramount Theatre. The City Council on Tuesday directed city staff to begin negotiations on the project with developer Steve Emerson. (City of Cedar Rapids)

CEDAR RAPIDS — The City Council on Tuesday gave city staff a green light to begin negotiations with a developer who wants to build the tallest high rise in downtown Cedar Rapids.

Developer Steve Emerson has proposed a $72.9 million, 25-story structure — with a Brothers Market grocery store, condos, apartments, rooftop patios and more — on city land at 101 and 109 Third Ave. SE and 312 First St. SE, adjacent to the Paramount Theatre. Emerson submitted the loan proposal in response to the city’s request for bids for the property.

“This allows us to move forward,” Emerson said after the council meeting.

The city is adding an extra step to its normal process by directing staff to negotiate a project terms sheet, which would outline the deal points, such as form and amount of public subsidy, architectural features, and key amenities, before negotiating public financing.

For typical developments, staff and the developer move directly into negotiations for a development agreement.

“This is sort of a preliminary action to a development agreement,” said Caleb Mason, the city’s economic development analyst.

Development agreements are legal documents, while a project term sheet is less formal but still allows staff and the developer to begin working, he said. Project term sheets can be a useful tool for more complex projects, he said.

Mason projected he could return to the council with the project terms in November or December and then a development agreement could be presented in January or February.

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“This is a really vital corner as you come across Third Avenue into our downtown,” council member Ann Poe said. “It deserves to hold down that corner and deserves to be beautiful and yet fit the needs of the community. And, I think, he (Emerson) did a really nice job doing that. I am really excited about this development.”

While supportive of the project, council members voiced a desire to keep a tight leash. The city had been working with a developer for about two years on One Park Place, a previous proposal for the land. The project received rave reviews but languished for months before the city pulled the plug because the developer couldn’t secure financing.

Council member Scott Olson pushed for benchmarks to ensure the project stays on track.

The last time, he said, “the timelines shifted. So we feel confident under this development agreement, keep the project on track and help the developer accomplish his goals and our goals at the same time — so how does all that work to keep on track?”

Mason said the project term sheet and the development agreement would lay out the benchmarks.

Emerson said he still is developing his plan and is looking to involve as many investors as possible, such as the people who’d own condos or businesses in the space.

“I get the impression they are going to hold me to a pretty stringent timeline,” he said.

As it stands now, Emerson’s proposal includes:

• Lower level: Parking (46 stalls)

• 1st floor: Entry lobby, grocery (Brothers Market), parking access

• 2nd through 4th floors: Parking, residential apartments and/or possible medical clinic space

• 5th through 13th floors: Residential condo units (for sale), parking

• 14th through 16th floors: Office, rooftop garden/patio

• 17th floor: Restaurant

• 18th through 25th floors: Residential condo units (for sale), roof garden on 19th floor

Other amenities:

• Rooftop solar

• Electric car charging stations

• Bike rack/bike storage and service station

• Rooftop garden & patios

l Comments: (319) 398-8310; brian.morelli@thegazette.com

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