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Aug 27 2018

City Foundry developers scrap apartment tower component of retail, office complex, Business, apartment complex for sale.#Apartment #complex #for #sale


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Rendering of main entrance to City Foundry

Rendering of City Foundry food hall

Sketch of planned apartment tower at City Foundry, which has been removed from plans.

City Foundry developers scrap apartment tower component of retail, office complex

Jacob Barker

Sketch of planned apartment tower at City Foundry, which has been removed from plans.

Apartment complex for sale

Rendering of main entrance to City Foundry

Rendering of City Foundry food hall

The developer behind one of St. Louis’ largest redevelopments is lining up financing for the second phase of the project to turn the old Federal-Mogul site in Midtown into stores and offices.

But the Lawrence Group has scrapped a 24-story apartment building that was planned for the second phase in order to maintain a key component of the financing.

“The historic (preservation) folks basically came in and said you can’t build a high-rise residential and use historic tax credits,” said Bill Kuehling, a Thompson Coburn attorney representing the Lawrence Group.

He and developer officials went before the St. Louis Tax Increment Financing Commission Wednesday to start the process required to tap TIF assistance for the second phase of the project. TIF lets developers use increased tax revenue from within their project footprint to finance development costs.

Lawrence Group is seeking some $17 million in TIF subsidies for the $97 million second phase. The commission will hold a formal public hearing on the request Oct. 4.

The second phase would include a 45,000-square-foot space for a movie theater and restaurant, two five-story office buildings with about 130,000 square feet and a 400-car parking garage. Construction is expected to begin in the spring and conclude in the fall of 2019.

Cleanup is advancing on the old industrial site Highway 40 (Interstate 64) just west of Grand Boulevard. The $134 million first phase of the “City Foundry” development already won approval to use $19.4 million in TIF assistance. Two special taxing districts set up on site would also cover some development costs.

Plans call for turning the old factory building into a food hall and office space and adding more retail and office space in adjacent buildings. Three anchor retail tenants are currently in discussions with the developers for three of the available spaces, Lawrence Group development services director Todd Rogan said. He declined to name them but said all would be new to the city. One does not have a location in Missouri while another does not have a location within the metro area.

The TIF request for this phase represents about 18 percent of project costs, above the city’s unofficial ceiling of 15 percent. The developers said asking rent would be too high without the incentive, which will primarily help offset parking garage costs. Without free parking, Lawrence Group officials worry that they won’t be able to draw enough traffic to support the retailers.

“If you have to pay for parking, it’s not going to work,” said Sean McKessy, the Lawrence Group’s director of finance.

Meanwhile, the Lawrence Group hopes to tap about $19 million in Missouri historic tax credits for the project’s first phase. The application is in for the historic credits, and an application for Missouri Brownfield tax credits to cover cleanup costs should be submitted next month.

Private loans for the first phase are still being finalized, but Kuehling said the Lawrence Group is “confident on their financing.”

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