Title
Amend Contract 147086 the West Fillmore Redevelopment and Purchase Agreement with High Street Fillmore, LLC. and High Street Fillmore Phase 2, LLC (Ordinance S-50508)
Description
Authorize the City Manager, or his designee, to amend Contract 147086, the West Fillmore Redevelopment and Purchase Agreement (Agreement) with High Street Fillmore, LLC and High Street Fillmore Phase 2, LLC (Developer) to extend the construction commencement performance deadline for Phase 2 of the High Street Fillmore project.
Report
Summary
On March 20, 2018, the City entered into the Agreement with High Street Fillmore, LLC and High Street Fillmore Phase 2, LLC for the sale of multiple city-owned parcels in downtown Phoenix for a mixed-use project to be developed in multiple phases. Phase 1 was completed in 2022 with 330 residential units, approximately 10,000 square feet (SF) of retail, and completion of the Taylor Street Paseo (4th Ave. to 6th Ave.). Two future phases, known as Lots 4 and 5, are currently in the visioning and design phases respectively. Phase 2, the subject of this request, will include 330 residential units and approximately 10,000 SF of additional retail. The Agreement, as currently authorized, requires the Developer to commence construction of Phase 2 by Feb. 7, 2024. The Developer is currently paying an annual carry payment of 2.5 percent of the Phase 2 purchase price and, because of the current state of the financial markets, has asked for an additional two years to commence construction on Phase 2. If approved, this will extend the Phase 2 construction commencement date to Feb. 7, 2026. All other terms of the Agreement will remain unchanged.
Financial Impact
The financial return to the City will not be altered by this request. Upon the sale of the Phase 2 Site, 7.6 acres will return to private ownership which will generate net new property tax revenues. The total project is estimated to generate approximately $1.3 million in construction taxes.
Concurrence/Previous Council Action
This item was recommended for approval at the Economic Development and Housing Subcommittee meeting on Jan. 10, by a vote of 4-0. City Council approved Contract 147086 (Ordinance S-43802) on July 6, 2017.
Location
Two parcels located between 5th and 6th Avenues, south of Fillmore Street. Parcel Numbers: 111-41-184, 111-41-185
Council District: 7
Department
Responsible Department
This item is submitted by Deputy City Manager John Chan and the Community and Economic Development Department.