HomeMy WebLinkAboutMN-IURAED-2018-08-21Approved: 9/14/18
108 E. Green St.
Ithaca, NY 14850
(607) 274-6565
MEETING MINUTES
ITHACA URBAN RENEWAL AGENCY
Economic Development Committee (EDC)
3:00 PM, Tuesday, August 21, 2018
Common Council Chambers, City Hall, Ithaca, NY
Present: Chris Proulx, Chair; Doug Dylla, Vice‐Chair; Leslie Ackerman; Charles Hamilton; Heather Harrick
Excused: None
Vacancies: 1
Staff: Nels Bohn; Charles Pyott, Anisa Mendizabal
Applicants: HAROLD’S HOLDINGS, LLC (“LITTLE COMMONS”)
Noah Demarest, STREAM Collaborative
Lisa Hicks, McGuire Development Company, LLC
John Driscoll, John Driscoll Studio
Michelle DeBergalis, McGuire Development Company, LLC
Johanna Anderson, Ithaca Neighborhood Housing Services (INHS)
VECINO GROUP NEW YORK, LLC (“ASTERI ITHACA”)
Rick Manzardo, Vecino Group New York, LLC
Molly Chiang, Vecino Design, LLC
J. Christopher Ball, Vecino Design, LLC
Stacy Jurado‐Miller, Vecino Group New York, LLC
Kevin Wagner, Vecino Construction, LLC
ITHACA‐PEAK DEVELOPMENT, LLC
James Trasher, CHA Consulting, Inc.
Tim Kalnin, McKinley Development Companies d/b/a/ Peak Campus
NEWMAN DEVELOPMENT GROUP, LLC & VISUM DEVELOPMENT GROUP, LLC
Steve Hugo, HOLT Architects
Scott Whitham, Whitham Planning & Design
Joe Bowes, Ithaca Neighborhood Housing Services (INHS)
Marc Newman, Newman Development Group, LLC
Jeffrey Smetana, Newman Development Group, LLC
Todd Fox, Visum Development Group
Yamila Fournier, Whitham Planning & Design
Kate Chesebrough, Whitham Planning & Design
I. Call to Order
Chair Proulx called the meeting to order at 3:03 P.M.
IURA EDC Meeting Minutes
August 21, 2018
Page 2 of 10
II. Agenda Additions/Deletions
None.
III. Green Street Garage Redevelopment Urban Renewal Project
A. Preliminary Review of Development Proposals
1. Harold’s Holdings, LLC (“Little Commons”) click to view proposal
2. Vecino Group New York, LLC (“Asteri Ithaca”) click to view proposal
3. Ithaca‐Peak Development, LLC click to view proposal
4. Newman Development Group, LLC & Visum Development Group, LLC click to view proposal
1. Harold’s Holdings, LLC (“Little Commons”)
Demarest explained the development team followed established design principles above and
beyond what was called for in the RFP, including establishing a ‘no‐build zone’ with open space up
to the sky. The project would include a loading dock to accommodate existing nearby businesses
and a height limitation on the Green Street side to create a more human‐scale impact. The top
deck would accommodate a public park space. The five‐story design would allow the project to be
implemented using wood‐frame construction, an important part of its sustainable approach. The
project would introduce a new façade and signage for Cinemapolis, as well as a significant
amount of solar paneling on top of the building. Home Dairy Alley would be an important
component of the project’s goal of opening up access to the Commons, connecting to a large new
open‐air public park (deeded to the City) to the west of Cinemapolis, with an extension of the
public art on the Commons, landscaping, and lawn space. The applicants have been negotiating
with GreenStar Natural Foods Market, which expressed interest in a slightly larger satellite store
than its current Dewitt Mall location. The same ground‐level retail space could house an indoor
Winter Farmers Market and conference center. Upper‐floor housing units would be designated
for a full range of income levels and operated by INHS. The upper floors would have common
rooms, a roof terrace, and light/ventilation coming from interior light wells. The project would
follow NYS Homes and Community Renewal design guidelines.
Meeting Procedure for Each Development Proposal
15 minutes ― Developer PresentaƟon
10 minutes ― Q&A with EDC (opened up to IURA Members, City Staff, & Alderpersons, as Ɵme permits)
5 minutes ― WriƩ en QuesƟons SubmiƩ ed by Public Asked by Chairperson
5 minutes ― Requests for ClarificaƟons/AddiƟonal InformaƟon
35 minutes
NOTE: 1. EDC meeting is not intended as a Public Hearing.
2. Developers may elect to answer questions in writing following the meeting.
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August 21, 2018
Page 3 of 10
Hicks explained the cost for both the retail and residential portions of the project would be $31M
($6.9M for commercial/retail portion alone). The project would be wholly owned by the
developer, although a potential commercial tenant is interested in a lease‐to‐own financing
structure. The $24.9M residential portion of the project would be owned and operated by INHS.
(Dylla arrived at 3:26 p.m.)
Demarest summarized the project’s benefits: significant addition of active public space; a human‐
scaled and accessible approach; contextuality with surrounding architecture; and net‐zero carbon
and sustainable components. Driscoll added the project’s focus is: equity, sustainability, and
public space. It would be relatively inexpensive and would provide genuinely affordable housing
in downtown Ithaca.
Hamilton asked the applicants to review the project’s affordable housing unit break‐down. He
observed some housing units are designated for renters at the <30% Area Median Income (AMI)
threshold. He asked how the applicants arrived at their housing unit break‐down and how the
units would be managed. Demarest replied the housing unit figures were provided by INHS. INHS
was specifically asked to serve the widest range of incomes, with an emphasis on the middle
market. He does not know enough to explain the calculations for the exact ratio of units. Hicks
stressed the unit mix is highly diverse: 12 units at <30% AMI (16% of total), 24 units at <50% AMI
(32% of total), 26 units at <60% AMI (34% of total), 10 units at <90% AMI (13% of total), and 4
market‐rate units (5% of total).
Hamilton asked how the housing units would be physically distributed in the building. Demarest
replied they would be distributed throughout the building. Driscoll added they would all be
comparatively large units.
Harrick asked what the project completion timeline is expected to be, as well as why a conference
center was not explicitly included in the design. Demarest replied the design does include 20,000
square feet in ground‐floor commercial space, creating the opportunity for a mixture of different
uses, including a conference center, even if that was not specifically defined in the proposal (in
part, because the applicants are waiting for the final version of the Downtown Ithaca Alliance’s
conference center feasibility study). The applicants would certainly be very open to including a
conference center. They are also engaged in preliminary discussions with Cinemapolis about
expanding its own space. Regarding the project completion timeline, since the western portion of
the garage is in the worst condition, that portion would need to be demolished/rebuilt first,
allowing subsequent construction to be staged on that western portion, with the public park space
as the final piece to be constructed. Construction is expected to take approximately one year.
Ackerman asked if the reconstruction of the garage is a part of the project. Demarest replied it is
definitely a part of the project, but the funding source remains in question.
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August 21, 2018
Page 4 of 10
Ackerman asked if the applicants would operate the parking themselves, or partner with another
entity. DeBergalis replied the applicants envisioned a public garage that would have a separate
funding and operational structure. They would like to employ a private parking model, while
ensuring parking rates are appropriate to sustain the level of anticipated activity. Demarest added
the developers would like to see a parking demand study, before committing to a specific number
of parking spaces.
Proulx noted the visual renderings depict four additional parking levels, but he has not seen an
accompanying financing plan. He asked where funding for additional parking would be expected
to come from. Driscoll replied the applicants have been engaging in discussions with the
WorleyParsons solar paneling design and installation company, which has a strong interest in
Ithaca. The applicants would like to install solar arrays on the top of the residential building and
around the center garage area to maximize the amount of solar power produced.
Proulx read a written public question to the applicants, asking how long the affordable housing
units would remain affordable and what the range of rents is expected to be. Driscoll replied the
affordable housing units would remain affordable in perpetuity, through the INHS housing land
trust, with rents correlated to the percentage of AMI.
Anderson clarified the affordable housing units would not in fact be going into the housing land
trust; however, they would remain affordable. Rents would depend on the unit size. For example,
a one‐bedroom unit designated for a one‐person household earning <30% AMI (i.e., less than
$40,000/year) would rent for just over $1,000/month.
Hamilton asked how the applicants determined the purchase price. Hicks replied they calculated a
purchase price of $1M for the commercial/market space and $1M for the residential space. They
valued the retail portion of the site based on the 20,000‐square foot building footprint, at
$50/square foot.
Proulx asked the applicants to describe the project’s anticipated use of local construction labor
and subsequent wage rates. Demarest replied one of the benefits of the wood‐framed
construction is the entire project would be far easier to accomplish using local labor, which the
applicants are completely committed to pursuing. He cannot predict what the wage commitments
would be for the commercial/retail market space, but living wages would certainly be the goal.
IURA EDC Meeting Minutes
August 21, 2018
Page 5 of 10
2. Vecino Group New York, LLC (“Asteri Ithaca”)
Jurado‐Miller explained the applicants’ proposal provides more than double the amount of
affordable housing than the other proposals: 209 units at <50‐80% AMI, with 16 apartments set
aside to serve individuals and families with intellectual and developmental disabilities. (Initial
discussions have taken place with the Franziska Racker Centers and Tompkins Community Action
to provide these support services.) All the affordable housing units would look and function just
like the market‐rate housing units. The applicants also have extensive experience with public‐
private partnerships, allowing the project to meet more than just housing demand, like the
conference center. The applicants propose developing the western and central two‐thirds of the
site, but do not currently plan to develop the eastern section.
Manzardo remarked the proposal’s financials are broken down into residential and non‐
residential. The residential portion would have a total development cost of approximately $69.5
million, largely funded by the New York State Housing Finance Agency (HFA), through bonds, tax
credits, subsidies, and a permanent 30‐year loan. In fact, HFA reviewed the proposal and provided
its initial blessing for approval in the 4% round of Low‐Income Housing Tax Credits (LIHTC). The
commercial portion (i.e., parking garage, Cinemapolis, conference center) would have a total
development cost of approximately $25.8 million, financed with conventional financing, and a
strong likelihood of New Market Tax Credit equity and Upstate Revitalization Initiative (URI)
funding of $5 million each. The applicants would also seek a 30‐year local Payment‐in‐Lieu‐of‐
Taxes (PILOT) agreement. The PILOT agreement would allow for an annual 2% tax assessment
increase, converting to a full tax burden at the end of 30 years. Long‐term leases would be
instituted for both the parking garage and conference center, with $190,000 annual installments
from the Vecino Group to cover repairs and expenses associated with the non‐residential portion.
Chiang noted the ground‐level pedestrian plaza would improve the existing network of outdoor
public spaces, connecting the Commons and Home Dairy Alley to the Six Mile Creek Walk. The
ground floor would also provide access to the 33,000‐square foot conference center, residential
lobby, Cinemapolis, and possible retail kiosks. The site would include 514 parking spaces, 50 more
than currently exist; and a Parking Demand Management (PDM) plan would be created. The
project’s upper floors would feature various amenities: roof terrace, fitness center, community
room with kitchen, and a resident lounge.
Hamilton noted the applicants indicated they need a PILOT agreement for the project to be
financially feasible. He asked what the PILOT payments would need to be. Manzardo replied the
applicants would pay $105,000/year, which would grow by 2% annually over 30 years.
Hamilton asked the applicants to quantify anticipated parking revenues. Manzardo replied current
revenue per parking space is $1,900, so the applicants used that figure as the Year 1 amount for
leasing the spaces to the City. In 20 years, parking spaces are projected to bring in $2,600/space
annually. The difference between the two figures would go to the City. By Year 30, total parking
revenue for the City should be approximately $1M.
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August 21, 2018
Page 6 of 10
Harrick indicated she liked the applicants’ idea about involving the wider community as much as
possible in planning and designing the project. She wondered how that process would be
managed and how it would affect the overall project timeline. Ball replied there would be a series
of community meetings, which could take as long as 120 days.
Dylla asked about the project’s impact on Cinemapolis. Wagner replied the applicants would
demolish the western portion of the parking garage, and would then concentrate on the center
and eastern portions, including Cinemapolis. None of those sections would be completely closed
during construction. They plan on maintaining access to parking and Cinemapolis, leaving the
Green Street side of the site accessible.
Proulx asked how long the affordable housing units would remain affordable. Manzardo replied,
50 years.
Proulx asked the applicants to describe the project’s anticipated use of local construction labor.
Wagner replied they would partner with the Welliver construction company and would structure
all construction bid packages as inclusively as possible.
Bohn asked if the applicants are essentially proposing to build/reconstruct the parking and then
lease it to the City at cost. Manzardo replied, yes. The estimated cost of parking space
construction would be $35,000 per space.
Hamilton noted some other applicants indicated they could provide some housing below the <30%
AMI income threshold. Jurado‐Miller replied that would only be the case with most of the 16
apartments set aside for tenants with intellectual/developmental disabilities. Manzardo explained
that the NYS Empire State Supportive Housing Initiative (ESSHI) bridges the gap between what
tenants’ incomes allow and actual rents charged. The other affordable housing units would need
to comply with HFA requirements that establish a <50 to <80% AMI income‐level band.
3. Ithaca‐Peak Development, LLC
Trasher explained the applicants’ proposal remains virtually identical to what was originally
submitted, with the exception of the modifications described in the July 31, 2018 addendum:
“Our initial proposal included 38 workforce studio apartment units with rents based on 90% of
AMI. Subsequent to our proposal, we agreed to reduce our affordable rents to 75% of AMI and
increase our affordable unit count to 41 – 10% of all units. This affordable approach was
conceived with much input from INHS. However, if a different affordable housing model is now
desired for the project, we are committed to evaluating alternatives to increase the number of
affordable units, the unit types to be included in the affordable program, and the affordable
rent thresholds. Any of these adjustments will likely require additional offsets in property tax
abatement and/or grants from the Empire State Development’s Upstate Revitalization
initiative.”
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August 21, 2018
Page 7 of 10
Kalnin remarked the project would develop all three portions of the existing garage, with a low‐
rise segment in the middle, providing 405 housing units, including 41 affordable units at <75% AMI
(representing 10% of all units). All financing would be in place, including a 10‐year tax abatement.
Harrick noted she thought the conference space was planned at 20,000 square feet, but it now
appears to be 30,000 square feet. Trasher explained the 30,000 square feet actually includes
back‐of‐the‐house functions and utility areas.
Ackerman remarked the applicants appeared before the Committee once before, when there was
considerable discussion about the proposed affordable housing component and some of the
public benefit components. She is surprised none of the critiques or concerns from that discussion
are addressed in the current proposal. Trasher replied the applicants did increase the number of
affordable units in response to the Committee’s concerns, from 38 to 41, which will be affordable
at <75% of AMI, instead of <90% of AMI as initially proposed. The applicants remain committed to
working with the City and Common Council to negotiate any remaining details and possibly adjust
the numbers, depending on a variety of factors. Kalnin added the affordable housing units are
also now distributed throughout building; and there would be no visual or functional difference
between affordable units and market‐rate units.
Proulx asked applicants to clarify what proportion of parking spaces would be for tenants. Kalnin
replied it would depend on a variety of factors. Trasher noted that 90 spaces would be needed for
the Ithaca Marriott. The applicants would negotiate the numbers of spaces and parking rates with
the City to make the project financially feasible.
Proulx asked how long the affordable housing would remain affordable. Kalnin replied there
would be no time limit.
Bohn asked how much funding would be needed to increase the number of affordable housing
units to 75, if the project were to receive additional public funding. Trasher replied that would
need to be determined. It would also be contingent on receiving a 30‐year tax abatement.
Hamilton asked what minimum PILOT tax abatement the project would need. Kalnin replied he
would need to determine the answer to that before responding.
Dylla noted there were some concerns about service vehicle access for nearby businesses. He
asked for clarification of the issue. Trasher replied the project would definitely not encroach on
the City Hall parking lot, which would remain entirely open. It would be completely confined to
the existing garage footprint.
Dylla noted the conference center would also presumably require additional service access.
Trasher replied there would be loading docks coming through Ithaca Marriott and they are
exploring options for servicing the eastern portion of building.
IURA EDC Meeting Minutes
August 21, 2018
Page 8 of 10
4. Newman Development Group, LLC & Visum Development Group, LLC
Smetana explained the applicants believe their proposal is highly responsive to what the RFP
called for. Equally important to the contents of the proposal itself is the quality of the applicants’
development team, including WGI Engineers (which worked on the original garage), Purcell
Construction (City Centre), Danter & Associates, SRF Associates, and Taitem Engineering. The
overall proposal has ‘checked all the boxes’ (e.g., housing, community benefits, local labor,
green/sustainable building, payment of pre‐development costs, attracting new people to
downtown). The Newman and Visum joint venture has the financial capacity to undertake project
and would be responsible for all project elements (e.g., workforce housing, commercial, retail),
except the 51 affordable housing units operated by INHS. The 20,000‐square foot commercial
space could be designated for retail or a conference center, and could also be expanded vertically,
if needed.
Smetana noted the project’s financing was designed to be as efficient as possible. Parking would
be operated as a public‐private partnership. Parking construction would be funded with tax‐
exempt bonds, the most appropriate funding for that use to preserve grant and public funding
sources for the public spaces, to be owned by the City. The applicants propose a 30‐year PILOT
agreement to reduce property taxes and rent levels. Parking operations would use stand‐alone
financing, with the City making up the revenue shortfall every year (similar to how the Cayuga
Street Garage operates). A 2‐story bridge would connect the residential building to the expanded
parking garage, with an outdoor plaza space between the new building and Cinemapolis, a park
between the Ithaca Commons and the Six Mile Creek corridor, an enclosed pedestrian plaza
adjacent to City Hall, and improved Green Street streetscape.
Ackerman remarked it would be ideal if the applicants could integrate the housing units
throughout the project, rather than segregated as they appear to be. Smetana replied the INHS
funding structure actually requires the affordable housing units remain as a contiguous stand‐
alone project.
Bowes explained the affordable housing units would need to be owned and operated separately,
due to the way the project would be financed. The NYS Housing Trust Fund Corporation requires
that there be no impact to the affordable housing component if the rest of the project/building
became infeasible, so the affordable housing would need separate electrical and mechanical
utilities. The affordable housing units would be as well‐designed as any of the other units.
Hamilton asked if the non‐INHS portion of the project on the top two floors would be market‐rate
units. Smetana replied, yes.
Ackerman asked if the workforce and market‐rate units could theoretically be integrated.
Smetana replied, yes. The applicants would be open to exploring that.
Harrick asked if extending the conference center vertically would reduce the amount of workforce
housing. Smetana replied, possibly.
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August 21, 2018
Page 9 of 10
Proulx asked if any other successful projects of this scope use the ‘building‐in‐building’ affordable
housing concept. Bowes replied, yes, although it is most frequently used in large metropolitan
areas, with a far denser housing markets.
Proulx asked if the additional parking would be situated on the eastern portion of the site.
Smetana replied, no. It would actually be in the central portion.
Dylla asked about the choice of exterior construction materials, since they seem a little
inconsistent with surrounding architecture. Hugo replied the building materials are consistent
with the new City Centre project. For the ground floor, the applicants believed maximizing
transparency was the best choice. The design process, however, is still in a very early stage, so the
choice of construction materials is by no means definitive. Smetana added that Green Street
actually possesses a more eclectic mix of buildings than some other portions of the city.
Dylla noted the scale of the project would look fairly intimidating from street‐level. He asked if
the applicants would be willing to step parts of the building back. Hugo replied the applicants
considered precisely that kind of issue (which is regularly the subject of discussion at Planning and
Development Board meetings for other projects). In this case, making the building higher
conforms to what was envisioned and zoned for on Green Street. The applicants did, however, try
to create the appearance of a four‐story building from the Green Street side. The building’s height
would also allow its length to be 60 feet, which provides all the apartments with a lot of natural
light.
Chesebrough added that the project benefits from numerous fine‐grained amenities, including
public spaces, community art park, and a connection to Six Mile Creek, which would all serve to
make the project more accessible and less intimidating.
Bohn asked the applicants to identify the shared financial risks associated with the parking.
Smetana replied the applicants would shoulder all up‐front design and entitlement costs, so there
would be absolutely no risk to the City for those particular costs. The only subsidy from the City
would be for it to make up for the annual parking revenue shortfall.
Bohn asked if the applicants could charge a fixed price for the annual revenue shortfall. Smetana
replied, yes.
B. Next Steps
Bohn asked Committee members to make sure to review the Downtown Ithaca Alliance (DIA)
Board’s comments on the proposals. The IURA Board will decide which applicant to designate as
the official project sponsor, which will initiate the 90‐day negotiation process. The final project
proposal would then need Common Council approval. Bohn suggested scheduling a special joint
meeting of the Committee, IURA, and Common Council to ensure everyone is in reasonable
agreement, before the final project proposal goes to Common Council for the formal Public
Hearing.
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August 21, 2018
Page 10 of 10
C. Next Committee Meeting: Friday, September 14, 2018, 2:00‐4:00 p.m.
IV. Other Business
A. Review of Meeting Minutes: June 14, 2018
Ackerman moved, seconded by Hamilton, to approve the June 14, 2018 minutes, with no
modifications.
Carried Unanimously 5‐0.
B. IURA Loan & Lease Payments Report: July 2018
Bohn noted the report was not included in the meeting packet, but all IURA borrowers and
tenants are current on their payments.
C. Cherry Street Industrial Park Expansion Project Update
Bohn distributed the initial road layout and site plan drawings and explained that the road would
be a simple, straight extension of Cherry Street. The project is scheduled for final approval by the
Planning and Development Board on October 23, 2018. Emmy’s Organics has agreed to the sale
price and has hired Whitham Planning and Design and STREAM Collaborative. The approval and
construction timeline is particularly tight. There may not be enough time to complete the road
extension before Spring 2019.
V. Public Comment (3‐minute max. per person)
None.
VI. Adjournment
The meeting was adjourned by consensus at 5:41 P.M.
— END —
Minutes prepared by C. Pyott, edited by N. Bohn.