Editor’s note: One in a series of stories on flood recovery, a topic that The Gazette considers a content priority for 2013.
CEDAR RAPIDS — Two flood-hit commercial neighborhoods on the mend, New Bohemia and the emerging Kingston Village, have more investment on the way.
The City Council on Tuesday selected a development proposal for the former Brosh Funeral Chapel site on Third Street SE in the heart of New Bohemia as well as proposals for the renovation of four flood-damaged buildings on Third Avenue SW just across the Cedar River from downtown in what is now called Kingston Village.
Local developer Allen Lerch’s proposal in New Bohemia calls for a four-story, multiuse building at 1020 and 1028 Third St. SE — called New Bohemia Station — that will feature a basement theater, retail shops on the first floor, a 14-room, extended-stay hotel and event ballroom on the second floor and 26 loft apartments on the top two floors.
The building also is designed so that removable flood panels can be inserted between first-story columns to protect the building against a flood.
“I’m really blown away with what they’ve brought forward,” council member Ann Poe, who spent a year as executive director of the New Bo City Market next door to the vacant Brosh site, said at Tuesday’s council meeting. “I don’t know what more we could ask for.”
Two weeks ago, council member Kris Gulick called New Bohemia a “hot” spot for entrepreneurs after the council agreed to move ahead on the sale of the former Iowa Steel plant site in New Bohemia to Geonetric Inc., a growing local health care software and services company that plans to build a new three-story office building there.
Now comes this “cool project,” Gulick said of the Lerch proposal.
As for Kingston Village, the City Council picked four of 11 renovation proposals for four, city-owned, flood-hit commercial buildings in a two-block stretch of Third Avenue SW — a stretch eligible for historic status such as New Bohemia now enjoys.
In the four proposals:
• KHB Redevelopment Group LLC plans to renovate the former Gatto Building at 102 Third Ave. SW with a commercial or retail business on the first floor and residential units on the second floor.
• Rowell Hardware Development LLC wants to turn the first floor of the one-time Rowell Hardware building, 120 Third Ave. SW, into a first-floor pub, restaurant and bakery and use the second floor for professional offices.
• Matthew 25 Ministry Hub plans to use about half of the former Acme Graphics Building, 207 Third Ave. SW, for its non-profit work and plans to lease out the other half to a commercial or retail tenant.
• Allan Development Co.’s Paul Brundell told the council on Tuesday that he will put two commercial/retail tenants — Keick’s Career Apparel and Brundell’s own Allan Custom Homes — in the former Barron Motors building, 222 Third Ave. SW, which started as an A & P grocery back in the 1940s.
Council member Poe said the four renovation projects would build on developer Fred Timko’s current project to renovate the historic Louis Sullivan-designed bank and attached office building at 101 Third Ave. SW, next to which Timko also is building a new six-story residential condominium complex.
Council member Don Karr, whose family’s plumbing business on First Avenue West was flooded in 2008 like the Third Avenue SW commercial district, said it was nice to see more investment coming to the flood-hit west-side of the Cedar River.
The city now will work to reach development agreements with the five entities. The agreements will spell out the city’s expectations of the developers, each of which will pay the current fair-market value for the property. The money from the sale will revert to the federal government by rule because federal dollars were used for the city to buy out these properties as part of the city’s flood recovery program.
All five properties sit in the 100-year flood plain, but the city has received special permission from the state of Iowa and the federal government to redevelop in the 100-year flood plain in a few historic districts or districts that comprise “viable commercial corridors.”
The council’s selection of the five proposals was preceded by lengthy debate by the council.
Council members Pat Shey, Scott Olson and Vernon said they wanted to see some sort of covenant in the development agreements to try to steer what kind of commercial tenants might move into to them. Olson said he didn’t want to see a Third Avenue SW commercial district turn into simply a bar district or a spot with tattoo shops.
Some of the discussion centered on the Acme Graphics property and what some said was the surprise that more entities didn’t seek to bid for the building, which Acme had renovated after the flood before moving to another spot in the city. Matthew 25 is a non-profit group and so won’t pay property taxes on the portion of the building it plans to occupy rather than lease.
Gulick wondered if the city should have staggered its request for proposals on the four Kingston Village properties, which might have generated more interest, he suggested.
Shey wondered if the city was undervaluing the Acme property. “Are we giving them a windfall?” he asked of the Matthew 25 proposal.
Shey noted, too, that the request for proposals for the properties on Third Avenue SW went out before the March 5 vote that approved casino gaming in Linn County. The proposed casino, if approved by the state, will go up just a block away, and Shey wondered if that might have increased interest in the properties.
But Vernon, Karr and council member Justin Shields applauded what Matthew 25 had done for neighborhood flood recovery, and they said they supported the Matthew 25’s proposal for the Acme Building.
As for Lerch’s New Bohemia Station proposal, Dale Todd, president of the Southside Investment Board in New Bohemia and the Oak Hill Jackson Neighborhood, said his board wanted the City Council to make sure as it worked on a development agreement that Lerch’s financial numbers on the project made sense.
Council member Gulick noted that Lerch had secured a letter from a local bank to provide project financing, and Gulick said his own review found that banks don’t provide such letters without doing their homework.
The council expects to approve development agreements on the five properties in July.
Mayor Ron Corbett noted that the four Kingston Village properties had been slated for demolition, but the council had listened to requests by preservationists to save them.