A Salt Lake developer cleared a major hurdle Thursday in reaching an agreement with the city's Redevelopment Agency on a $2 million discount to buy land for building a 40-story office tower on the city's ailing Block 57.
The RDA voted to draft a contract with H. Roger Boyer Co. giving the developer a roughly $2 million "write down," or discount, to buy land at 200 S. Main, site of the old J.C. Penney building, for the $39 million tower."This is the hurdle we've been working on since . . . July," said Kem Gardner, partner in the Boyer Co.
The agreement is a compromise coming in the wake of six months of negotiations between the developer and the RDA, an agency composed of Salt Lake City Council members.
Last year, Boyer asked the RDA for a $1.73 million tax increment break and assistance from the city's new Parking Authority to build a parking garage adjacent to the 350,000-square-foot high rise.
Now, however, the developer would, if an agreement with landowners can be reached, buy an existing parking garage, part of an adjacent building and all of the Penney site, getting a roughly $2 million write down from the RDA.
Gardner said the agreement with RDA permits the Boyer Co. to finalize an agreement with Morris Pacific Associates, which currently owns the J.C. Penney property.
Actually, the Morris Pacific land, including the Woolworth building south of the Penney building, will be bought first by the RDA at RDA's appraised price and sold back to Boyer for $7.25 million less the $2 million write down.
Included in that price is the northern portion of the Woolworth Building, which the developers will use for parking space and a plaza, Gardner said. The RDA will own the other portion of the Woolworth building.
Gardner presented a scale mock-up of the building to the RDA, showing a 20-story building with retail stores at ground level, a granite facade, public plazas, a two-story glass atrium and 870 parking stalls.
"We think that this is the substantial anchor building that we've all hoped to have to get Block 57 development going," Gardner said.
The RDA owns much of Block 57, a block plagued by abandonment and a focal point of the city's redevelopment efforts.
Gardner stressed the company was not yet announcing construction of the project, saying he was not prepared to discuss how well the structure would lease or how it would be financed.