Sunday, January 6, 2008
RiverPark
Place plans altered
Mortgage crisis, market slow work
The partners in the massive RiverPark Place condominium
and marina development across from Towhead Island have done little work since
November and have greatly reduced the scope of the project's planned first
phase.
It may take a decade or more, but "the project will
get built as designed, absolutely," said Steve Poe, the lead partner in the
venture.
It envisions more than 600 dwellings, including two residential towers, along
River Road just upstream from the Big Four Bridge.
"We've been fighting the sub-prime mortgage
crisis," Poe said, adding that with an uncertain housing market "we
and our lenders don't have an appetite for building a lot of 'spec'
buildings."
Mike Kimmel, spokesman for the Waterfront Development
Corp., the government agency that negotiated the deal with developers, said the
delays are not overly troublesome.
"This is an awfully large-scale project," he
said. "The developers have had to jump through an incredible amount of
regulatory hoops. If it takes a little longer than we hoped, it is no big
deal."
He added that "we are going to have a wonderful
project when it's done. It has a great urban design and architecture and fits
well with Waterfront Park."
The partners, headed by the Poe Companies, broke ground
last February after several years of environmental studies and other
pre-construction work required primarily by the Army Corps of Engineers.
Poe said the partners spent $13 million of their own
money and in November finished the pre-construction site work, including
installation of sewers and other utilities. They also have a good start on the
marina -- work temporarily on hold because of high river levels, Poe said.
In August the partners announced a tentative deal with
local lenders headed by National City Bank on a $75 million loan to cover the
cost of the 144-slip marina and two residential buildings with a total of 150
condos, including the first of two planned 16-story towers.
But work essentially ceased in November on the housing
side, Poe said Friday.
Poe said the partners originally planned to take dirt
excavated from the river bottom to use for landscaping and berms in the
development. But he said the lenders balked, fearing that some of the river soil
might later be found to be contaminated -- potentially hurting the sale of the
condos.
No soil contamination was ever confirmed. But Poe said
that, just to be safe, the partners recently decided to import dirt from off
site to use as fill material in constructing the housing portion of RiverPark
Place. No soil will be removed from the river bed.
The decision required some slight modification in the
project's engineering and design, he said.
At the same time, Poe said, the crisis in the national
lending industry affected River Park Place. He said the lenders expressed
reluctance to finance such a large initial phase of the development. And he said
the partners were concerned about building so much housing amid an uncertain
market.
"Everyone, including us, has a higher level of
uncertainty" about building condo towers than "we did 12 months
ago," Poe said.
Now, he said, local lenders, still led by National City,
have reached tentative agreement with the partners on a construction loan of
nearly $20 million. Poe said it would finance an initial four-story building
with about 50 condos to be built atop some parking at a cost of $14 million and
the completion of the marina at a cost of around $5 million.
Poe said he expected the deal to be signed in a week or
two, with the housing construction to start in February. He said the condo
building should be completed this summer. Poe said the marina could be completed
as early as June.
So far about 50 of the 144 marina slips have been sold,
for prices up to $60,000. And about 70 condos have been secured with
reservations and await conversion to contracts. The condos start at $129,000.
Poe said the partners have agreed to build the entire
project in relatively small phases until the market improves. The schedule, he
said, will be determined by demand.
Poe's partners are Louisville businessmen Nolen Allen,
Clyde Ensor and Mike Ehrler and architect K. Norman Berry.
In addition to the housing and marina, the project is to
include 40,000 square feet of ground-level commercial space -- two restaurants,
a fitness center and shops are planned -- and 12,000 square feet of offices.
A wide walkway is to be developed along the river's edge,
connecting with Waterfront Park to the west.
Reporter Sheldon S. Shafer can be reached at (502)
582-7089.