A ride on the streetcar shows you the two sides of downtown.
The east side is booming, with restaurants, condos, coffee shops, apartments and bars. The west side has some long-standing office buildings and courthouses but remains pretty dead.
That could change in 2015. In fact, it should change, if four private property owners would get going and make some progress on properties that now are either empty lots or, in the case of the Hotel Arizona, a vacant building.
“We’ve got private-sector people all over the downtown core finding ways to invest their money,” said Tucson City Councilman Steve Kozachik, whose ward encompasses most of downtown, including the hotel site. “We’ve got one white elephant down there.”
Gerry Dixon, of The Gadsden Co., told me conditions should make progress happen.
“I think the downtown is on the verge of being a great success story everywhere,” he said. “I can tell you that banks are willing to loan money for building downtown. Investors are interested in investing.”
With these market conditions, we should expect progress on these four key sites in 2015:
Hotel Arizona, La Placita
Let’s all give hearty congratulations to Humberto Lopez, Omar Mireles and the rest of the HSL Properties team on their $15 million purchase this month of the Hilton El Conquistador. How nice that this top Tucson-area resort is in local hands.
Now, how about taking some of that capital you apparently possess and making progress on the property that remains a stain on your reputation?
I’m talking, of course, about the closed Hotel Arizona, 181 W. Broadway. For years, Lopez has angled for major financial help from the city in order to renovate the hotel building on that site. The City Council shot down his last attempt in 2010, and Lopez closed the hotel in 2012.
The presence of the eyesore has become Lopez’s leverage with the city. “If you want it to change, then help me out,” he seems to be saying.
Mireles, the company’s executive vice president, told me in November 2013 that HSL would have a proposal ready for the redevelopment of the hotel site and the adjacent La Placita office complex in the first quarter of 2014. That obviously didn’t happen.
Last week, Mireles said the company has been distracted by its effort to buy El Conquistador and now can return to considering its downtown properties.
“We would like to get it moving as soon as possible,” he said. “We do want a hotel component to it. We also want to see a living component down there as far as apartments are concerned. We’d probably want to incorporate some retail as well.”
That’s nice, but it’s just words. Not even a concept, really. Kozachik has heard the same in meetings with the HSL team, he said.
“They’re asking me if I will support their proposal, and my answer is ‘Show me one,’ ” he said. “I can’t support something I haven’t seen.”
In an email, Mayor Jonathan Rothschild explained the complications of the Hotel Arizona site this way: “The existing debt obligation is relatively high, and the building is concrete, which makes reinventing the property difficult, although it was done with the Aloft (hotel) at (North) Campbell (Avenue) and East Speedway. Rio Nuevo and the city may be able to offer some help, but both would need to see a real, immediate return on their dollar.”
In 2015, the least we all deserve from HSL is a proposal — something everyone can imagine and consider. Otherwise, it should sell the properties to someone willing to make progress.
Gadsden Property
The area west of Interstate 10 and south of West Congress Street has a couple of new developments and acres of empty land, all bisected by the last quarter mile of the streetcar.
We can expect one small area of bare dirt to see action soon, said Dixon, a partner in the Gadsden Co. The area west of the Mercado San Agustin, should see the construction of 29 housing units and a below-ground parking lot beginning in the first quarter, Dixon said.
The bigger bare area is east of the Mercado, however. That’s where the Gadsden Co. plans to build 100 units of so-called “workforce housing,” or affordable housing aimed at people who work along the streetcar line, as far away as the University of Arizona.
The plan is for a four-story structure with parking underneath. The project, known as West End Station, depends on the company winning public financing, though.
“That won’t start till this fall,” Dixon said. “We’re hoping maybe the third or fourth quarter.”
It would front on West Congress Street and begin the development of that long strip of bare earth.
Arena Site
Allan Norville’s company was hoping to begin work on a new exhibition hall, part of the broader Arena Site development, as early as the end of next year’s gem and mineral show, in February.
That sounds great!
But first, his company, Nor-Generations LLC, must actually buy the Arena Site, which sits along the east side of Interstate 10 south of West Congress Street. That means negotiating a contract with the Rio Nuevo board for the purchase that includes performance measures for the development. The hope was that the contract would be signed by now.
“We pressed them pretty hard that we’d like to see this accomplished by the January meeting, on Jan. 27,” said Fletcher McCusker, chair of the Rio Nuevo board.
Let’s go one step further, though, and put a limit on the negotiations. As I’ve written before, Norville has been notorious for delays in progress on his downtown property adjacent to the Arena Site, and Rio Nuevo doesn’t have to conclude a contract with him because there’s a second-place bidder waiting in the wings.
If it doesn’t happen, say, in the first quarter of 2015, it’s time for Rio Nuevo to move on from Nor-Generations and begin negotiation with the second-place bidder, Peach Properties.
Bourn property
The empty land in the 100 block of East Congress Street, just behind the Bank One Building, is perhaps the best-known example of downtown delay. It’s not exactly in western downtown, situated as it is east of Stone Avenue, but it is where the disappointment begins as you head west.
Don Bourn’s company bought the property from the city in 2004 for $100, on a promise of building a condo-retail project called The Post. Many delays, problems and lawsuits later, Bourn still has the property and three years left to do something with it or lose it.
Bourn didn’t return my call last week, but McCusker told me work is taking place in the two existing buildings that bookend the vacant land and are part of the broader project.
“He’s working on the interiors of both the Indian Trading Post and the Annex,” McCusker said. “He intends to relocate his office from Broadway and Alvernon to the Annex downtown.”
The company must make quarterly reports to the Rio Nuevo board on its progress, and the last one says the company spent about $101,000 on the project in the third quarter of 2014, including continuing revisions of the design. Now, the plan for the main building includes two floors of commercial space topped by four stories of residential, but changes in the plan continue.
“Expected marketing rollout to begin first quarter 2015,” the report says.
That’s not much, but it’s something. A final design for the project, locked-in financing and a construction schedule would be real progress and would confirm what Rothschild said in an email: “As the good projects move from East to West, we will see more interest and activity on the west side. You will continue to see lots of activity in the entire area in 2015 as the Downtown continues to develop into a true city center.”
