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Author Topic: Santa Fe Square on the big surface parking lot in the Blue Dome...  (Read 22430 times)
AdamsHall
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« Reply #45 on: October 15, 2015, 02:42:38 pm »

If it approaches that rendering, very cool!

Agree.  I like it.  I like it a lot.
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carltonplace
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« Reply #46 on: October 19, 2015, 08:06:48 am »

This is beautiful. Seems incongruous to Arnie's (which I love).

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swake
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« Reply #47 on: March 03, 2016, 12:42:40 pm »

Santa Fe Square is now before the city asking for a 25 year, $36 million TIFF on property taxes for the $160 million project.

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Quick Facts:

Santa Fe Square is a $160 million downtown development for Tulsa
Needs city support to move forward
Plan would bring office space, shopping, up to 300 apartments, and a boutique hotel
It would fill the parking lot between 1st and 2nd street, and Greenwood and Elgin in downtown Tulsa
 

Developers of the Santa Fe Square proposed for downtown Tulsa say they need city support to move forward.

The $160 million plan includes office space, shopping, apartments and a boutique hotel. It'd be built in the parking lot between 1st and 2nd street and Greenwood and Elgin in downtown Tulsa.

A city council review committee approved creating a tax increment district, meaning the city would pay the developer up to $36 million in property taxes earned there over the next 25 years. The plan would not create any debt for the city.

City council has to approve the district, and will hold two public hearings before that, the first on March 31st.

The developer, Nelson and Stowe Development, said it can't move forward without the city's help.

Councilors support the project, saying the space would be just as attractive as Guthrie Green in the Brady District.

The developer hopes to have the office space completed sometime in 2017.

http://www.fox23.com/news/160-million-development-in-downtown-tulsa-needs-support/141741254
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Townsend
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« Reply #48 on: March 03, 2016, 01:17:26 pm »

Santa Fe Square is now before the city asking for a 25 year, $36 million TIFF on property taxes for the $160 million project.

http://www.fox23.com/news/160-million-development-in-downtown-tulsa-needs-support/141741254

Will all this come with a $36 million guarantee that we won't experience the disappointment we seem to feel every time we get excited about a development?
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DTowner
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« Reply #49 on: March 03, 2016, 02:21:10 pm »

Santa Fe Square is now before the city asking for a 25 year, $36 million TIFF on property taxes for the $160 million project.

http://www.fox23.com/news/160-million-development-in-downtown-tulsa-needs-support/141741254

That seems like a really big ask.  Is this purposefully intended to get rejected so the developer can blame the city and not his inability to attract financing and/or tenants as the reason for shelving the project?

In truth, it is hard for me to get excited about any of these announced projects.  Unless and until the Tulsa/Oklahoma economy makes a major rebound, I just don't see anything major actually happening that has not already broken ground or is funded by GKFF.
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Conan71
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« Reply #50 on: March 03, 2016, 03:38:08 pm »

So basically Casey and Elliot came up $36M short from their investors.

Tax increment finance districts are generally supposed to only be able to pay for public infrastructure improvements.  A good example of what is allowed is running a public road through a development, stormwater management, or sewer work.

They are not supposed to finance construction, leasehold improvements, nor incentives to lure tenants.  This was made really clear in working out the TIF for Horizon Group for their outlet mall project.

On the one hand, I give Elliot a lot of credit for the renaissance of downtown.  He was there early on, taking big risks and coming within an inch of tanking entirely.  I also like the idea of creating density.

HOWEVER- The main economic selling point of density and infill is it is a tremendous revenue boon with sales and property tax concentrated in a very small footprint as compared to sprawling suburban style development.   I don’t think there is $36M worth of public infrastructure to be gained there unless they are planning to provide free multi-level parking.  You could make a stretch and say that was public infrastructure.  If structured parking there meant we could lose another block or so of surface parking, that could be worth the investment.

I’d be curious to see the ask first hand.

/edited to add: Basically the developers are asking for $1.44 million a year tax abatement if i understand correctly.  Considering the property currently pays $19,994 a year in property taxes there’s little doubt the improvements will increase assessed property taxes.  The only other property I could think of downtown which would be similar in value or space was the Williams Center.  Basically total tax revenue on it is $1.32M from Boulder to Cincinnati.  Total assessed value of those parcels is $89.2M.  So, I guess it would be reasonable to expect maybe $2.5 to $2.6 million a year in property tax on Santa Fe Square.  Doesn’t look quite so bad put in that perspective.
« Last Edit: March 03, 2016, 03:56:20 pm by Conan71 » Logged

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TulsaGoldenHurriCAN
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« Reply #51 on: March 03, 2016, 03:59:07 pm »

That seems like a really big ask.  Is this purposefully intended to get rejected so the developer can blame the city and not his inability to attract financing and/or tenants as the reason for shelving the project?

In truth, it is hard for me to get excited about any of these announced projects.  Unless and until the Tulsa/Oklahoma economy makes a major rebound, I just don't see anything major actually happening that has not already broken ground or is funded by GKFF.

Yeah, that is a big ask. With the oil downturn, they might see it as the only way to get it done soon. They have a lot going on and are probably already seeing demand drop for leases.

They are asking for a discount of about $1,440,000 per year for 25 years. That is as much tax that the BOK Tower, the Hyatt and the 320 S Boston building pay combined and those have over 2,060,000 square feet as opposed to the 600,000 square feet of Santa Fe Square. I see empty store fronts all over downtown at pretty low prices and office space is easy to come by very cheaply. I don't see how this make sense economically for Tulsa.

It is a really awesome development and I hope it gets done, but I would not want taxpayers to pay that much. If it is put on hold, they can focus on the Boxyard and see if they can get a neat shopping hub going on a small scale first and use that to lure bigger investors.
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TheArtist
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« Reply #52 on: March 03, 2016, 05:38:57 pm »

I think its a great development but I wonder what the rational is for this one getting the Tiff and other new ones downtown not? 

If its done as planned, it appears to be a high quality one compared to many I see so that is an added plus.  And if they do have parking that can be used by everyone in the district that can also be a plus.  As for the infrastructure component of a tiff in new areas, that is one of the great things about infill is that it will not add more streets for the city to maintain and this type of mixed use density can help transit, biking, walking, etc work better.  And this development could be a game changer for downtown really setting the tone and upping the pedestrian fabric of downtown.

But, the building I am in is paying property taxes and my shop by default is paying for it, and indeed there are still empty store fronts all around.  So I hope this development won't have their retail spots be able to be cheaper because they are not paying the taxes.  That wouldn't really be fair to me and the vacant spots and buildings being redone around me.

Would really like to hear from some of the developers and other property owners to see what their take is.

 
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« Reply #53 on: March 03, 2016, 06:52:25 pm »

Yeah, that is a big ask. With the oil downturn, they might see it as the only way to get it done soon. They have a lot going on and are probably already seeing demand drop for leases.

They are asking for a discount of about $1,440,000 per year for 25 years. That is as much tax that the BOK Tower, the Hyatt and the 320 S Boston building pay combined and those have over 2,060,000 square feet as opposed to the 600,000 square feet of Santa Fe Square. I see empty store fronts all over downtown at pretty low prices and office space is easy to come by very cheaply. I don't see how this make sense economically for Tulsa.

It is a really awesome development and I hope it gets done, but I would not want taxpayers to pay that much. If it is put on hold, they can focus on the Boxyard and see if they can get a neat shopping hub going on a small scale first and use that to lure bigger investors.

This TIF request is paying for 100% of the value of the parking structure ~1,200 x $30,000 = ~$36 million. This was my only complaint about the development that they are WAY WAY over building the parking garage. I know everyone says this will help other lots be infilled - but all of those developments are still going to want their own parking. I will bet anyone that this parking garage will sit 40% empty almost everyday even when this development is fully leased and all the surrounding lots are developed.

Now for everyone who can't justify the demand for this project. I think you were the one who said before "but there are vacant signs EVERYWHERE downtown" that is just not true. Please tell me where all these vacant retail spaces are? And tell me who is actively marketing them? Are there vacant "storefronts" yes, like the Sinclair building - but no one can exactly open up a shop there can they? You have to have a willing owner wanting to lease the space. Class A office space is non existent downtown. There's one block in City Hall, and the floor plates there are an acre - that would be difficult to find tenants for in Dallas, let alone Tulsa. There is a decent amount of Class B space in First Place (Kanbar) but really that's the only large chunk of B space available downtown. The rest is in C buildings. That's not indicative of demand, it just means we have a lot of tired buildings that will be repurposed to apartments and hotels soon. There is a huge need for new Class A office space downtown, even with oil prices low.

This TIF has been making its way through the city for months now, they are on the last sign off part which I believe is getting the ok from the school district. Once they have that this project is probably 2-3 months max from breaking ground. There's been a lot of pre-leasing interest (believe they have multiple contracts on both retail and office portions), it has financing in place, a multifamily developer partner in place, a hotel developer partner in place, and is a few weeks from closing on the land. This project is 95% going to happen. It's no pipe dream, and they certainly aren't asking for a TIF to use as an excuse to shelve the project - it's been in the works since they announced the project publicly.

Parking downtown is expensive and a TIF to help them cover that isn't horrible. I can think of worse TIF's - Tulsa Hills anyone? Personally I wish they would shrink the parking garage by 30% and ask for less money, but I still support it even as is. This project has the potential to change the trajectory of development downtown, I can't think of a better reason to waive property taxes for a while.
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Conan71
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« Reply #54 on: March 03, 2016, 07:42:18 pm »


Parking downtown is expensive and a TIF to help them cover that isn't horrible. I can think of worse TIF's - Tulsa Hills anyone? Personally I wish they would shrink the parking garage by 30% and ask for less money, but I still support it even as is. This project has the potential to change the trajectory of development downtown, I can't think of a better reason to waive property taxes for a while.

Aside from Tulsa Hills being a complete traffic nightmare and typical of every last thing that is wrong with suburban sprawl and its lack of sustainability, what is bad about the TH TIF?
 
By most accounts, that TIF accomplished what the original intent of TIFs were: to anchor development, re-development, or help give an area an economic jump-start.  The area is not my idea of utopia, but it has accomplished those goals and my understanding is it is being repaid well ahead of schedule.

« Last Edit: March 03, 2016, 07:56:26 pm by Conan71 » Logged

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« Reply #55 on: March 03, 2016, 08:06:20 pm »

This TIF request is paying for 100% of the value of the parking structure ~1,200 x $30,000 = ~$36 million. This was my only complaint about the development that they are WAY WAY over building the parking garage. I know everyone says this will help other lots be infilled - but all of those developments are still going to want their own parking. I will bet anyone that this parking garage will sit 40% empty almost everyday even when this development is fully leased and all the surrounding lots are developed.

Now for everyone who can't justify the demand for this project. I think you were the one who said before "but there are vacant signs EVERYWHERE downtown" that is just not true. Please tell me where all these vacant retail spaces are? And tell me who is actively marketing them? Are there vacant "storefronts" yes, like the Sinclair building - but no one can exactly open up a shop there can they? You have to have a willing owner wanting to lease the space. Class A office space is non existent downtown. There's one block in City Hall, and the floor plates there are an acre - that would be difficult to find tenants for in Dallas, let alone Tulsa. There is a decent amount of Class B space in First Place (Kanbar) but really that's the only large chunk of B space available downtown. The rest is in C buildings. That's not indicative of demand, it just means we have a lot of tired buildings that will be repurposed to apartments and hotels soon. There is a huge need for new Class A office space downtown, even with oil prices low.

This TIF has been making its way through the city for months now, they are on the last sign off part which I believe is getting the ok from the school district. Once they have that this project is probably 2-3 months max from breaking ground. There's been a lot of pre-leasing interest (believe they have multiple contracts on both retail and office portions), it has financing in place, a multifamily developer partner in place, a hotel developer partner in place, and is a few weeks from closing on the land. This project is 95% going to happen. It's no pipe dream, and they certainly aren't asking for a TIF to use as an excuse to shelve the project - it's been in the works since they announced the project publicly.

Parking downtown is expensive and a TIF to help them cover that isn't horrible. I can think of worse TIF's - Tulsa Hills anyone? Personally I wish they would shrink the parking garage by 30% and ask for less money, but I still support it even as is. This project has the potential to change the trajectory of development downtown, I can't think of a better reason to waive property taxes for a while.

Well, sounds like a good deal for downtown and again I think it is well designed.  As for vacant retail, right across from me they have space in the Philcade on the ground floor between Mods and the Deco District Shops where some IBM offices once were.  The Vandever building right next to Jimmy Johns has had signs up for lease for quite a while.  Had some downtown realtors try to get me into that space actually but I wanted the high ceilings in the space I have now. And I think there are several other spaces on 5th that have been for lease for years now. My old space is available lol.  Someone with a little money could go in there and do it nice inside it would still be a good spot. Heck, they would have an instant customer base for it seems like there are still a lot of people who come into my new store saying they stopped by the old one first not realizing we had moved lol.
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LandArchPoke
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« Reply #56 on: March 03, 2016, 08:11:05 pm »

Aside from Tulsa Hills being a complete traffic nightmare and typical of every last thing that is wrong with suburban sprawl and its lack of sustainability, what is bad about the TH TIF?
 
By most accounts, that TIF accomplished what the original intent of TIFs were: to anchor development, re-development, or help give an area an economic jump-start.  The area is not my idea of utopia, but it has accomplished those goals and my understanding is it is being repaid well ahead of schedule.



My complaint with the Tulsa Hills TIF is because the main reason it was needed is because of the poor site selection of the developer. When you have to plow the top off a "mountain" and install infrastructure it's a lot of money. We were about to do the same thing for Simon by Turkey Mountain. What's more economically difficult to do a strip/power center or an urban mixed use development? If Tulsa Hills has been built more dense I would have less of an issue. Have apartments above the retail and made Olympia Avenue more of a "main street" type environment and the TIF would have made more sense to me. I think we wasted public investment on a sub par development that would have require less money if they had found somewhere else on the westside that didn't have an extreme elevation challenge. I will say it at least it making the projections to pay off the TIF, so could be much worse. Santa Fe Square will be an investment that is alive and well producing income for the city for well past 30 years. Tulsa Hills? It won't. In 30 years there will be a new power center in Glenpool with Target, Lowe's, Belk, and Sam's that will be the new shopping center for SW Tulsa and Tulsa Hills will be much like Southroads, Fontana, or Eton Square. It will have an extremely short shelf life of producing any significant amount of revenue for the city.
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LandArchPoke
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« Reply #57 on: March 03, 2016, 08:17:45 pm »

Well, sounds like a good deal for downtown and again I think it is well designed.  As for vacant retail, right across from me they have space in the Philcade on the ground floor between Mods and the Deco District Shops where some IBM offices once were.  The Vandever building right next to Jimmy Johns has had signs up for lease for quite a while.  Had some downtown realtors try to get me into that space actually but I wanted the high ceilings in the space I have now. And I think there are several other spaces on 5th that have been for lease for years now. My old space is available lol.  Someone with a little money could go in there and do it nice inside it would still be a good spot. Heck, they would have an instant customer base for it seems like there are still a lot of people who come into my new store saying they stopped by the old one first not realizing we had moved lol.

Those are a few space (I've walked by all of them as I live downtown). In a grand scale, those chopped up pieces of retail don't equal large amounts of vacancy and there's only a very small amount of retail tenants that would even be interested (more local shop people like yourself). Santa Fe Square is a completely different market of urban retail for downtown that is not available now. More retail, the more people will be walking around. Density builds on density and will ultimately be a great things for the local shops. The biggest block of retail space available downtown is in the Cimarex building, I think there's still maybe 15,000 sq. ft. on the backside interior that probably will never be leased due to the bad design of the building (no courtyard, no visibility to the street, etc.) not because of the market. The rest of the spaces are just small one off spaces in a bunch of random different properties. We need some new, bigger developments with the ability to draw in retailers like Santa Fe Square or the PAC lot development can.  
« Last Edit: March 03, 2016, 08:19:45 pm by LandArchPoke » Logged
johrasephoenix
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« Reply #58 on: March 03, 2016, 08:37:56 pm »

Some things:

TIF money is not only meant for infrastructure improvements like new roads.... in fact I would hesitate to use it for that purpose in most instances.  If our goal is to encourage infill then development should require minimal new infrastructure investment. 

In my experience, TIF money is primarily an economic development tool in neighborhoods where the market isn't strong enough to spur development on its own.  Much of downtown Tulsa fits this criteria perfectly.  For instance, I used to live in Uptown, Chicago, an area struggling with poverty and retail vacancy.  The city used $68 million in TIF funds to develop 100+ affordable homes and an urban format Target over an abandoned railyard fronting a street of vacant storefronts (Wilson Yards TIF).  That investment has served as a catalyst for a struggling community.

When looking at this project there are two things you need to consider when deciding whether or not to proceed:

a) How much will property tax in the TIF district increase in the absence of this development?  This increase is the revenue the city will be forfeiting (and given the current tax rate on surface parking in Tulsa its not that much $$$).
b) Are this project's positive externalities greater than the tax revenue the city forgoes (ie, future increases in property tax absent the development).  This can be monetary (does this development encourage new businesses, residents, development elsewhere?).  It can also be qualitative - and I think this is the most important.  The Blue Dome and Brady Districts are the standard bearers for downtown's resurgence.  This project makes a statement that downtown is back.  It also removes a gaping hole in the city's urban fabric, it gives Tulsa a beautiful building it can be proud of, and potentially brings hundreds of new residents and workers to what is now an eyesore.  If Santa Fe Square, the Edge at East Village, Urban 8, and whatever is going on the Hartford Building all get built then all of a sudden we have a real, viable urban district.   You could walk all the way from Hodges Bend to the BOK Tower and have the entire experience feel like you were in the urban core of a real city.

Last point: everything Elliot Nelson has touched so far turns to gold.  I'm willing to knock a point or two off my IRR calculations for the city in return for his magic urban fairy dust. 
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davideinstein
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« Reply #59 on: March 03, 2016, 10:14:40 pm »

I think this is the most valuable land in Tulsa and you can wait out for privately financed development. The East Village wrap around is inevitable.
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