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Developers behind two ambitious residential projects on East Broadway are threatening to shut down both developments if the city doesn’t hand over millions of dollars more in subsidies. Bill Bardenwerper, an attorney representing Columbus, Ohio–based Edwards Companies, suggested that the projects could be shuttered at a Metro Council zoning committee meeting.

The two projects in question are the $25 million Mercy Apartments on East Broadway, sited on the former campus of Mercy Academy, and the $52 million Phoenix Hill Apartments, located on the site of the former Phoenix Hill Tavern.

The Mercy Apartments on the left and Phoenix Hill Apartment site on the right. (Montage by Broken Sidewalk)
The Mercy Apartments on the left and Phoenix Hill Apartment site on the right. (Montage by Broken Sidewalk)

On Wednesday, the Courier-Journal‘s Sheldon Shafer reported that Edwards Companies wants a total of $10.4 million in incentives from the city to build the Phoenix Hill Project, up from the $7.5 million the city has already pledged. Edwards Companies’s lawyer said both projects are linked and the developer will either build both or none.

This is not the first time Bardenwerper has made suggestions that the projects might not make it if the developer doesn’t get its way. In February, WDRB’s Samantha Chatman reported that Edwards Companies made similar statements at the Bardstown Road Overlay Committee to gain design approval for the Phoenix Hill Apartments.

Rendering of the Mercy Apartments. (Courtesy Edwards Companies)
Rendering of the Mercy Apartments. (Courtesy Edwards Companies)

“The Mercy one is more reliant on this one [Phoenix Hill] because that’s an all residential project,” Chatman quoted Bardenwerper as saying at the meeting. “So as that one has already been approved, we’d like to see this one across the goal line before we make a total commitment to that one.” The implication then was that if the overlay committee didn’t come through with an approval, then the unrelated project might not make it.

Rendering of the Baxter Avenue side of the Phoenix Hill Apartments. (Courtesy Edwards Companies)
Rendering of the Baxter Avenue side of the Phoenix Hill Apartments. (Courtesy Edwards Companies)

This time, the threat is more overt, saying they need the city to increase the existing $7.5 million in subsidies by another $3 million if the projects are to proceed.

“Bardenwerper said Edwards is ready to give up on persuading the Jefferson County Public Schools to approve $3.8 million in financial incentives for the two projects—a deal that would include payments by Edwards to the schools, in lieu of paying property taxes over the long term,” Shafer wrote. JCPS is apparently reluctant to agree to the terms as they have never undertaken such a deal.

Site plan for the Phoenix Hill Apartments. (Courtesy Edwards Companies)
Site plan for the Phoenix Hill Apartments. (Courtesy Edwards Companies)

Today, Insider Louisville’s Caitlin Bowling reported that Louisville Forward, the city’s economic development department, is standing its ground on incentives for the project, refusing to add to the $7.5 million already proposed.

“Per the proposed agreement, the city would take out a bond of no more than $60 million on behalf of Edwards to fund the Phoenix Hill project and a second bond of no more than $30 million to finance the Mercy project,” Bowling reported. “The city would own both properties and lease them back to Edwards until the company paid off the bonds.”

The Mercy demolition site in late March. (Courtesy Tipster)
The Mercy demolition site in late March. (Courtesy Tipster)

Demolition of the historic and non-historic parts of the old Mercy campus is already complete. That site was to house 200 apartments. No work has started on the Phoenix Hill Apartments, where 281 more units and 33,000 square feet of retail are planned.

There’s no doubt these two projects would transform the East Broadway corridor and enliven Baxter Avenue. We have previously written highly of the Phoenix Hill Apartments concept as a good fit for the site. But how much pushing from developers will the city take? In a recent panel discussion of Edwards Company Vice President Jonathan Wood and three other out-of-town developers, all agreed that subsidies are necessary to get new urban apartments onto the market in Louisville. But how much is enough?

But on the opposite side of the coin, when everything being built in the urban areas of Louisville are subsidized with incentives like these, how can you say no to one developer and yes to another? Given the overwhelming subsidy at the Omni Louisville Hotel, $3 million seems like peanuts. Yet these two projects along Broadway will transform their section of town as much if not more than the Omni will around the convention center.

The original Mercy convent building (left) and stone ruins after demolition. (Courtesy Tipster)
The original Mercy convent building (left) and stone ruins after demolition. (Courtesy Tipster)

Should Edwards Companies abandon the projects the two projects, Louisville will be out another historic building. (Shafer reported that Edwards Companies had told area residents the Mercy site is worth more as a blank slate.) But that’s nothing new as developers have repeatedly demolished historic structures before financing has come through. According to Shafer, Councilman Tom Owen, cautioned against the city issuing demolition permits for several historic buildings on the Phoenix Hill Tavern site if the projects might lead nowhere.

For more, read these reports by the Courier-Journal and Insider Louisville.

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Branden Klayko

Branden Klayko

Founder and Editor at Broken Sidewalk
Branden founded Broken Sidewalk in 2008 while practicing architecture in Louisville. He continued the site for seven years while living in New York City, returning to Louisville in 2016. Branden is a graduate of the College of Architecture at Washington University in St. Louis, and has covered architecture, design, and urbanism for The Architect's Newspaper, Designers & Books, Inhabitat, and the American Institute of Architects.
Branden Klayko

9 COMMENTS

  1. We need a national movement to end all or most* incentives to businesses who should be able to conduct business on their own dime. They are depleting our local and state tax bases, passing the burden to families and small business. This leads to higher taxes than necessary, or reduced services, or both. When is enough going to be enough?

    * I might be willing to consider a metric by which incentives are given, such as the business creating a huge amount of jobs over a long period of time.

  2. Just because we let Omni rape the city doesn’t mean we should let everyone. We have an infrastructure problem and a public transportation problem that, in my opinion, should be given priority financial consideration.

  3. I think they should send the LPD over and lock’em up for extortion and while they are at it our public officials for bribery for giving our tax money as “incentives” to do these projects!

  4. A backroom deal comes to light and providing less than promised.
    Between preservationist, activists, overlay districts, etc. and city planning employees with alternate agendas, the only possible way for the city to attract developers in these “historic” areas the city has to provide incentives. The incentives offset the headache of dealing with all the nonsense. Has the city offered incentives for developers outside of I-264? If so, not as much. Easier to develop and less problems. Or they take their business to Southern Indiana and neighboring counties. Move Louisville will literally “move Louisville” back to Mayberry or out of town. Just my thoughts, hope we can get things right before it’s too late. Compromise if key for building a future for the city.

  5. Surplus or not, they should not get anymore incentive money. If they walk away they should have to give 7+ million back, we can put that money to use somewhere else. I am sure that there are others who would love to develop those locations.

  6. misinformation at its finest. Nobody ever threatened. Please do not print lies. work on both projects has never stopped. Shame on you Brandon!!! Lies.

  7. What work on the Phoenix Hill still has even begun?? Nothing!! Also, the lazy demo job on the Mercy property, just fantastic use of an existing structure. How much did demo cost vs. going green and rehabbing? Greedy little slobs.

  8. Edwards is a constipated out of town entity that wouldn’t dream of building this schlocky drek in Columbus. The Mercy site looks like a moonscape. Their designs are outdated and boring and belong in a suburban setting where this kind of design drivel passes for okay.
    And as of today nothing has happened except the dirt sliding into the street.

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