Readers raise questions about proposed Thunder Alley
The Oklahoman's Steve Lackmeyer took questions from readers during Friday's OKC Central Live Chat. You can join Steve's Q&As on Fridays at 9:30 a.m. and submit your questions about the happenings in and around downtown Oklahoma City. Here is an edited transcript:
Let's talk about the Thunder Alley Proposal, shall we? Overall, I don't have an issue with size and scope of the work. I feel it is interactive with the arena and somehow bridges the arena and Omni hotel. My issues are: 70 surface parking spots when two parking garages are next door and billionaires asking for TIF money at 15% of the total project cost. Also, the fact that Hogan is involved gives me cause for concern as he was the developer for Lower Bricktown. Thoughts?
We're looking at 1,100 parking spaces being built across the street. I've talked to several respected downtown brokers who all agree $40 per square foot is a pretty common figure for properties selling downtown and a couple have suggested this property between the arena and the new boulevard is easily worth $80 per square foot.
The Hogan/Thunder proposal is to pay $18.50 per square foot.
The tax increment financing district for the area was created, quite honestly, to make the numbers work for the 17-story Omni Hotel across the street and I'm not sure folks at City Hall will want to turn that over for this proposal.
The other issue with the $1.5 million TIF request is that the downtown framework guidelines established by the city council require a minimum of seven stories for any development to get TIF assistance in that area.
Hogan's Lower Bricktown did end up being far less dense than what was originally proposed to the Urban Renewal Authority and at least two of the pads in the plan have yet to be developed. The buildings that did get built, with the exception of The Centennial, consist of a lot of stucco and one-story buildings that are seen as being inferior to other highly visible developments of that era, most notably Spring Creek in Edmond.
Hogan responds the TIF is needed because the project includes a plaza, a public art component, and a desire for a retractable roof as part of a basketball court to adjoin a proposed restaurant.
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Are you at all concerned about First National Center with the need for the $25 million loan?
Not really. We saw a similar situation arise with the Skirvin where the original equity partner had to back out and the city really had to step forward and show commitment to ensuring the redevelopment would proceed and lenders wouldn't be tip-toeing along the edge of a financial cliff. The results since have far surpassed original expectations with the city recovering its investment and standing to profit if the hotel is ever sold by Marcus Hotels and Resorts.
These deals are not easy for any single bank to take on with a traditional loan package. There is no comp for this sort of thing. So lenders get nervous. They're far less nervous if they know the city is there to share the risk. So what the city has done is to back from the TIF the financing of the hotel and apartments with limits to the exposure.
How do you think the Indian cultural museum will impact downtown okc?
It could be a huge addition and a big step forward in connecting the river with downtown. But I think we have a big challenge ahead when it comes to the scrap recycling operations along Reno Avenue between downtown and the cultural center. It's the only real link.
Those operations were established at a time when it was OK to build them adjacent to black neighborhoods when it would have been an absolute no-go with white neighborhoods. Yeah, I'm saying it. They exist because of historic discrimination.