Lofty goals: Here's what to know about new apartments proposed for downtown Springfield
A $28.3 million proposed development by a New York company that will bring more than 130 market rate apartments to downtown Springfield is headed to a vote before the full city council.
The Lofts on Madison project will be on Tuesday's debate agenda after getting the greenlight from the committee of the whole following a presentation by Victor Salerno, the chief executive officer of Adirondack Community Development.
Last week, members of the Springfield Economic and Community Development Commission voted unanimously to endorse the project, though the recommendation was non-binding.
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The landing spot for the complex, 301 N. Fifth St.-- the north side of Madison Street between Fourth and Fifth streets -- has been a vacant lot for the last five decades, said Ravi Doshi, an economic development officer and TIF administrator for the city.
"We see this as a driver of the downtown economy," said Salerno, of the estimated 400 residents who will live on the property. "We're very excited to begin this partnership with Springfield. I think everyone's supportive of it, so we're thrilled to move forward."
Abby Powell, business development director for the Springfield Sangamon Growth Alliance (SSGA), said the project would help "unify" downtown and the Mid-Illinois Medical District, a one-square-mile area just north of downtown Springfield.
Steve Myers, president of Myers Commerical Real Estate, agreed.
"By being on Madison Street, that's the connective area that joins the medical district and downtown," he said. "I think my comment at the Economic and Community Development Commission was you can come out of the front door and turn left and go to work in the medical district or you can turn right and go to your job in the historic downtown district."
Ryan Croke, president of the Mid-Illinois Medical District Commission, said while the commission hasn't met to formally consider the proposal, there has been "broad and deep enthusiasm" from those who have been able to review its progress.
What are details of the project?
Overall, The Lofts on Madison would consist of 120,000 square feet of rentable space over six stories. It would include 136 apartments, including 87 one-bedroom, 30 two-bedroom, and 19 three-bedroom units on the upper five floors.
The ground level would include 15,000 square feet of commercial retail space. Salerno said "we would love for a Trader Joe's or something like that to go in there." Adirondack will work with SSGA and other development agencies to find a suitable tenant or tenants.
An open-air courtyard is planned in the middle of the development along with a rooftop pavilion, community room, gym, library room, and an office center, Salerno said.
There will be on-site parking for about 50 units, with a car wash, Salerno said. He added Adirondack has had "very preliminary" conversations about reserving spaces at the adjacent parking garage for the Abraham Lincoln Presidential Library and Museum.
What's the monthly rent?
The one-bedroom apartments would be 610 square feet and rent for $1,100 per month. The two-bedroom apartments at 960 square feet would rent for $1,300 and the three-bedroom units at 1,050 square feet would go for $1,450.
Salerno said the units could be attractive for medical and nursing students. It would be particularly attractive to millennials, he added.
Ward 6 Ald. Kristin DiCenso said while she supported the project, the rent costs were "a little concerning." Salerno said Adirondack did commission a market study which did conclude the rent costs were "sustainable."
What's the cost to taxpayers?
The project is estimated at $28.3 million. Adirondack is getting about $4.5 million in tax-increment financing and there is about $1.5 million in enterprise zone benefits, Doshi said. Adirondack will save 9.75% sales tax on any building materials used on the project, he added.
The $4.5 million would come from making the parcel its own TIF district with a full 23-year life, no funds would be taken out of other sources, Doshi explained.
"The developer will get out what they put in," Doshi said, meaning the risk is 100% on the developer.
Adirondack would put in about $3 million in private equity and independent financing of about $21 million. Merchants Capital Bank provided a letter of intent term sheet, Salerno said.
Who is the developer?
Salerno described Adirondack as a family-owned company and "residential specialist. He said the company would be a long-term owner of the complex. The company is based in New York City and has an affiliated management company, Mayfair Management Group, which manages about 16,000 apartments over 120 properties, primarily in the southwest.
Salerno said Adirondack focuses on "high-quality developments that are energy efficient. We are really focused on developing communities. As an owner-operator, we really believe in having a community that's a thriving community. It's good for us, but it's also good for the downtown area."
How many jobs will the project create?
The Lofts on Madison would create 40 full-time retail and commercial jobs and 10 full-time employees working on the property side as leasing agents, maintenance supervisors and community manager. Salerno said there would be company representatives at the property 24 hours a day.
Some 400 full-time yearlong construction jobs would also be created. Local subcontractors would be used, according to Salerno.
No general contractor has been selected, Salerno said.
When would construction start?
If city council gives the go-ahead on Dec. 20, Salerno said Adirondack would look at closing on the TIF and the land in the spring. Groundbreaking would happen in spring 2023 with a build time of about 18 months, he said. Leasing would start in late 2023.
What's the reaction to the project?
The Lofts on Madison, said Ward 5 Ald. Lakeisha Purchase, is what downtown needs "to keep the momentum going. We have a lot going on. The University of Illinois Springfield just got awarded $15 million (in state funds to purchase and renovate the former Illinois Sheriffs Association building to house the UIS Innovation Center). You've got the State Armory which will get $122 million (in the form of a state-funded renovation project). There are other entities that have reached out to me and specifically want to be in our downtown and all this is going to do is amplify their thought process of 'should I or shouldn't I?' This is going to help with that movement of 'I should take advantage of it.'"
The partnership with Adirondack, said Mayor Jim Langfelder, shows "the viability of Springfield, especially downtown. They understand the importance of being engaged in the public and taking ownership and really and truly investing in Springfield and we can't thank them enough for doing it. There is interest because Springfield is affordable, our ability to work remotely, our infrastructure, our great medical community, our (public) schools with the upgrades, I think there's a lot of upswing that was missing previously."
Spokesperson Angie Muhs said Memorial Health "encourages economic development in the community and views any project that provides for an increased workforce to support health care services to be provided within the Mid-Illinois Medical District as positive for our region."
SIU School of Medicine and Springfield Clinic said they were not in position to comment on the specifics of the proposal. A spokeswoman from HSHS St. John's didn't return a call.
Contact Steven Spearie: 217-622-1788, sspearie@sj-r.com, twitter.com/@StevenSpearie.
This article originally appeared on State Journal-Register: Springfield City Council to vote on proposal for downtown apartments
