Birmingham city commissioners on Monday, June 4, unanimously approved continuing discussions with development group Waldbridge/Woodward Bates Partners to redevelop the N. Old Woodward parking lot with more parking, an extension of Bates Street, a liner of retail along the new street, a mixed use building comprising residential and office space, and a park, as well as to hire a development consultant to represent Birmingham in its negotiations.
Assistant city manager Tiffany Gunter said the city had been studying increasing parking to meet the heightened demand for the last three years, creating an ad hoc parking committee whose goal has been to see if they could redevelop the N. Old Woodward structure to get more parking, as well as to residential housing to line the area.
“Amenities we wanted to include were to increase parking, to add a new mixed use building, add service drives to the area, create a public park property and connect it between the new city street and the Rouge River property to the north, and connect it to Booth Park,” Gunter said.
Planning director Jana Ecker said, “We've talked a lot about this over the last few years. We narrowed down the teams who were qualified to do this.” A request for proposal (RFP) was sent out last fall to four pre-qualified teams.
The parcel of land, approximately four acres in the city’s central business district, consists of the current N. Old Woodward parking garage, an adjacent parking lot and adjacent parcels. The city’s objective had been to solicit creative and innovative development plans from qualified developers that will extend Bates Street from Willits to N. Old Woodward, connecting the north and south parts of Birmingham, to redevelop the remainder of the site by constructing a new parking structure that will provide an additional minimum of 380 parking spaces while replacing the 770 parking spaces currently on the N. Old Woodward/Bates Street site, plus adding residential, commercial and/or mixed uses in order to create an activated, pedestrian-oriented urban streetscape while also providing public access to the Rouge River and Booth Park to the north.
The RFP stated, in part, that the city was seeking a new parking structure with a minimum of 1,150 parking spaces; new mixed use building adjacent to a parking structure facing N. Old Woodward Avenue; a service drive access to the adjacent buildings both north and south of the parking structure; new mixed use building facing Willits Street; public park property and connection between a new city street and the existing Rouge River to the north; and a residential building on the north end of the site, which can take advantage of the existing views in the area.
The city initially had four development groups submit proposals, which included parking consultants, developers, architects, designers and consultants, but only three ultimately submitted completed proposals to the city by the January 3, 2018 deadline: REDICO, TIR Equities and Waldbridge/Woodward, Bates, LLC. REDICO withdrew from consideration.
After reviews, staff felt the proposal submitted by TIR Equities, a Birmingham-based limited liability company incorporated by Ara Darakjian of Darakjian Jewelers on Willits Street, did not comply with the RFP, as it has a 15-story building as its centerpiece, and the group has requested a tax increment finance (TIF) district to help finance the development, which staff labeled, in essence, a subsidy by the city, which the RFP specifically said would not be part of this development. Staff also questioned some of the financial data presented by TIR relative to cost and revenue projections for the parking portion of the project. At the ad hoc parking committee meeting on May 2, members concurred.
“TIR Equities is proposing four levels of underground parking, a 15-story building, multiple other buildings that are six-stories, an extension of Bates street, all zoned PP-public property, so you go any height, but all the other buildings in the area are max five-story,” Ecker said to commissioners.
She said that Waldbridge/Woodward Bates also includes an extension of Bates Street, numerous buildings and a plaza improvement with retail along a liner which would activate the space. “Their parking is in the rear, with a couple of levels of underground,” she said.
Gunter said staff did a side by side comparison of the two proposals, evaluating both plans, and in the end, TIR had 690 points and Waldbridge, 992 points.
“The committee wanted staff to do further analysis in five key categories,” she said. Notable was that on page nine of the RFP, “it clearly said 'no city subsidy.' TIR has a TIF (tax increment financing) which is equivalent to a city subsidy, so they are not in compliance with the RFP, and they overestimated.”
She further explained that actual cost obligations for the city for public elements under Woodward Bates would be $54 million and $70 million under TIR.
She also said there were huge cost differentials for parking construction, with Birmingham estimating at $28,299 per space; Woodward Bates estimating costs at $37,000 per space; and TIR, with all parking underground, at $57,000 per space.
Further, Woodward Bates, she said, could be built in phases, whereas with TIR, all elements are co-dependent and must be developed and built together.
“With the new unchartered territory on trade and tariffs on steel and aluminum, we have concerns about building right now,” Gunter said.
City manager Joe Valentine pointed out to commissioners that they were not being asked to choose a developer or development, “but to allow us to continue discussions with a developer to move forward with the project. A development consultant would be the point of contact for the city in negotiating with the development team in the development agreement. The consultant would best represent the city as we don't have that expertise on staff.”
Commissioners expressed that they thought both development proposals were beautiful, but “we have to consider what is appropriate for our town,” noted mayor pro tem Patty Bordman. “We don't live in a metropolis. It's a town – four square miles. The one with a 15-story tower is just too big. It would create a mini-city within our little city, and overwhelm our city.”
“This started as a discussion on parking – not a building committee,” said commissioner Stuart Sherman. “We've crept away from our mission, and I'm throwing up the caution tape.”
Commissioner Mark Nickita disagreed. “I think we're doing what we're supposed to do, We have these assets, but if we're going to enhance them, we should enhance them in the best way possible. It wasn't parking in a vacuum. It's how do we enhance this part of downtown from a financial point of view.”
“The key objective is parking – the Bates extension is secondary,” Sherman said.