The following includes questions and comments concerning The Levinson project from the Noblesville community as well as from Julia Church Kozicki, candidate for Noblesville mayor. Questions and comments appear in bold; the City’s responses appear below each question.
- Does the Common Council have the final say on this project?
Yes, members of the Common Council have the final say in approving the project agreement that includes the financial incentives. In addition, the design of the project, as part of the downtown mixed-use overlay, will be worked out through the City’s Planning process, which includes another Council introduction followed by the Technical Advisory Committee and the Plan Commission before returning to the Common Council.
- What’s the schedule for planning?
If the project proceeds, the developer will meet with the Design Review Panel and other stakeholders in the coming weeks in order to prepare for an introduction with the Common Council on Nov. 6, Technical Advisory Committee on Nov. 15 and Plan Commission on Dec. 10. The Common Council would then hear the project’s second and third readings on the design of the project on Jan. 15 and 29, respectively.
- This process of approval for the Levinson sets a dangerous precedent and lacks transparency.
City staff believe the Levinson is following the same public process that all projects go through. And, if approved, any project proposed in the future would go through this very same process. So there is no precedent being set that would automatically approve another project. That said, the Levinson is unique as Noblesville’s first new apartment project in downtown in more than 100 years, and it is unique as a public-private partnership to increase downtown parking capacity – all subject to Council approval.
The process is open and transparent, but City staff have to be sensitive to the nature of these projects and the privacy of developers. While a portion of the project has been discussed within the City before making it to the public, those discussions need to happen for the public to have anything to review and provide feedback on.
And the community will have multiple occasions to voice their concerns through the Common Council, Plan Commission, Redevelopment Commission and Community Development Commission. In addition, the developer will continue to meet with interested parties in order to solicit feedback on the proposed design.
- Why wasn’t Main Street’s Design Committee or Noblesville Preservation Alliance not asked for input?
The developer has released one conceptual rendering to give the City and the public a sense of what the Levinson might look like. However, the design of the project will come under official review during the Planning Process. In the meantime, the developer has been and will continue to meet with local stakeholders and gather input on the design of the project. For example, the developer plans to meet with the Noblesville Preservation Alliance to get their input on the project.
- We don’t want to lose our local history in downtown or the special community feeling that I moved here for.
The developer, who is a Noblesville resident, understands the historical significance of our downtown, and is taking cost-effective measures to ensure that Noblesville history is embedded into the project. Inside and out, the Levinson will showcase Noblesville history by incorporating historical and architectural features into its façade and by dedicating space within the building’s lobby.
Depending on the amount of work necessary to preserve parts of the current buildings on the site or to replicate features from past buildings, additional costs could be incurred. The developer will continue to meet with interested parties in order to solicit feedback on the proposed design.
In addition, the City intends to hire Dave Kroll, a Principal and the Director of Preservation at RATIO Architects, to serve as its consultant for this project. Mr. Kroll is known in the design industry as a historic preservation specialist. Before joining RATIO, he served as Historical Architect for eight years with the State of Indiana.
- What’s the compensation for acquiring the buildings currently owned by Holt Legal Group and Ayer’s Real Estate that sit on the southeast corner of the property?
The sale of the private properties are private agreements between the developer and the property owners.
- With the Levinson’s 337 parking spaces, will there be enough parking for residents and visitors?
If the size and scope of the project remains the same, there will be ample parking for Noblesville residents in the apartments and visitors to enjoy downtown amenities – as well as permit holders from nearby businesses. Currently, there are 70 parking spaces in City Lot No. 3 on Maple Avenue between Eighth and Ninth streets. Of the 337 total parking spaces that are planned for the Levinson, approximately 50 to 100 spaces will be reserved for apartment residents, leaving at least 237 spaces for public use by hourly visitors and permit holders – a net gain of at least 167 spaces above the 70 spaces of the current surface lot. And the developer has considered allowing some of the spaces reserved for the residents to be open to the public during business hours (outside of the weekend) so that the City can maximize on the parking spaces that would be left empty during those hours.
- The price for the parking garage – at $13.2 million – is more than double the national average. And while the average cost for parking garage space in New York City is $26,000 per space; Indianapolis costs $18,000 per space – yet this one would be $79,000 per space.
The cost per parking space in the Levinson parking garage is actually $39,100. The cost per space and the total cost for the parking garage construction is higher than the national average for several reasons related to the size, location and scope of the project:
- The 337 parking spaces could only be attained by going below ground by two floors so that the building could align with the zoning code and still provide the parking capacity requested by the City. And sub-grade parking requires significant structural features and mechanical ventilation.
- As the garage is supporting the apartments above it, this requires additional features, such as a podium slab and street-level lobby, among other things, that support the residents living on the upper floors. The podium slab is built as part of the garage structure and is nearly equal to an entire floor of the parking structure.
- The City asked the developer to “skin” the garage with a higher-grade façade that will distinguish it aesthetically from standard parking garages. Adding the brick and other screening materials to complement the character of downtown adds significant costs.
- Can we limit the height of the Levinson to three or four stories?
The height of the Levinson as proposed – with two levels underground and five levels above ground – will follow the design standards set forth in the Noblesville Housing Policy Guide and Downtown Mixed-Use Overlay District code and direction given during the Plan Commission process. The building’s height also aligns it with the height of the buildings that stood on the site historically – such as the Wild Opera House. And the historic Courthouse (built in 1879), will by far still be the tallest structure in downtown.
Additionally, there is a certain scale and efficiency that enables the project to succeed financially and for the City to achieve the increased parking capacity and residents living in downtown and supporting downtown businesses. Reducing the scope of the project by one or two levels would make the project difficult or impossible to finance and would fail to meet the City’s objectives.
- Will a committee be formed to study the design and suggest ideas?
The project will go before a Design Review Panel to discuss the design of the project during the Planning Process. All stakeholders should keep in mind that whatever ideas and concepts that are requested will likely add to the cost of the project.
- Will there be handicap access across the alley for downtown businesses?
While there are many details still to be worked out through the Planning Process, all ADA requirements for the Levinson will be met.
- Would the City consider moving the Levinson to another location?
City staff agrees with the developer that City Lot No. 3 is ideal for the project due to its proximity to the downtown square, connected by the pedestrian alley adjacent to the Visitor Center, and the businesses that will be supported by the residents living in the apartments and the visitors who use the parking garage.
Furthermore, this project fulfills the objectives in the PLANoblesville Comprehensive Plan. According to the Plan, the City wants to “capitalize on existing successful areas of the downtown and its historic qualities to expedite revitalization of surrounding neighborhoods and create an around the clock, vibrant mixed-use district”. The City is trying to encourage more development opportunities such as The Levinson, which are compatible with mixed-use development and higher density growth.
- What’s the impact on the Downtown TIF?
This project only affects the current “Downtown TIF” by removing the affected parcels out and creating its own standalone TIF district. It is assumed that removing these four parcels will have very little effect on the existing TIF – and an analysis will be completed to assess any impact. The taxes generated from this project would support a portion of the project. Meanwhile, the project will not receive any TIF dollars from the existing Downtown TIF.
- Why are we paying more for this project than the developer, with the point being that we own most of the land? Why are we paying $2,272,486 for the apartments?
The City’s contribution to this project is estimated at $15,473,273 out of which $13,200,787 is for the City-owned parking garage. This will provide at least 237 parking spaces for public use by hourly visitors and permit holders. The remaining spaces allocated for the residents and retail will be leased from the City to the developer.
That still leaves a gap of $2,272,486 to be contributed by the City to cover the remaining costs of the project and assist the developer in making this project financially possible. Compared with similar projects throughout the state, the percentage needed to fill the gap for the remaining costs is still lower than what is seen in other communities.
All costs provided so far have been estimates, and the developer will provide a certified cost breakdown and keep their books open to the City during the process. The project agreement includes clauses that require any money the developer receives but does not put towards the construction or soft costs of the project will be returned to the City.
- According to industry information, the average cost in the Indianapolis area for the construction of a parking space within a parking structure is just over $18,000. If, as shared on Aug. 28, the total number of parking spaces is 337 and the Noblesville share of the total project cost is $15.4 million, that is over $45,000 per parking space, unless Noblesville taxpayers are being asked to pay for something else. What is the reason for this disparity? At $18,000 per space that would suggest a cost closer to $6 million for the City. Is there a parking charge? For residents of the apartments? For citizens who park there to shop? What are those costs? If there is a reserved spot for residents, how is the monetary value of that reserved space being considered between the City and the developer?
While we won’t dispute Carl Walker’s report referenced on the cost of the parking garage, it is important to note the article indicates the average cost of $18,000 is for the “hard” structural costs to construct the garage with certain qualifications. “Soft” costs (land, public spaces like lobbies, stairs, etc.) are an addition of typically 15 to 20 percent, and in urban environments, the costs are certainly at the upper end of this range.
For Indianapolis, an urban environment that demands higher grade exterior cladding to blend into the downtown, the starting average would come to $21,600 with the average cost per space coming to approximately $25,000 to $27,000 for an above-grade structure.
The total cost for the Levinson garage is estimated at $13,200,787, which includes hard costs as well as soft costs, which results in a cost per space of $39,100. The total cost for the parking garage construction and cost per space are higher than the national average for several reasons related to the size, location and scope of the project:
- The 337 parking spaces could only be attained by going below ground by two floors so that the building could align with the zoning code and still provide the parking capacity requested by the City. And sub-grade parking requires significant structural features and mechanical ventilation. This drives the cost per space up to an average of about $35,000 to $40,000 per space for those spaces below grade. In the case of this design, there are approximately 194 spaces on the two sub-grade levels.
- As the garage is supporting the apartments above it, this requires additional features, such as a podium slab and street-level lobby, among other things, that support the residents living on the upper floors. The podium slab is built as part of the garage structure and is nearly equal to an entire floor of the parking structure. With approximately 82 spaces per above-grade parking level, this is like adding the cost of 82 spaces without the benefit of receiving those spaces.
- The City asked the developer to “skin” the garage with a higher grade façade that will distinguish it aesthetically from standard parking garages. Adding the brick and other screening materials to complement the character of downtown adds significant costs to the garage structure and the cost per space.
- The retail and leasing office on the ground level along Eighth and Ninth streets take space out of the parking structure and eliminates spaces that otherwise would be available in a typical garage. The structure beneath it, however, still must exist in order to support the garage floor above it. While the garage loses about 20 spaces with the additional retail, the City requested it to activate more retail opportunities.
The City is working with Walker Consultants to determine the logistics of parking the garage and what the City’s return on investment would be to charge for the spaces in this garage. The plan is to keep any downtown parking that charges a fee – such as permits and hourly rates during weekday hours – to remain as paid parking. Any downtown parking that is free will remain free.
There will be permitted spots in this garage for a fee and the developer is leasing parking spaces for the residents and retail. The developer has considered allowing some of the spaces reserved for the residents to be open to the public during business hours (outside of the weekend) so that the City can maximize on the parking spaces that would be left empty during those hours. Walker is also assisting to figure out the logistics of sharing spaces between the residents and public.
- According to industry information, the cost to construct an 800 square-foot apartment within an apartment structure is approximately $86,000 per unit. If, as we were told, the total number of apartment units in the structure is 83, that would be a project cost of slightly over $7 million. This does not include the 5,100 square feet of retail that will also be constructed by the developer. According to industry averages, the per-square-foot cost of this type of construction is in the range of $200 per square foot, or just over $1 million. There is no attribution of the contributed land value owned by the City. If we knew what the developer paid for the privately-owned portion which will be demolished, we would have some idea of what the value is for the city portion of the real estate. How are these numbers reconciled? The City-owned land clearly has a value and it should be recognized.
Apartment project costs range greatly and depend on many factors: Complexity, height or stories, level of finish, amenities, soft costs, exteriors, etc. The developer has offered to deliver this project in an open-book format so the City will know what the final cost of the project will be. In similar public-private partnerships, we have recently seen a rough estimate of approximately $120,000 per unit for hard costs alone. With 83 units, this would cost approximately $9,960,000. If you add the typical soft costs of 15 to 20 percent, you would be at roughly $11,454,000 – an estimate that is very close to the numbers the developer has shared with the City.
The City has requested two appraisals on the City-owned land. One of the appraisals has been returned and has the property valued at $470,000. However, the City will continue to own the land with garage taking up the entire site. If the City were to sell the land to the developer, the City would expect to see that number as part of the finance gap of the project.
- What are the specific incentives being offered to the developer? It would seem that the total project cost does not equal the amount proposed: $6 million + $8 million = $14 million, not $24.3 million. Even allowing for the various costs associated with the project (legal fees, architectural and engineering costs, etc.) that should not equal an additional $10 million. What accounts for that difference? What is the amount of monetary benefit to the developer from the tax abatement over what period of time? Surely the City has made this calculation in order to know precisely what this benefit is worth to the developer. Applying the current City tax rate, 2.7420, to the attributed cost to the developer, that is a huge amount of tax benefit or savings while the City is expected to immediately provide City services to the new structure at a cost to someone.
The City is not offering an abatement on this project. In fact, the developer has agreed to a minimum tax payment each year of roughly $185,000 per year. The City will issue a bond in the amount of roughly $16.5 million, which covers the design, construction and related improvements for the garage ($13,200,787), estimated utility upgrades in the area (with benefits to more than this project; approximately $1 million) and the remaining gap ($2,272,486) in order to achieve a nominal rate of return required for financing to design and construct the apartments and retail.
The difference based on the question is the hard and soft costs for the apartments and retail portion of the project. Any money not used from the bond for the project will be given back to the City as the developer has promised an open-book process.
- Given the fact that the City appears ready to make this substantial investment to create a parking garage on this site, a decision with which I agree, was any consideration given to making a request for proposals (RFP) in order to see if there are other developers that might have an interest in participating in such a venture? Perhaps that route would result in a better deal for the City. This should not be viewed as a binary option: Do this project or not. All options to achieve the objective should be given consideration.
The Levinson has been a developer-driven project. The developer approached the City about a project they put together while securing options from private landowners on the non-City land. This project would fulfill a need identified by the Downtown Parking Taskforce to increase parking capacity, and it would fulfill the objectives in the PLANoblesville Comprehensive Plan. As a result, the City agreed to move forward on partnering with the developer in order to make a project happen on the site.
- What consideration has been given to maintaining safe access to the fire station during construction?
As with any downtown urban project, the developer is working with the City to ensure a safe and secure working environment. The developer will continue to work with the City on any necessary closures of the public rights-of-way and will pay specific attention to the emergency services that must be maintained. There isn’t a scenario where the City would jeopardize the function of the emergency services of the residents and business owners.
- Is the City prepared to engage an independent architect that will ensure that the look and feel of the structure is consistent with the historical nature of the area? If the parking garage portion is visible, it will clearly not be consistent with the historic architecture. As the City has expanded into other buildings to house its necessary offices, the old Post Office façade and the old Library façade and look were retained. It is clear that for a long time, the City has recognized and affirmed its historic character in the downtown.
The City intends to hire Dave Kroll, a Principal and the Director of Preservation at RATIO Architects. Mr. Kroll is known in the design industry as a historic preservation specialist. Before joining RATIO, he served as Historical Architect for eight years with the State of Indiana.
The developer also has been working with David Heighway, our foremost authority on Hamilton County history. Mr. Heighway’s input and knowledge have been crucial in guiding the developer’s initial design to ensure the Levinson reflects the historic nature of downtown Noblesville. This can be seen in the initial rendering’s façade and plans for the dedicated space in the lobby to showcase Noblesville history. Depending on the amount of work necessary to preserve parts of the current buildings on the site or to replicate features from past buildings, additional costs could be incurred. The developer will continue to meet with interested parties in order to solicit feedback on the proposed design.