RM 11-16-79 - Laserfiche WebLink

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South Bend Redevelopment Commission Regular Me ting - November 16, 1979 7. PROGRESS REPORTS a. MrI Ellison continues... point of view is that it will require substantial invest- me t beyond simply time and writing down the cost to an ac eptable figure;.that it is a risky proposition and that tha Commission should only take that action if it sees that building as a.high enough priority in downtown South Bend to warrant the kind of time and effort I think is necessary, Th2 staff would appreciate it if the Chair would recoognize Mr. Jerry Miller, of Nick Jannotta and Associates. We have consulted with them regarding the economics of these pr posals and Mr: Miller has a few comments he wants to shire with the Commission and the public. Tha Chair recognizes Mr. Jerry Miller. Mr. Jerry Miller: Our firm has been asked to consider the re ovation of the Odd Fellows Building in the context of th entire Redevelopment effort in the downtown area, but pa ticularly relative to the Century Mall and other nearby sites earmarked for newer office development. We've ana- lyzed and evaluated specific proposals for the renovation of that building as to the financial soundness and the advisability of proceeding further with negotiations. We fo nd that while the renovation of the Odd Fellows Build- inj may be desirable from some standpoints, I think all th ngs being equal, it is better to save our buildings ra her than to demolish -them, that overall (1) it does not re resent the most attractive opportunity for office deve- lopment in the downtown Redevelopment area, and (2) other sires should be given higher priority and greater atten- tion at this time. Our evaluation of the proposals them - se ves found marginally feasible projects which pose in- ordinate risks to the Redevelopment Authority and we be- li ve the City of South Bend. Marginal feasibility lay in such factors as, number one sanguine assumptions re- garding rent levels, which if not fully attained would re lut in uneconomic operation and negative cash flow. Secondly, inadequate consideration of the time, the effort, the cost necessary to reach a breakeven or full occupancy in the project. Thirdly, inadequate and in- complete detailing of all the costs incurred during the development process. We understand these are not finance ready proposals, but even in light of that, the detail- ing was not great enough that we feel we could recommend proceeding further. This is important because detailing of the costs, we feel, and adequate consideration of all the costs 'are necessary to ensure that a quality product -19-