The Community Reinvestment Area Agreement with the city of Springfield would relate to the commercial space that will be created as a result of the project. It would create a 50% abatement related to improved property tax evaluations on the commercial space for a period of 15 years.
Aaron Horn, a Development Coordinator with Dillin, said that the abatement would benefit future tenants and small business owners since it would lower their tax burden during that 15-year period. He added that would especially be the case since their commercial leases include paying property taxes.
Springfield city commissioners will be asked to authorize Springfield City Manager Bryan Heck to enter into the agreement during their next public meeting at the end of the month.
A request for a tax abatement regarding the residential aspect of the project would be a separate agreement. Horn said he believes that process would start after the project is completed.
Efforts to turn the McAdams Building into apartments and retail space have been in the works for a number of years. Previous plans ranged from building up to 36 and 56 apartments as well as adding on to the building or constructing a 20,000 square foot addition.
Renovations slated to began in 2020 were postponed after a potential developer for the project pulled out, citing concerns over the return investment on the property.
The scheduled renovations were expected to cost around $10 million to $12 million depending on the number of apartments created and what amenities they would include.
But with Dillin working on the project now, the idea is to create more apartments, construct an addition to the building and create retail space. Those behind the project are also looking to obtain more funding as inflation and the rising cost of materials can have an impact.
The Turner Foundation previously received up to $2 million in historic state tax credits for the project. However, there are plans to apply for a new pool of tax credits that could provide more money for the project and replace existing tax credits received.