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Developer: Without MSU deal, CottonMill Marketplace to need ‘reformulation’ |
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Sunday, 26 April 2009 |
By PAUL SIMS
Starkville Daily News
Without a deal with Mississippi State University, the CottonMill Marketplace’s developers may not be able to keep their commitments to city, county and state officials and would need to reformulate its scope, one of the project’s principal developers says.
CottonMill Marketplace is a proposed $176 million retail, residential and convention center project planned for 25 acres on the west side of Highway 12 between Russell and Spring streets. It is directly across the street from the MSU campus.
The project’s centerpiece is the E.E. Cooley Building, a former cotton mill which is in the Institutions of Higher Learning’s ownership and used to house the university’s Physical Plant operations.
The developers intend to convert the Cooley Building into a facility with 80,000 square feet of conference space and 30,000 square feet of office space.
Brooks Holstein is the managing member of Comvest Properties, one of the project’s developers.
Holstein says CottonMill Marketplace is the largest privately-developed, non-industrial commercial real estate development in Mississippi’s history in terms of dollars invested. The total project investment from a capital standpoint is $176 million, he said.
“To our knowledge,” Holstein said, the development is “the largest effort between city, county and university in a true, public-private partnership to create a project that would have the magnitude of economic impact on the region that CottonMill Marketplace potentially can offer.”
The National Trust Community Investment Corp.’s function is to serve as a facilitator of the placement of federal historic tax credits and new market tax credits to the investment community, Holstein said. U.S. Bankcorp based out of Minneapolis, Minn. is the lead investor, he noted.
“The investment proposal that has been issued to us by the National Trust is the largest historic restoration investment in the history of the National Trust,” Holstein said. “Because of that we have an extraordinary responsibility to ensure that we perform under the terms of our agreement with the National Trust.”
“One of the loan covenant provisions is that Mississippi State University be a tenant in a portion of the Cooley facility and make an annual contribution towards the ongoing operation of the facility,” Holstein said.
Project officials must provide the National Trust “with sufficient documentation from both the university and IHL that will provide them sufficient assurance that both the IHL and Mississippi State University intend to provide sufficient economic support to meet their proportionate share of the economic needs of the Cooley Center,” Holstein said.
This information has to be filed by Friday, he said.
Various tax credits total $21.9 M
The specific numbers on the tax credits are as follows, according to Holstein:
• $10 million in federal historic tax credits.
• $6.7 million in Mississippi historic tax credits.
• $5.2 million in federal new market tax credits.
These figures total $21.9 million.
Project officials met with MSU President Dr. Mark Keenum Wednesday, Holstein said.
Holstein described the discussion regarding the university’s ongoing role and participation in the project as “extensive, ... open and thorough.”
“It hasn’t been resolved. We’re actively working toward a mutually agreeable solution,” he said Thursday.
“I would describe the Cooley Conference Center as a critical part of the overall structure of the development,” Holstein said.
Regarding where this places the project, Holstein said: “It puts us in the unfortunate position that the commitments we had made to the city, the county and the state – as well as MDA – may not be able to be fulfilled without an agreement with Mississippi State University and would require a reformulation of the scope of the project.”
MSU President Mark Keenum issued a statement late last week on the meeting with project officials.
“In a meeting on campus with the developers, we conveyed that the university is committed to honoring its agreement to sell the property for this very important project to Mississippi State and to the community. We certainly hope the developer will be successful in acquiring the necessary resources to move ahead with the Cotton Mills project,” Keenum said.
“Personnel at Mississippi State are continuing to work with the developers, and we hope to see the project advance because of what it can bring to our area,” Keenum said.
Sales deal extended
In October, the IHL Board authorized the sale of a total of 11.87 acres, including the property where the Cooley Building is located, along with the site of Mississippi State University’s Writing and Thinking program, at a price of $6.03 million.
At its April 16 meeting, the IHL Board granted a request from MSU to extend the sales offer from March 31 to May 30.
In a statement, Mayor Dan Camp says he’s worked closely with Comvest Properties LLC and Net Lease Developers LLC – the project’s developers – “to help them secure funding from the local, state and federal levels.”
Based on Camp’s statement, these funding efforts include:
• A city agreement to issue tax increment financing bonds.
• A resolution from the Starkville Board of Aldermen enabling project officials to take part in a newly-created Mississippi Development Authority program so they can secure state money.
“As mayor, I have participated in meetings with the developers and federal officials to secure multi-million dollars in federal tax credits for this project,” Camp said in the statement.
“The City of Starkville, through the mayor’s office, remains in close contact with the developers of the project and stands ready to do everything we can to help make the CottonMill Marketplace development a reality.”
In an interview, Camp said that if the project does not materialize, “that eliminates 1,000 permanent jobs” and $30 million in annual payroll with those 1,000 jobs – along with 3,000 construction jobs.
“It would have a tremendous negative impact on the community,” Camp said.
‘Critically important’
Camp and Greater Starkville Development Partnership President and CEO Jon Maynard both addressed the project’s potential benefit to Starkville and the surrounding region.
“There’s a lot of great anticipation in the community as to what it would bring to the Golden Triangle area,” the mayor said. “You need this in order to get other facilities to locate in our area,” Camp said, clarifying the term “facilities” to mean such projects as high-tech manufacturing.
“The Cotton Mill project is critically important to economic development in and around Starkville. The positive impact that this project will have on quality of life, additional retail and tourism will lead directly to additional jobs in all sectors,” Maynard said.
Maynard, who was traveling when reached Friday, said “the Partnership will jump in to assist in moving this project forward.”
On Thursday, Holstein said project officials received word from their Washington attorney Thursday afternoon that the National Parks Service agreed to the majority of their interior alterations requests to the Cooley Building. The National Parks Service has jurisdiction because the Cooley Building has been entered into National Register of Historic Places, Holstein noted.
The building was placed on the national historic register by the university in 1975, “not because of its historical architectural” aspects, but “because of its economic impact and job creation for the university, Starkville and Oktibbeha County when it was a functioning cotton mill,” Holstein said.
“From our perspective and vision with the city, county and the (GSDP) as well as the university, we saw this as an ideal opportunity to place the facility back into commerce and to serve as a connection between the university community, the Cotton District and Main Street Starkville. That’s why our logo for the development is ‘Linking the History to the Historic,’” he said.
As of early afternoon Friday, “the dialogue continues,” said Wendy Barthe Peavy, marketing and public policy director for Comvest Properties.
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Last Updated ( Tuesday, 28 April 2009 )
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