With a unanimous vote and a new start for the project, the New Hanover County Board of Commissioners is moving forward with an agreement involving a county-owned block in downtown Wilmington.
Through a development agreement
approved Monday, the county is working with Wilmington-based firm Cape Fear Development to create new buildings on the block, bordered by Chestnut, Grace, Second and North Third streets.
Referred to as Project Grace, the initiative has been in the works for more than six years, with a previous plan halted when the Local Government Commission, a state division, failed to approve the financing arrangement the county wanted to have with its previous development firm partner on the project, Zimmer Development Co.
"Cape Fear Development has reviewed design plans that were purchased by the county [from Zimmer for $2.5 million] to determine value-engineering items that can reduce the cost with little impact to the customer," said Lisa Wurtzbacher, assistant county manager, in a presentation to the board of commissioners Monday morning. "The plans still include a purpose-built that includes a modern library and museum. That's a three-story facility that's approximately 94,000 gross square feet inclusive of programmable space throughout the library and museum, shared space, a loading dock and an outdoor terrace."
In the new plan, the county's cost for the new museum and library, parking deck improvements and development fee of $3.5 million would not exceed $60,524,860.
"The deal is distinctly different from the previous arrangement that you saw primarily due to the method of financing the public facility," Wurtzbacher said Monday. "Rather than financing through a lease with the developer, the public facility would be financed through limited obligation bonds, taking advantage of our triple-A bond rating and our borrowing capacity. This leads to a reduced interest cost for the county."
The agreement with Zimmer Development would have resulted in the county paying $80 million to the firm to lease the library and museum facility for 20 years.
Wurtzbacher said the county's staff believes the new deal will likely be more palatable to the Local Government Commission, and county officials hope the LGC will vote on the new financing method at its September meeting so construction on the new library and museum could start in October. That's only if county commissioners give their final approval to the plan in July.
According to the agreement with Cape Fear Development, once the new museum and library facility and parking deck improvements are substantially complete, the county will sell the south parcel of the property to Cape Fear Development for mixed-use private development.
"Cape Fear Development has committed to pay no less than $3.5 million for the south parcel property [where the existing main branch of the library is located]," a county news release stated. "Two appraisals will also be conducted for the property, and Cape Fear Development will pay the higher of the two appraisals if it is more than $3.5 million."
The development company's private investment, which could include residential and commercial space, is expected to be at least $30 million, and construction on that part of Project Grace would have to start within 24 months of the library and museum facility's completion.
In addition to evaluating costs, Cape Fear Development launched a community outreach campaign late last year.
"Our public outreach discussions have been ongoing and will continue through the completion of the project. The project is a large undertaking. It represents a significant investment not only by the county taxpayer, but in time invested by county staff, design consultants and local construction partners," said Mike Brown of Cape Fear Development, speaking during the public hearing portion of Monday's board of commissioners meeting. "And given that commitment, we wanted to make sure the community was behind this project. Since November we've presented to countless community groups and individuals ... and asked for their concerns, critiques and encouragement or whatever the case may be."