Tue June 4, 2013
Bold Visions Compete For Eastland Mall Redevelopment
Two developers have offered bold visions for what the closed Eastland Mall could become.
One proposal focuses on building movie studios while another would create an entertainment complex with a ski slope, ice skating rink and skateboard park.
Both developers, who submitted formal proposals to the city of Charlotte on Friday, also envision residential and retail construction in later phases.
But their distinct visions will offer a clear choice for city staff, and ultimately the Charlotte City Council, which will likely select a developer this summer. Both proposals call for some sort of public investment, but neither gives a specific dollar amount.
The city bought Eastland for $13.2 million last year, and council members voted last week to spend $781,520 to demolish the mall because neither developer said they would want it. Redeveloping the site is seen by the city and nearby residents as a key to improving the eastside, which has suffered as affluent residents have left in recent years.
Democratic council member John Autry, who represents east Charlotte, said he thought both plans were “bold and ambitious. … Either one would be transformative.”
He said he doesn’t think there may be a significant amount of public money available for the project. “(Paying for) the demolition may be it,” Autry said.
Studio Charlotte Development is a partnership between Charlottean Bert Hesse and PacificaVentures LLC, a group that has developed new film production studios in Albuquerque, N.M., and Philadelphia.
Hesse is president of Central Avenue Pictures, which has a presence in Charlotte and Los Angeles.
The first phase of his project would be at the back of the 80-acre Eastland site, and would be a 270,000-square-foot building with eight soundstages, production offices and a film school that would partner with local universities. The building also would include a 50,000-square-foot museum that would “educate and entertain” visitors about the movie industry.
After that is built, Studio Charlotte Development envisions possibly a hotel, residential units and nearly 140,000 square feet of retail space, some of it along Central Avenue.
ARK Ventures is a partnership between Rick and Noah Lazes, who built the N.C. Music Factory on the edge of uptown. They have teamed with Wagner Murray Architects of Charlotte and developer Ryland Homes.
The focus of ARK Ventures is to build what could be called an entertainment/activity center on 27 acres of the site. This could include a 40,000-square-foot ski slope, a skateboard park, a wave pool, ice skating rink and a gymnasium. The first part of the project would also include a 60,000-square-foot office building.
“People are leaning towards entertainment in a healthy way,” said David Wagner of Wagner Murray Architects.
He said the $51 million center would be integrated into the nearby neighborhood.
“It’s like Coney Island in the 1920s, where the amusement park was built right next to the neighborhood,” he said. “We abandoned that, but there are historical models.”
ARK Ventures said a movie studio could be built in a later phase of development – but not as a primary driver for Eastland.
“Our argument was, you can’t build a movie studio as an income generator,” Wagner said.
The Lazes have experience with movie studios. ReelWorks Studios is part of the N.C. Music Factory.
The Lazes also recently made a push to renovate the uptown Carolina Theatre. But council members selected the Foundation for the Carolinas for the project.
A team of city officials, along with a consultant, Partners for Economic Solutions, will review the two proposals. They will present their analysis to the City Council’s economic development committee July 18. After that, the full City Council could vote on which developer gets the job, if any.
Earlier this year, a third developer was interested in Eastland. But that group – California-based Film Studio Group – backed out because the firm felt the city wasn’t willing to provide enough public money for the project.
It isn’t clear how much public money the city is willing to spend on Eastland. It’s possible the city won’t recoup the $13.2 million it spent to buy the site, and it might not recover the nearly $900,000 it plans to spend to take down the mall.
The city has said it doesn’t want to be a major financier for the project, but hasn’t given an exact dollar amount of how much it is willing to spend.
In its proposal, ARK Ventures suggested that a number of the projects be subsidized by what’s known as tax-increment financing. If TIF is used, a developer would be reimbursed for part of the construction costs based on new property taxes generated.
ARK Ventures said it would be “impossible” to fund the project through “conventional debt and equity sources … without some city/county funding sources or tax credits.”
In his proposal, Hesse noted Pacifica Venture’s ability in 2004 to buy Culver Studios in California for just under $125 million. But he also said that “cities, counties and states continue to aid the capital stack by providing grants, tax credits, film incentives, bonds, TIFs (among other incentives).”
In an interview Monday, Hesse said it’s important – but not critical – that North Carolina continue a generous incentive program for movies and television shows filmed in the state. That tax credit, which can give studios a rebate of up to 25 percent of their expenses, has helped the state land productions such as the TV show “Homeland.”
Hesse said he didn’t think the General Assembly would repeal a tax credit that “generates eight or nine times as much in new spending.”
High hopes for site
Eastland was once the commercial hub of east Charlotte. But it lost business to other malls such as SouthPark and Concord Mills, and anchor stores began to close last decade.
The mall site had several owners, and the city bought the property so a developer wouldn’t have to negotiate with multiple people.
The city’s long-term vision for Eastland has been a walkable community of homes, stores and offices. Both proposals would fulfill that vision if they are fully built.
After the entertainment/activity center is built, ARK Ventures would build office buildings and residential units. The site would have a large pond, and a greenway circling the entire 80 acres.
Hesse’s plan also calls for having significant natural features, including a “waterway corridor” running through the site. The second phase of his project would be the The Forum, which Hesse describes as an international marketplace.
Hesse said the main part of his development – the movie studios and film school – would have roughly 1,400 people working there. He said that’s enough people to support some nearby retail.
More at CharlotteObserver.com