Folwell said this already agreed-upon element of the memorandum of understanding "puts a gun to my head" and added it "sends the wrong message, if another body doesn’t approve something, the unspoken taxpayers of New Hanover County are going to have to pay this developer $2.5 million." The county performed a market study to ensure it would receive the full market value for the disposition of its property and feels comfortable with the $2.5 million value it will receive from Zimmer, versus opening it up in an open sale, Wurtzbacher said.Ī new provision in the agreement includes a clause that the county will purchase development plans from Zimmer for $2.5 million if the LGC doesn’t approve the deal (the amount was $800,000 in the initial memorandum of understanding approved last year). “I would think a lot jumping on that,” Wood said. Only two firms responded to the county’s request for qualifications for the project, and Zimmer alone submitted a proposal. Wood locked in on the lack of competition Zimmer faced in submitting its proposal. State Auditor Beth Wood pointed out the unknown of how much tax revenue a different kind of development could generate (the county’s analysis put this new tax revenue value in the design-build scenario at zero, which she disagreed with). ![]() Those costs would be offset by the creation of an estimated $11.6 million new revenue stream generated by taxes from the enhanced value of the private portion of the block, according to the county’s analysis. The difference between the county’s total 20-year lease costs to Zimmer ($80 million) compared to a traditional design-build scenario ($66.8 million) is about $13.2 million, according to a county presentation. New Hanover County enjoys a triple-A bond rating, the highest municipal rating available, and can access financing for a lower interest rate than the rate of return Zimmer is seeking: the county can obtain financing at about 3.25% interest rate, Wurtzbacher said, and Zimmer has locked in its lease values at 8%. Provisions Wurtzbacher cited include the ability to ensure the project is completed in a timely manner and the inclusion of 5% workforce housing for the multi-family portion of the development. On Tuesday, LGC members’ recurring question for the county seemed to be: Why not just finance this project yourselves?Īssistant county manager Lisa Wurtzbacher told the board that under a public-private partnership agreement, the county could dictate certain elements about the development of private land that it otherwise has no control over under a traditional land sale. In a recent similar deal when the county was seeking public-private partnership for the redevelopment of its government center, the LGC stepped in and encouraged the county to renegotiate, according to WHQR. The governing body that oversees large financial transactions for the state's municipalities and other units of government, the LGC has the ultimate authority to approve the project. The county would retain land ownership of about two-thirds of the block while the developer would own the structures for 20 years it would sell the 1.2-acre portion of the block facing Chestnut Street to Zimmer for $2.5 million to be developed into a mixed-use facility.Ībout 100 residential units and about 150 hotel rooms are planned, along with about 10,000 square feet of retail. would finance and reconstruct the entire block, then lease the museum-library and parking deck back to the county for a 20-year term. In the arrangement proposed by the county, Zimmer Development Co. The current library would be razed to make way for the new build, but library use would remain uninterrupted as the construction shifts the public resource from Chestnut to Grace street. The project entails the renovation of an entire block of downtown Wilmington, involving the construction of a new public library and museum, hotel, multifamily housing and retail. Local Government Commission’s hot seat Tuesday as they faced questions and at times scrutiny over Project Grace, a proposed public-private partnership. ![]() ![]() New Hanover County officials were in the N.C.
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