20 Federal reconstruction project may face delay | News, Sports, Vacancies

YOUNGSTOWN — Youngstown officials and its consulting firm have met about a half-dozen times about the proposed redevelopment of 20 Federal Place downtown, although it has not yet been decided whether the City Council will hear a formal presentation as planned on Nov. 20.

“Everything is going well,” Doug Rasmussen, CEO and managing director of Steadfast City Economic & Community Partners, an urban consulting firm based in St. Louis, said of the 20 Federal Place project. “We are looking at their financial model and their proposal for the building.”

Rasmussen is referring to Bluelofts Inc. of Dallas, which was the sole responder to the city’s request for proposals to renovate the nine-story building by a Sept. 16 deadline.

Before soliciting proposals, a timetable for renovating the city-owned building at 20 W. Federal St. stipulated that the City Council would select a company to carry out the project at its November 20 meeting. This was the plan even after Bluelofts became the only interested party.

But that timeline remains uncertain, Rasmussen said Thursday. He said he should have a better idea next week.

“The goal is to move the project forward on schedule, but we want to do our due diligence,” Rasmussen said. “It’s a balance between the two and then making a presentation to the city council to get their feedback. Part of our due diligence is the financial model and capital size.”

Bluelofts, founded in 2018, has purchased properties in Cleveland, Dallas, Fort Worth and Atlanta with plans to transform them into residential space.

The only project the company has completed is the former Ohio Bell headquarters, now called The Bell, in Cleveland, which was converted into 367 market-rate apartments with some affordable retail and commercial space. It came with the help of another developer after its original partner, Wolfe RE Management LLC, faced foreclosure on its stake in the 16-story building. Wolfe, a frequent Bluelofts partner, has lost two other projects to foreclosure, according to The Real Deal, a real estate publication.

Bluelofts’ proposal at 20 Federal Place is to convert the building into about 125 units of housing – some market-rate apartments and others for local employee rentals – with commercial space.

“It’s basically a housing project,” Rasmussen said.

Because the city did not accept Bluelofts’ proposal, it is not considered public, so details are not being released.

Last month, a contractor completed a $7.4 million asbestos abatement and partial demolition project. The city received a $6.9 million state grant, announced in June 2022, to pay for much of this work.

Desmone Architects, the Pittsburgh firm that was selected more than three years ago to renovate the building, received a $10 million state historic preservation tax credit announced in December for 20 Federal Place. The credit also comes with a $14 million federal historic preservation tax credit.

Rasmussen said Thursday that the state tax incentive requires the city to take the next step forward in redeveloping 20 Federal Square by early next year.

“We’ve talked to the state and it’s not that we won’t meet the deadline, but we have the option to extend it,” he said.

One problem was that the city was delayed by the May 28 gas explosion at the Realty Tower, a former 13-story building near 20 Federal Square, and its subsequent demolition, Rasmussen said.

“The state recognizes the importance of this project to downtown,” he said of 20 Federal Place.

Desmone’s parent entity, 20 Federal Place LLC, leases the building for 40 years and controls the tax incentives. The lease could be terminated, and it remains unclear what role Desmon would play in any potential redevelopment of 20 Federal Place.

Desmon’s application to the state for tax breaks, submitted without the knowledge of city officials, lists the project as costing $82.1 million but does not provide details.

In its proposal to the city, accepted June 16, 2021, Desmone proposed four floors of residential building with a rooftop restaurant, a floor of rental office space, a floor of co-working space, a ground-floor food hall and activity space, and parking. area in the basement.

This $49.1 million project was rejected.

The city purchased 20 Federal Square in November 2004 after Phar-Mor, a national retail store company, went bankrupt. This was the Phar-Mor center, the company’s headquarters. Before that, the 332,000-square-foot building was Straus’s flagship department store for decades.

Before the eviction notice was sent in July 2022, there were 19 tenants occupying about 20% of the building. Some tenants were given a reprieve.