By J. B. Smith
City officials are confident they’ll finish negotiations in the next two months on the Brazos Promenade, a signature riverfront development, so it can launch in 2017.
But three weeks before the first vote on public funding for the project, details of the deal with Catalyst Urban Development remain blurry, even for the decision-makers.
Council and Tax Increment Financing Zone officials are still waiting for basic information on how much the mixed-use project will cost, how much public funding it will require and how different parts of the project will be phased.
“The council still has not heard what the developer is going to ask for infrastructure,” Mayor Kyle Deaver said. “Obviously, it’s a big question. . . . There’s a lot of infrastructure work that needs to be done.”
Deaver said he expects the request to be in the eight figures, though less than the record $35 million in TIF funds Baylor University received in 2012 for McLane Stadium. The TIF board is scheduled to vote on the request Nov. 4, and its recommendation would go to the council for two required votes in December. Also in December, the council would sign a development agreement and long-term lease for the project.
TIF funds come from a dedicated portion of the property tax revenue generated within the designated downtown zone.
James Nelson, chairman of the TIF board, said he’s eager to find out the bottom-line cost and a bit apprehensive about whether fellow board members will experience sticker shock.
“My thought is that they seem to be pretty supportive of the project,” Nelson said. “Everybody knows this is a huge project like McLane Stadium.”
Catalyst is proposing in the first phase of the project to build 264 living units and 44 units of flexible “live-work spaces” that could be used for restaurants, retail and office space. Work also could begin next year on a 170-car parking garage and possibly a 10-story boutique hotel with 120 rooms. Future phases include the renovation of the existing farmers market, plus destination restaurants and public recreational venues.
The TIF Zone has $14.7 million in uncommitted funds and expects to have $18.4 million by the end of 2017, said Melett Harrison, deputy director of housing and economic development. The TIF funds also could be bonded over several years to arrive at a higher amount, the strategy the city used with McLane Stadium.
The city will be seeking TIF funds for major environmental cleanup of the 16-acre riverfront development site, involving the removal of several feet of debris trucked in to be used as fill after the 1953 tornado. Depending on how contaminated the soil is, that project could cost several million dollars and take six months or more, city officials said.
Other potential public costs include:
• The parking structure on the north side of the tract, which could cost $3.4 million, assuming $20,000 per parking space.
• Landscaping and infrastructure along Webster Avenue with 18-foot-wide sidewalks, lighting and street trees.
• The reconfiguration of University Parks Drive to be a more pedestrian-friendly boulevard, with fewer traffic lanes and a traffic light.
• Improvements to the riverwalk itself and adjacent recreational areas.
In the previous negotiations for a riverfront development with developers Joe Beard and Rick Sheldon, the city considered giving a 20 percent match for the project, Duncan said. As the project ballooned in cost to $300 million, that would have resulted in a $60 million public contribution. That project was scrapped in 2014 because of financing issues.
This time, city officials said the public funding amount depends largely on an analysis of how much outside funding the project needs to be financially successful.
But council members said they have not yet seen the financial pro formas projecting costs and cash flow for the Brazos Promenade project.
“Obviously we need clarity,” Councilman Dillon Meek said. “We haven’t yet seen a really clear budget.”
Meek said he also has logistical questions about access to the Downtown Waco Farmers Market during construction. He said he wants more information about building materials and street design.
“I do trust this team,” Meek said of Catalyst. “I toured several of their sites in the Dallas area and I saw that their work is high-quality. They take great pride in their ability to build aesthetically pleasing, community-oriented spaces and they’ve consistently done so for the last 20 years.”
Still, Meek said he would like the city give the public more avenues to give input on the design details of the public spaces.
“I think that sort of input is critical,” he said.
Farmers market board President Sara Shoup said a meeting with city and development officials is being planned to talk about impact on the farmers market.
Shoup said she hopes the farmers market can remain open during construction and that it can ultimately be enhanced with better electrical and water utilities, as well as access to public restrooms.
The Brazos Promenade project is the third riverfront redevelopment proposal the city has entertained over the years. In 1984, the city gave a long-term lease to a California-based partnership called La Jolla Investments to build a $100 million complex with a 200-room hotel, office buildings and retail centers, along with a landscaped riverwalk.
The firm reportedly spent $2 million on the property, including $850,000 it handed to the city to build the riverwalk. But the project fizzled out in the real estate bust of 1987, with nothing built but the riverwalk.
The Beard-Sheldon proposal ended in 2014 before the city had made any firm commitment to it. The partnership said legal and environmental restrictions on the land and the changing priorities of their financial backers caused them to pull the plug.
Nelson, the TIF board chairman, said he thinks this project is sound, but he wants to make sure.
“If this fails again, it’s another black eye on the river,” Nelson said.
Councilman John Kinnaird, a banker, said Catalyst has a proven track record with even bigger projects in the Dallas-Fort Worth Metroplex.
“I’m satisfied they have the wherewithal to do what they say they’re going to do,” Kinnaird said.
“They’ve demonstrated they have financial ability to get the job done,” he said. “I certainly have confidence based on what they’ve done in the past.”
Deaver said the project should be transformative, not just in cementing Waco’s reputation as a tourism destination but in making downtown a hub of Waco’s life.
“It’s going to become more of a neighborhood where people can live and work,” he said. “If you look downtown now, there’s a lot of young professionals and empty-nesters moving there. I think there’s a strong and rapidly growing demand. . . . This is a huge step toward continuing the revitalization of downtown.”