mincow 04-18-22 - Laserfiche WebLink

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Mr. Sobczak showed different iterations of the project with a Curtis Block save, with parking underground, etc. paired with massing studies that demonstrated a decrease in scale of buildings/density. All iterations were priced with contractors for real time pricing. The first version of CASTO's project cost$160 million with a $50 million gap in financing. The 2nd version resulted in a$118 million cost and a$30 million financing gap. The 3rd version came in at$69.5 million with an $18 million gap. It should be noted that these figures represent the hard cost of the project, and do not include soft costs such as legal, engineering, design, etc. costs. Mr. Sobczak commented that the costs on construction are likely only going to get worse. He added that his team has looked at the project a lot of ways over the last year and a half, and still has a lot of input to receive on the design. He summarized that the plan looks like one on which CASTO can execute, despite rising costs and interest rate pressures. Councilmember Kepple posed the hypothetical if the Curtis Block building were removed from the equation, how the $7 million saved in the project could be switched into more density in another area. Mr. Sobczak stated that it would cost$2 million to save the facade in the plan's current iteration. He was unsure how attractive it would be to take on more density, but he stated that CASTO could repurpose the $2 million and enhance something else. Director Leininger added that CASTO's plan is holistic and that discussion including the Curtis Block was important to the physical and financial function of the project. Councilmember Bullock stated his hope that the project will be an engine for downtown activity and that he was trying to understand the opportunity costs of each project pathways. He expressed caution about having buyers' remorse 10-15 years from now about something that failed to be included in the project. He reiterated that the city is undertaking with CASTO building a 50-year property during today's moment of crisis. He voiced his affinity for the previous plans compared to the current midrise renderings, as higher density helps the city raise more tax dollars. He asked if CASTO had considered commercial tenants to occupy space other than in frontage on Detroit, what types of tenants it was seeking, and whether Detroit frontages could be listed as Class A commercial properties. Mr. Sobczak replied yes and that all commercial spaces are intended to be dynamic, whether that involves restaurants, coffee shops, ice cream stores, or other active users. Councilmember Bullock followed up asking about a hotel analysis that was completed on the project, stating his desire for a small boutique hotel. Mr. Sobczak replied that a 100-120 key plan was what was analyzed, which fits into the boutique category. All operators thought that would be about where the market would be, with the hotel having 120 keys in the first plan and 100 keys in the second one. Councilmember Rader stated he liked the overall design and scale, as the development is occurring in his neighborhood. He noted his support generally for affordable housing and historic preservation. He expressed desires to fully restore the Curtis Block building and have the public square component of the project placed on the corner of the site as opposed to the middle of it. Director Leininger stated that good planning practice involves holding a corner with a building to give a sense of density/scale for the site. He added that with a corner public area, one loses the opportunity to program the space, which would be interfered with by road noise, buses, ambulances going to the ER next door, and the busy traffic going in and out of the health center. Mr. Sobczak added that CASTO's planning team agrees. Vice President Litten stated that he hadn't considered the noise from ambulances and other types of traffic. Councilmember Bullock 3