WILMINGTON — The Water Street Parking Deck has once again made its way to Wilmington’s City Council agenda.
The city approved an additional $7.6 million increase to the project cost in August, which had a 45-day deadline for the city to transfer the air rights to Water Street Ventures, that deadline expired Sept. 30, and the developer, Water Street Ventures has failed to get a loan.
According to documents submitted to the City Council, Water Street Ventures is now requesting until Dec. 29 to complete the transfer of the air rights. Since the city is unable to seek financing until after the developer, documents state that the city will be unable to seek financing until at least January of 2018.
“The developer must complete their loan approval process prior to the City being eligible for consideration of temporary project financing. The timing in this sequential process dictates that the City cannot now seek loan approval until at least the January, 2018,” according to the document submitted by City Manager Sterling Cheatham.
The deadline extension, if approved will be mark more than one year after the city first approved the transfer of the air rights to Water Street Ventures in June of 2016.
According to an email from Malissa Talbert, communications manager for the City of Wilmington, “The amendment is needed because the timing sequence of financing for the developer and the city don’t line up. The developer must complete their loan approval process before the city can get needed temporary project financing and this amendment would provide adequate time for East-West’s financing to be approved.”
The request also amends the previous contract in several other ways as well including:
- The closing on the air rights will no longer be the trigger on which the construction timetable is based. Closing is dealt with separate from the construction schedule.
- Construction of the project will begin after Water Street Ventures requests from and receives a construction release from the city. Once that release is granted, Water Street Ventures has 30 months in which to complete the entire project.
- Water Street Ventures will be allowed to begin demolition of the second floor of the parking deck after seeking and being granted a construction release from the city.
- Demolition of the Water Street Deck will be defined as removal of the upper floor and the supporting structural members. No excavation or subsurface work is included in demolition. Bonding for this portion of work will be at 100% as opposed to the 125% required for the construction portion of the project
- If Water Street Ventures elects to delay construction of the new facility following demolition, they will be required to repair, pave, and stripe the parking lot so that the City may temporarily use the property as a parking lot.
If not approved, the Purchase and Development Agreement (PDA) would remain unchanged from the August amendments, and construction would likely be delayed until at least January 2018.
This is not the first developer that has failed to meet a city deadline, in August, Port City Daily reported on a developer’s failure to provide bathrooms to the Riverwalk within the allotted time. As of now, the bathrooms are still not built and the city’s legal department will not comment.
When asked if the company would face any repercussions for failing to comply with the contract, Talbert said, “The 29th kicks in a 30-day period for the city to notify the developer that they need to comply. In reality, Council will have voted before they even would have received the letter, so it’s a moot point.”
Michael Praats can be reached at Michael.p@localvoicemedia.com
