The Carmel City Council voted Dec. 19 to give the Carmel Redevelopment Commission the power to purchase a $1.6 million parcel of land at the Monon Trail and Main Street that will be used to build a multi-floor parking structure for a $20-million mixed-use development by Chuck Lazzara and his son, Anthony.
Lazzara, owner of Ritz Charles, is building a mixed-use development with an upscale steakhouse under the business name Meridian Associates LLC. Monon and Main has been thrown out as a possible name for this mixed-use development. It will include office and retail space, townhomes for sale and a public plaza with some green space since the current empty field has long been a popular spot for events such as Jazz on the Monon and public viewing parties for events such as the World Cup. Homes owned by Lazzara have already been demolished to make way for the project, which is shooting for a 2017 completion.
CRC Director Corrie Meyer said the commission planned to buy some land in order to construct a parking garage, which will be open to the public and not just customers and tenants, in the development. The garage will be less than 35 feet tall and include two floors with parking on a deck, she said. It will have approximately 200 parking spaces.
Lazzara will build the parking garage and assume the risk of paying back any debt associated with it, but he’ll be able to use tax increment financing from the project to help pay back any debt agreement or purchase contract. Meyer said the City would own the garage until it is paid off by Lazzara and lease to him for $1 a year. The garage itself will be taxable, and those taxes can help pay off any debt, she said.
Meyer said there are layers of protection to make sure the debt is paid, including a minimum tax payment.
“What they’re guaranteeing is the annual loan payment, and that’s something similar that we’ve had the in past,” she said. “There will be completion guarantees. There will be a master guarantee and the individual owners in case he sells it to other people, we’d have that too.”
Meyer said by the CRC purchasing the land before the end of the year the assessed property value will likely go to zero since it would be owned a nonprofit government entity. Once the TIF is at zero, Meyer said the CRC would transfer ownership back to Lazzara in order to allow for an increase in property value since it would then be private land.
This reset will allow for maximum TIF funds to be generated, and Meyer said by doing it this way the city could see around $33,000 more annually or $668,000 over the life of the TIF district. The garage will cost between $3.5 million and $4 million, Meyer said, and so TIF funds won’t cover the entire construction cost, but that’s why the city is paying Lazzara $1,614,750 for the 1.68 acres of land. That money will be used to help complete the project and to construct the public plaza, which will be maintained by Lazzara’s company as well.
Meyer said the city also already needed to buy some of this land to obtain right-of-way for a Monon boulevard in the works. This is a larger version of the Monon Trail through the Midtown area in order to accommodate extra pedestrians and cyclists in the soon-to-be revamped part of town between Main Street and City Center Driver. More than $150 million in development is in the works for Midtown, and some of the first buildings will be complete in 2017.