Brent Bryant, OKC’s economic development program manager, said the public financing is being used as an incentive to bring more growth to the downtown area.
“We’re turning the lights back on in three historic buildings,” he said. “The $12 million in TIF money is creating right at $88 million in additional investments. This will put new life into those areas, which is a good thing.”
Tax increment financing (TIF) agreements between the Oklahoma City Council, the developers and the OKC Economic Development Trust were approved Feb. 11. TIF funding is an economic development tool that cities are allowed to use in promoting development in underserved or blighted urban areas, Bryant said.
Fred Jones building
Topping the list is the development of the historic Fred Jones Ford Manufacturing plant, which will be transformed into the 21c Museum Hotel, Bryant said. City officials estimate the $51.6 million hotel and museum will be finished by mid-2016.
The Louisville, Ky.-based hotel company will receive $5.3 million in public funds through the TIF district 2, which extends from NW 13th Street to the old Interstate 40 alignment and from Interstate 235 to Western Avenue. About $3.3 million will be issued through a 20-year low-interest loan. The company will receive an additional $2 million as a one-time incentive payment after the project is complete.
The four-story brick building at 900 W. Main St. was built in 1917 by Henry Ford as a Model T assembly plant. Nearly 100 years later, the iconic building will be developed into a boutique hotel with about 135 hotel rooms, a contemporary art museum and a restaurant and bar inspired by regional culinary traditions, according to the company’s website.
Craig Greenberg, 21c Museum Hotels president, said the tax increment financing was instrumental in securing the deal.
“It’s extremely hard to finance a hotel project today, so this was critically important in making this happen,” he said. “It will be an excellent investment for the city with our ability to create [150] new jobs through the hotel and our food and beverage operation.”
An
estimated $78 million in public financing through eight TIF districts
has been allocated for development projects since 2000, creating about
$519 million in new investments, Bryant said.
More projects
» The Journal Record Building, 621
N. Robinson Ave., renovations. The overall project cost is an estimated
$26.7 million. Construction is expected to be complete by late 2015.
The Oklahoma City National Memorial & Museum occupies the west end
of the building.
Total TIF funding approved:
$4.75 million.
Of that, about $3 million will go to a 409-space parking garage.
Also, $1.75 million will help renovate office space in the building.
» Century Center, 100 W. Main St., renovations. The Oklahoman newspaper
is scheduled to move into the building later this year, Bryant said.
The $27 million redevelopment will consist of 93,500 square feet of
office space and about 6,500 square feet of other commercial, restaurant
or retail space.
Total TIF funding approved: $2 million.
About $800,000 will be a 15-year low-interest loan.
About $1.25 million will go to the developer as a one-time incentive payment.
TIF explained
Typically,
tax increment financing (TIF) is a method to use future gains, such as
increases in property values, to subsidize current improvements or
projects such as redevelopment of historic buildings.
Once
complete, the improvements generally result in higher real estate
values, consequently increasing the amount of property taxes.
“People
must remember, those property taxes went up only because of the
improvements that were made,” Brent Bryant, Oklahoma City’s economic
development program manager, said.
In
OKC, eight TIF districts have been established by the Oklahoma City
Council with primary focus given to District 2, which extends from NW
13th Street to the old Interstate 40 alignment and from Interstate 235
to Western Avenue.
When
a TIF district is created, property values are assessed at that time
and every year after that. When values increase, the difference between
the original assessment and the new property values is used to help
finance public and private projects.
According
to Bryant, TIF creates funding for public or private projects by
borrowing against the future increase in property tax revenue.
