HBU to make new 30-acre development

HBU to make new 30-acre development

By Mike Morris

March 21, 2013

Houston Baptist University’s plan to revitalize its southwest-side neighborhood with a 30-acre, mixed-use development anchored by a 5,000-seat arena, hotel and conference center got a $4.4 million boost from City Council on Wednesday.

The reimbursement deal, known as a 380 agreement, is between the city, the neighborhood’s economic development board and Beechnut Street Inc., a for-profit company run by the university. Much of the $160 million investment will occur along the U.S. 59 northbound frontage road between Memorial Hermann Hospital Southwest and Fondren.

R.E. “Corky” Dragoo, a member of the university’s executive council, said the company, as part of the 380 deal, will keep the property in private hands and on the tax rolls for 30 years after the end of the agreement.

“I just think it’s going to be an exciting transformation of the neighborhood and at the same time a really exciting opportunity for the city to discover that HBU is a growing and vibrant university,” Dragoo said.

In a separate but related deal, council also voted Wednesday to expand the economic development zone in the area and to grow its project list by $100 million, to tackle more drainage improvements in the flood-prone neighborhood, as well as more road, park and trail projects, and to enable it to offer more economic development incentives in the coming years.

Excited about the plans

City Councilman Mike Laster, who represents the area, said his constituents have expressed excitement about the university’s plans, which he called a critical step in developing southwest Houston.

“It will help reposition HBU’s campus to grow and prosper, and, yet, at the same time provide ongoing tax dollars because that property will remain on the tax rolls,” he said. “It just adds a level of excitement to that area for people to feel very good about the physical area and the redevelopment that’s happening there.”

Under the 380 deal, the city will use property tax revenue generated by the university’s development to reimburse the school up to $4.43 million: $1.5 million for roadways, $1.3 million for drainage and a detention pond, $615,500 for public tennis courts and parking, $545,650 for landscaping along U.S. 59 and in the Fondren esplanade, and $468,600 for demolition of existing structures.

“It’s not a transfer of city dollars over,” Mayor Annise Parker said. “They put their dollars up and then they recoup their dollars from the taxes generated.”

If construction costs less than projections, the city will pay the actual cost; the payments will stop after eight years, even if the maximum reimbursement amount has not been reached. Dragoo said he hopes the project will start later this year and finish by early 2017.

Creating jobs

In addition to the tennis courts, parking garage, hotel and arena for the school basketball team and performances, the project will add about 300,000 square feet of retail and office space, Dragoo said.

The effort will create about 300 jobs, Dragoo said. Under the 380 agreement, the university will see its maximum reimbursement reduced if the project fails to create and retain 150 jobs by the end of construction, and 200 jobs a year in all subsequent years.

Though the 380 deal is reflected in the local tax reinvestment zone’s expanded project plan, the two efforts were independent, said Ralph De Leon, who oversees such zones in the city’s economic development office. He said pairing them made sense, however, to better coordinate what officials hope will be the recovery of a blighted area. Much of the added area is open space or drainage ditches, he said, which could better direct runoff along U.S. 59, through nearby neighborhoods, to Keegan’s and Brays bayous to the south.

 

 

 

Other business

Also on Wednesday, City Council:

1 Delayed for voting for a week on whether to sue big banks for manipulating the LIBOR benchmark interest rate last year, an alleged collusion that officials say may have cost the city up to $9 million.

1 Set a public hearing for April 10 to gather input on revisions to the city’s development code, known as Chapter 42.

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