Rio Nuevo has two $100 million proposals to develop its land near the Tucson Convention Center on the table.
The board voted 4-1 Tuesday to publicly interview the two bidders in a final evaluation before it selects a winner to purchase and develop the approximately 8.5 acres of Rio Nuevo land, now occupied by the Greyhound Bus Depot.
In May, the district sought bids on the property behind the TCC along Granada Avenue, east of Interstate 10 and north of Cushing Street.
Both bids promise to transform the site of the current Greyhound station into a vibrant western gateway to downtown. To accomplish that, both include plans for a hotel, parking garage and some mix of apartments, office space, and restaurants and shops.
Both bidders also have a history with the property.
Developer Allan Norville owns about 10 acres adjacent to the property. Earlier this year, the board agreed to a stipulation that whoever winds up developing the Rio Nuevo land would build Norville a 1,200-space parking garage for his planned 120,000-square-foot exhibition center.
The other bidder, Peach Properties, won a bid for the parcel in 2009 when the city ran Rio Nuevo. But Peach wound up filing a $1.9 million claim when, according to Peach, the city reneged on the deal.
Peach has yet to file a lawsuit. If it does, and prevails, Rio Nuevo would pay for the city’s costs as part the two entities’ 2013 settlement.
So how do the two developments stack up?
- Estimated cost of $100 million.
- Would pay $5.6 million for the land.
- Hotel with 140 rooms.
- Eight buildings, including Norville’s exhibition hall, which he will build on his existing property.
- Ninety-six unit apartment complex.
- Estimate cost of $111.8 million.
- Would pay $5.4 million for the land.
- Hotel with 160 rooms.
- Twelve buildings.
- Three-hundred twenty apartments.
Both development plans would seek various forms of tax and other incentives from the city and Rio Nuevo to partially fund their projects.
Rio Nuevo board members ranked the two proposals prior to Tuesday’s meeting.
Even though they scored Norville’s proposal higher (5290) than Peach’s (5115), they weren’t comfortable picking a winner just yet.
Board member Mark Irvin said while both proposals looked solid, he still had plenty of questions to pose before he could support one over the other.
The majority of the board concurred and voted to hold a special meeting within the next few weeks to interview representatives for both proposals to flesh out more details.
Board member Alberto Moore opposed the interview plan, fearing it could drag the process out for weeks or months and cost both developers more money.
Norville had hoped the board would have settled on a final decision yesterday.
“We would prefer that they picked a winner. We had the best score,” Norville said. But it’s the process, so we’ll adhere to it and prepare for it. We have a great team and will be ready for the presentation.”
Ron Schwabe of Peach Properties said it’s been a long road regarding his company’s pursuit of the property and he is looking forward to stating his case during the interview.
Once the board picks a winner, it would then enter into negotiations to hammer out a final agreement.
Rio Nuevo Chairman Fletcher McCusker said unlike some past Rio Nuevo deals, a final agreement would likely entail provisions that would revert the property back to the district if development falters.
“We don’t want to turn a development loose and then not have any benchmarks tied to it,” McCusker said.