[Hold My Own]

WOW

Lynchburg is on the verge of spending its one-millionth dollar paying on a loan for Bluffwalk Center, a downtown hotel and restaurant complex.
City Manager Kimball Payne said that the city plans to wire the payment of about $247,198 on the federal loan on July 23. This would be the fourth straight year that the city, which backed the loan, has made the payment without help from Bluffwalk.
To date, the city has paid about $763,716 toward the loan.
“At this point I don’t anticipate that we’re going to receive the payment from Bluffwalk,” Payne said Wednesday. “They’re not making the money they need to make to satisfy their other obligations as well as make this payment.”
Hal Craddock, managing partner of the Bluffwalk developers, said the project’s revenue has increased, but not enough to make all of its loan payments. He is working to access tax credit funds that belong to the project so he can repay part of Bluffwalk’s debt to the city.
Bluffwalk’s developers got the $3.2 million loan from the U.S. Department of Housing and Urban Development in 2002 to help renovate two aged downtown buildings. HUD required City Council to agree to pay back the loan if the developers could not.
The developers made all payments on the loan until 2007, when the city made its first payment of $257,944 from its budget.
Since then, the city has made the payment with Community Development Block Grant money, which the city receives from HUD and uses for neighborhood revitalization, job development and other goals.
Bluffwalk has made smaller, interest-only payments each February without city help.
Bluffwalk is obligated to repay the city, but there is no timeline for that repayment.
Craddock said that the project’s financial picture is starting to look better. The hotel had 82 percent occupancy in June, its best month so far. “We need to have that be the norm, rather than the exception,” Craddock said.
Last fall Bluffwalk gave the city $10,000 to start repaying its debt, and it was setting money aside each month for future payments. That stopped this spring, when Bluffwalk started paying $2,000 per month to settle a lawsuit with an interior designer that Bluffwalk owed money to, Craddock said.
Craddock said the developers are trying to access $454,000 in tax credit money to make another payment to the city. Wells Fargo, which inherited Bluffwalk’s tax credit accounts from Wachovia as the two banks merged, is holding those funds.
The money belongs to Bluffwalk, but the bank can hold it until February 2011, Craddock said.
Wells Fargo wants financial audits of Bluffwalk before releasing the money, Craddock said. However, the audits for 2008 and 2009 have not been completed because of missing records on one of Bluffwalk’s Wachovia accounts.

Click for more:
http://www2.newsadvance.com/lna/news/lo ... ity/28539/

[Hold My Own]

Posted by Rational One on July 15, 2010 at 11:14 am


This is unreal. LU cant even get the City to approve things THEY want to pay for and effect the city in NO way however they continue to “loan” money.
If you “loan” someone money that has no intention on paying it back….is it still a loan? I suppose it’s like a tree falling in a forest with nobody around type question.

[From the class of 09]

The Bluffwalk is one of the nicer places to spend an evening. It’s too bad that they aren’t able to run it more profitably. But the part that is really ridiculous is that they don’t release quarterly financials since the city is making all these payments.

[Hold My Own]

They are prob thinking why would I supply financials NOW when I couldnt supply financials in the planning phase proving how a 200 room hotel costing millions would pay for itself? Nobody wants to see those financials b/c those financials dont exist. You cant turn that into a profitable venture. Call it like it is, it was a gift to revitalize the downtown area....dont say it was a loan.

[JK37]

I'm certainly distanced from this quite a bit now. But if I'm reading this correctly, the city is getting every ounce of what it deserves for going in on this. Am I right?

[BJWilliams]

I'm certainly distanced from this quite a bit now. But if I'm reading this correctly, the city is getting every ounce of what it deserves for going in on this. Am I right?

You are right, Mr Fettucine

[JK37]

Mr Fettucine

Huh? I don't get it.

[badger74]

It is nearly impossible for a small city to attract a first class hotel to an older downtown without some help from the city. The modest cost of around $250,000/year before property tax payments are deducted is not that bad to land a very much needed hotel to an area that scares many private developers--until now that there has been a hotel, and several other new restaurants etc built in what was recently a very dead area. Given the economy the hotel is doing OK and I think has helped be a catalyst to the success of new restaurants like Waterstone, Market on Main, The Depot, Shoemakers, Dish and Robin Alexander. Now you see private money moving into downtown at a nice clip. Everyone can second guess an idea but the results are speaking for themselves. Downtown L is much better than it was 10 years ago and if we ever get a strong economy it could really take off. Ay least downtown L is no longer a downer for the area.

A hotel expansion project in the much larger and more dynamic city of Madison, WI needed $16 Million in city aid to work.

http://host.madison.com/wsj/news/local/ ... 002e0.html

[Sly Fox]

I don't think anyone is arguing the rationale for city investment especially in huge projects like the one in your hometown. I think the frustration in this thread is that the city has put up roadblock after roadblock toward LU's self-funded development plans and then it turns around and underwrites a downtown deal under the thinly disguised idea of a loan. Frankly a million dollars seems like small potatoes if it can draw significant business to town.

[Hold My Own]

I'm fine with it. Just don't call it a loan. You will never see that money. And everything Sly said.

[JK37]

Supposedly the bluffwalk people are paying it back little-by-little even now, with a plan to do so in-full over time. But that's just what I was told by someone in advertising in L'burg.

[badger74]

Looking around at the LU campus it does not seem the city has hampered development THAT MUCH. Now there have have certainly been minor battles and quibbles over details but it appears in the end LU gets most of what it wants. As a one-time city planner this is par for the course. You fight a bit, compromise a few things and the thing gets built pretty much as planned. Normal political system. I don't think LU should have a complete blank check over its development and some of the early buildings were pretty bad/low quality.
It is also pretty common for major developments to help with infrastructure improvements around their project. How much is always the big question. As most of LU property is tax-free for the city you have that added dimension of little direct revenue from LU to the city coffers to fund infrastructure so you need to get that done up front when LU is paying a share. I want to see LU succeed financially but you have to see there are costs to the city that most private developments would be paying for through increased property taxes, etc. Both sides need to take a minute and look at where they want to be in 10 years. Then see what it will take $$$wise to get there.

[thepostman]

I agree to an extent badger. LU should cover some of the costs of infrastructure around the school, but I don't know how large of a sum. It is not like LU forced the city to approve all the businesses in and around wards road. Why there wasn't a better plan for pedestrian traffic and future growth when things began to develop up there is beyond me...so yes, LU should help some with the infrastructure, but lets not site here and pretend they are the only reason for traffic around that area...if LU has to help out then so do others...

[badger74]

I must admit I find all the concern over the traffic on Wards Road funny. Compared to any slightly larger city the traffic there is nothing much. A commercial zone should have heavy traffic--that's what makes it go. The maximum 10 minutes it takes to get through the area is nothing by real city standards. There are days it takes me half an hour to go a few blocks in Seattle. I never have seen anything like that in L anywhere.
Of course LU did not cause the traffic there. Many contribute. The pedestrian issue is the more important one as right now it is unsafe. And that shared entry with Sonic is bizarre and nuts too. A tunnel is probably the best solution to go by the tracks and to and from Wards Road. Don't know what it would cost--millions probably. Sounds like a good earmark project for the local House member.

[4everfsu]

I agree to an extent badger. LU should cover some of the costs of infrastructure around the school, but I don't know how large of a sum. It is not like LU forced the city to approve all the businesses in and around wards road. Why there wasn't a better plan for pedestrian traffic and future growth when things began to develop up there is beyond me...so yes, LU should help some with the infrastructure, but lets not site here and pretend they are the only reason for traffic around that area...if LU has to help out then so do others...

When I was at LBC all classes were at the old TRBC and Liberty Mtn was just that a mountain.
Ward Road was nothing but a big open field.

The only thing I remember driving into TRBC was the sign on the left for the CVCC.

[From the class of 09]

I must admit I find all the concern over the traffic on Wards Road funny. Compared to any slightly larger city the traffic there is nothing much. A commercial zone should have heavy traffic--that's what makes it go. The maximum 10 minutes it takes to get through the area is nothing by real city standards. There are days it takes me half an hour to go a few blocks in Seattle. I never have seen anything like that in L anywhere.
Of course LU did not cause the traffic there. Many contribute. The pedestrian issue is the more important one as right now it is unsafe. And that shared entry with Sonic is bizarre and nuts too. A tunnel is probably the best solution to go by the tracks and to and from Wards Road. Don't know what it would cost--millions probably. Sounds like a good earmark project for the local House member.

One of the area's cops I was talking to was adamantly against a tunnel because he said they are horrible for pedestrian safety. According to him assaults of all kinds are much higher because it is relatively closed off. He said they’ve had a number of problems even with the tunnel coming over from east campus.

[PAmedic]

One of the area's cops I was talking to was adamantly against a tunnel because he said they are horrible for pedestrian safety. According to him assaults of all kinds are much higher because it is relatively closed off. He said they’ve had a number of problems even with the tunnel coming over from east campus.

CAMERA

you'd be suprised how much passive surveillance deters crime

esp with signs indicating:

[Champion]

I love the bluffwalk area, restruants, and hotel, However; a lot of arguments don't make any sense. If the area is drawing in so much money, as was stated previously, then why can't the loans be paid back. Botom line is that it is not making nearly enough money. As a resident of the city i think that they need to cut off the area financialy and let it sink or swim. Tax rates in Lynchburg are already the highest in the central Virignia area. This project has proven that it is a money loser not a money maker. The city already has massive problems with the education budgets and properly compensating police officers on the city force. If this area doesn't make money then i don't see the need to pour money down a black hole as a beautifucaiton project. In terms of LU ... it really doesn't matter what Liberty proposes in terms of expansion....there WILL be a fight with the city. The only thing that LU has done recently that hasn't drawn a lot of fire from the city is the football stadium upgrades. Now we will have to see how easy it will be for 20,000 or so people to park on the mountain and get off of it!

[badger74]

So, then you must have predicted this massive recession that has been especially hard on such luxuries as hotels and restaurants?! Here's a fact--right now and for the last few years MOST hotels are losing money from the top hotels in Las Vegas on down. While taxes in L might be high for the area they are very modest in absolute terms. I pay less on two nice homes there than I do on one average townhome in Seattle. That's why so many people are looking to retire to Lynchburg. And the second reason people are now looking to retire there is we see an up and coming city with an improving downtown, better shopping, and even good college sports. The amount the city has spent for the hotel is trivial in the overall scheme and if Wells/Wachovia had not been such jerks there would have been money to pay the loans. Youi can thank your greedy banks for much of the hotel's problems--in more ways than one.

PS-A timely article about UVa having a zoning fight on its hands.

http://www2.dailyprogress.com/cdp/news/ ... ark/58317/

[rogers3]

So, then you must have predicted this massive recession that has been especially hard on such luxuries as hotels and restaurants?! Here's a fact--right now and for the last few years MOST hotels are losing money from the top hotels in Las Vegas on down. While taxes in L might be high for the area they are very modest in absolute terms. I pay less on two nice homes there than I do on one average townhome in Seattle. That's why so many people are looking to retire to Lynchburg. And the second reason people are now looking to retire there is we see an up and coming city with an improving downtown, better shopping, and even good college sports. The amount the city has spent for the hotel is trivial in the overall scheme and if Wells/Wachovia had not been such jerks there would have been money to pay the loans. Youi can thank your greedy banks for much of the hotel's problems--in more ways than one.

PS-A timely article about UVa having a zoning fight on its hands.

http://www2.dailyprogress.com/cdp/news/ ... ark/58317/

Banks and hotels haven't been on the best of terms lately. If you ever get to Charlottesville, take a look at the skeleton of a building on the downtown mall. My bet is that the taxpayers will be funding that property and it will be even pricier than The Bluffwalk project- plus it won't spur as much development, as that area is already pretty well developed.
In regards to Wards Rd., the city had a perfect opportunity to spread some development around about 8-9 years ago. A developer wanted to build a large retail complex at the intersection of Graves Mill and 501 (where Home Depot is). They were footing the bill for all infrastructure- I think the city's expenditures would have been in the 300,000 dollar range. The city planner and the planning commission denied their plans. One of the quotes I remember was the "we will determine where the next shopping center will be developed." A competing developer wanted to build as well, and was targeting some of the same retailers. The Graves Mill location was denied and the Wards Rd. (Wards Crossing) location was approved. The city planner at that time, Rachel Flynn, felt that ALL retail should be lumped together to prevent sprawl. Fast forward several years- people are complaining about Wards Rd. traffic and Home Depot locates on the original Graves Mill cite, prompting the city to spend more than a million in road improvements to the Graves Mill/Old Graves Mill intersection.

That is some forward thinking!

[badger74]

Actually is is most efficient for shoppers to have most choices close to each other. That's why you see things like auto malls with 10 big dealers all together in larger towns. Urban land theory supports this too. I was pretty sure that more recent large mall proposal was DOA (Near Billy Craft Honda)--the market is just no that big and they would mostly have to poach away stores from Wards Road. Traffic might be a minor headache but her economics were right on. Everyone is better off with most major retail tightly bunched. There is a reason Michigan Ave is Michigan Ave and two blocks away you can't give away a retail space. What they need to do is make the traffic flow as optimal as possible. I can see another major retail node forming out 221 to serve that growing population. OH, and bulldoze most of The Plaza or convert it to LU space. That thing is sucking the life out of that area.

[thepostman]

Actually is is most efficient for shoppers to have most choices close to each other. That's why you see things like auto malls with 10 big dealers all together in larger towns. Urban land theory supports this too. I was pretty sure that more recent large mall proposal was DOA (Near Billy Craft Honda)--the market is just no that big and they would mostly have to poach away stores from Wards Road. Traffic might be a minor headache but her economics were right on. Everyone is better off with most major retail tightly bunched. There is a reason Michigan Ave is Michigan Ave and two blocks away you can't give away a retail space. What they need to do is make the traffic flow as optimal as possible. I can see another major retail node forming out 221 to serve that growing population. OH, and bulldoze most of The Plaza or convert it to LU space. That thing is sucking the life out of that area.

Like you said in a previous post, compared to large cities Wards Road is nothing. I just think that there should have been a better pedestrian plan in place when developing that area. I know American's love their cars...but there is literally no sidewalks along most of that area of Wards Road...unless it has changed since I was last there.

You have college kids running across this busy highway..I am surprised somebody hasn't gotten hit yet. Maybe they have and I don't know about it...anyways..its just a dangerous area more so for pedestrians..I have a feeling Lynchburg does not want to embrace the college town they truly are..but that area could have even more life if it were more pedestrian friendly...

[rogers3]

Actually is is most efficient for shoppers to have most choices close to each other. That's why you see things like auto malls with 10 big dealers all together in larger towns. Urban land theory supports this too. I was pretty sure that more recent large mall proposal was DOA (Near Billy Craft Honda)--the market is just no that big and they would mostly have to poach away stores from Wards Road. Traffic might be a minor headache but her economics were right on. Everyone is better off with most major retail tightly bunched. There is a reason Michigan Ave is Michigan Ave and two blocks away you can't give away a retail space. What they need to do is make the traffic flow as optimal as possible. I can see another major retail node forming out 221 to serve that growing population. OH, and bulldoze most of The Plaza or convert it to LU space. That thing is sucking the life out of that area.

All I can say is that no city resident should complain about traffic woes because the city was active in pushing development along Wards Rd., a corridor that has little room to expand road-wise.

i think that the city would have been better off pushing development into the Graves Mill/501/Lakeside area. The city missed opportunities to have net income properties that are now in Campbell County. The demographics in that area are the strongest in the region. Had the Graves Mill center been developed, the likelihood of the center near Billy Craft might have been a reality. As one heads south on 221, the growth does increase, but it stops at Perrowville Rd, less than a ten minute ride to the 221/501 intersection. It is too bad that Flynn's economic decision has successfully grouped retail in an area that isn't the best for attracting the higher income shoppers along the fringes of Bedford County, Forest, and the Boonsboro area.

badger- you might find this an interesting read, based on your background. I came across it while doing a demographic study for a class and had this been around ten years ago, I wonder if our retail mix would look a little different.

[rogers3]

Actually is is most efficient for shoppers to have most choices close to each other. That's why you see things like auto malls with 10 big dealers all together in larger towns. Urban land theory supports this too. I was pretty sure that more recent large mall proposal was DOA (Near Billy Craft Honda)--the market is just no that big and they would mostly have to poach away stores from Wards Road. Traffic might be a minor headache but her economics were right on. Everyone is better off with most major retail tightly bunched. There is a reason Michigan Ave is Michigan Ave and two blocks away you can't give away a retail space. What they need to do is make the traffic flow as optimal as possible. I can see another major retail node forming out 221 to serve that growing population. OH, and bulldoze most of The Plaza or convert it to LU space. That thing is sucking the life out of that area.

All I can say is that no city resident should complain about traffic woes because the city was active in pushing development along Wards Rd., a corridor that has little room to expand road-wise.

i think that the city would have been better off pushing development into the Graves Mill/501/Lakeside area. The city missed opportunities to have net income properties that are now in Campbell County. The demographics in that area are the strongest in the region. Had the Graves Mill center been developed, the likelihood of the center near Billy Craft might have been a reality. As one heads south on 221, the growth does increase, but it stops at Perrowville Rd, less than a ten minute ride to the 221/501 intersection. It is too bad that Flynn's economic decision has successfully grouped retail in an area that isn't the best for attracting the higher income shoppers along the fringes of Bedford County, Forest, and the Boonsboro area.

badger- you might find this an interesting read, based on your background. I came across it while doing a demographic study for a class and had this been around ten years ago, I wonder if our retail mix would look a little different.

[Cider Jim]

As to pedestrian traffic, I just returned from visiting Huntington, WV, home of my beloved Marshall University Thundering Herd, and noticed that they had built TWO pedestrian bridges across 3rd Ave that are 4 lanes wide.

Wouldn't this look great across Wards Road with a big red LU on it?