Parking issues, steel prices jeopardize downtown student housing project
By Martin Kidston
A team of developers is urging the city to consider – with some urgency – a proposal to help pay the cost of expanding public parking in the downtown district, saying that rising steel prices have placed the project in jeopardy.
Jim McLeod, senior managing director and co-founder of Farran Realty Partners, said his firm is ready to move forward with a student housing project and parking garage on Front Street.
It's asking the Missoula Redevelopment Agency to contribute roughly $2.9 million to help pay a portion of the parking garage, a portion of which would be reserved for public use.
“We've got our contract ready to sign, and we understand what our costs are,” said McLeod. “But costs are rising every day with steel because of the tariff placed recently on China. This project is teetering a little bit, so we're looking for some assistance in a public-private partnership to make it happen.”
At its regular board meeting this week, MRA agreed the project has value to the downtown community and should move forward, and it's likely to support Farran's request at a future date.
Still, the firm is asking to “proceed without prejudice,” a move that would allow work to begin immediately and capitalize off current market rates. The city would then reimburse it's share of the cost at a later time. MRA has used the arrangement several times in the past.
“We've easily seen a 10- to 15-percent increase in construction pricing over the last 18 to 24 months,” said Pat Corrick, a managing partner and co-founder of Farran. “As of this week, we're going to see a $500,000 increase in steel prices because of the tariffs imposed on China. We want this project to happen, and we need help on parking to make it work.”
Chris Behan, assistant director of MRA, has spent the past few weeks pouring over a number of city plans, including the Greater Downtown Master Plan, the Front Street Urban Renewal District Plan and the Missoula Growth Policy, among others.
They all call for expanded public parking in the Front Street corridor, a downtown area eyed for high-density housing and retail to reduce sprawl in outlying areas.
“The Downtown Master Plan suggested, at a minimum, 535 spaces be located on Front, Main and Pattee streets,” Behan said. “Later conversations that evolved after the plan was finished felt that up to 700 spaces would be ideal for that area, given the potential growth.”
But just over 300 parking spaces were provided in the Park Place garage, which opened in 2013 at a cost of $10 million. Adding parking in a public-private partnership remains preferable to the city going it alone, MRA believes.
Behan added that plans for a new Missoula Public Library across the street from the proposed student housing project will include just 90 parking spaces. While that's more than what the library currently offers, he said, it's not enough to accommodate the library's projected use, which is expected to nearly triple.
“I think there's a parking issue there, and there will be other pressures well beyond parking in that area,” Behan said. “MRA must decide how much it wants to prioritize parking in the Front Street district, and how much the public should be involved.”
Aside from the question on parking, MRA sees value in the student housing project. The five-story, $30 million project will include 168 housing units built atop two levels of parking and 6,000 square feet of retail space.
That, along with other projects slated for the district, including a proposed Marriott Hotel on the corner of Front Street and Higgins Avenue, could bring an influx of new shoppers and residents into downtown Missoula.
“That's a lot of people, and it's going to impact any commercial neighborhood,” Behan said. “There should be a significant impact on retail businesses downtown.”
Over the past few months, downtown businesses have expressed frustration with the lack of activity on Front Street, particularly as it relates to the Mercantile, which has sat vacant for six years.
The Missoula Downtown Association, the Business Improvement District and local business owners have lobbied the city to clear the way for several proposed projects. They've also asked for additional parking.
“They've been clinging on for a long time,” Behan said. “One thing that's needed for the existing businesses and any additional business, which we certainly need, is an increase in the customer base. We can start creating that 24-hour, 7-day-a-week customer base in the downtown.”
The same plans referred to by Behan also note the impediments to new downtown construction. Parking and the high cost of building in the city's core ranked among the biggest challenges facing downtown growth.
McLeod said that while their recent Corso project on Russell Street included 224 units, it cost half as much as the proposed downtown housing project, which includes 168 units.
“That gives you an idea of the costs we're dealing with,” McLeod said. “This is an opportunity here to provide additional parking downtown. If we don't have parking, it will put pressure on Park Place, and that would have an impact on the downtown businesses.”
Contact reporter Martin Kidston at email@example.com