20 Federal renovation project may be delayed | News, sports, jobs

YOUNGSTOWN — Youngstown officials and its consulting firm have met about a half-dozen times with the proposed redeveloper of the 20 Federal Place building downtown, although it has not yet been decided whether the City Council will hear a formal presentation as scheduled on Nov. 20.

“Things are going well,” Doug Rasmussen, CEO and managing director of Steadfast City Economic & Community Partners, the city’s consulting firm based in St. Louis, said of the 20 Federal Place project. “We are going through their financial model and their proposal for the building.”

Rasmussen is referring to Bluelofts Inc., a Dallas company, which was the sole respondent to the city’s request for redevelopment proposals for the nine-story building before the Sept. 16 deadline.

Before proposals were submitted, the timeline for the redevelopment of the city building at 20 W. Federal St. was for the City Council to choose the company that would undertake the project at its Nov. 20 meeting. That was still the plan after Bluelofts became the only interested party.

But that schedule remains uncertain, Rasmussen said Thursday. He said he should have a better idea next week.

“The goal is to move the project forward within the timeline, but we want to do our due diligence,” Rasmussen said. “It’s a balance between the two and then taking the presentation to the city council to get their feedback. Part of our due diligence is the financial model and capital stack.”

Founded in 2018, Bluelofts has purchased properties in Cleveland, Dallas, Fort Worth and Atlanta with plans to convert them into residential space.

The only project the company completed is the former Ohio Bell headquarters, now called The Bell, in Cleveland, which was redeveloped into 367 market-rate apartments with some retail and commercial space available. That was done with the help of another developer after his original partner, Wolfe RE Management LLC, faced foreclosure of its interest in the 16-story property. According to The Real Deal, a real estate publication, Wolfe, a frequent Bluelofts partner, lost two other projects to foreclosure.

The Bluelofts proposal for 20 Federal Place is to convert the building into about 125 residential units — some market-rate apartments and others to rent to the area’s workforce — with commercial space.

“It’s largely a housing project,” Rasmussen said.

Because the city has not accepted the Bluelofts proposal, it is not considered a public record, so the details have not been released.

A contractor completed a $7.4 million asbestos abatement and partial demolition project at the downtown building last month. The city received a $6.9 million state grant, announced in June 2022, to pay for most of that work.

Desmone Architects, a Pittsburgh firm chosen to redevelop the building more than three years ago, was awarded a $10 million state historic preservation tax credit, announced in December, for 20 Federal Place. That credit also includes a $14 million federal historic preservation tax credit.

Rasmussen said Thursday that the state tax credit requires the city to take the next step forward in the redevelopment of 20 Federal Place early next year.

“We’ve talked to the state, and not that we won’t meet the deadline, but we have the option to extend it,” he said.

One problem was that the city was delayed by the May 28 gas explosion at the Realty Tower, a former 13-story building near 20 Federal Place, and its subsequent demolition, Rasmussen said.

“The state recognizes the importance of this project to downtown,” he said of 20 Federal Place.

A Desmone umbrella organization, 20 Federal Place LLC, has a 40-year lease on the building and administers the tax credits. The lease could be terminated and it remains uncertain what role Desmone will play in a potential redevelopment of 20 Federal Place.

Desmone’s application to the state for the tax credits — filed without the knowledge of city officials — lists an $82.1 million project but provided no details.

In the proposal to the city accepted on June 16, 2021, Desmone proposed four floors of residential housing with a rooftop restaurant, a floor of rentable office space, a floor of coworking space, a dining room and activity space on the ground floor, and parking. a lot in the basement.

That project, which cost $49.1 million, has been rejected.

The city purchased 20 Federal Place in November 2004 after Phar-Mor, a national retail company, went bankrupt. The building was the Phar-Mor Center, the company’s headquarters. Previously, the 30,000-square-foot building was the flagship location of Strouss’ department store for decades.

There were 19 tenants, occupying about 20% of the building before eviction notices were served in July 2022. Some tenants were granted an extension.