ECU in talks to build downtown hotel, Millennial Campus
By Ginger Livingston
The Daily Reflector
Friday, September 13, 2019
ECU is in active discussions to bring more development into the downtown/Dickinson Avenue areas, the vice chancellor for administration and finance reported during the Board of Trustees' Thursday committee meetings.
Sara Thorndike outlined discussions that are underway to build a hotel in downtown Greenville and begin work on the long-envisioned Millennial Campus, an opportunity for public-private partnerships that would serve the university and stimulate the business community.
The project involves the Warehouse District, which encompasses land between Clark Street and the Dickinson Avenue corridor,
Earlier in the year, the university released a request for proposal to begin development of the project. Several offers were submitted.
"Only one of them ended up being financially viable for us, but it is one that we are really excited about," Thorndike said. "We are currently having very active discussions with that particular company who's also interested in one of the master development plans for the whole area which is an exciting endeavor."
She did not identify the company because negotiations are ongoing.
The company's immediate focus is on the Export Leaf Warehouse and two other buildings, she said. The buildings qualify for the North Carolina Mill Tax credits and federal tax credits that would offset the cost of renovating them.
The university is working on a potential memorandum of understanding that would lay out the parameters of a partnership.
The university does not want to sell the warehouse district land, so it will need to do an Estate for Years transaction where the university leases the property to the company for 60 years or longer, Thorndike said.
Such public-private development partnerships usually require a university to agree to lease a large amount of the redevelopment property, something ECU did not want to do, Thorndike said. The company has agreed the university only will need to least 10,000 square feet.
The transaction will need approval of ECU's Board of Trustees, the UNC Board of Governors and the North Carolina Council of State, which must approve it because an Estate of Years lease is treated like the sale of state-owned property.
"I don't know if that's the right way to do it. I think we should be creative," Trustee Fielding Miller said. He questioned if it would be better to sell the land and use the revenue on other capital projects or perhaps partner on the renovation.
Thorndike said the university isn't able to fund a revocation project. It also would not benefit from the tax credits. The sale amount would be no more than the lease payment, she said, and ECU benefits from maintaining ownership of the land in the long run.
Time constraints are involved, she said. The mill tax credit ends in January 2023 and to receive it, the renovation works needs to be completed and the building occupied by that time, she said.
Thorndike said she hopes to bring a memorandum of understanding to the board in November for approval. It then would go to the Board of Governors in early 2020.
A master plan written by the university nearly 10 years ago proposed developing a visual and performing arts center, a hotel and conference center and alumni center on property the university owns along Reade Street.
While the construction on the Main Campus Student Center has eliminated the need for a conference center, discussions about partnering to build a hotel downtown never ended.
This summer, the university released a request for information to determine if a private developer would be interested in partnering with the university on the project, Thorndike said.
While a number of proposals were received, two companies made a financial proposal. Thorndike said a letter of intent was developed with one of the businesses.
"They have great ECU connections and we are very excited about them," she said.
"They do develop other hotel properties," Thorndike said. "This is a request for information versus a request for proposal but we are still very much negotiating with them."
She did not identify the business because negotiations are ongoing.
The hotel would be located in one of the university-owned parking lots between Third and Fourth streets. University officials and representatives of the company plan to meet with Greenville city planners to discuss what steps must be undertaken to rezoning property, Thorndike said. The rezoning is needed because the company wants to bring the hotel to the sidewalk's edge, placing parking in the rear.
"We are excited by this opportunity," she said. "It would be franchised hotel but it would be ECU branded. It would look like an ECU hotel. We would be getting some revenue on an annual basis off this property.
The university would lease the property to the builders, using a more traditional ground lease.
Thorndike said she hopes to bring a lease proposal to the board in November. While there aren't time constraints, Thorndike said the university would like to see the process continue and the proposal will be approved in November. It will also need the board of governors' approval.
The various committees also took the following actions:
- A College of Business program has been renamed for the second time in two years.
Last year the Small Business Institute, which provides on-site management assistance to small business owners while giving entrepreneurship students practical business experience, was renamed the Entrepreneurship Center and housed in the Miller School of Entrepreneurship. However, the name proved confusing. Jay Golden, vice chancellor for Research and Economic Development, said a donor has provided funding to rename it the Small Business Resource Center.
- Renewed the lease for the ECU Pediatrics Family Autism Center, 108 Fire Tower Road. The lease rate will be $49,800 per year for three years.
The Board of Trustees will meet today beginning at 8:30 a.m. when the newly formed Advocacy Committee meets in the Trustee Parlor, Main Campus Student Center, 10th Street. The full board will meet at 9 a.m. in Ballroom C of the student center. A detailed schedule and meeting materials are available online at www.ecu.edu/bot.