Gainesville will be selling the land on the midtown end of the Jesse Jewell Parkway to an Atlanta developer for $5 million, half the price the city paid for the 6.8 acres last year.
On Tuesday, the Gainesville City Council voted to resell the land to Terwilliger Pappas, which has plans to build restaurants, retail and apartments on the site. Councilwoman Ruth Bruner was absent, and all other council members approved the purchase.
The agreement approved Tuesday covers the purchase of 6.8 acres at 110 Jesse Jewell Parkway on the midtown end of the pedestrian bridge near Roosevelt Square. The city announced in September that Terwilliger Pappas had been selected as the developer for the property, and the company plans to build 220 apartments and 10,000 square feet of retail space on the lot.
Terwilliger Pappas also plans to purchase the 4-acre former Hall County Jail site at Main and Parker streets in midtown. That second phase of the $81 million project will have 180 apartments and 5,000 square feet of retail space.
Terwilliger Pappas will have the option to buy the former jail site for $3.6 million within 60 days of when the last certificate of occupancy for the first phase of the project is issued — or essentially, when the first phase on the land closest to the bridge is complete.
The city paid Hall County $7.2 million for the former jail site in 2012. The jail was demolished in 2017, and the land has been empty since then.
Although the city is losing money on the transaction, City Manager Bryan Lackey said Tuesday the investment is worth it. The officials who approved the purchases of both sites were thinking long term, he said.
“I don’t believe either of those City Councils believed they could get that in return,” Lackey said. “I believe they both knew that the investment in the community to make sure that we could get a quality redevelopment like what was shown, at its highest and best use, and I believe that is the case for both of these sites.”
Terwilliger Pappas will not have to pay property taxes for five years and will get a discounted rate for several years after that. Starting when the final certificate of occupancy for the project is issued, expected in 2022, the developer will not have to pay taxes for five years. For the sixth year, the developer will have a 90% abatement, and the abatement will decrease by 10% for the next eight years. By year 15, Terwilliger Pappas will be paying the full rate.
Lackey said Terwilliger Pappas has not requested to participate in the Midtown Tax Allocation District, another incentive for developers that lets property owners use the tax increases from new development toward the property improvements.
Lackey said Terwilliger Pappas offered $5 million in its proposal to the city.
Officials have long seen the properties as key to development in midtown. The city bought the property closest to the bridge last year, taking over a $10 million contract from the Northeast Georgia Health System. The property had been owned by developers who had plans for a hotel with a conference center and two 11-story office buildings, but that development was never built as the economic recession hit.
“I really think this is going to be a catalyst project for our midtown area,” Councilman Zack Thompson said. “I think this is an area that for decades, has not had any growth. It’s been kind of a stalemate.”
Mayor Danny Dunagan said he saw the project as a connection to midtown and was especially looking forward to its residential component.
“We’re going to have some downtown living, which we’ve always wanted for a long time, so we’re excited about this,” he said.