Carmel City Council considers $8 million bond to redevelop former Party Time Rental site
The Carmel City Council will consider an $8 million bond to help pay for infrastructure improvements needed to construct a $60 million mixed-use development by Anderson Birkla called The Proscenium.
The project is situated on 6.5 acres at 1212 N. Range Line Rd. across from the Kroger grocery store. The City of Carmel bought the land when Party Time Rental went out of business and have agreed to sell the land to Anderson Birkla to build apartments and office space with retail offerings on the first floor of the buildings.
The centerpiece of the future development is a promenade walkway for visitors with retail on each side. A brewery-style restaurant is planned next to a center community green that can be used for public events, such as concerts and festivals.
The land sits on a grade that isn’t at street level, necessitating many infrastructure changes. New streets are planned to be built to improve connectivity and an underground parking garage will be constructed with an entrance off of Range Line Road.
The bond would be backed by the developer, which means the city would have less of a risk associated. Tax increment financing, which is a way to capture increases in property taxes to support public improvement, would be used to pay off the bond. In essence, the developer gets to use a portion of the property taxes it pays for the project to help fund public improvements such as streets and parking.
It’s been suggested that 75 percent of the TIF money would go to the bond and the other 25 percent would go back to the Carmel Redevelopment Commission to help pay for debt such as bonds associated with The Palladium.
Carmel Mayor Jim Brainard said it’s a project that will benefit the whole city and not just the residents and businesses in the area.
“Not only will it be great for development along Range Line Road, but this center green will be a great community asset,” he said.
City Councilor Sue Finkam said she needs to review the proposal but would likely feel comfortable with the bond, comparing it to similar deals struck with the Edward Rose project and Olivia on Main.
City Council President Rick Sharp said he wondered if the City of Carmel is giving away too much in order to get this project done. He said other developers were interested in the land but had very different uses planned. He also questioned why a 50-50 split of TIF money wasn’t proposed.
Sharp questioned why the CRC would sell the land to Anderson Birkla for $50,000 even though it purchased the property for $3 million in 2009.
City officials say the low price is to help with the cost of infrastructure improvements, which are estimated at approximately $10 million. With the 75-25 split, around $6 million in TIF would be available to Anderson Birkla to help pay off the bonds, which leaves a gap that is addressed by the lower sale price.
Sharp said some infrastructure improvements aren’t necessities in his mind, such as bringing the project up to street grade. He also notes that Anderson Birkla’s other recent development, Mezz 42, hasn’t lived up to expectations in Sharp’s opinion, with delays in construction and other concerns.