13 WTHR - Indianapolis News |Deal approved to develop area near Market Square Arena site

Deal approved to develop area near Market Square Arena site

Mary Milz/Eyewitness News

Indianapolis - A decision by the Metropolitan Development Commission paves the way for a new $65 million mixed-use development on the near east side of downtown. The board voted 7-2 in favor of a 10-year tax abatement for developer Tad Miller.

Miller owns the old Bank One Operations center just east of the City County Building. He plans to build 500 apartments and add a retail component over two phases. It's a site the city has desperately want developed for years

The commission's approval did not come without debate.

Pat Andrews is Vice President of the Marion County Alliance of Neighborhood Associations. She spoke out against the idea.

"This is not a simple abatement request," she said at Wednesday's hearing.

Part of the deal involves the city buying the adjacent garage from Miller for $18.5 million and then leasing a third of the spaces back to Miller at a discount. Andrews argued the purchase price is based on a "future value" saying the city will pay Miller several million more than the garage is worth.

"The risk is all the city's," she said. "You take it off the tax rolls and have the city own it? It doesn't make sense."

Commission President Randy Snyder agreed. He was one of two "no" votes.

"It's not right. It's not worth that much today and it's wrong to do that," Snyder said.

Even with the $4 early bird special, the 1,667-space garage is never full, raising questions about how long it will take to pay for it.

Deputy Mayor Nick Weber said while the garage is "underperforming" now, it's certain to generate more revenue once the two gravel lots just west of it close next summer.

Miller said the garage is critical to his project.

"All deals take public-private partnerships if something is to happen," he said.

Weber said what the city wants is that something to jump start other projects, particularly the old Market Square Arena site.

"I think over time that area will only develop more and parking in downtown is always an asset and one we think the garage is one that will increase in value," Weber said.

Miller said he hopes to break ground in May.