At the Rio Nuevo meeting Tuesday, the board moved ahead to finalize an agreement with Allan Norville's Nor-Generations, LLC, or ‘Nor Gen’ to acquire and develop the 8.5 acres adjacent to the freeway, where the Greyhound Bus Terminal is currently located, commonly referred to as the Arena Site, or the western gateway to Downtown Tucson.
Nor-Gen won the "right to negotiate" with the Rio Nuevo District in August, 2014, based upon a proposal in which it offered to buy the 8.5 acres for $5.6 million ($15.11 PSF) and develop a multi-faceted project that included a hotel, parking facilities, a visual arts complex, residential and retail space on the site, adjacent to the parcel where Nor-Gen proposes to construct a 120,000-square-foot permanent exhibition hall for the gem show connecting to the TCC.
As indicated by post-August comments from the District Board, coming to a final agreement with Nor-Gen had become arduous. As a result of Tuesday's meeting, the parties finalized, executed and released the final Purchase and Sale Agreement.
By the terms of the agreement, Nor-Gen has 90-days to assess the property and determine whether it wants to proceed with the purchase and development. If Nor-Gen does proceed, the sale is to close escrow in 30-days and Nor-Gen will be given six months to submit development plans to the City of Tucson.
Once the City approves the Nor-Gen's plan, the Greyhound Terminal will have one-year to be relocated, then the construction timeline calendar will begin sometime after November 2016.
Nor-Gen will then have 42-months (3-1/2 years, or until May 2020) after the Greyhound Terminal is moved to invest a minimum of $10 million in hard construction costs, 10% of the proposed $100 million project, on the Arena Site or pay the agreed upon liquidated damages of a one-time charge of $2.5 million, without further recourse or payment date specified.
After the execution of the agreement, Rio Nuevo Chairman, Fletcher McCusker, proclaimed that "we are grateful to Allan and his team for working through all of the issues in the agreement." McCusker went on to say that "given the legacy of failed Rio Nuevo projects, we succeeded in attaching meaningful conditions to assure the taxpaying community that this gateway parcel actually gets developed."
Well, as part of the taxpaying community, we would just like to say missing in this agreement is any timeline for Nor-Gen to construct anything on its adjacent parcel already owned, something that could start tomorrow, or any confirmed hotel brand for the arena project, one of the many reasons many saw the Peach Properties’ proposal as superior having already in-hand a commitment from Drury Inn “ready-to-build”. Nor-Gen has still to confirm a hotel flag; it has only implied it might be a Hyatt.
Nor-Gen has been given over 5 years, or basically as long as it wants, to holdup development from I-10 to Granada Avenue and from Congress Street to Cushing Street downtown, the western gateway to Downtown Tucson, that about sums up all the vacant property downtown.
Welcome to Nuevo-Norville-ville.
To see the full Rio Nuevo - Nor-Gen Purchase and Sale Agreement click here.
For related articles in Real Estate Daily News see: Two $100 Million Projects bid Arena Lot Rio Nuevo District
Nor-Gen Peach Faceoff on Downtown Arena Lot
Rio Nuevo Moves Ahead with Nor-Gen