By Brandon Martin
Martinsville City Council, acting as the Redevelopment and Housing Authority, unanimously voted to execute the contract of sale on the Chief Tassel Building during a May 12 meeting.
Waukeshaw Development, who previously renovated the Historic Henry Hotel, will now begin assessing a new project at the Chief Tassel Building, located at 51 East Church Street.
Martinsville City Manager Leon Towarnicki said that the city acquired the building in 2018 and began issuing requests for redevelopment proposals the following year. Before the housing authority voted on the sale of the building, Dave McCormack, representing Waukeshaw, gave a brief presentation on their plans.
“We are really happy to be in Martinsville again and we are excited about this project,” McCormack said. “We are looking for an outcome that is not just financially successful but we hope that it keeps spurring development downtown.”
McCormack said that his goal is to redevelop the property into 18 residential units on the 2-4 floors, with commercial units on the bottom floor.
The project would cost approximately $2.5 million, according to McCormack who said the firm is in discussions with Carter Bank & Trust regarding funding, along with exploring other grants and historic tax credits.
He added that the historic tax credits will make up 30 percent of the qualified rehabilitation expense (QRE), but noted that some things don’t qualify — such as carpet installation and cabinetry.
“If we spend $2.5 million, we might get a QRE of 85-90 percent of that number,” McCormack said. “You multiply it by 30 percent, take out all the legal fees and cost of the transaction, and you come up with a number. I think we will have permanent financing of $1.8 million.”
Towarnicki said that the building has asbestos problems, old boiler pipe wrap and lead-based paint, which all must be addressed as part of the project.
In addition to the necessary updates, McCormack said that his redesign will play on the historic building’s “1940s, 1950s wood features” as well as the doors, elevators and floors.
“The goal here isn’t to do massive re–modification of the interior,” he said. “It’s really to keep it as is, with a little bit of interior, and create a really strong brand/brand name.”
Now that the building has been sold to Waukeshaw, the firm will enter a 180 day “due diligence period,” according to Towarnicki. This will allow for the developer to look at architectural and environmental issues. If the project is feasible, the city will execute the development agreement.
After the housing authority recessed and reconvened as City Council, they unanimously voted to set a public hearing on May 26 for a Special Use Permit by the Lester Group, Inc.
The group plans to build 3 townhouse structures along Fairy Street, northeast of the intersection of Fairy and Watt streets, according to Towarnicki. Between the three structures, one building will provide five units, with the other two buildings capable of four units each.
After setting the May 26 public hearing, council continued a Feb. 11 public hearing for a car display and custom vehicle wrap business at 128 Clearview Drive. Towarnicki said that the applicant was given 90 days to present further information on structural plans to the city’s building office. He added that the applicant has yet to provide additional plans or make contact with inspectors.
In lieu of the current limitations from the coronavirus, Council Member Danny Turner suggested continuing the hearing again. June 23 was ser as the next meeting date on the permit.
In other matters presented, city council:
*Approved on first reading, an ordinance reciting the expediency of the issuance of up to $2,500,000 principal amount of bonds assisting in the acquisition, construction, renovation, and equipping of repairs, replacements, and capital improvements at the city’s Beaver Creek Reservoir Dam. The improvements will include repairs and renovations to the dam’s spillway.
Bids are due June 12 and Towarnicki said that the city expects to proceed in July with an estimated 270 days to complete. Debt service payments will begin six months after completion of the project.
Towarnicki said that the project will likely have a 20 year bond, with a debt service payment around $100,000 a year. He added that if necessary, the city could address payment of the note with an increase of “a dollar, dollar and a half” on the city’s water rate.
*Water Resources Director Mike Kahle provided an update on the city’s annual water quality report. Besides resolution of a previous issue and notification of a late report to the Virginia Department of Health, Kahle said there was nothing else to report.
*Issued a proclamation recognizing May 10-16 as National Hospital Week.