The Raleigh City Council recently voted to take the property at 301 Hillsborough Street away from the developer that had been planning to build at the site since 2000. The Reynolds Company missed a December 31 deadline to get financing.
The site at Hillsborough and Dawson streets has sat vacant, surrounded by a chain-link fence for more than a year. The property could now be converted to a parking lot temporarily while the city looks for a new buyer.
The company originally agreed in 2000 to purchase the land and were to have a proposal to develop it by November 2004, which was later extended to February 2006. In October 2007, the building plan for the 25-story tower included a 135,600-square-foot hotel, 26 condominium units, 17,500 square feet of ground-floor retail space, and a four-story parking deck.
The time line was again amended to give Reynolds until December 31st, 2008 to close. After the company missed that deadline, council voted 5-3 to take the property back.
In a letter to the council, Reynolds Company wrote that their appraisal of the undeveloped land had been “significantly below our projections” making it hard to get financing. The company said the current economic downturn and credit crisis have made financing hard to come by.
During Friday’s meeting, Councilor Phillip Isley (District E) supported giving Reynolds another 6-month extension noting that they had already invested a significant amount of money, he also expressed concern about finding another developer for the property. To date, the company says it has invested more than$2.5 million in the project.
Assistant City Manager Julian Prosser said that the council decided to not continue with “a project that might go forward adversely” noting that continuing Reynolds developmental delays would “jeopardize our right to reclaim the property.”
The city has no plans for the property. But at the last council meeting, City Manager Russell Allen said it could be used temporarily as a parking lot for the new Campbell Law School moving in across the street.
