Whole Foods on ‘fast track’
July 21, 2010
BASALT – The Basalt Town Council agreed Tuesday night to “fast-track” the review of the Whole Foods Market building in Willits Town Center, but the board made no promises about the outcome.
Town Manager Bill Kane said a “fast-track schedule” is warranted to try to get the stalled project started in these particularly tough economic circumstances. Kane also said it would be fair if the town put a time limit on any concessions that might be granted. If the market isn’t built in a certain amount of time, the amended approvals would be voided and it would revert to the current rules under that scenario.
The Basalt Planning and Zoning Commission will start reviewing amendments to the approval next week, with the goal of making a recommendation to the council by early August.
The council is scheduled to hold hearings on Aug. 10 and 24. Town Planning Director Susan Philp said a lease signed by the developer and Whole Foods requires amended land-use approvals to be in place by Sept. 2. If not, the specialty food store can cancel its second lease on the property.
The biggest change being sought is decreasing the store size from 44,000 square feet to 25,000 square feet.
“That’s no problem at all,” said Councilwoman Anne Freedman.
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Councilman Pete McBride agreed, saying the town would be “gaining a store that’s more in line with the scale of Basalt.”
The smaller store would mean the Whole Foods building would be one floor rather than two. The market wouldn’t take all the space on the one floor so a handful of small shops would be added on the west side of the building.
The Willits Town Center project is in a world of hurt right now. Chicago-based development firm Joseph Freed and Associates (JFA), through its Willits Town Center Partners, ran out of financing in September 2008 after a parking garage and much of the infrastructure was completed. Construction stalled, and there is now a concrete hole surrounded by dirt mounds and construction debris.
Whole Foods Market’s first lease for the 44,000-square-foot store lapsed when JFA didn’t meet deadlines. The developer renegotiated a lease for the smaller store on March 2.
The developer’s woes worsened in April when lender Bank of America foreclosed against the project, claiming JFA missed payments on a loan with $36 million still due. A foreclosure sale is scheduled Aug. 25. The bank successfully had a Denver firm, Cordes and Co., appointed as a receiver to run the project, essentially removing JFA from the decision-making process.
Mike Staheli, project manager at Willits for Cordes and Co., told the council Tuesday night that his company’s role is to preserve the value of the project until ownership issues are resolved. He is seeking amendments to the approval, with Bank of America’s blessing.
Staheli said he viewed the amendments as a return to earlier approvals, rather than concessions by the town. He said he is working closely with JFA, which is confident it will remain involved in the development.
“We’re trying to make this doable,” he said of the proposed amendments to the approval.
Town officials seemed inclined to label some of the requests as concessions. Staheli and JFA proposed installing a stoplight at Willits Lane and East Valley Road instead of a roundabout. They also want to delay construction of affordable housing required as part of the market approval.
Council members want the roundabout. Councilwoman Jacque Whitsitt said traffic at the intersection “sucks” as it exists. McBride agreed it is already dangerous there.
The town should explore ways to front the money for the roundabout, with the understanding that the owner would eventually repay the funds, Mayor Leroy Duroux said.
“To me, spending funds for a traffic light is a waste of money. It’s not going to work,” he said.
The roundabout was estimated in 2007 to cost $1 million to $1.3 million.
The council didn’t discuss the possible deferral of affordable housing.
Board members agreed they must have some financial assurance that the construction site will be cleaned up if work stalls again. Current conditions are “an abandoned disaster,” McBride said.
Freedman said she wouldn’t support amended approvals without some guarantee the work will be finished or the site cleaned if it stalls.
Staheli said he has already taken steps to improve the appearance. A contractor was hired to pick up trash, straighten out construction materials and take other steps. That work is ongoing.
“We’re sensitive to those things,” he said.
If the town’s review is completed by Sept. 2, the goal would be to start construction in the fall, likely in October, according to Tim Belinski, JFA’s local representative. The building shell would be turned over to Whole Foods in spring 2011, and the grocery chain would finish the interior. The store would open in fall 2011 in the best-case scenario.
He felt the aggressive schedule was realistic. “The building as it sits out there is pretty far along,” Belinski said.