The Oak Ridge City Council voted 6-0 on Monday to approve a $13 million proposal to use new property tax revenues to help redevelop the Oak Ridge Mall.
There was one abstention. The near-unanimous approval by Council continues a string of successes for the proposed redevelopment.
Known as tax increment financing, or a TIF, the proposal approved by Council on Monday had already been unanimously endorsed by the Oak Ridge Industrial Development Board and the Anderson County operations and budgets committees. It will next be considered by the Anderson County Commission on Monday, Nov. 18.
A TIF uses new property tax revenues generated at a site to help pay for development costs. The mall TIF could last 20 years.
Oak Ridge City Council member Trina Baughn abstained from Monday night’s vote. She said she couldn’t support the 20- to 30-year timespan.
“I just felt that was too much of a risk,” Baughn said. But she also didn’t want to vote against the project.
The redeveloped 59-acre mall could open in 2016, create an estimated 950 to 1,000 new jobs, and increase city and county sales tax revenues by about $2.16 million. The enclosed mall would be converted into an open-air, retail-driven, mixed-use property that could include 400,000 square feet of retail space and roughly 60,000 to 100,000 square feet of office space, a hotel of about 100 to 120 rooms, and up to 50 multi-family, “walkable” residential units. It could also include three to four restaurants.
Mall redevelopment plans have languished for about a decade, but city officials are optimistic that Crosland Southeast, the North Carolina company that has had a purchase contract on the property since January, can make something happen.
City officials and project executives say the TIF would not create any risk for the city, county, or IDB. Under the conditions of the TIF agreement, site demolition would have to start within 30 months, although developers plan to begin sooner.
A key to the project is marketing and signing up retailers.
“That’s the key to this project, frankly,” said Tim Sittema, a partner in Crosland Southeast, which is working on three “dead mall” redevelopment projects. “Absent the retailers, there’s no deal here.”
But he said his company has had many positive conversations with retailers and has already gained some credibility based on the IDB approval last month and the community support.
“We are going to work as hard as we can,” Sittema said.
Crosland Southeast doesn’t have signed leases for the proposed redevelopment yet but is focused on 20 or 30 larger potential tenants. If all goes well, the sale of the mall could close in the middle of next year, and demolition could then start immediately and last three to four months. Construction could last about 1.5 years, and the redeveloped property could open in 2016.
More information will be added as it becomes available.
Note: This story was updated at 10:24 a.m. Nov. 12.