Developer Tatman, Texas firm interested in Burnham property
CHAMPAIGN – Local developer Paul Tatman has told the city of Champaign that he and a Dallas, Texas, company would be willing to buy the old Burnham City Hospital site at fair market value and construct a mixed-use development with no or little city assistance.
City officials say at this point they still have confidence in the city's designated developer, Pickus Companies of Highland Park. But Mayor Jerry Schweighart made a pointed mention of the Tatman offer at a recent city council meeting where Pickus officials successfully sought additional financial incentives to redevelop the site.
"If Pickus doesn't follow through, (the Tatman offer) will be an option," Schweighart said.
Schweighart said that while he supported increasing the incentives for Pickus, he also said he wants to see construction get started.
"I'm unhappy about the delays," Schweighart said. "They should have had a blade in the ground, and I feel they're dragging their feet. I think the Pickus plan is a good plan, but let's get it going."
Pickus was supposed to begin construction this past spring. Now, the company is talking about starting construction of the 18-story, 259-unit apartment building that will be the centerpiece of the project in late January. The $30-million-plus project will also include a grocery store and 102 for-sale condominiums. It will be located on the old hospital site north of Springfield Avenue between Third and Fourth streets.
Late last month, the city council tentatively agreed to extend the joint city/Champaign County enterprise zone to include the Pickus project, which will save the company an estimated $1 million on sales taxes for building materials purchased in the state. The city also agreed to reduce by $300,000 the sale price of the city-owned hospital property, to $1.35 million.
Tatman, in a letter to the city council and city administrative staff, said he was working with Trammel Crow Co. of Dallas, a major development company, and that they would be interested in purchasing the Burnham site.
"The Burnham property is exactly what we are looking for," he wrote. "We are prepared to make a fair market value proposal for the property and feel our mixed-use project would carry itself, meaning we would need very little, if any, city involvement financially."
Tatman told The News-Gazette he thinks that when Pickus negotiated its original deal, it should have stuck by the terms.
"I think once you negotiate a deal, you should stick to a deal," he said. "I hate to see all these incentives for apartments. We're already pretty saturated with apartments. ... I'm sure there's a bunch of developers in town who would have jumped on it for that price and with those kinds of kicks (incentives)."
If the city were to take him up on his offer, Tatman said, he and Trammel Crow would build student apartments and also retail.
Richard Dickason, vice president of Trammel Crow Co., sent a letter to the city council, dated Aug. 29, saying the company has targeted Champaign "as a key market for our development activity." He wrote the company has completed or is in the process of completing more than $2 billion worth of capital projects.
"We are familiar with the Burnham Hospital property and are very interested in purchasing the property at a fair market value for the development of an attractive mixed-use project," Dickason wrote, saying the company had added Tatman to its "development team."
Dickason could not be reached for comment Thursday.
Champaign Planning Director Bruce Knight said Thursday he remains "very confident" Pickus will successfully develop the project.
If that doesn't prove true, the city would solicit new development proposals, which it has done twice in the past five years.
The city in mid-2004 issued $8 million in general obligation bonds to pay for the site acquisition, environmental cleanup, building demolition and to obtain design guidelines. The city would recoup its investment over time from increased property tax receipts from a city tax increment financing district that includes the Burnham site.