By Tammy Lieber
Indianapolis Business Journal

VOL 24 NO. 46, JANUARY 19-25, 2004

A project agreement spelling out details of a 22-story hotel and condominium tower at Washington and Illinois streets downtown is finalized and awaits a scheduled Jan. 21 vote, according to the mayor's spokesman.

City officials planned to file a resolution Jan. 16 with the Metropolitan Development Commission seeking approval of the deal between the city and local developers Kite Cos. and Mansur Real Estate Services Inc., spokesman Steve Campbell said.

If the MDC approves the pact, it will close 11 months of negotiations between the city and the developers. Kite and Mansur were chosen in February to build a Conrad Hotel and luxury condominiums on the vacant site and to convert two adjacent buildings into market-rate apartments.

Details of the final agreement were not available before deadline. Some sources said Kite and Mansur, in the final stages of negotiations, sought financial contributions from the city in excess of the $18 million already approved for redevelopment of the parcel.

The entire project is expected to cost $85 million.

Parking and the escalating costs of renovating buildings at 26 and 30 W. Washington St., known as the Taylor and Goodman buildings, contributed to the length of the negotiations, officials with the Indianapolis Bond Bank said last year.

In mid-December, Indianapolis Bond Bank Director Robert Clifford said those issues were mostly resolved and that "now it's the [deal] structure and how to put it all together so we have the money to get started."

Kite, Mansur and locally based Hunt Construction Group, general contractor for the job, originally hoped to begin the two-year construction process by the end of 2003. Now, the goal is for the hotel to open before the Indianapolis 500 in 2006, Clifford said.

Executives at Kite and Mansur could not be reached for comment.

Once approved, the project agreement will allow Kite and Mansur to finalize financing for Circle Block.

That was the stumbling block for an earlier proposal for the site from local developer Barrett & Stokely Inc. Barrett & Stokely's high-rise apartment project fell apart after the project agreement with the city was signed in 2001.

The amount of work that needs to be done between signing the agreement and breaking ground might be less for developers of the new project. The city was expected to require extensive construction and financing details from Kite and Mansur before signing the project agreement.

Barrett & Stokely was selected to develop the site after Peterson pulled the plug on a plan conceived by former Mayor Steve Goldsmith for a two-story retail development.

Mansur lost its bid to develop an apartment tower when Barrett & Stokely was chosen, but teamed up with Kite when the land became available again.

The two lined up Conrad Hotels, the most upscale Hilton Hotels brand, for a 243-room luxury hotel. Four floors of the tower would include some of the city's priciest condominiums, and the first floor would house high-end retail space. The Taylor and Goodman buildings would become 26 market-rate apartments.

The Circle Block land, now a park, has been empty since 1990, when the Roosevelt Building was imploded to make way for Circle Centre, which later shifted a block south. The city acquired the Taylor and Goodman buildings in protracted dealings with the Goodman family, which eventually ended up with the Lieber Building at 24 W. Washington St. and the office building at 2 N. Meridian St.