Two new bids submitted Wednesday to develop the former Market Square Arena site call for condominiums, apartments, offices and perhaps a Target store.
The proposed Target at Market and Alabama streets is the most surprising element in the competing bids, which respond to the city's second request to redevelop the vacant, 4-acre former arena site.
The first attempt failed when the partnership picked to build a 31-story condominium tower failed last year to land financing.
In what could be a new sticking point with Mayor Bart Peterson's administration, both new bidders have their hands out for city subsidies that could run into the millions of dollars.
Mayoral spokesman Justin Ohlemiller has said the mayor prefers the city not grant subsidies to any private redevelopment of the site.
But developers insist that subsidies are needed for their projects, both of which meet the city's requirements for a tower of at least 14 stories with ground-floor retail and financing that is not dependent on presales of residential units.
The presale condition was cited as a key reason that the former winning bidder, Market Square Partners, never made headway in breaking ground on its project.
In rebidding the project, the city will have to confront the issue of extending subsidies, which it has provided to other major Downtown projects, such as the Conrad Hotel and the Marriott Indianapolis Downtown.
The Market Square redevelopment "has to be (subsidized). It doesn't happen without it," said Gerald Kosene, a partner with Kosene & Kosene, an Indianapolis developer involved in one of the bids, a $130 million dual-tower design with condos and apartments and a small amount of retail.
Since 2001, Kosene has built 270 townhouses and condo units within several blocks of the Market Square site, the development of which will radically remake the east side of Downtown.
A spokesman for the other bidder, Jim Thomas of Hearthview Residential, said his team will propose that the city subsidize its project and, in return, share in the profit or cash flow.
During the last round of bidding, the city received six proposals in 2003. The winner then was a team of Chicago and Ohio businesses that included Columbus, Ohio-based Smoot Construction.
Smoot, which still owns a parking garage and vacant bank operations center next to the arena site, is back in the bidding. It joins Kosene & Kosene and Pedcor Cos., of Carmel, in the Market Center Partners team that proposes the twin-tower complex.
That project does not call for redeveloping the boarded-up bank operations center, between New Jersey and East streets, although it might be done in a future phase, Kosene said. The center has become a hangout for homeless people.
The other proposal, submitted by Market-Ability Partners, is a $150 million project that also makes use of additional ground besides the arena site. The extra two acres, partly owned by Lee Alig, chairman of Mansur Real Estate Services, is needed to fit in the Target and the parking spaces the store would require, Thomas said.
Market-Ability submitted a letter from a Target real estate representative saying the Minnesota-based chain has an "interest" in putting a store Downtown and believes the Market Square site "may work."
"This proposal is not just good intentions and pretty pictures," said Thomas, who said the Market-Ability team includes four development companies -- all locally based and familiar with Downtown.
The Market-Ability proposal mixes in 100,000 square feet of office space, which was not included in the previous project. The condos in the Market-Ability complex would sell from $110,000 for 650-square-foot studios to more than $2 million for upper-floor penthouses, Thomas said.
Market-Ability calls for building designs that meet new energy-saving guidelines and include roofs planted with grass or other vegetation that absorbs sunlight and reduces rain run-off, Thomas said.
Downtown is gaining the density of residents that mass-merchandisers such as Target demand before they locate stores there, said Mark Perlstein, a principal of Sitehawk Retail Real Estate Group of Carmel.
Landing a Target Downtown "would be a real coup for the city, with Target's reputation and their (customer) draw," he said. He noted that a Downtown Target "would have minimal cannibalizing on their other stores in the marketplace."
City officials have said they want to pick the winning bidder by summer and then negotiate a development agreement that would spell out details such as public subsidies, if given. The city has set a minimum price for the four-acre site at $6.17 million.
Both new projects would take about three years to build.
DETAILS ON THE PROPOSALS
Indianapolis officials are expected to decide by this summer which of these contenders will develop the former Market Square Arena site at Alabama and Market streets.
Market-Ability Partners
Partners: Hearthview Residential, Mansur Real Estate Services, Venture Real Estate Services, all of Indianapolis, and Lauth Property Group, Carmel.
Cost: $150 million.
Features: 14-story tower, two six-story mid-rises and a proposed 140,000-square-foot Target store.
Size: 200 condominiums, 100,000 square feet of office space, 5,500 square feet of additional retail space.
Timetable: Two to three years to build.
Worth knowing: One partner controls an adjacent two-acre parcel needed to fit in the Target store.
Market Center Partners
Partners: Kosene & Kosene of Indianapolis, Pedcor Cos. of Carmel, Market Square Equity (includes Smoot Construction of Columbus, Ohio).
Cost: $130 million.
Features: 21- and 15-story towers.
Size: 240 apartments, 180 condominiums, 58,000 square feet of retail space.
Timetable: Three years to build.
Worth knowing: Hired well-known New York architect Stan Eckstut to design the dual towers. He also designed the Artsgarden.
WHAT'S NEXT
The winning bidder is expected to be selected by summer. Officials then will negotiate a development agreement that spells out details such as public subsidies. The project is expected to take about three years to build.
Image Provided By Market Ability
