A Montgomery-based development group has signed a $2.5 million agreement to buy and rede¬velop a city-owned stretch of property along Max¬well Boulevard.
Maxwell Development LLC offered the most money out of the four developers that submitted proposals for the property between Holt and Whit¬man streets.
David Payne Jr., vice president of Design Build South and one of the key players behind Maxwell Development, said Wednesday that the planned roughly 300,000-square-foot building will stretch the entire length of the property and in¬clude 304 apartments and about 50,000 square feet of retail space. The most recent plans call for a va¬riating roofline of five and six stories.
The purchase agreement was signed last month.
Montgomery Mayor Todd Strange said Wednesday evening that it was the scope of the project that set it apart from others.
"We felt like it was the complete package," he said.
The development's estimated cost is about $42 million. However, two bodies must first sign off on the project: the U.S. Depart¬ment of Housing and Urban Development and the Mont¬gomery City Council.
Payne's group is seeking a mortgage guarantee through HUD.
According to HUD's web¬site, the guarantee referred to as 221(d)(4) is used by "profit-motivated sponsors" to "assist private industry in the construction or rehabili¬tation of rental and coopera¬tive housing for moderate-in¬come and displaced families by making capital more readily available."
It does not require rental price limits; the apartments would rent at market rate, said Chad Emerson, the city's director of develop¬ment.
"If (HUD is) able to en¬sure a loan, it gives banks more confidence to process that loan," Payne said. "If (the project) is not economi¬cally viable, it won't get past HUD."
Once HUD gives its initial approval, the sale proposal will go before council, Emer¬son said. Over the summer, the city advertised for pro¬posals from interested devel¬opers. The next highest of¬fers for the property was $1.758 million, its appraised value. Strange has previous¬ly said the city spent about $1 million purchasing the 14 parcels.
"At the end of the day, while it is nice to get $2.5 million, that is not the real objective," Strange said Wednesday. "The real objec¬tive is development."
But the plans are not yet set in stone, Strange said. While he's confident that there is a market for 300 apartments near downtown -- he has recent housing and retail demand studies that tell him there is room for much more than that -- HUD could come back and say the project should be scaled down.
A smaller project is what the property owners along Clay Street would like.
From his conference room, attorney Dean Mooty of Mooty & Associates, has an impressive view of the Alabama River and parts of downtown Montgomery. If Payne's plans go through as they are now, Mooty in a year or two will have a view of a parking area and the back of a building.
Mooty and other property owners have met with the city and Payne's group about their concerns.
"We are vehemently and adamantly opposed to the Payne proposal and we will fight it anyway possible," Mooty said Wednesday. "We think it is so out of character with this neighborhood."
Mooty said that he and others have been supporters of redevelopment along Maxwell, but was surprised to see Payne's proposal in September.
"We never fathomed that someone would contemplate six stories, corner to corner," he said. "This is just such an aberration from what has been pitched (to the commu¬nity as possible develop¬ment.)
Some of the other propos¬als left more open space in the middle of the tract, al¬lowing property owners south of the development to keep at least part of their views.
Payne's original plans called for six stories across the building, but new plans show a mix of five and six stories. That was something planning consultant Victor Dover, with Dover, Kohl & Partners, recommended, Payne said.
But Payne said he's not ruling out additional changes to the structure to accommo¬date other landowners.
"There is the possibility to put some vertical breaks in some of the structures," he said. "We've left the door open to pursue some options, if possible. But at the end of the day, we may just be in a position where we don't agree."
He said that the project's density was necessary to make it a profitable venture. He's already getting inquir¬ies about the property.
"I've gotten two calls to¬day (Wednesday) from real estate representatives with possible tenants," Payne said about the retail space.
He said he wants a diverse offering -- grocery, dentist, nail salon, hardware store and restaurants -- so resi¬dents wouldn't have to leave, unless they want to.
"I want everything you need right there," he said.
The building will be one structure, but designed to look like buildings connected over time. The idea is for it to look as if it has been there for 100 years, and last 100 more, he said.
The working name of the development is The Over¬look, taken from the name of park across Maxwell Boule¬vard.
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