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When Chico Is Happy, I Will Be Happy

Posted by Chris Berry on September 13, 2008 in Local Politics, Roanoke Valley

“When Chico is happy, I will be happy”. That was the response from Mayor David Bowers to the recently rejected proposal by the Coalition For The Roanoke City Market to renovate the historic Market Building. The mayor was referring to the owner of Chico’s Big Lick Pizza, a long-time tenant of the food court. The coalition plan was unanimously rejected by the city council last week on the advice of City Manager Darlene Burcham.

Much of the criticism of the proposal was based on the fact that it did not provide sufficient protection for the current building tenants. A controversy arose when the public was made aware that council members had not been allowed to read the actual proposal before the vote was held. On further examination of the facts, it appears that they also failed to read the original RFP. The 23 page document makes virtually no mention of the existing tenants. It contains no requirement that they be consulted on the development of the plan, or that they be included in the future tenant mix.

The only reference to existing tenants is on page 11 of the RFP, in which respondents are asked for a “proposed plan for managing the retention of existing tenants, or the transition plan for the recruitment of tenants in concert with the capital improvement phasing strategy in item (d) above”. Clearly this was an either/or option, and provides no protection or preference for the current tenants.

The plan was also criticized by city officials for straying too far from the development principles laid out in the RFP. Those principles are in fact quite vague, and spelled out on page 14 of the document as follows:

1. Any proposed modifications to the building’s interior or exterior will respect the architectural significance of the structure and its compatibility with other structures in the historic district.

2. The proposed uses of the facility will result in a mix of food court, restaurant, retail, and similar establishments in a configuration that maximizes efficient use of the building and ensures its functional vitality.

3. The tenant mix of the facility and leasing structure should ensure opportunities for locally owned vendors, food court, and retail establishment tenants.

After reading the document, it’s difficult to see where the coalition proposal fails to meet these principles.

The real issue behind the rejection is money. The coalition proposal called for the city to foot the entire bill for the renovations, and projected that roughly half of the cost could be recouped in the form of historic tax credits once the project is completed. The city had anticipated that a private developer would make a substantial capital investment in the project. This is just one more example of a history of unrealistic expectations. The fact that this RFP, along with those for Countryside, Rockledge, and the Amphitheater failed to attract private investors indicates a fundamental lack of business savvy on the part of city officials.

Given the size of the market building and the projected cost of the required renovations, it only takes a moment to realize that the project is not viable from a pure business standpoint. The footprint of the building is 15930 square feet, and as currently configured, roughly half of the ground floor is leasable space. At 100% occupancy, that amount of square footage would only produce about $200,000.00 in annual rent. Without the flexibility to reconfigure the space to maximize leasable square footage, no private developer is going to touch the project. If the city believes that preservation of the Market Building is an essential priority, it must be willing to pick up the tab to make it happen.

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