[robk1982]

http://www.mlive.com/flintjournal/in...we_buildi.html

Owners of downtown Rowe building seeking federal loan to keep project on track
by Joe Lawlor | The Flint Journal
Monday December 22, 2008, 10:32 AM

FLINT, Michigan -- Owners of the future Rowe Inc. building in downtown are asking for a lifeline from the federal government to keep the project from stalling.

The project to renovate several South Saginaw Street structures into one office building suffered a major setback when a wall collapsed in August 2007. And the cost of the project ballooned from $13 million to $20 million.

The developer is asking for a $3.3 million loan from the U.S. Department of Housing and Urban Development.

Without it or some other funding source, the project would be in jeopardy, said Phil Shaltz, a partner for Uptown Developments, which owns the building that will house Rowe.

"It's critical that we get this funding," Shaltz said.

Shaltz said the HUD loan would be for 20 years, and likely would be at a lower interest rate than could be found on the market. He said securing financing in the private market is difficult due to the weak economy.

"It's hard to get money for a car loan right now, never mind something like this," Shaltz said.

The Flint City Council this week voted to allow Uptown to apply for the loan.

"I didn't want to see this project fail," said Councilman Scott Kincaid.

Shaltz said with that hurdle cleared, Uptown has a "pretty good chance" to secure funding.

Once the building is completed next spring or summer, about 110 Rowe employees would move in and Rowe would pay rent to Uptown. Eight loft apartments also are being constructed.

The loan also needs the approval of Mayor Don Williamson, who said he is "100 percent" in favor of it.

"Look at what Uptown has done for this city," Williamson said. "They are a first-class operation. I'm with them all the way."

Earlier this year, Williamson had expressed opposition to tax breaks for Uptown, but he ultimately reversed course and approved the incentives.

John Matonich, president and chief executive officer of Rowe, said the company believes the new financing plan "makes sense."

"Hindsight being crystal clear, many folks would have advocated building a new building rather than renovation," Matonich said. "But once it's done, it will be a beautiful new building in downtown."

If all goes well, employees would move into their new downtown offices about two years after they were originally scheduled to move in. The company moved from Mundy Township to the Genesee Business Center in Flint last year as a temporary location while waiting for the new building to be completed.

Matonich said despite the cost overruns the lease with Uptown remains the same. He declined to reveal how much Rowe would pay Uptown to lease the building.

Plans to revitalize downtown are ongoing despite the downturn in the economy. Downtown has recently seen the completion of the new Wade Trim and Community Foundation of Greater Flint buildings. Berridge Place apartments, the former Berridge Hotel, has also been renovated, and Shaltz said he expects two new downtown restaurants will be announced in January.

"We're still seeing some pretty good momentum downtown," Shaltz said.

- That's all I have to say.