WINCHESTER — More details about what may be coming to the Winchester Towers site emerged Tuesday as the prospective developer asked City Council for a tax incentive to offset the project’s estimated $30 million construction cost.
Lynx Ventures Inc. of Richmond is conducting a feasibility study to determine the cost effectiveness of building a multi-use complex called Cameron Square that would include an estimated 165 one- and two-bedroom apartments in two separate buildings, 8,000 square feet of ground-floor commercial space, and a parking deck with at least 167 spaces for tenants and downtown visitors.
Rick Gregory, founder of Lynx Ventures, told council during its work session that the tax break would offset garage construction costs that could exceed $5 million.
If Lynx receives the incentive, it plans to buy the Towers site at 200-214 N. Cameron St. from the Winchester Economic Development Authority, as well as parcels owned by Glaize Properties Inc. at 220, 224, 302, 324 and 326 North Cameron Street and 101 and 110 East Fairfax Lane. The Towers site is empty, but the Glaize-owned buildings are still standing. Most of the Glaize structures are vacant, but two have been renovated and are occupied by Winchester Brew Works and NextHome Realty Select.
According to Lynx’s proposal, the previously renovated Glaize buildings would be incorporated into the new Cameron Square project, and the vacant buildings at the corner of Cameron and Baker streets would be converted into a four-story apartment building. The project’s parking deck would be located between the four-story apartment building and a five-story mixed-use structure proposed for the parcel where Winchester Towers stood before being demolished three years ago.
The apartments would be offered at competitive market prices, but Gregory said he is pursuing Virginia Housing Development Authority financing that, if approved, would require 20% of the units to be rented for reduced rates that working individuals and couples could afford.
When asked what types of businesses he hopes would lease space in the ground floor of the mixed-use building, Gregory replied, “The hope would be restaurants.”
Lynx is asking City Council for a $3.1 million tax incentive to be paid out over a maximum of 10 years in the form of annual rebates.
The existing properties at the development site currently generate $11,609 in annual real estate taxes, but the multi-use complex would generate a projected $693,476 in real estate taxes per year. Lynx is asking that any annual taxes it pays to the city above the current $11,609 level be reimbursed for 10 years or until the total reaches $3.1 million, whichever comes first.
Winchester would not have to dip into its coffers to cover the incentive because the tax money would be paid each year by Lynx and then rebated by the city.
When the incentive period ends, Councilor John Willingham said, “Our return on investment ... will be a positive number.”
Lynx would allow the public to use its parking deck and has agreed to charge rates that will not undercut the fees of 50 cents and $1 per hour assessed by the Winchester Parking Authority at its four downtown garages.
Revenues generated by the garage will be kept by Lynx, but Gregory said he doesn’t expect to make a profit for quite some time.
“I will lose money [on the parking deck] the first several years, no question,” he said.
Willingham said approving the tax incentive for Lynx would set a precedent for other developers hoping to build in the city, so he added a condition that Lynx must spend at least $15 million on the project in order to qualify for the tax break.
Council unanimously agreed, with one abstention, to forward Lynx’s request to its next business meeting on Oct. 22. Councilor Bill Wiley abstained from the discussion and vote because his employer, The Shockey Cos. of Frederick County, could be involved in the construction of Cameron Square.
With the project’s future apparently hinging on whether council approves the tax incentive, Gregory couldn’t say when Cameron Square would be built.
“My goal is to get it done as fast as I can,” he said.
Attending Tuesday night’s City Council work session in Rouss City Hall were Mayor and council President David Smith, Vice Mayor John Hill, Vice President Evan Clark and councilors Kim Herbstritt, John Willingham, Les Veach, Corey Sullivan, Bill Wiley and Judy McKiernan.