Map courtesy of city of Hoover
The 91-acre site striped in red between Riverchase Parkway East, Parkway Office Circle and Interstate 65 is the Regions Bank campus slated for redevelopment as a mixed-use center called Riverwalk Village.
The Hoover City Council on Monday night voted 5-2 to amend the Riverchase development plan to make way for a new Riverwalk Village that an economist said could have a $2.5 billion economic impact over 10 years.
The council also voted 5-2 on an economic incentive package that would grant an estimated $25.8 million in tax rebates to the private company doing the development, plus up to $16 million in cash payments over the next 10 years to help get the project started.
The Riverwalk Village development essentially is a redevelopment plan for the 91-acre Regions Bank campus in the Riverchase Office Park. Regions Bank currently has operations in two office towers on the property connected by a bridge but plans to consolidate its operations in the north tower.
A company called Healthcare Resources has purchased the 91-acre campus from Regions and plans to convert the property into a mixed-use center anchored by an ambulatory surgery center with diagnostic and imaging services and other physician and medical offices, said Jimmy Holloway, the chief investment officer for Corporate Realty, the parent company of Healthcare Resources.
The surgery center and diagnostic and imaging center, if approved by the state, would go into part of the south tower that Regions is vacating.
But Healthcare Resources and partner Signature Homes also plan to build up to 134,000 square feet of new commercial buildings, 375 age-restricted multi-family residential units (for ages 55 and older), 120 unrestricted multi-family residential units, 102 single-family residential units, a hotel with up to 135 rooms and potentially a civic building that could include a performing arts center, officials with Healthcare Resources said.
The total investment in Riverwalk Village is expected to be $414 million, said Greg Knighton, the city of Hoover’s economic development manager.
Conceptual plan courtesy of city of Hoover
The Riverwalk Village conceptual plan is a plan to redevelop the 91-acre Regions Bank campus in the Riverchase Office Park for a mixed-use center anchored by a health and wellness center that includes an ambulatory surgery center and diagnostic and imaging center. The development also is proposed to have up to 134,000 square feet of new commercial buildings, 375 age-restricted multi-family residential units (for ages 55 and older), 120 unrestricted multi-family residential units, 102 single-family residential units, a hotel with up to 135 rooms and potentially a civic building that could include a performing arts center, officials with Healthcare Resources said.
Hoover Mayor Frank Brocato said the redevelopment plan falls in line with the city’s goals of diversifying its economy to rely less on retail and traditional office complexes and to revitalize an underutilized quiet corporate campus. It also goes along with the city’s desire to bring more top-shelf medical services that a city of almost 100,000 people should have close to home, Brocato said.
The Riverwalk Village is a remarkable plan for a master planned community built around a health and wellness concept that includes medical services, a variety of housing options, convenient retail options, walking trails, green spaces and hospitality options, he said.
“The economic impact cannot be ignored,” the mayor said. The project should create more than 3,500 construction jobs in the short term, create more than 1,000 full-time jobs and have an economic impact estimated at $2.5 billion over 10 years, he said. The Riverwalk Village also should generate $29 million in property taxes for Hoover City Schools over 20 years, he said.
“The energy from this development will have a tremendous positive reverberation throughout Hoover’s economy, attracting further investment in our community and resources for our residents,” Brocato said. “With Riverwalk, Hoover can once again hold the mantle “trailblazer” not only in pushing the boundaries of what health care looks like, but also exploring new frontiers in what community building in the 21st century looks like.”
The $25.8 million in tax rebates the City Council approved Monday night include 85% of the retail sales taxes generated by the project over 20 years (an estimated $9.42 million), 85% of the construction-related sales taxes in the project’s initial phase (an estimated $7 million), 85% of the lodging taxes generated by the hotel over the next 20 years (an estimated $5.4 million) and 50% of the non-educational property tax revenues generated by the development over the next 20 years (an estimated $3.95 million), Knighton said.
The $16 million in cash payments will be paid in varying amounts over 10 years, ranging from $3 million the first two years to $500,000 the last two years. However, once 93% of the south tower gets leased, the city will no longer have to make any more of those cash payments.
The city projects the tower will reach that level of occupancy within four years, Knighton said.
The Hoover City Council also on Monday agreed to lease 30,000 square feet of space on the first floor of the south tower for its own office space, relocating some personnel from the Hoover Public Safety Center on Valleydale Road to make room for expansion of the National Computer Forensics Institute. The rent will be another $700,000 per year for 10 years, except the first year’s rent would be waived, City Attorney Phillip Corley said.
Hoover Councilmen Casey Middlebrooks and Sam Swiney voted against the redevelopment plan and the economic incentive package.
Middlebrooks said the level of financial incentives being offered to the developer is too much.
Unless the city changes its policy regarding budget growth from year to year, this project and its large annual payments may prevent the city from moving forward with other deals that are already in the works and other deals in the future, Middlebrooks said.
“I never want to put the city in a position where we are strapped to have to say no to future projects,” he said.
He doesn’t think the city will be able to move forward with a performing arts center for five to 10 years unless the council changes its budget policy restricting year-to-year budget growth to 4%, he said.
Also, he doesn’t favor giving approval for this project and its incentives when the city’s Health Care Authority has not yet been given approval by the State Health Planning and Development Agency for the ambulatory surgery center. “It’s a level of risk I’m not comfortable with,” Middlebrooks said.
Councilman Curt Posey, who on Thursday expressed reservations about the $16 million in cash incentives, said Monday night they probably are justified.
“I think this is a great deal,” Posey said. “I think this is a way to move Riverchase forward, to revamp Riverchase.”
Councilman Derrick Murphy said Hoover is ripe for this type of medical development and noted that Riverwalk Village shouldn’t impact the school system in a negative way.
Hoover schools Superintendent Kevin Maddox said school officials have estimated the residential portion of Riverwalk Village should generate about 88 students for Hoover City Schools, and the school system has plenty of room for more students at Riverchase Elementary, Berry Middle and Spain Park High School. “The impact for us is minimal,” he said.
Councilman Steve McClinton said he, too, had some concerns about the incentive package but said the city of Hoover is in a strong financial position with $80 million in reserves.
“We have money to do other projects coming down the road,” he said.
If the council needs to rethink its budget restrictions, it can do so because those restrictions are rules they put on themselves, McClinton said.
Joy Patterson, president of the Riverchase Residential Association, said she has lived in Riverchase 38 years and is very invested in the community and looking out for its future. At first, members of the community had concerns about the Riverwalk Village plan, but the more they studied it, the more they believed it has the amenities that people want.
“I really feel like we should recommend this project and we should embrace it for the city,” she said.
Alan Paquette, chairman of the city’s Health Care Authority, said the next step is for the authority to apply for a Certificate of Need for an ambulatory surgery center and diagnostic and imaging center with the State Health Planning and Development Agency. The authority first must file a letter of intent to seek the certificate of need 30 days before it plans to do so, and that should take place very soon, he said.
Neither the Health Care Authority nor Healthcare Resources have identified the health care provider that would be providing the services, Paquette said. Once a Certificate of Need is granted, the Health Care Authority and Healthcare Resources will seek proposals from interested parties, he said. It’s his understanding that there is a lot of interest, he said.
The City Council also on Monday declared the entire Riverchase Corporate Park (roughly 900 acres) a Health and Wellness District with the goal of attracting more health care service providers, health care research companies and health care education entitites to the park and helping existing businesses in those industries that already are in the park to continue their growth.
Map courtesy of city of Hoover
This map shows the roughly 900-acre Riverchase Corporate Park, which the city of Hoover is now designating as the Riverchase Health and Wellness District.
See the entire video of Monday night's Hoover City Council meeting on The Hoover Channel YouTube page.
