Maclellan Building
Initial approval was given on Wednesday for a $10 million conversion of the historic Maclellan Building downtown into 90 apartments above the ground floor commercial.
The city's Health, Education and Housing Facilities Board voted 6-1 in favor of a PILOT (payment in lieu of taxes) for the project by Memphis developer John Glassell. Lloyd Lognion voted no.
It will have 40 studio units, 42 one-bedroom, one-bath apartments and eight two-bedroom units.
Kim White of the RiverCity Company said the building that was designed by famed architect R.H. Hunt has been mainly vacant for over 10 years and is in Bankruptcy Court.
She said, "We are thrilled to see this development. It's a great way to utilize the building."
It was earlier announced that a boutique hotel would go into the building that is in the 700 block of Broad Street, but that did not materialize.
The building is assessed at $2,257,000 with an assessment of $902,960. Current taxes are $45,818.
Under the PILOT, $1.3 million would be abated over the first 10 years, plus additional amounts during step-up periods of 20 percent, 40 percent, 60 percent and 80 percent for the next four years.
Ms. White said the company will pay the school portion of the tax.
The tax abatement still must be approved by the city and county and go back before the HEB.
Mr. Glassell said he did not get a PILOT for the redevelopment of an historic building in Memphis, but he said on a project in Alabama he got significant federal and state tax credits.
Ms. White said Tennessee does not offer tax credits for the refurbishing of historic buildings.
The 12-story structure was built as the home of Provident Insurance in 1924. The first three stories are in the Greek Ionic style and the nine-story tower is capped with a sloping Mansard roof finished in green tile.
Architect Hunt was a top Provident official.
The building was later named for the Maclellan family, which long operated Provident.