Union Square Campus yet to receive land from City of Greensboro

by Jeff Sykes | @jeffreysykes

On Sept. 30 the plans for the first phase of the proposed Union Square Campus were celebrated at a public meeting on the campus of Bennett College. The next day’s press was positive, glowing even, as the success of the project seemed inevitable.

Behind the scenes, however, criticism and change was in the air.

The proponents of Union Square, formally a limited liability corporation named Union Square Campus Inc., needed occupancy commitments from the various education and healthcare entities involved with the project in order to secure financing to close the gap between money raised from a combination of private and public donors and the cost of building what had been advertised as a 100,000 square foot facility.

One of those entities, Guilford Technical Community College, had yet to commit to a lease. Earlier in September, Jeff Phillips, a conservative Republican member of the Guilford County Board of Commissioners, had questioned the cost to the county of relocating GTCC’s radiography technology program from Cone Health to the new Union Square Campus.

By Oct. 1, project backers were in the dark about the outcome of the county’s discussions. They had wanted GTCC to commit to a lease payment of $450,000 a year for 10 years.

In advance of the commissioner’s Oct. 16 meeting, GTCC President Randy Parker sent County Manager Marty Lawing a letter. GTCC had worked closely with USCI to come up with a lease that would allow the college to participate in the project, Parker wrote.

“GTCC has worked with the USCI board to negotiate a lease agreement that represents our best efforts to support the project as an investment by the County that is in the best interest of the citizens of Guilford County,” Parker wrote.

Ultimately, GTCC’s board of trustees requested approval to lease space at Union Square to the tune of $150,000 a year.

How would that impact the larger project?

A week after the meeting at Bennett College, which sits nearby the South Elm redevelopment site at the intersection of Lee and Elm streets south of Downtown Greensboro, public comments about the master developer’s presentation began rolling in from feedback cards distributed at the meeting.

The event had been a celebration of the collaboration between the city’s healthcare industry and local nurse training programs, the Downtown Greenway, USCI and the South Elm Development Group. SEDG is the master developer for the site, which belongs to the Redevelopment Commission of Greensboro. Action Greensboro, the economic development subgroup that is managing the Downtown Greenway, surveyed attendees regarding their view of the greenway portion of the South Elm project.

City staff shared those comments relevant to Union Square at South Elm, referred to as US@SE, with the team from SEDG.

“It seems those who commented, in general, feel positive about the direction of US@SE and USC, but were disappointed in the quality and content of the presentation,” one city staffer wrote in an email to the team. “We can definitely do a better job telling our story in a polished and professional way. Let’s make a point to revisit our talking points well in advance of the next public outreach opportunity.”

The comments themselves were at times a mix of warm praise and terse observation.

“Great location. Nursing campus is an excellent choice. Restaurants and/ or bars may be ideal along Elm, as a continuation of downtown.”

“I like everything but the hotel. As much as I want a downtown hotel, people in general hate to stay in downtown areas.”

“The proposed mixed-use development plans provide the opportunity to extend the Downtown and provide an economic catalyst. The presentation of that opportunity was poorly delivered, poorly explained and without the passion you would expect for such a catalytic project.”

“I am a little concerned that there are no other buildings planned at his time. I would like to see the hotel plans come off and replaced with an RFP for a grocery store in the area. Maybe the city can provide incentives to lure one to the area which is in desperate need for this type of retail.”

Bob Chapman, one of the partners in the South Elm Development Group, took issue with the criticism of the hotel. In an email among project members he noted two negative comments about the hotel component of the larger development.

“I continue to disagree. Chattanooga (population 173,000 vs. 279,000 for Greensboro) now has 18 downtown hotels, up from three or so not too long ago,” Chapman wrote. “Their experience is informative. Plus, we have the best traffic counts for a downtown hotel.”

By Oct. 10, USCI had shifted gears on the first phase of their combined campus. Just 10 days after rolling out the plans for their first public viewing, plans for the smaller building circulated among developers and city staff.

SEDG partner Bob Isner emailed city staff seeking the new plans early that morning. As has been widely reported, the first phase of the combined campus moved from the primary intersection of Elm and Lee streets one block east to the intersection of Lee and Arlington streets. The building was scaled back from four stories to three, and square footage reduced to about 85,000.

“I was out of town. What happened between USC, GTCC and the County?” Isner asked.

On Oct. 16 the county commissioners voted to fund GTCC at the rate of $150,000 a year, just one-third of what project backers had hoped for. Concurrently, USCI was advancing their request to have the city gift them up to two acres of the redevelopment site at no cost. This would reduce their overall construction costs.

At the November meeting of the Redevelopment Commission of Greensboro, staff told commission members that city council had approved the land transfer, and wanted to vote on Dec. 2 to approve the request. The commission would require a special midmonth meeting to pass a resolution in order for that to happen.

The commission met on Nov. 19, fulfilling their requirements, but the conveyance of the land has twice been pushed off of the city council agenda, both on Dec. 2 and Dec. 16.

The master developer, South Elm Development Group, had anticipated recouping their expenses, and perhaps making a profit, by selling land to potential component developers at a higher price than they would pay to buy it from the city.

With USCI the only component on the table after a year of marketing, having them gain two acres at no cost would throw a wrench in those plans.

When asked this week why the conveyance of the land to USCI had been delayed after city council expressed interest in a quick turnaround time, none of the players wanted to go into much detail.

“We don’t have any reason to believe that any dissension exists. It’s going to be fine with us in terms of maintaining our schedule,” said John Merrill, the owner’s representative for USCI. Merrill said the land conveyance issue should be heard at the council’s Jan. 6 meeting.

Ed Kitchen, former Greensboro city manager and a board member on several entities behind the Union Square concept, said that current Greensboro City Manager Jim Westmoreland contacted him late last week to ask for the delay.

“As long as we have it done by early January it doesn’t pose any real problem for us timing wise,” Kitchen said.

“We’ve got a lot of moving parts with the banks and executing all the leases to get everything in order. We will end up on a tight construction schedule, but it will not create any problems.”

The cause of the delay is unclear, but perhaps foreshadowed in an email from SEDG partner Bob Chapman.

“As you know, we have been working since early March to resolve the issue of our fair compensation that was precipitated by the City’s desire to give land to USCI,” Chapman wrote. “I believe we are very close and I want to thank you and your colleagues at the City for their constructive approach. Now, time truly is of the essence.” !