The City of Glendale has given Bayshore Town Center’s owner the green light to carry out plans for an extensive redevelopment of the property.
The Common Council on Monday night unanimously approved the project’s financing plan, which includes a public funding subsidy of up to $36.7 million, depending on the success of the project.
That project, which was originally proposed late last year, includes downsizing the mall’s retail space by almost half and demolishing or converting existing buildings for other uses such as residential units, a hotel, independent senior living, a medical facility, restaurants and office space.
As part of the approved financing plan, Bayshore’s owner, New York-based AIG Global Real Estate Services, would cover the cost of the estimated $75 million project without any immediate help from the city.
Glendale’s offer to help AIG pay for the project will only stand if the mall is redeveloped and, in turn, able to generate more property tax revenue based on a greater assessed property value. The city would then use Bayshore’s new property tax revenue to reimburse AIG for “eligible project costs,” according to the proposal.
AIG has also agreed to pay off the city’s remaining $56.6 million in outstanding tax financing debt, which was incurred to help fund Bayshore’s original $300 million redevelopment project in 2002.
The TIF agreement would ultimately leave Glendale debt free, city officials have said.
Bayshore is currently assessed at $65 million, according to the proposal, but upon its revitalization, the mall is expected to be valued at $200 million. That assessed value increase would result in higher property taxes paid for the property and a total reimbursement to AIG of $36.7 million, which the city would pay to AIG with $2.8 million annual payments until 2033, according to the development proposal.
After the TIF is paid off and closes, the increased property tax revenue from the redeveloped Bayshore would then benefit the city and other local governments.
The struggling Bayshore now has an upwards of 50 vacant tenant spaces after suffering the losses of stores such as Boston Store, Sports Authority, J.Crew, Teavana, American Eagle, Shaw’s Jewelers, Charlotte Russe, Payless ShoeSource and Gymboree.
Construction at the mall is expected to underway this summer. Read more about Dallas-based developer Cypress Equities Managed Services L.P.’s plans for a reimagined Bayshore Town Center in BizTimes Milwaukee’s recent cover story, “Sink or Swim.”
