Insurance and Utilities and Real Estate & Retail

Winning bidder plans mixed-use project: Plan for state-owned parcel would add new neighbors for Bourbon Street Distillery, Musicians' Repair & Sales

April 30, 2007

The winning bidder for a prime piece of state-owned land on the west side of downtown hopes to break ground later this year on a residential and retail complex.

The project would replace a shabby parking lot on a triangle-shaped block that is now anchored by The Bourbon Street Distillery and Musicians' Repair & Sales. The U-shaped, 0.75-acre property at 340 N. Capitol Ave. touches Indiana Avenue, Capitol Avenue and Vermont Street. The development likely would include condos above a bank and other retail shops.

Jim Thomas, a partner with locally based Hearthview Residential Inc., confirmed that he is personally a partner in the project, separate from Hearthview. He said his team agreed to pay roughly $920,000 for the land. Thomas declined to name his partners and said it was too early to reveal project details or a price.

The property appraised for slightly more than $900,000, said John M. Bales, president of Venture Real Estate Services, which has a contract to help the state dispose of surplus real estate. Bales said a preliminary site plan includes a bank with a drivethrough and about 30 condos.

"This is an area that people previously haven't had much of a reason to stop in, unless they're parking," Bales said in an email.

The state had issued a request for proposals for the site last year, with submissions due in December. Elizabeth Barrett, a spokeswoman for the Indiana Department of Administration, said there were two bidders. Barrett would not identify them or release any information on the bids because, she said, a final agreement has not been reached.

A restaurant or service-type retail use such as a dry cleaner or a FedEx Kinko's would work well on the site, particularly if it can serve residents living above and attract students from IUPUI, said Steve Delaney, a principal with locally based Sitehawk Retail Real Estate.

"All of a sudden, there's a little bit of buzz around that area," Delaney said.

Rick Oldham, owner of Musicians' Repair, said he figured something was up when workers recently began marking utilities and taking core samples. His shop had neighbors when it opened on the block in 1984, but the state gradually bought other properties and tore down buildings.

Oldham said he's curious how the site plan will incorporate what is an odd-shaped piece of property.

"I'm surprised they haven't looked at acquiring other properties around to make it happen," he said.

New residences nearby should help The Bourbon Street Distillery, said Owen "OB" Brant, who has owned the bar five years. Before that, it was known as Snazzy Jazz, and before that it was Distillery Saloon.

Brant's main concern is that the multifloor project might block the skyline view from the second floor of his bar.

"Other than that, I don't know if it'll impact me much," he said.

If the project moves forward, it would join a series of major mixed-use developments in the works for the western side of downtown. They include:

A Flaherty & Collins Properties plan to build a $33 million apartment and retail complex along Central Canal north of Michigan Street. The plans call for 218 apartments, a 340-space parking garage and 20,000 square feet of retail, mostly at the corner of Senate Avenue and Michigan.

A mixed-use project for a one-acre lot along the canal between Ohio and New York streets. The state and city own the land and are requiring that developers include retail. Four bidders have submitted proposals. Locally based Browning Investments Inc. and Dora Brothers Hospitality Corp. would include two hotels with more than 250 rooms. Flaherty is proposing a residential development for the site. The other bidders haven't been disclosed.

A $9 million renovation of the fivestory Gibson Building at Capitol and Michigan by American United Life Insurance Co. for office and retail. The building was constructed in 1916.
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