Commercial Real Estate and Mixed-Use and Development/Redevelopment and Premier Properties and Grocery Stores and Real Estate & Retail

Developer lures Whole Foods across street into Venu project

October 29, 2007

The developer of a $750 million mixed-use project called Venu has acquired a 13-acre site across the street from where another developer had planned to build condos and a Whole Foods Market.

The sale could diffuse a long-running battle waged by Nora-area residents who don't believe a Whole Foods should be built at the northwest corner of East 86th Street and Keystone Avenue.

Locally based Premier Properties USA Inc. hopes to incorporate the natural foods market into its 50-acre Venu project at the intersection's southwest corner. For the other site, Premier wants to build residential units that would connect to Venu via a pedestrian bridge.

Project renderings showing the bridge appear in plans filed with the city in October, along with several other new project details--including plans for retractable sections of roof and walls that would make Venu an all-weather attraction.

The project calls for a mall roughly the size of The Fashion Mall at Keystone, a 575-room hotel that would be the city's third largest after a new JW Marriott and the Indianapolis Marriott Downtown, and an office building with nearly as many square feet as One Indiana Square.

Venu would add up to 3 million square feet of retail, office and residential space to a thriving corridor in one of the most aggressive and expensive projects city planners ever have seen. And the Whole Foods acquisition could add even more cachet.

The deal should help Premier accomplish two objectives: appeasing the neighborhood, which had opposed the grocery at the site originally proposed, and incorporating Whole Foods into the Venu development, said Mark Perlstein, a partner with locally based Sitehawk Retail Real Estate.

"It's a very smart move," he said. "I think it's creative and certainly will be very beneficial if and when that project moves forward."

Perlstein called Whole Foods "absolutely the perfect anchor" for Venu.

Happy neighbors

Members of the nearby Driftwood Hills Neighborhood had fought the Whole Foods plan and sued the city over its approval. They hoped to save the wooded site, or at least prevent commercial development on the land.

Whole Foods announced in November 2006 that it would open a 60,000-square-foot store as part of a project by developer Paul Kite's PK Capital LLC. Whole Foods now says it is in the "planning stages" for a new location. The company will have two local stores, in Nora and Carmel, following its acquisition of Boulder, Colo.-based Wild Oats Market.

Neighborhood leaders applauded Premier's purchase, even though details of the company's plans aren't yet clear.

"We are certainly not disappointed it has been sold, and that is an understatement," said Ruth Hayes, president of the Nora-Northside Community Council.

Premier bought the land--and PK Capital's original Whole Foods lease--for an undisclosed price, said Baker & Daniels attorney J. Murray Clark, who represents Premier. Premier still would have to work out a new lease agreement with the Austin, Texas-based chain to include it in Venu instead.

Kite referred a question about the deal to Premier CEO Chris White, who was unavailable to comment.

The Nora-Northside Community Council has endorsed the conceptual plan for Venu, which would replace a low-rise shopping center, furniture store, hotel and several parking lots.

Premier owns much of the property it needs for the project and has obtained permission to file rezoning plans from other property owners that are involved, including the Metropolitan School District of Washington Township, Cox Real Estate and Keystone Suites Developers LP.

New details emerge

Several new details about Venu emerged this month in a filing with the Metropolitan Development Commission. Planners will give the project a special review reserved for the largest developments with the most impact on infrastructure.

Venu's plans call for several restaurants with a total capacity of more than 2,000 people, a 5,000-seat performing arts theater, 116 condos in two residential towers, and a 21,000-square-foot health club.

Three or four levels of underground parking with more than 6,300 spaces will span roughly 20 acres and offer access to the project in several locations. The developers plan to seek the highest level of Leadership in Energy and Environmental Design, or LEED, certification.

Perhaps the most dramatic detail revealed in the filing is that the development would feature retractable sections of wall and roof canopy that could open and close depending on the weather.

The developers are seeking zoning approval and vacation of portions of Haverstick Road and Woodfield Crossing Boulevard, along with approval for uses including an assisted-living facility and retail sales on sidewalks. A sunken plaza would be the project's focal point. Most roof surfaces would be covered with plantings.

"In the land-use world, this is a precedential, visionary project for Indianapolis," said Clark, Premier's attorney and chairman of the Indiana Republican Party. "In more progressive communities, this is the kind of project you're seeing."

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