A local insurance company is reviving three-year-old plans to build a headquarters building downtown.

An affiliate of McGowan Insurance Group Inc. will seek Regional Center Approval April 28 to proceed with construction of a $2.75 million, 19,000-square-foot building at 355 Indiana Avenue. The two-story, brick veneer-clad structure will contain some space for lease, said Hugh M. McGowan, the firm’s president.

McGowan Insurance would receive a tax abatement in return for building the $2.75-million headquarters.

The firm plans to move from 8,800 square feet it leases at Market Tower, 10 W. Market St.

McGowan said a variety of factors caused the firm to hold off on the plan, which was announced in August 2008. Predictably, one of those factors was the deteriorating economy. But the same economic downturn is partially responsible for the plan’s revival.

“Because not a lot of people are doing this type of project now, it makes it a good time,” McGowan said, noting that the players involved are hungrier for work and therefore more willing to negotiate favorable terms.

McGowan Insurance is working with Chase Bank on financing and plans to use a Small Business Administration loan. Curran Architecture of Noblesville designed the building and locally based Buckingham Construction has been hired to build it. There’s still a slim chance the insurance agency could decide not to pursue the project, but McGowan expects it to proceed. The project timeline calls for construction to begin next month and wrap up by next February.

The city granted the company a six-year property tax abatement for the project in exchange for promising to add jobs. The abatement, awarded in 2008, goes into effect once the property is improved. McGowan said his firm has 33 employees and plans to add 10 in the next few years.

A city property tax abatement document from 2008 estimated the company would save almost $186,000 over the period of the abatement and pay about $131,000 in property taxes during that period. It estimated an annual property tax payment of almost $53,000 once the abatement expires.   

McGowan said a proposed accounting-rules change that would have commercial tenants record lease payments as a liability was not a factor in the decision to move forward with the project.

He said the independent insurance agency believes staying downtown is best for its employees, who live all over the city. “Downtown is convenient for everyone,” he said.

Adding to the convenience, the new headquarters will come with a 48-space, on-site parking lot. McGowan’s parking will front Indiana Avenue to the south of the building and Capitol Avenue east of the building with entrances on both Indiana and Capitol. The plans call for screening the parking with landscaping.

The city’s recently adopted urban design guidelines discourage surface parking in the city’s core but don’t prohibit it. The regional center plan, which sets out what uses are preferable for specific sites, recommends high-density, mixed-use development for the McGowan site.

Jeffrey York, a senior planner with the city’s Department of Metropolitan Development, declined to comment on McGowan’s plans because they are still being reviewed.

The building site is on a triangular block bounded by Capitol, Indiana and Vermont street. McGowan bought the property in 2008 from Hearthview, a residential developer, which had purchased it from the state. The block is mostly surface parking, some of which is unpaved. The Vermont Street side is lined with a chain-link fence with barbed wire.

Brian Mader, an architect with ArcDesign and past president of the local chapter of the American Institute of Architects, said the low-density nature of the project and the surface parking make it less than optimal for the site. But Mader said the McGowan building would represent a significant improvement considering how the site looks today.