State looking for suggestions for prime downtown land: Request for proposals signals possible sale of parcel near IUPUI, Central Canal

Keywords Real Estate

Indiana is turning to developers to help brainstorm on what type of development might fit a prime real estate parcel two blocks from the Statehouse.

The state owns the three-quarters-ofan-acre site at the intersection of Vermont Street and Indiana Avenue. State officials have determined they can do without the space, which is currently used for state employee parking.

The official request for ideas, posted June 7, asks for proposals that might “present the state with the opportunity to realize revenue through redevelopment.”

That doesn’t necessarily mean the state wants to get into the landlord business, said Elizabeth Barrett, spokeswoman for the Indiana Department of Administration.

She said that portion of the request should be broadly interpreted and could include, for example, bringing in new state tax revenue by establishing a company headquarters downtown.

The request for ideas is just the first step in what could be a lengthy process. Developers interested in the land must submit questions by June 30. The department will post answers by July 7. Final proposals must be submitted by July 14.

Then state officials will decide how to move forward, potentially picking a specific use for the land from the ideas submitted and posting a request for bids.

“It’s kind of a ‘testing the waters’ mechanism to gauge interest in the property,” Barrett said of the current phase.

It’s a good location given the development occurring a couple of blocks west along the Central Canal and at IUPUI, said Abbe Hohmann, principal and vice president of the local office of St. Louisbased Colliers Turley Martin Tucker.

While the parcel has lots of frontage on Vermont Street and Indiana Avenue, Hohmann said it might be a stretch to get retail to work there because there’s not much foot traffic or housing nearby.

She said a hotel or a mixed-use project with office and residential space might be better fits.

Barrett said the state doesn’t yet have an appraisal, but Hohmann estimated the property might fetch around $640,000.

It would be worth more if the state could bundle it with neighboring parcels, she said. By itself, the site probably isn’t wide enough to accommodate a building fronting Capitol Avenue.

One neighbor has doubts whether the state will really sell. Rick Oldham owns Musicians’ Repair & Sales at 332 N. Capitol Ave., next to the state parking lot.

Oldham said the entire triangular block-which, apart from his shop and the Bourbon Street Distillery, is all parking lots-used to be filled with businesses. In the late 1980s, the state bought several stores and tore them down.

Oldham said he’d be happy to have a different neighbor in part because he doesn’t think the state keeps up the parking space as required. But he said when state officials take a second look, they’ll hang onto the land.

“My assumption is that they’ve put it down as surplus property, but will decide they really need it for parking,” he said.

The information request is part of a larger state program to sell off unneeded property statewide. Meridian Asset Development, a local firm headed by John M. Bales II, won a contract late last year to handle property sales.

The downtown land is the first Marion County property the state is considering selling.

Barrett said the state has put out a request for bids on property in Carroll County, has scheduled auctions for three houses in Allen County, and has two requests for ideas posted for large tracts in Putnam County.

It will soon put up for auction, put up for bid or seek development pitches for another 20 properties.

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