An investment group led by the Herb Simon family has filed a preliminary plan to demolish the century-old CSX building across the street from Gainbridge Fieldhouse in downtown Indianapolis and replace it with two high-rise buildings containing a hotel, apartments and retail space. The development carries a estimated price tag of $250 million.
According to documents submitted to the Indianapolis Historic Preservation Commission by Indianapolis-based Ratio Design—the architect of record for the project—the proposed development at 230 S. Pennsylvania St. would include a 26-story apartment tower and a 16-story hotel, and would feature an elevated walkway connecting to the fieldhouse.
Boxcar Development LLC, an investment group led by the Herb Simon family—which also owns Pacers Sports & Entertainment—is behind the project, according to Phil Bayt, an attorney for Ice Miller LLP who represents Boxcar.
The 16-story tower proposed for the southwest corner of Georgia and Pennsylvania streets would have 225 hotel rooms and nearly 18,000 square feet of retail space. The 26-story structure would be built directly south, along Pennsylvania Street, with 254 apartments, nearly 4,800 square feet of retail space and a 700-space parking garage.
“This project is going to activate a long-vacant building with a new complex consisting of housing and hospitality,” Bayt said. “It will complement and amplify the $125 million that’s already been invested by the Simon family in the Wholesale District, including at Gainbridge Fieldhouse.”
If built as planned, the apartment tower would be the tallest structure in terms of floors since the 28-story 360 Market Square tower was completed in 2018 on the former site of Market Square Arena.
The hotel would have a mezzanine style second-floor lobby and amenities on the third floor, along with an undisclosed rooftop amenity. The main entrance would be along Georgia Street and a drop-off area along Pennsylvania Street. At least 51 spaces in the garage would be for hotel guests, with another 21 for event parking.
Bayt said a hotel operator has not yet been designated for the project.
The building’s retail space would be split between three areas, including a 9,400-square-foot space along Georgia Street and a 4,600-square-foot space on the corner. A third space—about 3,840 square feet—would be connected to the hotel lobby on the second floor, although plans indicate it could be used by the first-floor retailer directly below. The hotel would also have a bar and two terrace spaces in the lobby area, along with the fieldhouse bridge.
The entrances to the apartment tower’s parking garage and lobby would each be along South Pennsylvania Street. A 4,600-square-foot market is proposed for part of the first floor retail space, along with a 1,060-square foot lounge. The amenities planned for the apartment tower include an outdoor pool and a rooftop deck area, along with multiple green spaces.
The new structures would utilize curtain wall systems, glazed brick masonry and granite in their design.
The CSX building, built in 1923, is also known as the Indiana Terminal warehouse building. The five-story, 231,400-square-foot building has been used as offices, shops and storage since its construction and was connected directly to the rail line that crosses over Pennsylvania Street. Designed by notable Indianapolis architectural firm Rubush and Hunter, it has a reinforced concrete frame and brick exterior walls.
The property is listed through the Indianapolis and Chicago offices of brokerage JLL for an undisclosed price. A sale of the property is expected to be contingent on necessary city approvals for its redevelopment, including demolition of the existing structure.
In its submittal for the project, Ratio said at least six redevelopment studies have been conducted on the property over the past 22 years—most of them since 2015. A 2019 study called for the building to be repurposed into self-storage, office uses and a hotel, including the addition of seven stories to part of the existing structure.
Others have considered co-working space, an extended-stay hotel development and a development similar to the current proposal that included apartments and a 14-story hotel.
But the firm said all past proposals have been hindered by the building itself, which has low ceiling heights, poor column spacing and a cacophony of other architectural issues that make repurposing the building a challenge.
Bayt said he did not know if the development group would pursue tax-increment financing or incentives to subsidize the effort. The site is located within a qualified Opportunity Zone, meaning the developers could receive substantial tax breaks by investing capital gains into the site.
The filing said a rehabilitation did not make financial sense.
The “acquisition cost, combined with anticipated rehabilitation costs to create a project that will be a substandard, non-competitive facility … does not provide for a reasonable return on investment even taking into account potential historic tax credits, tax increment financing and the benefits of the Opportunity Zone,” the filing said of a possible rehab project. “In fact, multiple scenarios of the rehabilitation of the building all yield a negative return on investment.”
“Having studied the rehabilitation of this building extensively, it is clear that the physical limitations of the building, coupled with the purchase price, render the building unusable from an economic standpoint.”
The proposed project would span over three parcels totaling about 1.8 acres. The entirety of the hotel portion of the development is within the city’s historic Wholesale District, while only part of the apartment tower site would carry that designation.
To move forward with the project, the IHPC must give its support for demolition of the existing building. It also must approve the portion of the proposed project that is within the district’s boundaries.
The site also would need to be rezoned to CBD-2, which allows for multifamily and hotel uses downtown. A variance might also be required for the sky exposure plane because of the height of the buildings.
The project is set for a preliminary review by the IHPC on Wednesday, May 4. The hearing will allow the development team to receive feedback on the project. The developer would be required to return for another meeting with the IHPC if it decides to move forward with the project.