It’s official—the former Arby’s parcel on the northwest corner of Carmel Drive and Rangeline Road will be included in Anderson Birkla’s redevelopment project adjacent to that site.
Anderson Birkla Investment Partners LLC is pursuing a $70 million project on a 6.5-acre site that surrounds the corner property where Arby’s formerly operated, and although initial renderings incorporated that land, the developer did not have control of it until recently.
The development, known as the Proscenium, will include nearly 400,000 square feet of residential, retail and office space among six three- to four-story buildings. It will also feature a central plaza with an upscale restaurant and a 449-space underground parking garage.
The property is where the former Party Time Rental warehouse was located, across the street from Kroger.
The Carmel Redevelopment Commission recently agreed to sell the Arby’s property to Anderson Birkla for $100 with the understanding that an office building would be constructed on the site and the underground parking already included in the Proscenium development would be expanded. The cost of the development has now increased from $60 million to $70 million.
The Carmel-based developer also agreed to construct two new roads as part of the project and transfer the right-of-way to the city at no cost.
“It is a substantial savings for the city to not have to do that kind of infrastructure,” CRC Deputy Director Michael Frischkorn said.
As part of right-of-way acquisition for the newly constructed roundabout at that intersection, last year the city purchased the property where Arby’s formerly stood for $2.5 million. Arby’s then closed, and the city demolished the building.
The entire property was about 1.05 acres at the time, but after taking the necessary land for the roundabout, slightly less than 0.4-acre remained and was put up for sale. Anderson Birkla was the only offer the CRC received.
Frischkorn said the low sale price is because of the lack of interest from other developers and for the work Anderson Birkla offered to do, such as extending Veterans Way south to Carmel Drive and lengthening Executive Drive to intersect with the new portion of Veterans Way.
“It’s a smaller parcel now, and it’s difficult to develop,” Frischkorn said.
The city also gave Anderson Birkla a discount on the 6.5-acre site where the Party Time Rental building stood when it sold it for $50,000 in 2015, even though the city purchased the property for $3 million in 2009.
At the time, CRC Executive Director Corrie Meyer said the price would help make up the difference between expected tax increment financing dollars and the cost of infrastructure improvements.
The CRC issued bonds backed by TIF revenue for up to $8 million, with $6 million being available to Anderson Birkla for public infrastructure improvements.
The company estimates the infrastructure work will cost $10.5 million, leaving a $4.5 million gap that it will be responsible to pay. That price tag doesn't include the new work related to the Arby's property purchase.
Anderson Birkla started on the project in 2016, and the Party Time building has been cleared from the site.