Developers of the proposed mixed-use development Thistle Station are heading back to the drawing board on their plans for the Newtown Pike site.
The company’s planned 16-story, $34 million development could not move forward for multiple reasons, including the Kentucky Economic Development Finance Authority’s decision to deny the request for $2.5 million in tax increment financing, or TIF, to be applied to the project, said Thistle Holdings manager John Cirigliano.
Cirigliano said the group did appeal the decision, but the TIF proposal was ultimately rejected.
“Without the TIF, we could not build this project,” Cirigliano said.
Other factors in the decision to drop the plan included rising building costs and a recent zone change to the property immediately north of the project to neighborhood business (B-1) to allow for construction of a convenience store/gas station/restaurant and commercial building on that site, Cirigliano said.
“We had to examine every alternative once that was done,” Cirigliano said. “We are now exposing the property to a wide group of potential users, and possibly developers or co-developers. When we get that [response], we will determine what’s the best thing we can do for the property.”
Cirigliano said that within days of making the property available for sale or lease in February, the company had already received multiple inquiries. Some interested parties have been looking to buy the property, Cirigliano said, while others have proposed possible joint ventures for future development.
The original development plan for the 4-acre site between Third and Fourth streets, which once housed a lumber yard, featured 200 one-bedroom studio and two- and three-bedroom apartments, in addition to first-floor retail space. The urban infill project was primarily targeted toward young professionals and students attending nearby Bluegrass Community and Technical College as well as the expanding Transylvania University campus, located a few blocks away. The site has already been cleared for development.
“We really think that the west end of Lexington is very exciting and would benefit enormously from these market-rate residences over there,” Cirigliano said. “But we are not going to exclude anything. … We have to expose it to the marketplace and see what the marketplace tells us.”