In light of its budget crunch, the University of Kentucky is looking for private sector help to spruce up its southwest entryway in anticipation of the much-heralded Newtown Pike extension - while gaining some much-needed facility renovations at the same time.
The university issued a request for proposal in July that involves the sale of four UK-owned buildings along South Broadway for mixed-use development, including the dilapidated Reynolds Building that houses UK's fine arts program, with the stipulation that the circa-1917 brick warehouse be completely renovated and leased back to the university.
"It's quite unique that we would sell a property that we would want to lease back," said Tom Harris, UK's associate vice president of external affairs. "But the Reynolds Building is a pretty unique building. In tight budget times for the state, in the foreseeable future, we're just not going to have the resources to (renovate) it, and we want to maintain the integrity of the building, and the department of art desperately wants to stay in that facility."
The poor state of the Reynolds Building, which lacks a central cooling system and adequate ventilation among other shortcomings, has drawn criticism from the media and the general public in recent years. The university has made investments in the facility, said Tom Harris, but without sufficient funding from the state or the ability for UK to control its own bonding, a complete renovation, including an HVAC overhaul and updated environmental and fire safety measures, has been fiscally out of reach. At the same time, the formerly industrial nature of the surrounding area has given way to more high-profile residential developments in recent years, many targeted to serve a growing university-based clientele. Developers such as the South Hill Group have transformed the former landscape of tobacco warehouses, industrial sites and vacant parcels into mixed use and quality residential developments.
"It has taken longer than some people realize," said South Hill Group developer Bill Lear. "If you look at before and after pictures, though, the contrast is startling."
But the success of earlier projects, among other factors, has made prospects for future development in the area increasingly expensive, Lear said.
"Our involvement has definitely driven land prices up some, and construction costs are up significantly over when we started," Lear said. Also, the area was initially designated as an enterprise zone by the state and eligible for related tax benefits. All of Kentucky's enterprise zone designations have since expired. However, despite rising costs, South Hill Group is still actively involved in the South Hill community, Lear said, launching the second phase of its CenterCourt development, which adds 84 condominiums to the mixed-use retail and residential project's initial 74 units.
While the private sector partnership outlined in UK's RFP for the Reynolds block is a new approach for the university, Lear said, similar approaches have been used by other public universities that are feeling the pressure of budget constraints.
"While it's a little out of the the box for UK, it's consistent with what other (universities) have been doing across the country," Lear said.
But fixing up the Reynolds Building is only one of the university's goals for the RFP, Harris said.
"For so long, Broadway has kind of been our backdoor to the campus," Harris said. "We see this as a really unique opportunity for somebody, with a pretty nice parcel of land, to put together a really neat, mixed-use opportunity, and with the opportunity for us to get the Reynolds building renovated."
In addition to the Reynolds Building, UK is offering two adjacent storage warehouses along with its Integrated Resource Information System, or IRIS, office building on South Broadway and an adjoining railroad right-of-way, divided into four tracts with an estimated total of five acres. UK will also consider optional development proposals to incorporate a one-acre portion of an adjacent parking area behind UK's Taylor Education Building. The block itself also includes additional privately owned land and property that is not included in the terms of UK's RFP.
In addition, the RFP, which is available on the university's Web site, details the university's specifications for the required Reynolds Building renovations, including space requirements and some general preferences for the individual fine arts programs housed in the facility. The deadline for submission of proposals, including purchase prices for the property and access easements and lease terms for the Reynolds Building, has been extended to October 15.
Possible general uses for the overall property listed in the RFP include hotel/conference space, residential, parking, retail, restaurant and classroom facilities, in addition to the creation of "inviting, public spaces and connectivity to the University campus."
The university's future plans call for moving its law school to Scott Street and the renovation of the nearby Taylor Education Building, Harris said, which along with the proposed Reynolds development project, could transform the complete corridor from Broadway to South Upper Street.
"What we'd like to see is redevelopment all the way from Bolivar, up Broadway all the way to Scott Street, which is where both the entrances of the Newtown Pike extension will come in," said Harris, who also pointed out that developers have already brought notable improvements to the area, in the form of residential and mixed-use projects such as South Hill Station Lofts, University Lofts, CenterCourt, Newtown Crossing, with more currently in the works.
"All of this comes together, and that little corridor becomes a very vibrant part of the city," Harris said.
In partnering with the private sector, UK's approach could create a good model for other future development projects, according to Harold Tate, president and executive director of the Lexington Downtown Development Authority.
"It's great that the university is bringing the private sector and the city Ö in together to create a new entrance for the city and for the university," Tate said. "It's part of the collegetown relationship that we're interested in having. It's a way to bring more mixed uses within the downtown area, and it shows the ability to try something new that hasn't been used in the city before or on campus."
Tate said he hopes the eventual winning proposal will not only serve the needs of the university and its students, staff and faculty, but also draw more active engagement from the city's general population to the area.