In the midst of celebrating its 100th birthday, Anchorage finds itself at a critical juncture. The city is about to go through a leadership change while economic headwinds -- namely the state's projected $3.5 billion budget shortfall due to a 50 percent drop in oil prices -- kick up the dust of uncertainty. Now, perhaps more than ever before, Anchorage finds itself in a position where bold, forward-thinking ideas will help define our community for the near and long-term.
One such bold idea is the plan to redevelop the Fourth Avenue and Fifth Avenue properties currently owned by Peach Investments LLC, including the Reed Building and the 4th Avenue Theatre. This kind of redevelopment is exactly what was envisioned by the 2007 Anchorage Downtown Comprehensive Plan, our community's strategic framework to guide future development of downtown. Central to achieving that vision is focusing and concentrating limited resources to ensure that properties achieve their greatest potential; key amenities are linked through streetscape enhancements and good building design; and catalytic projects are developed in the right locations to stimulate additional development.
The redevelopment project proposed by Peach Investments meets all three criteria to achieving the vision of the ADCP with new private sector investment in downtown hotel/housing, office space, a lively pedestrian retail galleria and four-season activity for residents and visitors. And in recognition of the iconic connection between the former theater and Fourth Avenue, the Peach Investments redevelopment project will restore and preserve key elements of the theater facade, lobby and art. This project will incorporate these key elements of the 4th Avenue Theatre and repurpose them into an iconic new landmark of a vital downtown Anchorage.
One of the more exciting components of the Peach Investments redevelopment project is the possible inclusion of residential units. The ADCP prioritized residential growth in downtown, recognizing that Anchorage's demographic and economic indicators continue to shift in favor of downtown living, and set an ambitious target of 4,000 housing units by the year 2025. The Peach Investments redevelopment project presents forward momentum toward that target.
The second exciting component of the Peach Investments redevelopment plan is the city's proactive role in supporting the project through targeted tax abatement. By taking this proactive approach to reduce development costs and enhance feasibility, the municipality is encouraging a catalytic project in an ideal location to stimulate additional development.
This is of particular interest because, by utilizing this strategy, the city will be able to take underutilized properties that generate approximately $235,000 in annual property taxes today and encourage development that will bring the tax revenue to $2 million in 10 years. This creates a potential 40-year return on investment of $113 million dollars, versus $17 million over the same time period if no development occurs.
Given the economic headwinds we're facing, that kind of return for the city through increased tax revenues goes a long way toward fixing streets, supporting schools and paying for police and fire services.
From an economic development standpoint, this partnership between the city and the private sector is a winning combination with tremendous community benefit. In addition to the increased utility of the properties, downtown businesses stand to benefit from the new project in much the same way that downtown benefited from the construction of the Hotel Captain Cook following the 1964 earthquake. The project demonstrates a commitment to downtown and Anchorage's future and will be a potent new attraction that brings foot traffic and new opportunities for neighboring properties.
If successfully launched, this proposed public-private-partnership will send a clear signal to other developers that Anchorage welcomes their investments in our city's future. This is a project we should all support.
More than just a catalyst for new development and increased opportunities for all of downtown; more than just an economic engine that is estimated to generate 1,000 new jobs; and more than just a benefit to municipal tax revenues, this redevelopment project is a bold, forward-thinking idea that will carry Anchorage forward into the next 100 years.
And on Tuesday night, citizens of Anchorage will have an opportunity to encourage bold and forward-thinking action by the Anchorage Assembly. We encourage you to contact your Assembly member and voice your support for this project.
Bill Popp is president and CEO of the Anchorage Economic Development Corp.; Christopher M. Schutte is executive director of the Anchorage Downtown Partnership, Ltd.; Bruce Bustamante is president of the Anchorage Chamber of Commerce.
The views expressed here are the writer's own and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary(at)alaskadispatch.com.