A controversial proposal to build a 25-story building in downtown Lexington cleared another regulatory hurdle Wednesday, but there's still no money to build the long-stalled CentrePointe project.
The Courthouse Area Design Review Board unanimously approved a new design for the project, which includes an upscale hotel, 63 condominiums, ground-floor retail space and 50,000 square feet of office space.
Attorney Darby Turner, who represents The Webb Companies and developer Dudley Webb, acknowledged that financing has not been secured for the project but said he had met with two large banks recently, and both had shown interest.
About 40 people were in the audience for Wednesday's meeting, some of whom urged the board to reject the proposal.
Julie Good, executive director of the Blue Grass Trust for Historic Preservation, said the board should insist that developers demonstrate they have adequate financing before approving the CentrePointe design.
However, Turner said there is nothing in city ordinances that requires proof of financing or ability to build, or for the developer to reveal his business plan. He said the developer has $17 million tied up in the project, including the land.
The only question before the board, Turner said, was whether the design complied with standards of the Courthouse Design Zone.
Webb said after the meeting that economic circumstances during the past two years have created difficulties for his project. But those hindrances are changing "slowly but surely," he said.
"There is a lot of interest on the part of lenders to get back into the market, contrary to what has been said here today," Webb said.
He said he was optimistic that CentrePointe would get financing and that construction would begin this winter.
"We'd like to see the actual start of physical construction start this winter, dig the hole, and come back out of the ground with the parking garage in the spring," he said.
Wednesday was the fourth appearance before the board by the CentrePointe developers. In June 2008 they received approval for a 35-story CentrePointe and permission to demolish 14 buildings to clear the block bounded by Limestone, and Main, Vine, Upper streets. In November, 2008, developers asked for changes to the design. In July, 2009, they requested a reauthorization of their permit to build because it was ready to expire.
On Wednesday, the developers were seeking another one-year extension of their construction permit, this time for a scaled-down version of the building.
Billy Van Pelt, design review officer for the board, presented findings that analyzed the new design, showed it to be in compliance with the Courthouse Area Design standards, and recommended approval.
During the hearing, Good, of the Blue Grass Trust for Historic Preservation, spoke said the height of the proposed building was not in compliance with the Downtown Master Plan or the courthouse area board's own standards.
"At 25 stories the CentrePointe building will be 55 percent taller than what's called for in the Downtown Master Plan," she said.
Rob Morris, a blogger on local issues, said he thought the issue the board should decide was not the CentrePointe design but "whether this design is even possible."
The local market for expensive properties is overbuilt, Morris said. Currently, 75 million-dollar residential properties are for sale in Fayette County. Only five have sold since January, and eight sold in 2009, he said.
On that basis, there is a 13- to 15-year supply of million-dollar homes for sale, he said.
Webb said not all the condominiums would cost $1 million. For 14 smaller units, described by Turner as hotel-room condos, the starting price will be $300,000. The most expensive penthouses will be in the range of $2.5 million.
Webb called the units "affordable."
"They obviously can't exceed market or you can't sell them," he said. "We're not suicidal."
Reach Beverly Fortune at (859) 231-3251 or 1-800-950-6397, Ext. 3251