Deal on downtown high rise likely to take longer

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BY MATT OLBERDING / Lincoln Journal Star

Don’t expect to see glass and steel rising anytime soon from the site of a proposed downtown high-rise project.

Negotiations between the city and the Lincoln Synergy Group are taking longer than expected, meaning construction may not start until 2010 at the earliest.

The project is slated for the block bounded by 13th, 14th, P and Q streets.

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A rendering of the Catalyst Building from 13th Street looking south. This is not the final design.

A rendering of the Catalyst Building from 13th Street looking south. This is not the final design.

When it was announced last April the city had chosen the $180 million Synergy project, city officials estimated it would take from six to 18 months to work out a deal, meaning construction likely would have started next year.

But Dallas McGee, assistant director of the Urban Development Department, said starting in 2009 would be “optimistic.”

“Things would need to come together rather quickly,” he said.

Monte Froehlich, who heads the Lincoln Synergy Group, was a bit more optimistic but generally agreed.

“If we can make some real strong progress in the next two months, I think we can stay on schedule,” he said, “but a lot has to happen.”

The delay in negotiations is due to technical changes in the project — and not financial problems or major disagreements between the developer and the city.

A market study done by Froehlich’s group completed in December found a “positive response” to what’s being proposed, McGee said.

When proposed last year, the plan included a 22-story hotel and apartment tower on the east end of the block at 14th and Q, with a 15-story office tower on the west end of the block, at 13th and Q.

It also includes an 18-story tower with a parking garage and retirement units across the street to the north.

Despite a slowing economy and tightening credit markets that have made it harder to borrow money, Froehlich said the project is still going forward as proposed.

“We’re still working on Plan A — no major changes,” he said.

In fact, the scope of the project is one of the reasons negotiations are taking longer, McGee said.

Because the project includes more than what the city asked for — namely the 18-story building with a retirement center on the block to the north — additional parking is needed.

McGee called parking “the No. 1 issue” in negotiations.

Another reason negotiations have bogged down, at least from Froehlich’s point of view, is a change in city officials’ philosophy of what they want at the site.

McGee confirmed the city has now asked that a liner building included in its original request for proposals be dropped to expand the civic plaza.

McGee said the change has nothing to do with “new people in new jobs” — a reference to a new mayor and new Urban Development director — but rather was prompted by a review of the Downtown Master Plan by consulting firm Crandall Arambula.

The city had envisioned a four- or five-story building lining the plaza and filled with retail shops on the ground floor and offices or housing on upper floors.

But McGee said Crandall Arambula determined that could be achieved a different way. He didn’t specify how, exactly, but said details would have to be worked out in negotiations with the Synergy Group.

Froehlich said the city’s change of heart had required his group to tweak their plan to try to find “the best blend” of uses.          

Reach Matt Olberding at 473-2647 or molberding@journalstar.com.