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City approves development agreement for four downtown buildings

David Floyd • Aug 15, 2019 at 8:23 PM

Four downtown buildings, three of them vacant, took another step this week toward redevelopment.

During their meeting Thursday, Johnson City commissioners approved on their consent agenda a development agreement with AC Commercial Properties for four city-owned buildings at 309, 313, 319 and 323 E. Main St. The developers plan to repurpose the structures for a project with a combination of commercial and residential uses called The Henry.

Preston Mitchell, the city’s development services director, told the Press the agreement does not establish a required start and end date for the project, but does ensures that, once development begins on the project, the work is continuous. The project cannot cease or stall for more than 18 months.

The agreement also puts in writing the mixed use development plan that AC Commercial Properties brought to the city, which includes the option for ground floor retail or restaurants with residential units on the top floors.

“This is a catalyst project for that end of downtown,” Mitchell said. “It’s four large buildings in the 300 block of East Main Street, so that’s going to be a big deal.”

The building at 309 E. Main St. also has the option of housing indoor amusement and recreation on the ground and upper floors, according to the development agreement. The building at 323 E. Main St. only has the option of restaurant or retail uses on the ground floor.

Commissioners decided in May to sell the buildings to developers Shane Abraham of Universal Development and Construction and Philip Cox of Mitch Cox Companies for $600,000. The partners do business as AC Commercial Properties. Mitchell said the due diligence period for the sale ends on Sept. 2.

Abraham told the Press passage of the agreement will allow the developers to close on the properties in the next 30 days or so. He hopes the developers will be able to start construction on the project in the next 60 to 90 days. The first phase of development will involve the buildings at 319 and 323 E. Main St.

He anticipates the development will result in about 30 multifamily residential units, a number that could change as the project continues.

Langston infrastructure

Commissioners also approved on their consent agenda the use of community development block grant funding and money from the city’s general fund to make street, curb and sidewalk improvements in the Langston neighborhood.

The project will cost about $284,000 with $211,000 coming from CDBG funding and $73,000 coming from the public works department budget.

According to a memorandum of agreement between the city and the Johnson City Housing Authority, which administers the city’s CDBG funding, the project will involve replacing sidewalks and curbs, milling and resurfacing streets and the reconstruction of Welbourne Street from East Myrtle Avenue to East Millard Street.

“The Langston area has previously been identified as a low- and moderate-income neighborhood and the infrastructure improvements will address the Community Development Block Grant national objectives by benefiting low- and moderate0income persons and preventing or eliminating slums and blight,” the agreement says.

The city said the work will be completed during fiscal year 2020.

This project comes as the city gears up for the completion of the Langston Center, a multicultural hub that used to be the site of Langston High School, Johnson City’s public African American high school from 1893 until the school system was integrated in 1965. The city hopes to complete the construction of the facility in September.

“We thought it was a good opportunity to start addressing that neighborhood,” Assistant City Manager Bob Wilson told the Press. He said the improvements will hopefully encourage housing rehabilitation in the neighborhood.

Mayor Jenny Brock and Commissioner John Hunter were not in attendance at Thursday’s commission meeting because they were at a joint workshop involving Washington County Commissioners, Jonesborough aldermen and the school board.

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