The Charlotte City Council is moving toward offering a property tax rebate for the new owners of the old Duke Energy building uptown, who want to convert the building to apartments.
The move comes as the city says public money will be needed to repopulate older office towers as people continue to work from home. Office vacancy rates are higher in uptown now than during the Great Recession, topping 20% — though they're even higher in places like University City and Ballantyne.
A little more than a year ago, D.C.-based MRP Realty and Asana Partners of Charlotte bought the old Duke headquarters on Church Street for $35 million. They announced they would convert the 1975 office building into 440 apartments along with retail space.
Though the developers have already bought the building and announced their plans, the city’s economic development director, Tracy Dodson, told a City Council committee Monday they may need financial help from the city.
In exchange, the developers might set aside some apartments for affordable housing. She also said they might make additional improvements to the retail and areas for pedestrians.
She said if the City Council votes no, then, she said, “I think it gets harder.”
“I don’t know that (the developers) would say they are walking away from it — that’s a question I would ask them. But I think it makes it harder.”
But if the City Council ultimately approves helping this project, now called Brooklyn and Church, it could encourage other developers to also ask for public money even for renovations they are already planning to do.
For instance, the owners of One Independence Center, along with two other office towers, said in 2022 that they would spend $42 million to renovate their buildings and make them more attractive for tenants. They did not receive any public money.
Council members were enthusiastic about the idea of giving the Brooklyn and Church project some kind of financial assistance.
Dodson didn’t say how much that might be. She said a final proposal might come this spring.
The amount of money would likely be based on a percentage of new property taxes created by the finished project.
In the case of the Duke building, it was previously untaxed because it was owned by Duke Energy. After being sold to MRP Realty and Asana Partners, the building is now on the property tax rolls and generating revenue for the city and Mecklenburg County.
She also said the same financial assistance could be made available to property owners in other parts of the city. Her discussion about empty office towers has mostly focused on uptown.
