University is close to choosing developer for downtown office building

Tom LiVigne, left, and Melissa Detrick from the Cornell Real Estate Department talk during the Tompkins County Chamber of Commerce luncheon in the Holiday Inn, Feb. 8. Robert Barker/University Photography

By Roger Segelken

Following a March 1 deadline for proposals, Cornell will select a private developer to site, design, construct, own and operate a new office building in downtown Ithaca, with several Cornell units as principal tenants, university real estate officials told local businesspeople at a Feb. 8 breakfast meeting hosted by the Tompkins County Chamber of Commerce.

That timetable would put the proposed multistory, 130,000-square-foot building on schedule for an early 2004 opening, said Tom LiVigne, operations manager of the Cornell Real Estate Department. About 300 Cornell employees from units such as Development, Investments and Real Estate would occupy 70,000 square feet of the proposed, privately owned structure under a 20-year lease, while ground-floor retail space and another 50,000 square feet of class A office space (suitable for as many as 200 non-Cornell workers) would be available to rent, he said. The building, including offices rented by Cornell, would be on the tax rolls.

In addition, the office building's developer is being encouraged to construct a 50- to 100-unit apartment building somewhere nearby as part of the project, LiVigne said, while the city of Ithaca would be responsible for constructing a proposed 600-car parking garage to accommodate the new buildings' needs as well as the perceived parking shortages throughout downtown.

While no site for the office building has been selected yet, LiVigne said, the university's "preferred site" is the current location of the Tompkins County Trust Co. main office, in the "bank alley" section of the Ithaca Commons, near the intersection of Tioga and Seneca streets. The university also holds a purchase option for the town of Ithaca's former town hall, just west of the bank site on Seneca Street.

It is up to the three developers who are still "in the running" to choose a building site, LiVigne said, but one consideration in the university's final choice of a developer will be an appropriate site, as well as an architectural design "that is in character with downtown," he said. Originally, 11 developers had expressed interest in the project, LiVigne said. Then a committee narrowed down the field to eight, and subsequently to three, including one locally based developer. Property acquisition and construction is estimated to cost more than $17 million.

The presentation by Cornell's LiVigne and project manager Melissa Detrick got a generally favorable reception from Chamber members, although several expressed concern about the proposed office building's height, its architectural design and about tax abatements the developer might seek to temporarily reduce property taxes on the facility.

The Cornell real estate planners are hoping for a seven-, eight- or nine-story building, LiVigne said, "because I think we will make the 'footprint' larger by adding space behind the Trust Company space." The possibility of having a 12-story building in the Trust Company site is remote, he said.

Detrick added that the height of the building "all depends on the size of the footprint space selected by the developer." If the structure turns out to be 12 stories tall, it would equal or exceed the only high-rise structure in downtown Ithaca, the Holiday Inn building on Cayuga Street, where the Chamber of Commerce breakfast was held.

Regarding architectural design, LiVigne repeatedly promised "no glass office towers" and that the design would be "in character with downtown Ithaca." If the bank site is chosen, he said, architects may recommend retaining the building's decorative façade and fitting the new structure within at least part of the façade.

Property tax abatements would be sought by the developer-owner of the building to make the project financially feasible, LiVigne said. Michael Stamm, director of the economic-development agency Tompkins County Area Development, observed that new tax-abatement policies are under consideration by local governments to encourage higher-density use of land where that is deemed appropriate. Locating the Cornell units in taxable, privately owned space will cost the university "millions of dollars extra" over the years, LiVigne added, compared to on-campus construction on tax-exempt university property.

Detrick called the proposed project -- with an office building, a parking garage and possibly an apartment building -- "a true partnership between the university, the city and the developer." Cornell's contribution is the leadership to initiate the project, a commitment to a 20-year lease so developers can secure financing and the relocation of 300 employees, she said.

By relocating personnel near the Ithaca Commons, the university "is taking the people approach" to bolstering the economic health of its home, LiVigne said. "It is important to us to have a vital and vibrant downtown Ithaca when we're recruiting students and faculty." Not just the university, he said, but the entire community stands to benefit from the project, offering projections of increased business activity from each new job and each new apartment dweller in the downtown area. Sales tax revenues would rise by an estimated $84,000, LiVigne said, and another $150,000 per year in property taxes would be generated.

Restaurants and other service-oriented businesses are expected to thrive in downtown with patronage from workers, residents and visitors. According to LiVigne, city officials are confident that the downtown infrastructure now in place can handle the increased activity -- with one exception: Some on-campus workers may be traveling downtown to the new offices, and TCAT (Tompkins Consolidated Area Transit), the community bus service, may want to add more buses.

"Although, personally," LiVigne said, "I'd like to see a trolley."