OGDEN -- After nearly a decade of waiting, a Bluffdale firm is poised to begin building townhomes next month as part of the Ogden River Project.
The Ogden Redevelopment Agency, made up of the city council, will convey to SouthRiver LLC about 6.1 acres valued at $1.3 million. The land is east of Grant Avenue between 20th Street and Park Boulevard.
The agreement calls for the construction of 69 townhomes on about 4 acres. Built on the remaining 2.1 acres will be 125 apartment units and 25,000 square feet of retail space.
The entire project is slated to be completed by the end of 2014, said Brandon Cooper, a senior development coordinator for the city.
Scott Sauric, a principal with SouthRiver, said 15 two-, three- and four-bedroom townhomes are expected to be constructed by the end of the year.
It makes sense to build out the project incrementally because of housing demand and current economic conditions, Sauric said.
"We have found a way to make it work," he said.
The SouthRiver mixed-use development will be the first of its kind in the Ogden River Project, which has been on the drawing board since 2002.
"It's been challenging because of the economy and managing a big project," Cooper said in explaining some of the reasons why the project has languished.
Mayor Matthew Godfrey said it's gratifying to know that construction will finally be starting.
"It's been a long time coming," he said. "It's an exciting project. It will be nice to bring life to this area downtown and bring life to this beautiful river corridor."
The entire Ogden River Project area encompasses about 60 acres straddling the river from 18th to 20th streets and Washington Boulevard to Wall Avenue.
SouthRiver also would be the first firm required to comply with a new $50,000 master plan formulated for the city by Pittsburgh-based Urban Design Associates.
The aim of the master plan is to offer an array of housing types and sizes to accommodate Ogden's population in the downtown area.
The development agreement calls for the RDA to retain all of the tax increment derived from the development to cover conveyance of the property to SouthRiver.
"The main benefit we will receive is that we will get development sooner than later," Cooper said. "If the realized tax increment goes beyond the $1.3 million value of the land, that excess revenue goes into the RDA coffers."
The SouthRiver townhomes will be constructed in four 1-acre phases, Cooper said. The city won't deed parcels to SouthRiver until each phase is 80 percent occupied, he said.
The RDA would retain tax increment proceeds for the property through 2019 and may seek an extension of the collection period through 2026, Cooper said.
An extension of the collection period would have to be approved by six of the eight members of the Ogden City Redevelopment Agency Taxing Entity Committee.
The committee includes representatives from the city, Weber County, Weber School District, the state Board of Education and smaller taxing entities.
The city council would also have to approve the extension.
The SouthRiver project is estimated to have a market value of $18 million to $20 million, providing a little more than $100,000 in tax increment annually to the RDA, said Tom Christopulos, the city's deputy director of community and economic development.
The project will also provide housing for more than 200 families who will live and shop in the downtown area, he said in a memo to the RDA board.
In addition to the SouthRiver development, Millrock Development LLC, based in Holladay, has a letter of understanding from Gadi Leshem -- whose firm, Ogden Riverfront Development, is the main owner of river project property -- to be the major partner in the river project.
Millrock has completed several projects, including Millrock Park, which includes four buildings in Holladay with 490,000 square feet of class A office space.
Christopulos said the city is negotiating with Millrock, which plans to submit a proposed development agreement to the RDA board in September.