The developer of Rayzor Ranch Town Center is asking the Denton City Council to relax design standards and boost financial incentives to help the project gain momentum.
The design standards set by the city — which were meant to attract a higher quality commercial and residential development than might come to the city otherwise — were ultimately a barrier for Dillard’s moving into the proposed center as planned, Mayor Mark Burroughs said.
“The difference is subtle to us, but huge to the developer,” Burroughs said.
On the eve of considering creation of a special taxing district for the Town Center project just south of Rayzor Ranch Marketplace, the City Council is now considering a host of possible changes to the nearly eight-year-old deal between the city and the current developer of the massive, mixed-use development.
The developer’s many-faceted request to the city comes shortly after Dillard’s announced it would not be leaving Golden Triangle Mall to be an anchor store for the Town Center, as had previously been announced.
During a council briefing Monday by city staff, council member Jim Engelbrecht said he is concerned that the Rayzor Ranch project has now dwindled from four planned anchors down to one. As a result of Dillard’s decision to remain at Golden Triangle Mall, the only large project now announced for the Town Center project is a Cinemark movie theater and, possibly, a grocery store, city staff told the council.
Several council members said they were concerned that the city is continuing to make changes and concessions to the original agreement, which was inked in 2007 before the economic downturn.
Scott Wagner, vice president of development with RED Development, told the City Council that the officials are “retooling” after Dillard’s announcement but remain bullish on the project.
Aimee Bissett, the city’s economic development director, told the council that Denton didn’t have the average household income that other nearby cities have and as result probably couldn’t afford the same design standards employed at Southlake Town Square or The Shops at Highland Village.
The council is expected to vote today on whether to create a public improvement district for Rayzor Ranch Town Center and economic incentives for both Rayzor Ranch projects.
The council is expected to discuss the issue further in closed session today before holding a public hearing tonight on the creation of a possible public improvement district for Rayzor Ranch.
The public improvement district would allow RED Development to borrow about $40 million in public bonds to build the infrastructure — water, sewer, roads and other public fixtures — for the Town Center project. RED will be limited to borrowing no more than one-third of the value of the land it seeks to improve, Bissett said.
Among the additional concessions RED has asked for include being able to recover the costs of setting up the district with the bonds. RED is asking the city to make other changes to its original agreement, which allowed the company to recover some costs through $62 million in tax incentives.
RED has asked that the cap of the agreement be increased to $68 million and other terms be extended, including the deadline to meet performance thresholds. The company also is asking that additional categories of expenses be considered reimbursable.
Wagner said RED, based in Scottsdale, Ariz., also wants to be released from terms in the agreement that protect Golden Triangle Mall, which has since received its own incentives from the city.
The council added the terms after reports emerged that Rayzor Ranch’s previous developer was pursuing the mall’s tenants. Those terms included prohibiting Rayzor Ranch’s developers from claiming credit for sales tax revenue the shopping center lured away from the mall.
The company is also asking to be released from a requirement that made it responsible for any vacancies left behind at the mall.
Council members agreed to consider a sunset provision that would release those provisions involving the mall in about five years in order to re-level the playing field, but the council was lukewarm to RED’s other requests.
“In general, we don’t like to incentivize retail development,” Burroughs said.
PEGGY HEINKEL-WOLFE can be reached at 940-566-6881 and via Twitter at @phwolfeDRC.