Developer decides on condos for Heer's

McGowan, president and CEO of Blue Urban LLC, said construction on the seven-story structure would begin in June and would last no longer than 14 months. St. Louis-based Mike Shannon’s will open its second restaurant on the building’s ground level in May 2009, McGowan said.

(Click here for a rendering of the Heer's project.)

McGowan’s plan calls for three three-bedroom units, 18 one-bedroom units and 20 two-bedroom units, one of which is a 3,000-square-foot penthouse in the former department store’s signature tower going for $750,000. The other condos – about half of which will have outdoor balconies – will range in price from $165,000 to $280,000, McGowan said.

McGowan said he had hoped to convert the Heer’s into a boutique hotel, but he said the financial risk associated with the project was too great. He remains hopeful, however, that the hotel concept will work elsewhere in downtown Springfield, possibly close to Park Central Square.

“We are working (on a deal) right now,” McGowan said, declining to discuss specifics. “I hope perhaps by late spring, we can make some sort of announcement.”

Springfield Mayor Tom Carlson praised McGowan as a nationally recognized developer with the experience and initiative to tackle one of downtown Springfield’s biggest redevelopment projects.

“This is not easy work,” the mayor said. “… It’s not something for the weak of heart.”

McGowan, co-founder of St. Louis historic renovation firm McGowan|Walsh, purchased the Heer’s building from the city for $3 million. The sale closed Nov. 8.

McGowan recently split with longtime business partner Nat Walsh and formed Blue Urban, a company that hired all 15 employees from McGowan|Walsh.

The city had owned the abandoned landmark since December 2006, when previous developer Vaughn Prost ceded ownership and sidestepped the city’s plans to foreclose on his acquisition loan. Prost, of Jefferson City, purchased the building from Warren Davis Properties for $2.2 million in 2004 and had planned to redevelop the building as a mix of class A office space and luxury condos before missing a series of construction financing deadlines last year.

McGowan submitted a draft list of his requested incentives to the city in September, but he missed a Nov. 1 deadline to finalize the list. McGowan has indicated he will pursue special taxing districts, tax credits and tax abatement programs for the Heer’s project.

Under his agreement with the city, McGowan has until Sept. 1 to begin redeveloping the building. McGowan has agreed to pay the city $1,400 for each day of inactivity after the deadline, with a maximum penalty of $250,000.

See SBJ’s Dec. 24 double issue for more about Blue Urban’s plan to redevelop Heer’s. [[In-content Ad]]