Sugar Land’s highly touted Imperial Sugar redevelopment project has been put on hold until the end of first quarter 2009 by the private equity firm acting as its managing partner, FortBendNow has learned.
“Our investment partner is kind of taking a 90-day re-look at all their projects,” said Shay Shafie, vice president of commercial development for Southern Land Co., developer of the project.
Cherokee Investment Partners of Raleigh, N.C., which partnered with the Texas General Land Office to purchase and manage the approximate 750-acre Imperial redevelopment, has a portfolio of projects stretching from coast to coast, many of which are in markets hit by the real estate and general economic downturn.
Shafie said he believes the Imperial project will unfold largely as touted on the residential side, where more than 1,600 homes have been planned on 234 acres.
But he indicated the commercial portion of the Imperial project may be subject to more stringent review, as partners in the project are faced with a much weaker market than a year ago.
“It’s going forward,” Shafie said of Imperial. “We just want to make sure what we develop makes sense” in an economic landscape that has changed dramatically over the past year.
Cherokee Vice President Kyndel Bennett, who had been overseeing the Imperial redevelopment, declined to comment Monday, saying he’s no longer involved in the project.
Neither officials at Cherokee’s headquarters nor General Land Office officials could be reached Monday, the Martin Luther King Jr. holiday.
Sugar Land City Council approved Cherokee’s general plan for the Imperial project a year and a half ago.
Bounded by U.S. 90A to the south and State Highway 6 to the west, the project includes Imperial Sugar Co.’s historic char house and other company structures.
The general plan calls for 234 acres of residential development set among parks and green space, as well as 27 acres of commercial retail space, 36 acres of office or light industrial space and 46 acres of mixed-use development surrounding the historic buildings just off of U.S. 90A.
Shafie said a recent study obtained by the Imperial partners showed strong growth at residential developments Telfair and Riverstone despite a weak residential real estate market in other parts of the country. He said homes developed at Imperial also should do well.
Shafie said it’s likely that research will show the commercial market is “probably not as robust as it could have been.” But compared to Cherokee projects elsewhere, “this is probably one of their jewels.”
The economic downturn and other factors have affected Cherokee in other states in recent months.
Specializing in remediation and development of property containing environmental hazards, Cherokee had partnered with SunCal Cos. of Irvine, Calif. to develop nearly 1,000 acres on a former munitions plant in California’s Santa Clarita Valley.
But in September 2008, SunCal announced it wouldn’t buy the property. The company didn’t say why, but the announcement came shortly after one of its owners, Lehman Brothers Holdings, filed for protection from creditors in what has been billed as the biggest bankruptcy filing ever.
A company called EnCap, variously described in news reports as a Cherokee subsidiary or as being financed by Cherokee, filed for Chapter 11 bankruptcy in May of 2008, the day after the New Jersey Meadowlands Commission severed ties with EnCap.
That move pulled the plug on a proposed $1 billion development in the Meadowlands, and angered Donald Trump, who was to have been the project’s manager.
In October, Cherokee sued the New Jersey commission, claiming it is owed a refund of nearly $9 million for money paid to the commission for lease rights in the failed development deal.
Citing a weak economy, Cherokee pulled out of a proposed project to put condominiums, shops and a golf course on 392-acre Petty’s Island in southern New Jersey.
Also in 2008, the City of Camden, N.J. rescinded its approval of a Cherokee project in Cramer Hill, according to news reports.
Ah, Sweet Beginnings:
Creating Mixed-Use Development While Preserving Our Heritage
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Developers and builders with projects in Sugar Land are earnest partners and have a shared vision with the City. Several exciting events occurred in 2007.
Creation of the Imperial Redevelopment District is a milestone in the City’s history. The City and Cherokee Development Corporation have worked together, creating a planned development district for the Imperial property and the adjacent large parcel commonly called State Tract 3.
The District includes tailored zoning specifying aspects of future development, such as building height, density and easement areas. The process has included several public meetings, including a five day “design charrette” hosted by Cherokee in September when City staff, members of the Planning and Zoning Commission and the public were invited to discuss development plans. As preparations continue for the zoning application, there will be opportunities for public involvement.
As a tax increment reinvestment zone, the District will be able to levy taxes and capture revenue from the ad valorem taxes to pay for needed infrastructure to support the development.
Because the future development of the Imperial/Tract 3 development will be market driven, it is too early to name a completion date. However, if other current developments in the City are any sign, the Imperial/Tract 3 development should “take off” once the initial remediation work by Cherokee is concluded.
The City contracted for services with the Fort Bend County Museum Association to retrieve and store artifacts, photographs and documents from the Imperial Sugar Company property, Sugar Land’s historic birthplace. The City’s role in this project is to serve as temporary custodian of the Imperial artifacts until the Sugar Land Heritage Foundation can be formed and operational.
Preserving the past is important or Sugar Land. In 2007, and existing ordinance was amended, ensuring the continuation of a unique zoning district on the west side of Brooks Street, a mixed-use conservation district intended to protect the historic character of that neighborhood.
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City of Sugar Land
2007 Annual Report
Sweet: OffTheKatKuff
Sure, I am no Bob, but my passion for writing feels just as strong. It was The Imperial Project via U.S. 90A that had me “winging it” on my own community bulletin board in 2007. I knew then, I was smitten with not only FortBendNow, but with the City of Sugar Land’s political projects — the rest is sweet history, as we “write along” Texas Friendly!
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If my memory is correct – Cherokee would not take the Imperial Building unless they got all of the “fast & easy money land” for residential development. And remember the Sugar Land Mayor Wallace had an office with Cherokee. (Just follow the money trail – looks like they snookered the City of S/L.
I hope all goes well, eventually, with this project. It is understandable if the project is in a state of flux momentarily due to the economy, but I’m confident that the economy will rebound. My daughter loves that general historic, old area because she love attending Lakeview Elementary and fell in love with the general area.
They have possibly misled the City of SL and many of its citizens. The residential piece is where the fast money is and some of us thought that is ALL they would ever develop and take the easy $$$$$$$$.
What will City do??