Property for Future Public Park Assembled
December 17, 2004by Claudia Morlan
Today the City of Houston, with the help of a group of private foundations, closed three simultaneous transactions that completed the assemblage of 11.78 acres of downtown property for the development of a future public park. The park assemblage consists of Blocks 124, 125 and 249, which make up the “superblock” in front of the George R. Brown Convention Center, Block 127 which extends to the west of the superblock, and the Crawford Street right of way between Lamar and McKinney.
The first of the three closings consisted of the City’s purchase of two blocks from Crescent Real Estate Equities Limited Partnership. The purchase price for the two blocks of unrestricted commercial property was over $27 million of which $8 million was paid from City funds and approximately $3.7 million was a credit against the purchase price given by Crescent as an in-kind donation toward the park project.
The balance of funds for the first closing came from the proceeds of the second simultaneous closing, in which the City conveyed the two new blocks, two adjacent blocks that the City had purchased on 2002 from Crescent, plus the existing Crawford Street right of way, to Houston Downtown Park Conservancy. The City’s deed to the Conservancy contains a deed restriction requiring the completion of the park by December 31, 2007. The City retained an underground easement that will allow it to build underground parking facilities for the Convention Center in the future.
Houston Downtown Park Conservancy is a private non-profit corporation formed by a group of six private foundations for the acquisition and development of the future public park. The foundations include Houston Endowment Inc., the Brown Foundation, the Kinder Foundation, the Wortham Foundation, the Cullen Foundation and the Fondren Foundation. The foundations have collectively committed a total of $28.5 million for the park project, which includes the $15.3 million paid in cash today by the private donors and an additional $13.2 million pledged by the donors for design and construction costs. The five members of the Board of Directors of the Conservancy include Nancy Kinder of the Kinder Foundation, as Chair and President of the Conservancy, H. Joe Nelson, III, from Houston Endowment Inc., Dr. Maconda O’Connor from the Brown Foundation, Brady Carruth from the Wortham Foundation and Jackie Martin, President of United Way-Texas Gulf Coast.
As part of this second closing, the City, the Conservancy and the Houston Downtown Park Corporation, entered into a Joint Development Agreement, a three-party agreement approved by City Council on December 1, 2004, as an outline of the joint public/private project for developing and operating the future park.
In the third simultaneous closing today, the Conservancy transferred the full assemblage of property, consisting of approximately 11.78 acres, to Houston Downtown Park Corporation, a local government corporation formed by the City on December 1 for the purpose of holding title to the land. The Conservancy’s deed to the Park Corporation contains a number of deed restrictions that require the property to be developed and permanently operated and maintained as an urban park of high quality, reputation and natural beauty.
As part of this third closing, the Conservancy and the Park Corporation entered into a Development Management Agreement under which the Conservancy will design and build a public park by the December 2007 deadline required by the City. The Conservancy expects that programming, planning and design may take a full year, with construction beginning in early 2006.
Upon completion of the park facilities in 2007, the Park Corporation will enter into an Operating Agreement with the Conservancy for the operation of the park. Under the Operating Agreement, the City will contribute $750,000 a year for park operating costs and the Conservancy will provide funding for all capital improvements and any operating costs that exceed the City’s contribution.
Nancy Kinder, Chair of the Conservancy, said “We are all so excited to begin the design phase of this project. We want to create a beautiful, clean and safe park that will be the heart of Houston. Everyone with the Conservancy and with the Mayor’s office worked very hard to complete these deals today. We are going to go home and catch our breath, but the Conservancy will get to work immediately after the holidays on the planning process. ”
Joe Nelson of Houston Endowment Inc. said “Being located next to the Convention Center, this park will give many visitors their first impression of Houston, and we want it to make a good impression. The park will also be a terrific amenity for the growing residential community moving into our downtown, as well as for citizens of Houston who do not come downtown to work every day.”
Greg Armstrong, President of Wedge Real Estate Holdings, Inc., served as the Mayor’s special assistant in completing this land assemblage. Armstrong said “This park should have a positive effect on land values surrounding the park, and we expect that it will spur additional development of both commercial and residential projects on the east side of Main Street in the Central Business District. The foundations have given a wonderful Christmas gift to the City of Houston.”
In a separate press release Mayor Bill White thanked the Foundations on closing the deal for the park. “This is a significant transaction that will leave a lasting legacy for future generations of Houstonians – a premier urban park,” said Mayor White. “The role of the private-sector funding organizations in helping the city seize this unique opportunity cannot be overstated. I know everyone in Houston shares our gratitude. This has been a real can-do project. This would not have happened without the leadership and commitment of Greg Armstrong, as well as the foundations’ generosity.”