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No deal yet on former Regency project

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A public hearing on Woodland Hills, the former Michael’s Landing development that spread across 300 acres in West Des Moines and was seized by banks in the wake of the collapse of Regency development companies, was canceled Tuesday in a disagreement over the tax increment financing cap on the project.

The hearing was scheduled for a new development plan that is being driven by Oppidan Investment Co. of Minnetonka, Minn. Oppidan has attempted for the last year to buy land held by four banks, including residential and commercial lots.

The Waukee Community School District board has approved spending $42,500 an acre to buy 18.3 acres in the development for an elementary school that could open in 2013, when the district’s kindergarten through fifth grade enrollment is expected to reach 4,296, said Superintendent David Wilkerson.

“We have been looking for quite some time; we know that we need another elementary school south of (Interstate) 80,” he said.

Waukee schools had planned to build in the area when Regency controlled the project;  however, the development costs for the school became excessive, Wilkerson said.

The Oppidan deal would trigger more growth and create jobs, he said.

The development agreement with Oppidan includes plans to pave 88th Street and rebuild the intersection of 88th and Mills Civic Parkway.

The city of West Des Moines has proposed a $20 million limit on the tax benefits Oppidan could receive under the agreement. Mayor Steve Gaer said the developer believes the level is too low.

Collapse of the Regency project, which included paving 88th and making additional infrastructure improvements, has created legal problems for the city.

First National Bank Midwest, which had loaned $7.6 million to Regency’s Michaels Landing LLC for development of residential lots and obtained land via a foreclosure and sheriff’s sale, sued the city last year, claiming it could not receive building permits after the city said the bank needed to hold up Regency’s end of an existing agreement.

In a lawsuit filed in Dallas County District Court, the bank said the agreement had not been recorded at the time it made the loan to Regency, and therefore did not apply to the bank’s interest.

According to the lawsuit, the infrastructure improvements would cost $10 million and should have been carried out by the city after Regency’s collapse.

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