Rochester’s agreement to sell riverfront property to Bloom International Realty has been terminated.
Apparently seeking to revise its plan, the Abu Dhabi-based developer has backed out of the agreement for a proposed $230 million development along the west side of the Zumbro River between Second and Fourth streets in Southeast Rochester.
“We are going to continue with Bloom and have discussions to understand what this means,” Rochester City Administrator Steve Rymer said Monday.
He said the developer informed the city in December that it is ready to continue with the first phase of the project, which includes creation of private senior housing in a tower south of Third Street.
However, plans for the northern tower, which was designed to include retail space, a hotel and condos, are uncertain.
“They want to test the market conditions for the condos and townhomes, so they are going through the process of having a market study done,” Rymer said, noting the study could take four to six months.
Assistant City Administrator Terry Spaeth said the first phase of the project was set to start construction in July, but it’s uncertain whether that timetable will remain in place, since a new purchase agreement must be developed.
He said the city is waiting for Bloom to define its expectations for a revised agreement before seeking council input.
“The council needs something to react to,” Spaeth said.
In addition to council approval, a new agreement will face Destination Medical Center Corp. board review since it approved $18 million in tax-increment financing for the original agreement.
Patrick Seeb, director of economic development and placemaking for the DMC’s Economic Development Agency, said it’s not uncommon for large, complicated projects to go through adjustments before breaking ground.
He said he’s hopeful city and EDA staff can work with Bloom to provide details for a new agreement during the DMCC board’s Feb. 5 meeting.
“We’ve got to find out what’s on their minds and have some discussion,” he said of Bloom officials.
Rochester City Council President Randy Staver he’s becoming impatient with the process that started in 2015, when Bloom sought exclusive rights to negotiate for a project on the city-owned land.
“We have expended a great deal of resources on this,” he said. “To be fair, we did some of this to ourselves by renewing the exclusive negotiating agreement.”
Council Member Michael Wojcik said he wants to see policy changes to ensure circumstances are not repeated with future projects. Additionally, he indicated a desire to see Bloom cover city expenses related to continued negotiations.
“I’m not happy with the essentially corporate welfare that we’ve extended to them at this point,” he said.