Lofts bring new 'Option' for downtown living

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BY DEENA WINTER / Lincoln Journal Star

An old mattress factory in the Haymarket District will soon make way for a new option in downtown housing called Option 13.

Demolition is expected to begin soon on a building most recently known as Larson Furniture and Antiques on the corner of Seventh and R streets, after the City Council recently approved a redevelopment agreement with developers Fernando Pages and Bob Hampton.

The developers plan to build 13 loft-style townhomes.

Urban Development Director Marc Wullschleger said as far as he knows, this project will mark the first new construction of housing downtown in more than 40 years.

Originally coined The Option and planned as a six-story high-rise with 40 upscale condos and penthouses, the project has been scaled back to 13 lofts in two, three-story buildings, with garages and three floors, with an optional fourth-floor penthouse.

Pages — owner of Brighton Construction Co., which will build the townhomes at a cost of about $3.5 million — said market forces and other factors changed the scope of the project. But the resulting lofts meet a need in Lincoln. Five of the 13 townhomes are under contract, he said.

Tax increment financing — an urban investment tool in which a  project’s resulting property tax increase pays for improvements such as sidewalks, lighting and landscaping — will be used on Option 13.

The townhomes are expected to increase the property value by an estimated $3.2 million, generating $473,000 in TIF funds. Of that, $75,000 will be used for things like benches and landscaping, while most of the remaining funds will go into a special account that the developer can access for project costs.

The arrangement calls for the city to buy the property from the developers for $398,000 and immediately give it back to them for free.

Normally the city would use TIF funds to do the demolition, but this method saves time and gives the developer more flexibility, said Dallas McGee, assistant director of the city’s Urban Development Department. McGee said a similar arrangement was used for the Federal Place condos downtown.

Urban Development officials are anxious to see the project get off the ground after several delays.

“Housing is hot down here,” said Jeff Cole of the Urban Development Department, which is located just a few blocks from where the condos will be built.

Demolition is expected to begin soon after the closing, in June, with construction expected to be complete within two years.

Reach Deena Winter at 473-2642 or dwinter@journalstar.com.