Business

Preservation group to guide mill effort

By Matt Matteson, Published: September 5, 2014

After years of debate, plans and study, the Hendersonville City Council pulled the trigger on a decision that could lead to redevelopment of the historic Grey Hosiery Mill.

The City Council voted unanimously on Thursday night to give the historic mill and property to Preseervation North Carolina, nonprofit that has a track record of guiding redevelopment of historic cotton mills, tobacco factories and other historic properties.

The council will convey the property to Preservation North Carolina only after investors complete complete a due dilgence evaluation, secure financing and reach an agreement with the nonprofit group. In July the city obtained a certification of eligibility for historic tax credits. The certification was crucial because the state Legislature repealed the state's historic tax credits, effective Dec. 31 of this year. The council's motion directed the preservation agency to sell the property to an investment and development group made up of White Challis, the Daytona Beach, Fla., developer that does historic renovation projects; Investors Realty Group, the Hendersonville real estate development company owned by Jim Hall; and HD Investors, the investment group owned by Austin Fazio, the son of Hendersonville golf course designer Tom Fazio.

"We'll convey the property to Preservation North Carolina and from there Preservation North Carolina — assuming everything works out — White-Challis and the investors will be doing their due diligence and getting their financing together."

Only when that's done will the city transfer ownership to Preservation North Carolina with the condition that the development preserve the two oldest sections of the historic mill. The last two additions — one built in the 1940s and another in the 1960s — can be modified or even bulldozed. Beyond the preservation restrictions, the buyers may use the property in accordance with the existing mixed use zoning.

The council recommended that Preservation North Carolina sell the property to the developers for $100,000.

"That's the recommendation," Connet said, adding it's possible that greater development costs or some other factor could change that figure. The historic preservation agency is not bound to it. "Preservation North Carolina will negotiate terms of the sale," he said.

By the time the sale to the developer takes place, the city expects to have a brownfields agreement that will shield new owner from liability arising from old industrial pollution. The agreement, Connet said, will save the developer costly testing "with the exception of asbestos and lead paint."

The City Council in February directed the city staff to explore the possibility of deeding the mill to Preservation North Carolina, which says it has saved more than 700 properties and generated $350 million in private investment. Before that decision, the City Council had twice invited developers to propose plans for using the 34,000-square-foot brick structure, only to have the proposals fizzle.

The last time the city received proposals, the City Council chose a Richmond, Va., developer that proposed renovating the mill as classroom space for Wingate University. The proposal failed. In that vote, council members Steve Caraker and Ron Stephens voted instead for the White-Challis loft apartments proposal.