Project creates several red flags
Opinions: Dave Godschalk (Guest Columnist)
Daily Tarheel
October 26, 2005





The biggest development on the agenda for the Chapel Hill Town Council in the coming year is not Carolina North,
but the public-private downtown project being submitted by Ram Development Co. of Palm Beach Gardens, Fla.
Ram proposes to build 124 residential units and 24,000 square feet of retail space, along with public open space
and a 375-space underground parking garage on parking lot 5, across from University Square.  The central building
would be nine stories tall, rising to 120 feet, with four levels of underground parking.

Ram also proposes to build 109 residential units and 6,000 square feet of retail space atop and adjacent to the
Wallace Deck, on East Rosemary Street behind the Franklin Street Post Office.  Fifteen percent, or 35 of the 233
total housing units, will be qualified as affordable and provided by the Orange Community Housing and Land Trust.
The town will pay $500,000 toward construction of parking for the units. 

Development will proceed on a fast track, with town approval expected by September 2006, and construction
completed by September 2008.  The town will give Ram a 99 year lease on the sites, receiving $7.9 million in prepaid
revenues, which it then will return to Ram for construction of the parking garage and other improvements to be owned
by the town.  The aggregate town investment is fixed at $8.4 million, unless it requires Ram to add improvements. 
All risks of cost overruns, including increased construction costs, fall on Ram.

On paper, this project sounds almost too good to be true.  The sagging Chapel Hill downtown gets revitalized with
233 new housing units and 30,000 square feet of new retail space in green buildings, along with a new public plaza
and some 227 new parking spaces on lot 5 in addition to the 173 spaces there now.  All the town has to come up
with in return is $500,000 for the affordable housing spaces, and they expect to gain increased property tax and other
revenues of more than $500,000 annually when both sites are occupied.

But as a planner who wants to see the downtown turn around, I have some major questions about this proposal.

Is it too big?
The developer has put too much building on these two small parcels.  The nine-story building on lot 5 is out of scale
with the existing downtown streetscape and soars above the 90-foot height allowed in the town center 2 district of the
Chapel Hill zoning ordinance.  Cramming 109 condos on the Wallace Deck means that half of those living there will
have to park two blocks away in the Lot 5 garage.

Will it solve the downtown parking problem?
Despite the new construction, public parking will remain tight. While the project adds spaces to existing parking on
Lot 5, the bulk of these will be reserved for new tenants.  And during construction, existing parking on both sites will
be out of service.

Will it worsen traffic?
The new condos and business will add considerable congestion to Rosemary and Franklin streets, but no major street
improvements are proposed.  Rosemary Street actually will be narrowed to accommodate new retail space on the north
face of the Wallace Deck.

Will it be financially feasible?
Cost estimates for the underground parking garage seem optimistic compared to the estimated cost for similar parking
on the University campus, some two blocks away.  Although Ram will be responsible for absorbing cost overruns, the
community will suffer if the project is found to be over budget and abandoned.

Is it getting special treatment?
Imagine how the council would respond to a private development request that exceeds the zoning limits and increases
traffic, but narrows the access street. These issues have been glossed over.

Why is there no critical voice from the Town Council?
Town officials are playing conflicting roles of project advocates and project regulators.  The council seems reluctant to
wear their regulator hats, preferring to act like developers.  Their meetings focus on details such as the plaza paving,
while no one raises questions about the larger issues.

Unwillingness to question overly rosy project assumptions follows the pattern of other public/private mega-projects
worldwide, where political ambition downplays risk of cost overruns, environmental impacts and poor performance.

When something seems too good to be true, maybe it is.





David R. Godschalk is the Stephen Baxter Professor Emeritus in the Department of City and Regional Planning,
and a former Town Council member.