More details were unveiled about a potential Dome site re-development deal in Virginia Beach.
The city has reached a non-binding agreement with Venture Realty Group. The real estate developer will transform the site into an entertainment complex and surf park at the 10.5-acre lot at 18th Street and Pacific Avenue.
The Deputy City manager, Ronald Williams explained key elements in the proposed “term shear or arrangement" between the city and Venture Realty.
“No project before has gotten to the point of getting an approved term sheet," Williams said.
The city and the reality company made a non-binding agreement, to develop the $328,500,000 multi-use attractions on the Oceanfront.
Such a plan has been the brainchild of singer and Virginia Beach native Pharrell Williams, who partnered with Venture Realty to help make this Oceanfront revitalization into a reality.
The city will invest $95.5 million dollars towards common spaces, three parking lots, and entertainment venues. Virginia Beach's money will come from the “Tourism Investment Program,” not the city’s general fund.
The new Dome has a similar model to want the city used to build Town Center. The invested money from the city is an incentive to get the features they want.
The Virginia Tourism Development Financing program (TDFP) will fill a gap in the development cost.
So, the developer pays 80 percent for the project. Then the remaining gap will be paid for in three equal parts from 1.5 percent of the state, and city sales tax and the developer provides the other third of the money.
The project qualifies for this program because the project fulfills a tourism gap. When the gap loan ends, all of the money will go to the city’s “general fund.”
The second part of the agreement is a ‘performance grant,’ that uses a portion of the taxes that would otherwise go to the tourism and investment program.
It would be returned back to the developer, as a performance grant, as long as they earn it. It could take a while, so the city has a gap incentive for up to $5,000,000 a year.
Also, 100 percent of the admissions taxes, plus 20 percent of meals tax revenue from Venture condominiums will go towards paying for the grant.
“Our analysis and our balancing of our capital investment was looking at over the 20 year period when we will have debt service,” said Williams. “In this format, the project pays for itself... All grants and incentives are only if the project produces the revenue.”
City Council will be briefed on the agreement next Tuesday, but city officials will give a preview of that presentation on Wednesday.
It won't be set in stone until city council votes on the project agreement on January 15.
The Dome site, located between 18th and 20th Streets off of Pacific Avenue, is currently a parking lot. But before it was bulldozed in 1994, the nearly 10-acre site featured big musical acts.
If the Dome gets the right approvals, groundbreaking could take place in 2020.