Indianapolis to sell former city hall to builder for redevelopment

by: Russ McQuaid

Posted: Aug 29, 2023 / 05:51 PM EDT

Updated: Aug 29, 2023 / 05:55 PM EDT

INDIANAPOLIS — Built in 1913, Old City Hall in the 200 block of N. Alabama Street has remained empty more than it has been full since the Indianapolis municipal government moved into the City County Building in 1962.

For a while, the Indiana State Museum was housed there and it was the temporary home for elements of the Indianapolis Public Library more than a decade ago before falling into disrepair.

“We need updates to the water pump system, repairs to the walls and updated windows to the building, new mechanical, electrical and plumbing to the building,” Scarlett Andrews, now the deputy mayor of economic development, told FOX59/CBS4 in September of 2021 when the price tag to fix the more-than-century old building was pegged just south of $55 million.

After October of this year, Old City Hall and its repairs will be somebody else’s problem.

TWG, a developer with headquarters in downtown Indianapolis, announced it will renovate Old City Hall as part of its Alabama Redevelopment project to construct a towering apartment building/hotel in a parking lot next door to the former seat of city government.

“This building will change the skyline forever,” said TWG CEO Tony Knoble. ”We’re strong believers in downtown and I think we’ve seen a ton of positives just this year and I think it’s gonna be stronger going forward.”

Mayor Joe Hogsett was pleased to find a developer with a vision for the long-abandoned historic property and its neighboring parking lot at the corner of New York and Alabama Streets on the east side of downtown.

”Old City Hall itself is going nowhere,” said the mayor. “It will serve as a centerpiece art venue for a boutique hotel 21c. This will be the latest location of their modern art galleries combined with first-class hotel experience.”

The former municipal building will be literally overshadowed by a new high-rise just to its north.

”That includes a 32-floor tower mixing 190 residential units and 150 hotel rooms, along with eight thousand square feet of retail and hospitality space and around 300 new parking spaces,” said Hogsett.

The City’s sale of Old City Hall to TWG is included in the developer’s estimated $140 million plan.

”That’s in our total development costs now,” said Knoble. ”Our plan is to incorporate that into the project, have it connected, we’ve went back and forth. We hope there’s some office space on the second and third floor of that.”

The City’s announcement of the project indicated that both parties, “will work to determine the best use of community and office space in the remainder of Old City Hall.”

Knoble said on the outside the building will look the same but TWG will maintain the historic significance of the four-story structure.

While the 21c Museum Hotel will occupy floors 6 through 13 of the tower, its public art gallery will be housed in Old City Hall.

24 condominium units will be included in the tower as well as five percent of the apartments set aside for affordable income tenants so that the developer can qualify for Tax Increment Financing from the City.

”It’s a 25-year TIF and I think based upon the valuations it’s somewhere around $15 million, it’s all supported by the site,” said Knoble. ”There’s more need for the high-end housing but also for the workforce housing, there’ll be ten units, and all the different bedroom kind of matrix for low-income units.”

Just this week, TWG firmed up its agreement with 21c to locate its ninth North American hotel in Indianapolis which will include a lobby, restaurant and curated retail space as well as a contemporary art museum and works and designs throughout its property.

”21c they have several hotel resorts across the country and the world and so they’re very good about bringing some of their own concepts. I think it will be neat to have them here,” said Knoble. ”Having an experienced hotel operator as a partner, being able to use their booking system, lean on all the experiences that they have, I think that really puts us to the confidence level that we’re at.”

Knoble told FOX59/CBS4 he has “100 percent” confidence that TWG will be able to line up financing, perhaps within a year, for the project.

21c has had its eye on the Old City Hall property for several years having announced previous plans to develop the property that fell through.

Knoble said the hotel chain has been purchased by new owners and will brand and operate the new hotel.

The Alabama Redevelopment further anchors the east side of downtown which has undergone several changes since the demolition of Market Square Arena in 2001, including the construction of a Cummins Indianapolis Headquarters and the location of 360 Market Square, a nearly 300-unit apartment high rise.

Currently in the works are the $175 million renovations and construction of several buildings in the City Market Block, including 400 new apartments along with retail space.

An engineer’s reports estimated it would take $25 million in repairs and improvements to bring the 136-year-old City Market up to 21st-century standards.

Still in the planning stage, a reimagining of the City County Building and its two wings with thousands of square feet of empty space now that the Marion County court system has relocated to the Community Justice Center in Twin Aire, as well as the future of the soon-to-be vacant former Marion County Sheriffs Office and Jail across E. Washington Street.

The Alabama Redevelopment project will be located between a thriving downtown entertainment, retail corridor and a struggling swath of city-owned properties.

”It is a mixed-use development, including housing, including hotel and including condos and so it’s gonna be really dynamic,” said Andrews. ”Mass Ave is just right there, it’s kind of connected to this corridor. I think with the redevelopment of the City Market Block with over 400 units of housing there, adding another around 200 units of housing with condos and apartments here, plus the hotel, you can imagine the kind of activity and excitement dynamism that’s gonna be generated by that kind of development and connectivity.”

The project will displace a recycling dumpster, portable latrines and an open-air feeding site that serves persons without shelter who reside downtown.

”It hasn’t been good in recent months. There have been a lot of encampments that have been set up overnight and some issues where we had to call the police,” said Mary Beth Servie, a resident of Firehouse Square across Alabama Street from Old City Hall. ”We’re really excited. We’re glad that they’re keeping the historical value and renovating the property and not going to change that in any way and add the art part to it, and then the condos and hotel and space look really promising and the renderings look really nice.”

The project still needs approval by the Metropolitan Development Commission and the City County Council in October in the final days before Indianapolis’ mayoral election.

”Once completed this development will combine the best of our history with the optimism we feel at the dawn of our next 200 years,” said Mayor Hogsett.

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