CLEARFIELD -- With a planned $150 million development at a standstill, officials have begun reviewing whether the developer has met conditions of the development agreement and if that agreement should be voided.
Midtown Village, near the Legend Hills development on the city's east side, is a 1.2 million-square-foot project that was planned to have 300 residential units, a state-of-the-art performing arts theater and more than 300,000 square feet of office, retail and restaurant space.
This project was hailed as a public- private partnership that would improve the city. For its part, the city promised roughly $27 million in incentives to the developer.
City Manager Chris Hillman said Midtown Village LLC declared bankruptcy in late 2008 and has not been able to fulfill requirements of the development agreement.
Community Development Director Adam Lenhard said the developer failed to meet the agreement in five different ways, including failing to complete site improvements by July 2009 and failing to reimburse the city for costs of a feasibility study.
But those findings need to be validated before the agreement is deemed null and void.
"The developers were caught in the perfect storm of the subprime mortgage collapse and the credit collapse with the real estate market tanking as well," Hillman said.
Hillman said the developer's efforts have been focused on completing a similar project in Orem first. However, both projects have been sitting for nearly two and a half years.
"It could be years before that project is completed," Hillman said of Orem. "The city felt that at this time, it is necessary to do the findings and reviews. Those will show that the developer has not been able to fulfill the agreement.
"But it is understandably so."
Mayor Don Wood agreed, saying the economic conditions affected the development.
"This developer is still a friend of the city," Wood said. "This action doesn't speak to his willingness to do this project."
The city council unanimously approved conducting the annual review of the development progress at Midtown Village. Once that is finished, there would be a 30-day review period, plus a public hearing to discuss the matter.
If deemed null and void, the incentive package as well as the agreement will be taken off the table. Hillman said the city would likely want to work with the new property owner to get a quality development in place.
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