One Wake, developers at odds as Raleigh moves closer to vote on Downtown South
A new coalition of faith organizations and nonprofits says the developers of Downtown South are walking away from negotiations as the city nears a decision on the project’s controversial rezoning.
But a representative of Kane Realty Inc., one of the project’s developers, says that’s not the case.
“Our overall impression is that Kane has walked away from the negotiating table with ONE Wake, and is instead pursuing a series of discreet deals in private, and in doing so is keeping everyone else in the dark of what’s being offered and to whom,” according to a letter that ONE Wake sent to the Raleigh City Council this week. “We feel this calls for us to make our position public to ensure that the Raleigh City Council and all residents of our city know exactly where ONE Wake stands.”
“I don’t know where that is coming from,” said Bonner Gaylord, managing director of operations for Kane Realty.
Downtown South is a 140-acre mixed-use development proposed as a southern entry to downtown Raleigh near South Saunders Street, South Wilmington Street and Interstate 40. Pitched by John Kane, of Kane Realty Corp., and Steve Malik, owner of the North Carolina Courage and North Carolina FC, it would include housing, stores, restaurants, and hotels anchored by a sports and entertainment stadium.
ONE Wake
Years in the making, ONE Wake formally launched in mid-October focused on affordable housing, eviction prevention and education. In its first public assembly, ONE Wake got commitments from Kane and Mayor Mary-Ann Baldwin to work together regarding the Downtown South project.
The group focused on Downtown South because of its size and effect on all of Wake County, Rose Cornelious, development director of Dorcas Ministries, told The News & Observer during an interview with ONE Wake leaders.
“It has the potential to impact so many people, and to displace so many people and to flood out so many people and institutions in that area,” she said. “And we just certainly think that a project of this scope, this size, should certainly be able to address affordable housing and also wages. Ensuring that women and minority contractors are included in the bargain.”
The community should be treated as investors in a project this big and know the “tangible community benefits,” said Mycal Brickhouse, pastor of Cary First Christian Church.
“It is our hope that as a result of these conversations the community will be able to see the issue of the stormwater protection addressed,” he said. “It’s our hope the community would see affordable housing in this major complex. And it is also our hope to see there are livable wages for those who will be working on this project and a project that is open to minority contractors. That is our hope as investors in this project.”
“We have noticed that our hopes are not being met just yet,” he said.
Not feasible during rezoning, says developer
ONE Wake asked that 20% of the housing units in Downtown South be considered affordable and that the minimum wage for workers “in and at the development” be $20 per hour, Gaylord said.
“It’s not something that is feasible, of course,” he said. “There isn’t a way to use a zoning condition to dictate what third-party businesses that have no relationship with that agreement must do. So all the tenants and folks who are working on the site for other companies there is no control there.”
Some of those items could be discussed during the tax increment grant negotiation process, Gaylord said, referring to the financing method the developer hopes to use. Kane Realty has a good relationship with ONE Wake and remains “ready and open to further discussion,” he said.
“We have conveyed we are more than happy to continue a conversation about how to meet our mutual goals, and that those mutual goals can be met through a tax increment grant and welcome continued conversation,” he said. “We have certainly not backed away.”
But the negotiations have to move beyond conversations, said Cornelious.
“We are disappointed in what we have received so far,” she said. “We’ve approached this with open hearts and willingness. We know he has to make money and his investors have to make money, but on the other hand, we don’t want people displaced. We don’t want gentrification. ... We don’t want houses and institutions flooded.”
“We just want equity and fairness,” she said. “And we want everybody in the community to rejoice that this project is going up.”
Not a ‘false deadline’
ONE Wake is encouraging the more than 50,000 members it says it has to send letters to the Raleigh City Council as the rezoning vote gets closer.
The Planning Commission will hold another virtual meeting at 9 a.m. Tuesday when it could make its recommendation to the council. People can sign-up to speak at raleighnc.gov/planning-commission. The meeting will be streamed on the city’s website and YouTube channel.
While the commission has until Jan. 11 to make a decision, developers say the rezoning must be in hand before the end of the year for the project to move forward
“The closing is at the end of the year, and there have been some attempts to adjust that,” Gaylord said. “It’s the date we have. And we don’t have the opportunity to amend that. There needs to be a clear direction of what the zoning is going to be before the closing.”
He added that the developers are not trying to pressure the city.
“This is not some false deadline by any means,” Gaylord said. “There is a very real chance this doesn’t happen for our community.”
A Planning Commission recommendation would trigger two specially called meetings of the City Council: a two-hour public hearing Dec. 15 and a second meeting Dec. 17 when council members could vote on the project.
Council member David Cox was the lone vote against scheduling the special meetings.
“Downtown South envisions people living in high density housing,” Cox said on Facebook Thursday. “After a year of COVID-19, would you really want to live there?”
New conditions
Developers added several zoning conditions to the project in late November.
One states that 10% of the first 999 dwelling units would be reserved for households making less than 80% of the area median income for at least five years. A one-person household at 80% AMI must make $52,750 or less a year. For a family of four, it’s $75,300 or less.
While the rezoning condition references 80% AMI, the deveopers would target “households earning an average of 60% AMI,” according to the Downtown South’s website. One-third of the affordable units would be dedicated to seniors, according to the website.
Other conditions include a promise to hold public information meetings every three months for the next three years and “green stormwater” measures like rainwater harvesting, green roofs and permeable pavement systems.
“We have developed conditions in response to all the community concerns we have heard to the extent that can be resolved in the rezoning,” Gaylord said. “We are hopeful that the planning commission and city council will see all the benefits this brings to the community and support the project.”
Campaign contributions
A handful of speakers told the City Council on Tuesday night the Downtown South rezoning has moved too quickly. Some called for council members to recuse themselves from a future vote.
“The reason is straight forward,” said Wanda Gilbert-Coker. “Mayor Baldwin and Council members Buffkin, Branch, Knight and Melton will be in a conflict of interest if they vote to approve Kane’s rezoning after receiving large sums of money from him during the 2019 election campaign.”
John Kane donated $5,400 to Council members Patrick Buffkin, Jonathan Melton and Baldwin, and $2,500 to Council members Corey Branch and David Knight. Kane’s wife, Willa, and Mike Smith, president of Kane Realty Corp., also donated $5,400 each to Baldwin.
After Gilbert-Coker spoke, Baldwin asked City Attorney Robin Currin to address the remarks.
“In order for there to be a conflict, there has to be an identifiable and real financial impact based on that one particular project,” Currin said. “You won’t be recused just because there was a campaign donation. There would have to be a more substantial benefit. And if in fact a question is raised it is disclosed and the council votes on it. But on most things, council has a responsibility to vote unless it is something that is very substantial and identifiable.”
The Wake County Housing Justice Coalition is circulating a petition also calling for those council members to recuse themselves from any Downtown South vote.
“The question here is, who runs Raleigh?,” according to the petition. “Do developers run it? Does Kane run it? Or do citizens have a voice and a stake in the outcome? Developers should not be allowed to buy the votes of City Council.”
This story was originally published December 3, 2020 at 2:53 PM.
