May 5 2009 12:00 AM

Sobi Square

Status: On hold pending more interest This project goes back a long way. When Virg Bernero was still a state senator he passed legislation to get the property known then as Ottawa Block conveyed to the city of Lansing. At the beginning of 2008, the state did as such and a few seconds later the city sold the 5.8-acre parcel to developer Gene Townsend for $460,000 for a mixeduse develo p m e n t that would include 52 condominiums. T h e p r o j e c t , which has since been officially named Sobi Square — see if you can guess what thatstands for — includes a zonechange for a mixed-use building at the corner of Ottawa Street and Butler Boulevard (which Townsend personally shopped around to neighborhood groups).

But, the project is “waiting for the economy,” Townsend says. “The project is complete in its entitlements, site plan approval, zoning and the site work has been bid,” he said. “We’re at the point where we’d seek reservations.

But we’re not going to spend marketing dollars on that until it seems like a more likely prospect.” The bottom line is that the financing is not there. Townsend says he’s put in applications for new market tax credits, which would guarantee lenders at least a 40 percent return, but even that is not enough. Add to that state workers who were a target market for the development, and the uncertainty of the future of those jobs given a state deficit,only hurts the project.

But, generating interest in the project is needed to push it along. Five “good leads” on a 12-unit building, Townsend said, could provide enough incentive to do further marketing and develop more potential buyers.

“If people are interested, they need to tell us,” he said.