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Developer secures financing for 'Sugar Hole' project

By Jard Page and Andrew Adams | Posted - Dec. 14, 2011 at 8:03 p.m.


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SALT LAKE CITY — The stalled development not-so-affectionately known as the "Sugar Hole" could soon be showing signs of life.

Developer Craig Mecham says he's secured financing for his most recent vision for the corner of 2100 South and Highland Drive in Sugar House.

If all goes to plan, construction on the $51 million mix of street-level shops and restaurants, topped by five levels of apartments, will begin in spring 2012.

"We think this will be a great asset for the community of Sugar House," Mecham said.

It's a scaled-back version of the project he first pitched in 2007. Those plans included a seven-story office structure and an abutting eight-story residential building, with retail on the ground floor of both buildings.

The revised plans call for 44,000 square feet of retail space, with 204 one-, two- and three-bedroom apartments. Plans also include two levels of underground parking.

"Given the prominence and significance of this particular location, we're very excited that (Mecham) has his financing and designs in order and is moving forward," said Soren Simonsen, who represents Sugar House on the Salt Lake City Council.

The City Council, acting as the Redevelopment Agency of Salt Lake City, voted Tuesday to lend Mecham $5 million for construction of the underground parking garage. The developer also has secured a $36 million construction loan from Wells Fargo, he said.

Mecham plans to repay the RDA loan with parking fees collected from tenants and the public. Rent from commercial and residential properties will go toward the bank loan. The developer is putting up about $10 million for the project, according to financial documents.

"It's going to be a major complement to the Sugar House area," Mecham said.

That hasn't been the case for the past four years. In January 2008, crews began demolishing the eclectic row of shops that faced 2100 South to make way for a planned 4½-acre mixed-use development.

The credit crunch created by the Great Recession made securing financing for the project difficult. The development also was a casualty of Salt Lake City's then-maligned planning division.

"With the economy and political environment, there have been a lot of issues we've had to deal with," Mecham said. "It's been a long, drawn-out process."

Email:jpage@ksl.com,Email:aadams@ksl.com

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Jard Page
    Andrew Adams

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