LOUISVILLE — A final subdivision plat and a service plan for a metropolitan district for the Redtail Ridge mega-development in Louisville were each approved on Tuesday evening by city leaders.
The plat and metro district plan establish a framework for infrastructure construction on the vacant property off U.S. Highway 36 where a large biotechnology- and health care-centric business park is proposed along with a strategy from the developer to tax future Redtail property owners for the cost of that infrastructure.
Developers, including the property’s current owner and master developer Sterling Bay LLC, have had their sights set on building a 2.55 million-square-foot business park on the roughly 300-acre property, which was previously home to a massive Storage Technology Corp. campus, for about five years, but the Louisville entitlements and approvals process has been a gauntlet.
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Tuesday’s plat and metro-district approvals, each passed on a 5-1 vote of Louisville City Council, are significant steps forward for Sterling Bay.
“Since acquiring this property two years ago, Sterling Bay has worked closely with Louisville residents, community and business leaders, and City of Louisville staff to create the best possible version of redevelopment at Redtail Ridge,” Sterling Bay vice president Evan Pesonen told BizWest in a texted statement Wednesday. “We’re very humbled by the broad community support that helped get Redtail Ridge to yes, and now it’s time to get to work in building the premier innovation campus in Colorado.”
Denver developer Brue Baukol Capital Partners LLC bought the property from Phillips 66 (NYSE: PSX) in 2020 for $34.93 million. As part of a July 2022 real estate transaction conducted by a series of holding companies, Sterling Bay acquired the property from Brue Baukol for just under $128 million, Boulder County warranty deeds show. Brue Baukol remains a minority partner in the development.
When Sterling Bay entered the picture, the developer added plans for flex-lab-office spaces aimed at biotechnology tenants, a red-hot subsector of the Boulder Valley commercial real estate development scene in recent years. AdventHealth Avista also plans to build a new hospital on the site.
Avista has been under contract for about two years to buy about 40 acres on the Redtail site at the interchange of Highway 36 and Northwest Parkway, where it plans to relocate from its existing building at 100 Health Park Drive.
Redtail’s plat also includes public dedications of nearly 140 acres, along with an extension of Campus Drive, new underpasses and roadway-accessibility improvement around Monarch High School.
Louisville City Council’s approval came with a series of conditions — mostly centered around transportation issues related to traffic and safety — that Sterling Bay must meet before beginning horizontal-development work.
“This is an opportunity that we have that is transformative for the community,” Mayor Chris Leh said of the Redtail proposal. “It doesn’t come around very often.”
Sarah Komppa, a Redtail project representative with Tryba Architects, told city officials that at Redtail’s buildout, which is likely to take several decades, the project “will have a $4.9 billion annual impact” to Louisville’s economy.
The metro district service plan estimates the infrastructure cost at more than $160 million and included a total debt issuance limit of $228 million, according to a city memo. The district comes with a “maximum total mill levy of 60 mills, which is the maximum property tax mill that the district could impose to pay for construction of infrastructure, operations and maintenance.”
A $60 million escrow agreement is being hammered out to provide the city with a guaranteed pot of money to help pay for infrastructure improvements.
“This was not ready to pass,” Sherry Sommer, a representative of Redtail opposition group Citizens for a Vibrant Sustainable Louisville, said in a prepared statement. “There are nine essential conditions for approval that have not been met. In addition to the reduced financial guarantee, the contributions to public infrastructure are inadequate to deal with the traffic created by the project. There is no plan or financing to deal with the premature failure of the (U.S. Highway) 36 interchange.”
Concerns from residents — mostly centering around flattening of the site, traffic, the size and location of public spaces, sustainability and economic viability — have nagged Redtail Ridge for years, culminating in an April 2022 special election in which Louisville voters repealed a previous approval of the project by city officials.
Those concerns persisted during a public hearing during Tuesday’s Louisville City Council meeting.
“Unfortunately, the air pollution is a big problem and the traffic is a big problem. We did a lot of work on the petition for this project,” resident Joy Brook said. “It was not listened to and we wasted a lot of money on an election that wasn’t listened to.”
Redtail’s developers have said throughout the entitlements process that they have actively and repeatedly amended their plans in response to community input.
“Ultimately our team’s vision for Redtail Ridge has been directly influenced by citizens, by (Louisville City Council) members and (Louisville planning) staff … to create a premier innovation and life-sciences campus,” Komppa said.