Mike Vondran long has thought that the greenspace behind his downtown Davenport ad agency was destined for a higher purpose.
Now the CEO and founder of TAG is involved in a proposed development that not only will transform the vacant site into a new five-story mixed-use housing project but will expand TAG's offices another three stories higher.
"I've been chasing this idea for several years," said Vondran, who relocated his full-service marketing and communications firm in 2004 into 230 E. 2nd St. offices. "My problem was I was thinking too small."
But after partnering with Bush Construction, the vision has grown from a simple office expansion into a brand new $18 million building. To be known as the TAG Building, it will still house TAG but also have 82 market-rate apartments, retail/commercial space and covered parking. The vacant site also is adjacent to the south side of Davenport's RiverCenter.
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AJ Loss, Bush Construction's president and CEO, said Vondran's office expansion plans were "rolled into a bigger development that just makes the project more feasible."
The project would create four levels of market-rate housing above a ground-level parking on the vacant lot as well as add a three-story addition atop the now two-story TAG building, Loss said.
"TAG's building will stay but it will be adjoining (the new structure) to the west and east and over the top," said Vondran, who will continue to own his building as well as be an investor in the new project.
The Davenport City Council recently approved an option for Bush Construction Co. to purchase the vacant greenspace for $250,000. It will eventually be sold to a new investor group.
Loss said the project now will begin its due diligence period "to make sure everything is in order" including soil boring testing and recruiting investors. "Until you have ownership or site control, it is hard to do any work on it."
He added that Vondran will continue to own his original office as part of a condominium arrangement. The new partnership will develop and own the project. Apartments will be leased to tenants.
"There is very limited greenspace in the downtown," Loss said. "We have the opportunity to build a brand new building in a downtown setting, which is a unique opportunity for downtown Davenport."
Construction could begin in the spring of 2019 and be completed 11 months later. The new building's opening should coincide with TAG's 30th anniversary, said Vondran, who launched the company in 1990. He now employs 32 people and has a satellite office in Dubuque, Iowa.
The project adds a new type of housing stock to the downtown, which has seen an influx of loft apartments in the warehouse district as well as other historic building renovations.
"Housing is in a good spot right now," said Kyle Carter, director of the Downtown Davenport Partnership, an initiative of the Quad-Cities Chamber of Commerce. "We've challenged our developers that they need to be doing something that is unique and different to keep up the growth."
Carter said the downtown housing occupancy rate is 97.8 percent, which is down just slightly from a year ago.
"What's important here is we need to keep building diverse housing," he said. "We can't just keep building buildings that are like what we have got."
He said the proposed TAG project and other projects now underway do just that. It would be the first new construction downtown that is 100 percent market-rate units. Projects such as 601 Brady, built by Newbury Living, has some subsidized housing because of its tax credits, and the new Lafayette Square is a low-income project because of its financing.
"We'd still love to see some townhomes, which we believe might draw other types of residents to the market," Carter added.
Loss said developers will be applying for Workforce Housing Tax Credits, Greyfield Tax Credits and financing from the U.S. Housing & Urban Development forthe TAG project. But it will mostly be privately funded with local equity investors. "We're in discussions with potential investors right now."
Officials with the City of Davenport did not return telephone calls to the Quad-City Times.
"This was about keeping Mike (Vondran) and his successful advertising business downtown and continuing (downtown's) vibrancy," Loss said.
The development, which still will need city council approval, is the latest new investment in the east end of downtown adding to the recently opened event center, The Stardust, and a growing entertainment district.
"The whole corridor on Second is looking great and it will look different in two or three years," Carter said, adding "There is plenty of energy on the opposite end too."
TAG's existing building, which had previously housed Iowa American Water's offices, as well as the adjacent greenspace were once part of the original power company, he added.
"It's cool that this building that has been here a long time, now it is going to find a new life," Vondran said.
Loss said the TAG Building will feature mostly one-bedroom units catering to the young professional customers, but it also will have some two- and three-bedroom units. Rents are estimated at about $1,200 a month.
"I think there's some great value to having all the residential (projects) downtown," Vondran said. "A lot of folks like to work and live in their neighborhood. It's all a matter of convenience. Downtown has become so fun and is continuing to go in that direction."