CHAPEL HILL, N.C. — The $45.75 million acquisition of a mixed-use piece of real estate near the University of North Carolina at Chapel Hill by a private foundation has the potential to enhance the property's commercial presence in the downtown business district, university and town leaders said Friday.
The UNC-Chapel Hill Foundation will purchase the University Square-Granville Towers complex on Franklin Street from one of the university's biggest benefactors, the Kenan Family, by July 1, 2009.
UNC Chancellor James Moeser called the buy a "sound strategic investment for the university with great potential for playing a larger role in downtown revitalization."
"We want to explore all options for using the property to meet the university's needs, while also benefitting downtown Chapel Hill," he said.
The new owner will be the Foundation, not the university – an important distinction because the public university would not have pay taxes. The Foundation will keep paying taxes (which exceeded $868,000 in 2007) to support local government and schools.
"Thanks to a wise arrangement that will protect and potentially expand our tax base, the UNC-Chapel Hill Foundation has responded well to the town's economic development goals," Chapel Hill Mayor Kevin Foy said.
The university has no immediate plans for change for the 12-acre tract of land that consists of retail and office space, three student dorms and parking. Leaders want to keep the center's retail focus and add parking.
Other redevelopment ideas would come from community input. An $80 million mixed-use project was already planned for the land.
The university and its subsidiaries lease about 80 percent of University Square's two office towers. It will honor all current leases and contracts.
Current business owners said Friday they are excited about the arrangement.
"We feel like the university will be a good partner, because it's in their best interest to see downtown thrive and grow," business owner William Travis said.
A vibrant downtown, university officials have said, will help recruit students and faculty to Chapel Hill.