Urban Revitalization and Municipal Economic Development Incentives provide intriguing opportunities to for urban minded developers and entrepreneurs.
Following the recent economic slump, many cities, including Covington, are taking aggressive initiatives to revitalize their urban cores. In Covington, the City has negotiated a deal to turn the City Hall into a Landmark Hotel. (http://rcnky.com/articles/2012/10/25/checking-covington-city-hall-become-landmark-hotel).
The City also has programs to deed dilapidated buildings to developers for little to no consideration, in exchange for a commitment to redevelop the property. In one case, an entrepreneurial developer plans to take title to a distressed property on Scott Street and redevelop it to house commercial office tenants. Notably, the developer will lease a portion of the building back to the Covington Police Bike Patrol, along with a current Covington business requiring more leased space. (http://rcnky.com/articles/2012/12/05/scott-blvd-building-be-renovated-will-house-police-bike-patrol). In addition, Covington will assist in the redevelopment with a Low Interest Loan Program. (http://www.covingtonky.gov/index.asp?page=commercial_low_interest).
Covington is just example of cities providing real opportunities for entrepreneurial developers. If you have an appetite to take on such a project, you must nonetheless proceed deliberatively. Like any project, due diligence is key, and when talking about redeveloping real property one of the very first steps is getting a title exam. Urban properties can involve unique title issues, e.g. alleys, easements, boundary issues and development restrictions. It is essential that you know of these issues early on in your evaluation, so step one is to order a title exam from a title company and lawyer experienced in urban properties.
For a relatively small investment, you can get a good picture of what real property issues you may face if you take on an urban redevelopment project.