The Town Council would not take action on proposed amendments to the Park Place development agreement requested by the developer of the downtown residential project when it met on Tuesday, Feb. 1.

Bart Shea, manager for N-Shea Group and the developer of the project, contacted the Town about moving forward with the second and third phases of development for the complex. The original development agreement was approved in 2016 and applied to all three phases of the project. Phase I along the Avenue of the Fountains was completed in late 2017 with 230 apartments and 35,000 square feet of commercial space on the ground floor.

Phase II calls for an additional 72 residential units and 8,000 square feet of commercial. This second phase extends down the Avenue from the existing structure to Saguaro Boulevard and along Saguaro to the hotel. The commercial portion of this phase is slated for a building along Saguaro.

Phase III is all residential with 102 units in what was originally planned as a three-story building. That structure is planned for Verde River Drive adjacent to the rear of the Phase I west structure and the Fountain Hills Community Center.

Shea had proposed amending the plans to add one story to Phase III, making it a four-story structure, and eliminate residential to the ground floor of the Phase II building along Saguaro, thus reducing the ratio of residential to commercial from 10:1 to 12.4:1. He also proposed changing the plan to reduce the number of Town public parking spaces from 130 to 103.

Development Services Director John Wesley was prepared to take the amended site plan for the project to the Planning and Zoning Commission on Monday, Feb. 14, with council consideration on March 1. However, Wesley said the requested changes are inconsistent with the development agreement, and before the new site plan could be reviewed the council would need to approve the changes to the development agreement. He said without the amendments approved he would recommend denial of a new site plan.

When the council declined to act on the development agreement at the Feb. 1 meeting Shea agreed to go forward using the original plans for Phase II and Phase III. However, according to Wesley, the next steps are unclear.

Although the maximum height allowed for development on the project is 54 feet and could allow for four stories within that limit, the development agreement also limits Phase III to three stories. Vice Mayor Alan Magazine said he is unwilling to consider the four-story structure.

Mayor Ginny Dickey said she would not support eliminating the commercial use on the ground floor of the building along Saguaro Boulevard. She said that would be a good location for retail businesses.

There has been a lot of discussion over the years regarding too much commercially zoned property in Fountain Hills. Councilwoman Sharron Grzybowski said she is okay with reducing the commercial space but has a number of concerns regarding a reduction to the public parking.

Resident Larry Meyers, in speaking during public comment, said, “I told you so.” Meyers recalled speaking against the Park Place project when it was first brought to the council. He said the town had a great vision or “dream” for the downtown but the only thing getting in the way is government and staff.

“I don’t envy you (on this council) having to go back and clean up this mess and do the best you can to salvage a bad decision made in 2016,” Meyers said.

Another resident brought up the “unfinished” look on the end of the existing east apartment building. That would be covered by the new construction in Phase II.

A woman urged the council to allow for commercial in the downtown area. She explained that she had been attempting to purchase a franchise looking into several opportunities, however she was told there was not enough residential density in the area to have financing for a franchise approved.

Shea, along with the property owner and his development partner, explained that they were having a great deal of difficulty leasing the commercial/retail space in the existing buildings and did not wish to add more. They did offer to help the woman seeking to bring a franchise to town.

There were several people speaking in support of the request by Shea including people praising his civic support for the arts and theater, as well as two former council members who supported the original project and development agreement.

Former councilman Art Tolis said he supports the project.

“It is the responsibility of the council and staff to be fair with the developer,” Tolis said. “Delays cost him time, money and investor relations.

“The mayor’s comments should not have been made in a public forum.”

“There was a lot of discussion between the developer and staff,” Dickey said. “This is the only way we can move forward legally.

“If we had done this in executive session you would accuse us of not being transparent.”

Councilman David Spelich also had a response to Tolis’ comment.

“You said we are not being fair, not delivering customer service?” Spelich said. “The reason I sit in this chair is because of the things you did while you were in this chair.

“I didn’t see overwhelming support when Phase I was built.”

Wednesday, following the meeting, Wesley said it was taking some time to sort through the impact of the council decision and Shea’s decision to pull the development agreement amendment requests.