Metro-east developer Bruce Holland has pulled out of $382 million development in Marion to be funded by sales tax and revenue bonds, which were not approved for a previously proposed project in the metro-east.
Holland, of Millennium Development LLC, has left the planned retail and entertainment development in Marion that would have been funded by the so-called "STAR bonds," which Gov. Pat Quinn authorized for the project in June 2010. Under the this plan, the first 20 years of sales taxes generated from the development would pay for the project's construction costs, instead of going to taxing districts.
Holland, who is also president of Holland Construction Services in Swansea, headed the development with his nephews Chad Holland and Ryan Holland. Under the contract, their options were to expire at the end of May.
Holland said that after three years, few retailers have come forward expressing interest in the development. He said representatives from Bass Pro Shop and Nebraska Furniture Mart initially visited the proposed site. Bass Pro Shop was interested in the site, Holland said, but the lingering effects of the recession have apparently thwarted any further large retail development for the time being.
"In fact, the retail industry is still somewhat in recession," Holland said. "You don't see any big-box users being built in the last few years."
The legislation that permitted STAR bonds to be used for this project also required "significant retail users," Holland said, that would build stores that covered a certain square footage and created a number of jobs.
"As much as we think it is a great site, someday it will be developed into something very good, but we just weren't prepared to invest any more time or money in it," Holland said. "I will say the city was more than helpful."
Marion City Administrator Gail West said that she and Mayor Bob Butler were disappointed to hear that Holland was leaving the project. West said the city is currently in discussion with another potential developer, but declined to reveal the identity of this developer. She also said the city has invested $8 million in road improvements for the development.
"We're ready to move ahead," West said. "STAR bonds have not gone away. We have another developer who has been looking at the project and so we are very hopeful and we have strong hopes that this developer will come in and take over the project and move it ahead. We will do all we can to move ahead. We've spent a lot of money as a city on road development to fit the STAR bond area."
STAR bonds were initially proposed in March 2009 for another Holland-led development planned for Glen Carbon, but the General Assembly defeated that proposal a year later before eventually approving STAR bonds for the Marion project.
The Glen Carbon development, which was known as University Towne Centre, called for a $1 billion, 650-acre retail and entertainment development that was possibly going to include a Legoland theme park. But the measure was defeated after many metro-east mayors and other lawmakers argued that STAR bonds would take away sales tax revenue from existing businesses in surrounding communities.
Contact reporter Will Buss at firstname.lastname@example.org or 239-2526.