Union Mission Ministries' downtown building is back under contract.
Developer Buddy Gadams has worked out a deal with the nonprofit for the iconic building at Boush Street and Brooke Avenue it formerly used as a homeless shelter. The sale price was not disclosed.
Gadams, president of Marathon Development, said he plans to transform the historical structure into luxury apartments and build a five-story building on an adjacent parking lot.
The agreement was reached less than two months after Union Mission's contract with Columbia, S.C.-based U.S. Development fell through. The company signed a contract to buy the building in 2009 but wasn't able to come up with $6 million to complete the sale.
The building was constructed in 1909 and was used as a YMCA for the Navy until 1972. It then became a homeless shelter.
The mission planned to use the proceeds from the sale to finish construction of a new shelter for homeless men.
Marathon Development now will complete inspections and surveys before the deal closes. Gadams said he plans to begin construction in April if the process goes smoothly.
The Union Mission building would be converted into about 90 luxury apartments, and the new building would have 46.
J. Lindsay Bilisoly, senior vice president of sales and leasing for Harvey Lindsay Commercial Real Estate, the firm representing Union Mission, said Gadams is "uniquely suited" to buy the building because of his experience with residential housing in downtown Norfolk.
"He has access to a great design team and financing, and he knows the market," Bilisoly said. "Buddy Gadams is creating a neighborhood downtown."
Marathon Development wrapped up construction inside the Wainwright building in October. The 126 apartment units were 90 percent leased by the end of November, Gadams said.
The company also has been working on the 19-unit Franklin Condominiums. Gadams said he plans to sell the units starting in late January.
Two buildings under construction near Granby, Freemason and Boush streets are set to be completed in early spring. They will have 137 high-end apartment units combined.
If Gadams closes the deal on the Union Mission building, he expects the project to be ready for tenants in the summer of 2015.
Mayor Paul Fraim, who has pushed for redevelopment of the building, said he met with the nonprofit's leaders recently and urged them to take Gadams' offer because he didn't know whether another offer would be made.
"It is important to the city that the project move forward," Fraim said.
Sarah Kleiner Varble, 757-446-2318, email@example.com