The Billings skyline could be in for a major overhaul — the addition of the state's tallest building — if a $120 million downtown development comes to fruition.
One Big Sky Center, a multiuse development being proposed for downtown Billings, would include a 70,000-square-foot conference center, a 160-room hotel, downtown residences that cater to both seniors and millennials, plus the addition of major retail and office space downtown.
Plans unveiled Monday also call for a downtown walking mall flanked by two high-rise towers, one of which would be 324 feet tall, dwarfing Montana's current tallest building, the 272-foot-tall First Interstate tower. Supporters described the project, two years in the making, as a catalyst for new growth and development, and a shot in the arm for the city’s efforts to recruit conventions and conferences.
As planned, the development would include both private and public investment, with some of the money generated through the downtown tax increment funding district. At a news conference attended by more than 75 people, developers said it's too soon to estimate how much TIF money would be needed to make the development work.
Greg Krueger, development director for the Downtown Billings Alliance, told the Billings City Council Monday that tax increment bonds can probably be used to construct the parking structure. But whether they can be applied to a conference center remains to be seen.
The city council will have a pre-development agreement on the project to consider during its Sept. 12 meeting, City Administrator Tina Volek said.
“It would be fantastic to have something of this magnitude in downtown Billings,” Mayor Tom Hanel said. “What I keep hearing is, 'where is the money going to come from?' That seems to be the big question. Obviously that will be a huge hurdle.”
Skip Ahern, developer and principal for MontDevCo LLC, said funding will come from at least four sources: a TIF investment approved by the city council, a construction loan from the bank, equity and an investment program administered by the Internal Revenue Service called EB-5, which could fund up to 25 percent of the construction cost.
Under the program, Ahern said, foreigners who invest $500,000 in a project that creates at least 10 jobs receive a green card and a path to citizenship within two years.
Allison Corbyn, business recruitment and outreach program manager for Big Sky Economic Development, said a third-party analysis indicates the project will have a $150 million impact on Yellowstone County’s annual gross domestic product – about 2 percent of the county’s annual GDP.
“I don’t want to sugarcoat anything, and I don’t want to make promises I can’t deliver on,” Ahern said. “This is a huge project for a fairly small city. To make it work, the city and the people of Montana have to believe in the project. That belief will be generated by your interest in investing in it.”
“The only thing that taxpayers will have to put in,” Krueger said, “is their time to come down and ice skate.”
Developers want to close North 29th Street between First Avenue North and Second Avenue North, to create a park-like walking mall to provide convenient access to nearby stores and residences.
“The streets are wide and the sidewalks are narrow in that part of town, which is not conducive to getting the outdoor flow going,” said Ahern. “Adding an open pedestrian way would allow restaurants to spill out on the open area and really create a synergistic effect.”
Ahern sees great potential for Billings.
“We found there was even an opportunity to put in a skating rink during the winter and make it a really green public space in the summer,” Ahern said. “That would really bring out the character and make it fun.”
The development would help revitalize downtown by attracting some 300 new permanent residents, Ahern said.
New retail development being discussed by the developers includes movie theaters, a bowling alley, a brew pub, other businesses and first-class office space.
Lisa Harmon, executive director of the Downtown Billings Alliance, said the conference center that’s included in One Big Sky Center has long been a priority for the Billings tourism and convention industry. Competition for convention business is fierce. Local tourism officials say they often find themselves at a disadvantage when making a pitch for conventions.
“I think we’ll see how critical it is that we are competitive regionally,” Harmon said. “We have had experts come in here and talk to us about marketing to conventions and where the business is going. They have told us that we are losing market share.”
Ahern said the convention center that’s part of One Big Sky Center would boost room reservations throughout the Billings area, not just the hotel that’s part of the project.
Mike Tuss, a principal with CTA Architects Engineers, which has been doing design work for the project, said members of the millennial generation often prefer to live in urban areas as opposed to suburbs. Some 6,500 people work in the downtown medical corridor, and the developers believe that many of them would prefer to cycle or walk to work rather than commute from the Heights or the West End.
“We’re pretty bullish on having people live downtown,” Tuss said.
Harmon said about 21,000 people work downtown, and downtown residences continue to be in short supply despite efforts to add new units. One Big Sky Center will help address a shortage of downtown residences, she said.
Ahern said he has been in contact with a developer that specializes in senior housing. Recent retirees have embraced "walkable developments" like what is being proposed for downtown Billings, he said.
Asked about potential roadblocks, Ahern said the project’s complex financing plan remains the biggest challenge. But the project is being designed with enough flexibility so that it meets the needs of the marketplace, he said.
Burke McHugh and Greg Tatham, principals in MontDevCo LLC, both have experience in real estate development. They became interested in Billings about four years ago while looking at other investment opportunities in the Roundup area.
“We had spent time in the Crowne Plaza and the Northern Hotel,” Tatham said. “We realized that downtown Billings had a lot going on. It reminded us of where Denver was 30 years ago.”
"We loved what we saw downtown," McHugh said. Noting that downtown development has taken off in many cities across the country, One Big Sky Center will feature the kinds of amenities to bring Billings into the 21st century, he said.
The project has a hopeful groundbreaking date of next year and completion date for 2019, according to onebigskycenter.com.
Reporter Mike Ferguson contributed to this report.