City Club forum explores historic preservation and economic growth

By Martin Kidston/MISSOULA CURRENT

A member of the Missoula historic preservation community on Monday accused the city of rushing a proposed deconstruction permit for the Mercantile through the process, suggesting an alternative project or a new buyer would step forward given time.

In a public forum hosted by the City Club Missoula, Page Goode with Preserve Historic Missoula said the Mercantile remains structurally sound, despite the findings of an engineering report stating otherwise.

“We were as blindsided as the (Historic Preservation) commissioners were by the presentation that the Merc must be destroyed,” said Goode. “It's no more hazardous than any other building of its vintage and construction.”

Missoula Mayor John Engen, who offered an opposing view at Monday's forum, said he still remembers the day his phone rang in 2010. It was Macy's announcing the closure of its store in downtown Missoula.

The loss of the large retail anchor hit the business district hard. But hope came anew when the Mercantile was purchased in 2011 by Octagon Capital Partners, a real-estate investment firm based in Virginia that focuses on select U.S markets.

Over the next two years, Octagon attempted to rehabilitate the building for reoccupation. But by 2013, unable to find a viable tenant, it placed the property back on the market for $4.5 million.

Over the past three years, several interested buyers have stepped forward, but none have followed through with a purchase. HomeBase announced its interest last year, and with financing in hand, it plans to deconstruct the Mercantile and build a $30 million branded hotel in its place.

It needs a permit from the city to do so.

“We've heard from developers who were interested in trying to make something work,” Engen said. “Until this proposal from HomeBase, we didn't have a viable project. We have some opportunity here to have life on a corner of downtown Missoula that needs life.”

Monday's discussion between Goode and Engen mirrors the debate taking place across Missoula, with preservationists fighting to save the building and business advocates seeking a project that will bring economic vitality back to a downtown corner.

“The problem here is that (HomeBase) came in with the mayor's backing and made an extremely aggressive presentation to the commission,” said Goode. “We think preservation and development is a unique place and one the city can come together behind – up front – instead of waiting for something to come forward and then having to react to it.”

Goode described the Mercantile as the city's most important historic structure, one that represents Missoula's establishment as an economic hub starting in 1869. While the building fails to represent any particular architectural style, she said, it does represent the city's rise as western Montana's largest community.

“We're the only community group that has stepped forward to voice concerns regarding the demolition permit process for the Mercantile,” Goode said. “We should not dismiss it because it's not pretty. It's the physical embodiment of where we came from.”

Engen agreed that the city and the preservation community could work more proactively in identifying other historic properties vulnerable to redevelopment. However, he said, the issue was more complex than preservation for the sake of sentimentality.

“The fact is, there are market forces and the private sector involved here as well,” Engen said. “We would be having a much different conversation if the Mercantile were a public building. The fact of the matter is, it's not. By virtue of that, we're in a position where we're going to be a little more reactive than proactive.”

While some have accused the preservation community of obstructing economic development, Goode said she wasn't opposed to growth. However, she added, preservation advocates want to maintain what they see as the business district's positive character.

It is, she believes, what draws people to the city.

“We believe something economic needs to happen downtown,” said Goode. “We'd certainly be behind (the proposed hotel) 100 percent if the developer was behind the building 100 percent. If we tear everything down, it's going to change the face of Missoula.”

In making her argument, Goode advocated for commercial design standards, saying they were needed to preserve the district's feel. Engen agreed and said the city is working to implement such standards – a process the City Council embarked upon last year.

Engen also said the city will continue to attract economic investment, despite the recent debate around the Mercantile.

“I'm not concerned that because we've had a bit of a tense conversation around this particular project and historic preservation that everyone from outside of Missoula will think they can't do business here, because we have all sorts of reasons for folks to do business here,” he said.

Engen said the debate surrounding the Mercantile could help improve the permitting process and the review of historic properties.

“I think we may have some opportunity to do some of this better,” he said. “One of the concerns I have is, could there be a chilling effect on future designations of historic buildings, in case owners believe somehow that registering makes a building less valuable because it's restricted? I don't want to see that happen either.”