YOUNGSTOWN — The city is paying $24,363 to a firm to conduct a market feasibility study for the potential redevelopment of 20 Federal Place downtown.

Bluelofts Inc., the Dallas business proposing a $57 million project at the building, will use the results of the study to “finalize the development and refine their plans and architectural drawings,” said Katie Ward, associate director of planning for Steadfast City Economic & Community Partners, the city’s St. Louis-based consulting firm for the project.

Bluelofts spoke to three companies about the feasibility study and selected Zonda Advisory, with an office in Dallas, to handle the study, city Finance Director Kyle Miasek said.

The board of control authorized payment to Zonda on Thursday.

“There needs to be this study to determine what kind of housing will be put in,” Miasek said. “Under the agreement, we will be reimbursing Bluelofts. This is a requirement for the project. We have to get it done.”

The city agreed to pay for the study, rather than Bluelofts, as “part of the effort to work with the developer and support them in a spirit of partnership,” Ward said.

The study is expected to start shortly and take four weeks to finish, Ward said.

The study will “look at rents and unit mix recommendations for various housing types,” Ward said. “It will look at the programming for the housing project and the local economics of that and figure out what developments make sense there. It’s probably some supply-and-demand analysis.”

The study will “help the developer finalize the programming of the building and what will be most successful in the spaces and therefore they can refine their plans and architectural drawings,” Ward said.

She added: “This is the big step in identifying what makes sense and what’s going to be successful. Then they’ll look at the space and get the square footage nailed down because that will help with tenant outreach and which partnerships to dive into.”

Bluelofts’ most recent proposal, which could change based on the study, is to build 100 apartments to house 180 people in one-to-three-bedroom units with 43 of the apartments being affordable / workforce housing at 80% median income rent as well as 30,000 square feet of commercial space, a small wellness center, and e-commerce and mini-warehouse space on the first two floors for small businesses.

The project at the 20 W. Federal St. building also calls for 62 parking spaces in the basement and the redevelopment of the city-owned parking lot at the rear of the building, which has about 200 spaces.

The city’s board of control on Dec. 19 signed the non-binding MOUwith Bluelofts that gives the company “an exclusive project due diligence period” until Oct. 15 “to finalize a ground lease and the P3 (public-private partnership) structure and financially close the bonds and commence construction.”

Bluelofts is teaming with the Madrone Community Development Foundation of Berkley, California, which would own the building through a P3. The city, which currently owns the building, would retain ownership of the ground underneath it.

Bluelofts’ proposal is to start construction in October and be finished around June 2027.

The building has $10 million in state historic tax credits and $14 million in federal historic tax credits that expire at the end of 2025 if a project at the building isn’t started by then.

The tax credits were awarded in December 2023 to Desmone Architects, the Pittsburgh company that was initially leading the building’s redevelopment. Desmone was retained to serve as the project’s architect.

The project’s plans have undergone changes since Bluelofts was the only firm to submit a proposal to the city for 20 Federal Place by a Sept. 16 deadline.

Bluelofts was initially going to work with a different non-profit organization on the P3 to build 112 units, with half being affordable / workforce housing, at a cost of $50.85 million.

While Bluelofts is working on redeveloping properties in Texas, Georgia and Missouri, it’s only completed one project. That is the former Ohio Bell headquarters, now called The Bell, in Cleveland that was redeveloped into 367 apartments with some retail and commercial space available.

That happened after Bluelofts’ initial partner faced foreclosure on the property and another developer stepped in.

The city purchased 20 Federal Place in November 2004 after Phar-Mor, a national retail store company, went out of business. The property was the Phar-Mor Centre, the company’s corporate headquarters. Before that, the 332,000-square-foot building was the flagship location of Strouss’ department store for many decades.

There were 19 tenants, taking up about 20% of the building, before eviction notices were sent in July 2022. Some tenants were given an extension before leaving, but it’s been completely vacant for more than two years.

A city-hired contractor finished a $7.4 million asbestos abatement remediation and partial demolition project in October — after lengthy delays — at the building. The city received a $6.9 million state grant for the work.