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City Talk: Cost estimates show benefits of Civic Center demolition, new theater build

A financial analysis of three potential plans for the Civic Center's future.
A financial analysis of three potential plans for the Civic Center's future.

This is the City Talk column by Bill Dawers, a longtime contributor to the Savannah Morning News.

At the most recent Savannah City Council workshop, City Manager Jay Melder shared the estimated net costs of the options for redevelopment of the Civic Center site.

The numbers suggest what many residents have suspected. Over a period of several decades, the upfront costs of building a new venue to replace the Johnny Mercer Theatre will be offset by increased tax revenue on the valuable site.

More: Savannah council workshop shows detailed options for Civic Center future, final vote set for June

I have questions about the city’s projections, and the numbers could change dramatically depending on many variables, but Melder made a good argument at the workshop that the estimates were developed using the same assumptions for each scenario.

If the city moves ahead with the plan developed by Sottile and Sottile to demolish the Martin Luther King, Jr. Arena and renovate the Mercer, the net cost would be $90-$120 million. City officials seem to have largely given up on plans to put an office building on the site.

Demolishing the entire complex and building a new theater somewhere else would have a net cost of $130-$160 million. That’s about $40 million more than the cost of keeping and renovating the Mercer.

But officials estimate that the site will generate an additional $1 million in annual tax revenue if a new theater is built elsewhere. So the initial cost difference would eventually evaporate.

As noted in a recent column, Historic Savannah Foundation has suggested that the site of the old Union Station would be fitting for a new theater if the I-16 exit ramp is eventually removed. The city also owns a parking lot on Martin Luther King, Jr. Boulevard that could presumably accommodate a structure of sufficient scale.

More City Talk: Historic Savannah Foundation weighs in on Civic Center's future

Other locations are worth considering, but the single-minded focus on renovating the Mercer has prevented adequate public discussion of the options.

The idea of renovating both the MLK Arena and the Mercer has also gained considerable traction amidst the labored decision-making process. That would cost $135-$165 million, according to the city’s estimates, and generate less revenue than the other options.

Architect and planner Christian Sottile, who has become the public face of the chosen plan, has repeatedly emphasized that the city should eventually restore the original street grid, but several council members seemed dismissive of that goal.