The Stone Hotel development on Fifth Street South got a 10-year tax exemption Tuesday night, courtesy of Columbus City Council.
The mixed-use development is in the 200 block of Fifth Street South. It includes 18 apartments and nine retail spaces.
The property renovation is eligible for local ad valorem tax exemptions of up to 10 years under two state statutes, since it is located in both the central business district and a historic district, City Attorney Jeff Turnage explained.
The property will not be exempt from city taxes entirely, however.
“Whatever it was assessed at before construction began, they will still be responsible for paying those taxes,” he said. “The multi-million dollars of new value that they added will be exempt for 10 years.”
The exemption is only for the city’s ad valorem taxes, not the school district’s. The school taxes will still be due in full. The exemption also does not apply to sales taxes.
According to tax records, Chain’s development had a 2021 assessed value of $179,620. The last combined tax payment made was $4,265.
Developer Chris Chain, president of Renovations of Mississippi, estimated he had invested $3.3 million into the property. Work started in summer 2021, and in April of this year people started moving in.
Chain said all but one of the apartments had been leased, and one lease had been signed for the retail space.
“We have another one that looks like it’s going to come on in and will take two more of those spaces,” he said.
“We have another (retail prospect) that is promising as well. The problem is that nobody is really doing anything (new) right now. What we’re getting is somebody who’s just moving.”
Chain bought the site from Susan MacKay, whose family had owned it for more than 70 years, in 2016. Originally slated to become a boutique hotel, it will now house a mixture of apartments and retail spaces, along with a gym.
The buildings, which are adjacent, were built in 1905. They were originally The Stone Hotel and The Arcade Hotel. In the 1940s MacKay’s family bought them, and they housed a variety of businesses ranging from Price’s Auto Parts to Kwik Kopy and Party and Paper.
Tax exemptions help with redeveloping old downtown structures such as the Stone, he said.
“Anything like that that helps a project come together is just a piece of it,” he said. “The (exemption) basically freezes the taxes and helps us get ahead of the game. When the taxes do go up, you’ve already been in business and you’ve sustained it and everything’s good and you can pay the higher taxes at that time.”
Tuesday night, Chain’s request passed unanimously, with no discussion. Mayor Keith Gaskin said the developers had come to the council before work started to ask for the exemption once it was complete.
“(The exemption) is very similar to the situation we had with the old Fred’s building and with several other old buildings downtown in the past,” Mayor Keith Gaskin said. “This was different in that they came to the council prior to beginning the work, where sometimes others have not.”
Other downtown properties that have gotten the same tax exemption include Gail Guynup’s properties on College Street, Mark Alexander Sr.’s building on Fifth Street North and Jim Mauldin’s mini-storage business in the old Fred’s location on Fifth Street South.
Brian Jones is the local government reporter for Columbus and Lowndes County.
You can help your community
Quality, in-depth journalism is essential to a healthy community. The Dispatch brings you the most complete reporting and insightful commentary in the Golden Triangle, but we need your help to continue our efforts. In the past week, our reporters have posted 37 articles to cdispatch.com. Please consider subscribing to our website for only $2.30 per week to help support local journalism and our community.
You can help your community
Quality, in-depth journalism is essential to a healthy community. The Dispatch brings you the most complete reporting and insightful commentary in the Golden Triangle, but we need your help to continue our efforts. In the past week, our reporters have posted 37 articles to cdispatch.com. Please consider subscribing to our website for only $2.30 per week to help support local journalism and our community.
Join the Discussion