LOUISVILLE, Ky. (WHAS11) -- One year after a demolition deadline deal to save historic Whiskey Row buildings on Louisville's Main Street, the development team confirmed Friday that a new financial plan was necessary because preservation costs are nearly triple the original estimates.
The plan requires the city to chip in an additional $1 million. Last year, the city agreed to a $1.5 million forgivable loan for preservation and demolition work.
"These important and beautiful buildings behind us will be saved," declared developer Craig Greenberg, standing several feet from where he made a similar announcement one year ago this week.
Last year, a group of investors led by Brown-Forman heiress Laura Lee Brown and her hotelier husband Steve Wilson, agreed to purchase five of the seven historic buildings for $4.85 million, investing an additional $2.5 million to stabilize the structures.
Yet, after actual preservation estimates came in far more than anticipated, developers in recent months determined they needed $4.5 million more and filled some of that gap on their own.
"Yet, we still need an additional $2 million," Wilson said.
Without that extra cash - the fate of the historic bourbon warehouses hangs in the balance.
Enter a big name, a once silent investor who made a big statement on Friday with a $1 million challenge grant.
"Christy Brown, God bless her..." said investor Jim Welch as he called the widow of former Brown-Forman Chairman and CEO Owsley Brown to the lectern. "... has stepped up to the plate and really gonna help us make this happen."
Philanthropist Christy Brown - one of Mayor Greg Fischer's biggest supporters and co-chair of his inauguration - announced a $1 million donation to the preservation effort with the condition that the city raise a matching $1 million donation.
"We've very excited to be able to put forth our donations and most importantly, to be able to put forth a serious challenge," Brown said.
Asked about any pressure her challenge may place on the mayor, Brown said Fischer is "an extraordinary leader."
"This is just another opportunity for him to be able to lead and to inspire all of Metro Council to go ahead with this effort, which I feel just happened here today," Brown said. "It's really, really thrilling."
"I don't feel the pressure," Fischer said, having been pulled into the WHAS11 interview by Brown, "because we have so much acceptance of the project. This is a great 'leveragable' project when you can get so much private money. Asking the city to help out either through public or private sources is the least we can do, so we're dedicated to getting this job done."
The city is in a budget crunch. Fischer has called for $6.8 million in cuts across city departments and agencies.
"There's a lot of moving parts in the budget right now," Fischer told reporters. "Councilman (Jim) King and I have talked about this. We're not taking anything off the table. We're committed to getting the million dollars regardless of what the source is."
"We have confidence that this challenge grant will be met and we will have sufficient funds to finish this project," Greenberg said.
Fischer would not comment on whether the city may issue bonds to pay their end of the challenge grant, an idea floated to WHAS11 last week by Councilman David Tandy.
"I've already talked to some council members who are both committed to the challenge grant and to utilizing to whatever extent they need some of their neighborhood development funds and capital infrastructure funds that are in the budget," said King, the Metro Council President. "So, we will find a way."
King said the council would want to minimize the amount of funds that have to come out of this year's budget, but "we're not going to miss this opportunity."
Council members Tina Ward-Pugh and Tandy also attended the news conference and echoed their endorsements of the financing plan.
"We're talking about real tax dollars being generated in our community," Tandy said, emphasizing that jobs will be created by both the preservation work and permanent jobs when businesses operate in the buildings.
The plan calls for five buildings to be saved. Only the facades of two others will remain, with the interiors reconstructed.
Largely abandoned for decades, the cast-iron and brick buildings were constructed between 1852 and 1905, mainly to house operations for Louisville's booming bourbon industry.
Today, some window openings are filled with plywood, some remain open to the elements. The Main Street sidewalk below has been covered with a construction walkway to prevent pedestrians from being stuck by falling debris.
Several buildings on the western end of the block adjacent to the KFC Yum! Center have already been developed, the first floors housing restaurants and upper floors with loft condominiums. The renovated properties offer a stark contrast to the neglected remainder of the block.
Fischer said that NCAA officials asked "what's going on with that row, that block?" during a review of men's basketball tournament games at the KFC Yum! Center.
With the financial plan agreement, Greenberg said stabilization workers are expected to be on site by the end of May.
After the first deal ended up several million dollars short, Greenberg was asked if the news conference truly marked a turning point for Whiskey Row.
"I think all of us up here are very confident or we wouldn't be up here," Greenberg replied.
"The million dollar challenge grant we heartily accept," Fischer said. He explained that he hoped to recruit more private investors.
The city contribution would not go to private investors but into a new non-profit historic preservation fund for Louisville projects.
"It's first investment will be Whiskey Row," explained Valle Jones, a veteran Main Street developer and member of the Whiskey Row development team. "But in the future it will be available to finance many other downtown historic preservation developments."
The Heritage Conservation Fund was created with $3.5 million of private contributions, Jones said. It is a first of its kind partnership with the Washington D.C. based National Trust for Historic Preservation and is intended to be a case study for a new national model of equity financing for historic preservation.
"It speaks to a larger sense of community in terms of the partnerships that are required, the creative thinking that is required to get things done in today's fiscally restrained environment," Fischer said.