Rio Nuevo advanced roughly $2 million in funding for the Friedman Block redevelopment and extended deadlines for several downtown Tucson projects last month, even as the board faces about $15 million in outstanding commitments.

Developers for the stalled Friedman Block project presented a draft redevelopment package during the board’s Aug. 11 meeting, with Union Hospitality Group owner Grant Krueger telling the board Aug. 25 that the parking dilemma has been solved.

The original and preferred parking plan involved sharing spaces with neighboring apartment complex Council House, which could provide up to an additional 166 spaces, a large improvement from the 82 spaces in the current lot.

Krueger said the collaboration would ultimately make the Friedman Block a substantively better property, but that plan is expensive, costing developers an extra $500,000 up front, plus $250,000 in TPT rebates and attorney fees.

There’s also a backup plan, should Council House decline to share its spaces with Friedman Block, that would involve acquiring 26 street parking spaces on Plumer Avenue and renting 60 spaces from the M. Lee Starr Learning Center immediately north of the property.

Krueger said he believed simply having a backup plan would likely help negotiations with Council House.

“I believe we can get Council House across the finish line, especially denoting that we’ve got a plan to do this without them,” he said.

Developers are seeking $250,000 to $500,000 from Rio Nuevo to bridge the gap and pay Council House, or to pay the rent toward the learning center depending on which parking plan prevails.

Following an executive session to discuss next steps, the board unanimously voted to advance the project, with certain stipulations.

Rio Nuevo will provide $500,000 in initial cash with a $2 million cap on rebates to the developers. There will also be a strict clock on the deal moving forward, especially given the project’s lengthy timeline.

Following the vote, CFO Dan Myers presented the financial report, telling members Rio Nuevo had spent about $3.1 million as of July 31.

But with significant commitments to the Tucson Inn and Market, the Moxy Hotel and others, Rio Nuevo has an outstanding balance of around $15 million.

Myers said the board will have to rely on its previous investments to continue funding its more recent ones.

“There’s a lot of stuff going on and a lot of money going out the door, but I think it’s all worthwhile,” Myers said.

Also evaluated at the meeting was Rio Nuevo’s now three-year involvement with Empire Pizza and its expansion into a neighboring building at 145 E. Congress St., allowing more room for dine-in service and bar facilities.

The building permit has been submitted and reviewed by most departments but has been flagged for review by the Historic Districts department.

The board discussed providing a yearlong extension, saying that with the historic and design review process likely taking three to four months, the extension would grant Empire ample time to obtain the appropriate approvals.

Jacqueleen Larson, owner and operator of social wellness studio El Ritual, located at 401 N. Toole Ave., is currently under construction on the space, which will focus on contrast therapy, sound, breathwork and meditation. The project was about 75% complete as of last month.

The Economic Benefit Agreement between Larson and the board set a build-out deadline of Aug. 31. Out of an abundance of caution, Larson requested a Nov. 30 extension in case of any hiccups before the project’s conclusion.

The board took no action on either extension but will likely vote on them during the next meeting.

Larson is working on the final push of El Ritual’s build-out, ramping up social media promotion and hosting founding member tours.

The grand opening is tentatively scheduled for October.

The board also heard from representatives of Eleven Eleven Tucson, a new hospitality and nightlife group focused on revitalizing the downtown experience.

Managing Partner Fernando Minjarez and his brother, Geovanny Minjarez, presented plans for a new lounge, nightclub and speakeasy at 121 E. Congress St.

The property used to house the Zen Rock Nightclub, another multilevel entertainment facility and dance club. Fernando Minjarez said the space needs “a fresh concept, a substantial reinvestment, and a team ready to operate it with purpose.”

“Our vision is not a one-dimensional night club. We’re building an elevated, multi-concept destination that can welcome different guests for different reasons,” he said.

A defining feature of the Minjarez brothers’ plan is the use of the three different levels on the property. The project features an upstairs bar and piano lounge area for a more upscale, refined experience, while the main floor will serve as a space for larger, higher-energy events and the “nightclub” aspect of the project.

The downstairs space will hold a speakeasy, and the building will also include a full kitchen, a completely new addition to the property

The brothers pointed to the value of having three distinct experiences at one downtown address, saying it would be a great opportunity to generate repeat visits and taxable sales for the city.

The group is seeking $355,368.38 from Rio Nuevo to help finance the renovation of the property.

The board did not make any decisions but expressed interest in helping out.

“It’s a beautiful project, I think we’d be happy to support it,” said Chairman Fletcher McCusker.

The board discussed the possibility of offering rebates instead of just cash, similar to the discussion surrounding Friedman Block.

Closing out the meeting, the board heard an update on the Tucson Children’s Museum project, which is expanding to the adjacent historic building at 130 S. Scott Ave.

It will include a cafe in partnership with El Charro and a new gift shop.

Executive Director Hilary Van Alsburg said plans for the interior and exterior of the building are being finalized. She noted that construction is expected to be completed by May 2029 and requested an extension of the EBA up to that date.

The board granted the extension request.

Ahva Ghazanfari is a University of Arizona student and Tucson Spotlight intern. Contact her at ahvanghazanfari@arizona.edu.

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