Phoenix commission blocks Craig Milum from bulldozing historic buildings

Brokers say that preservation status makes Streamline Moderne plant hard to sell

Phoenix Commission Stops Craig Milum From Razing Buildings
Milum Textile Services' Craig Milum and 333 to 337 North 7th Avenue, Phoenix (Loopnet, Art116 Fall 2014 Sweet)

Craig Milum has listed a 104-year-old industrial complex in Downtown Phoenix for $9.2 million after the city’s Historic Preservation Commission nixed his redevelopment plans.

Milum, whose family founded Milum Textile Services in the 45,250-square-foot Streamline Moderne buildings at 333 to 337 North 7th Avenue, has battled the city over plans to bulldoze them, the Phoenix Business Journal reported.

Once known as Phoenix Laundry and Dry Cleaning, built in 1920, the property was rebuilt in 1935 after a fire destroyed a building. The Milum family bought it in 1956 and founded Milum Textile Services, which cleaned textiles for medical centers and restaurants. It closed in 2020.

For months, Milum has sought approvals to demolish the block-size complex to sell it to fund his retirement, but the Historic Preservation Commission turned him down in December, KJZZ reported. Last week, the commission heard an appeal and upheld its previous decision.

The city has declared its white single-story buildings architecturally significant for their Streamline Moderne design and use of lamella roofs, known for their elegant vaulted patterns.

The commission said Milum could appeal the decision with the Phoenix City Council.

Milum, who expressed financial hardship, said he’s unable to redevelop it and unable to sell it.

Owners of vacant, underused buildings in Phoenix must submit a statement of potential return on investment based on existing or new uses, including costs of rehabilitation and new construction. 

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Developers are eligible for property tax abatements for projects in Downtown Phoenix that are mixed-use, preserve historic buildings or include affordable or workforce housing.

Milum estimated it would cost more than $100,000 to save the property and nearly $19,000 to insure it.

In a letter to the city’s historic preservation officer, commercial brokers Paul Borgesen of Transwestern and Justin Horwitz of SVN said they have tried to sell the property since April 2020 and failed to find a buyer, mainly because of its historic preservation challenges.

Few developers are equipped to take on the project and obtain a higher sale price because of the cost of preserving the buildings, the brokers said.

Horwitz said they’ve spent “countless hours” targeting end users for the buildings. They said a rough estimate from a general contractor deemed it would cost $10 million to bring the property up to code.

“While we have groups acknowledge the unique elements of the structures and have a vision for an end use, the estimated costs of renovations steer groups away from pursuing a purchase of the property,” their letter said.

Commission members questioned the estimated $10 million cost and said they believed this was higher than the actual cost, according to the Business Journal. Commissioners recommended Milum obtain a formal estimate and bid for the property.

— Dana Bartholomew

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