Lexington-owned Coldstream Park gets second tenant in 3 years. Why so little interest?

The Lexington council recently approved a $1.1 million sale of 5.6 acres in the city’s 50-acre business park to a doctor’s group.

Dr. Colton Jayne, a general practice physician, will be building a medical facility on the property adjacent to the University of Kentucky Coldstream Research Park off of Citation Boulevard. The plan is to eventually have a group of specialty practices on site, city officials said.

“There are very few medical offices in that area,” said Kevin Atkins, chief development officer for the city of Lexington. “This will fill a need in that part of the city.”

The plans call for the new doctor’s group to use UK interns in its practice in future years, he said.

Since the city acquired the 50 acres from UK in 2019, the doctor’s group is just the second business to locate in the park. The first was A & W, which announced in 2019 it would move from its current location inside Coldstream Research Park, to the city’s portion of the property.

The 50 acres was part of a land swap between the university and city originally announced in 2017. In addition to the 50 acres that was once part of UK’s Coldstream Research Park, the city also acquired 200 acres of land off of Georgetown Road and Interstate 75 and Interstate 64 for a new industrial park. Title to the 200 acres transferred to the city in July. In exchange, the city gave the university control of dozens of streets around the state’s flagship university.

At the time, the city said the sale of the property on the 50 acres will help pay for improvements needed on the 200 acres. Half of the proceeds from sales of property on the 50 acres goes to the city. The other half goes to the university, which then uses the money generated to make improvements on the rest of UK Coldstream Park.

Sales of the parcels on the 50 acres have been slow. Meanwhile developers and those in real estate have repeatedly argued the city must open its growth boundary due to lack of land for housing and new businesses.

Atkins said there has been interest in those 50 acres but there are some constraints that has hampered business location.

Businesses must comply with design standards for UK Coldstream Research Park. Those design standards include setbacks — how far back a building must be from property lines — which can be prohibitive for some uses, Atkins said.

“Sometimes the numbers just don’t work to make it viable,” Atkins said.

The 50 acres is zoned as professional business. That means industrial-type businesses can’t locate there, which can limit the types of businesses allowed in the park, he said.

Also, it takes time for industrial and business parks to fill, he said. Blue Grass Business Park, off of Citation Boulevard, took 15 years for all the tenants to locate there. That park is 100 acres, nearly twice the size of the 50-acre city-owned park.

“COVID also hurt us,” Atkins said of attempts to draw new businesses to the park.

Atkins said Commerce Lexington, the city’s business chamber, the city and the state Economic Development Cabinet have helped advertise the property.

But marketing the city’s available business and industrial land will ramp up soon, he said.

The city is about to hire a new group to help it market it the 50-acre park and the new 200-acre park off of Georgetown Road. Five tracts in the 50-acre park are still available for development.

The Lexington-Fayette Urban County Council will hopefully approve that contract after it returns from its winter break in mid-January, Atkins said.

Using American Rescue Plan Act funding, the city set aside more than $9 million to help pay for infrastructure for the 200-acre park. That includes new road, sewer and other utility lines.

The city is hoping to start turning dirt on the property in the spring, Atkins said.

“We’ve already had interest in that site,” Atkins said of the new industrial park. “I think people are really going to like the park. There will be greenways and green spaces and trail connections throughout the park. It’s not going to be a concrete jungle.”