THE VIRGINIAN-PILOT 
              Copyright (c) 1996, Landmark Communications, Inc.

DATE: Tuesday, June 18, 1996                TAG: 9606180010
SECTION: FRONT                   PAGE: A14  EDITION: FINAL 
TYPE: Letter 
                                            LENGTH:   44 lines

CITY DOESN'T NEED COSTLY WHITE ELEPHANT

I wish I could share associate editor Glenn Allen Scott's optimism about MacArthur Center (Perspectives, June 12). The last thing Norfolk needs on the 17 acres is a failed MacArthur Center, an expensive, empty or even half-empty white elephant.

Unfortunately, that certainly will be the prospect if the city's estimates of shoppers and potential sales volume of MacArthur Center are as wrong as their advance projections of visitors of Nauticus.

The only feasibility study that has been made public to date confirms my fears that the city's crystal ball has not been repaired and its estimates cannot be relied upon.

My family bought a copy of the feasibility study by Realty Development Research, a respected firm that has been employed in the past to prepare similar studies for Taubman Center Inc., the very company which has joined with the city in the MacArthur Center project.

I find RDR's report convincing and very disturbing, especially since that study was undertaken well before the announcement of another up-market mall on the Peninsula that undoubtedly will have an adverse effect on the viability of MacArthur Center.

As a stockholder in one of the local banks that will provide the construction loan for the Nordstrom-store component, I am dismayed at this method of funding. To the best of my knowledge, many important questions have not been answered.

Has the city ever made a formal feasibility study? If so, has that study been provided to the banks?

Are loans to the city that benefit private companies appropriate?

Figures that I have seen indicate that the cost per square foot of this project will be greatly in excess of the average even for upscale malls. If this is true, how has it been justified to the lenders?

Furthermore, Scope, Chrysler Hall and the Waterside convention center do not appear adequate collateral for the bank loans. Is this a prudent undertaking for the bank I have invested in? Unfortunately, I have no evidence that it is.

Both as an investor and as a Norfolk taxpayer, I am deeply concerned about the prospects and funding for MacArthur Center.

SUSAN R. O'NEAL

Norfolk, June 13, 1996 by CNB