A proposed redevelopment of a city-owned property on Castle Street could add to a growing list of projects within an area that has seen revitalization in recent years, local developers say.

A mixed-use project that would transform 1110 Castle St. will have another 60 days in the predevelopment period following approval by Wilmington City Council on Tuesday.

The additional time will allow for preliminary conversations with the city to hammer out the predevelopment agreement, including requirements for the actual transfer of the property, said Clark Hipp, of Hipp Architecture and Development PC and the lead developer on the potential project.

That includes a wide range of activities that include addressing environmental investigation of the site and timelines for the project, which aims to bring together private investors and community development partners, including Cape Fear Community Land Trust and Cape Fear Habitat for Humanity.

The redevelopment proposal would add to several efforts that have been shaping the Castle Street community over the years.

"Castle Street has seen a resurrection recently in the Arts and Antiques District, which has happened over the last 10 years between Third and Seventh streets. And then just in the past two years, they have seen resurrection on the other end – in the 15th, 16th and 17th street area – which is what they call the Cargo District,” Clark said Wednesday. “We see the Castle Street project as an anchor to draw those two together, so that all of Castle Street sees redevelopment.”

Terry Espy, president of MoMentum Companies who has been active in the revitalization of the Castle Street area, said there is some excitement about the project from the surrounding community.

“As a developer, I understand the economics of what he is doing. It’s just not easy," Espy said, noting Hipp's plans to incorporate present buildings on the site into the development plans. The property was once used as a bus maintenance facility for Wave Transit.

“It's great to see [the property] brought to the next life,” Espy said.

The redevelopment project would involve residential units, including affordable housing, and commercial space.

The development “introduces a new solution to housing in the downtown area with a mix of affordable housing and market-rate units in one development,” Hipp said.

Hipp also said he is in talks with a community service organization to take up 8,000 square feet of commercial space in the project.

Another community service organization, Kids Making It, is also building on Castle Street. Kids Making It teaches woodworking, life and entrepreneurial skills to at-risk children. The Wilmington nonprofit organization is creating an addition to its space at 617 Castle St.

"Right now you can see the facade, they're starting to incorporate the existing building and tie it into a new new look altogether. That's a great energy for that street," Espy said of the project.

There is an ongoing commitment to making Castle Street a vital community, Espy said. The Castle Street Collective, a group of residents, business owners and others who want to be involved in the community, is also making an impact, she said.

"There's a good group there. There's about 35 active members. A lot of them are new to the area. I'd say a handful have been here a while," Espy said. "But the positive thing is there's a very, very cohesive vision for the Castle Street district. And a lot of them are now as a unit putting their money where their mouth is too, making enhancements to some of the landscaping and miscellaneous events."

And Espy said the search is on to find a tenant to fill the space at 509 Castle St., which was previously Rolled & Baked.

"The owner of that property and ourselves, we have been saying all along that space should be a community-style restaurant; a place to get a good burger, a salad for lunch ... we are lacking that on Castle Street currently," Espy said. 

Since Rolled & Bake has left, there have been nearly a dozen offers on the property, but Espy said that the space requires the right tenant fit.

"There's great interest, but we want what's good for the client and for the community," she said.

That same owner is working on transitioning the building at 508 Castle St., Espy said, adding that there are existing tenants there that they would like to help stay in the building.

Boston-based RCG Real Estate Fund Limited in the fall purchased Urban Oasis, a mixed-use project on Castle Street, for $2.25 million. 

"A lot of what's happened in Castle Street is due to the fact of the property owners and the business owners out there that came together to really kind of make this happen," said Wilmington Mayor Bill Saffo. "I see Castle Street continuing to improve and for investment to continue to happen in that area."

Another example of recent Castle Street activity, the mayor pointed out, is the End of Days Distillery at 1815 Castle St., which is scheduled to open Feb. 1, according to the distillery's website.

All are good signs for an area that in the past has seen businesses come and go every couple of years, Espy said.

The district has "strong viable businesses that are there," she said, "and that's a new turn for Castle Street."