In 2008, actors used a portion of the Liberty Warehouse as a rehearsal space.

Durham’s planning department held a public meeting Thursday to determine whether Greenfire Development, which owns more than 25 properties downtown, neglected its historic Liberty Warehouse property on Rigsbee Avenue. Part of the roof over one of the two adjoining warehouses at 611 and 613 Rigsbee Avenue collapsed in heavy rains last May, displacing several artists and art nonprofits. (See a map on all Greenfire Development properties)

The incident also generated questions about the management of Greenfire’s historic properties, and whether the local company was on track with its large-scale redevelopment plans for downtown; They include the renovation of the former SunTrust building into a boutique hotel, the redevelopment of an adjacent Main Street site that used to house a Woolworth’s store, and a newly announced venture to build 88 apartments on an acre just north of the American Tobacco campus.

If Durham’s planning officials find that Greenfire didn’t do enough to maintain its historic property (called demolition by neglect, see p. 85 of the Unified Development Ordinance) and the company fails to meet future deadlines for repairs, it could be subject to civil fines of $500 a day and other legal action. Planning Director Steve Medlin said he expects to make a decision by the end of next week. If he does find Greenfire neglected the property, he’ll set a final deadline for the repairs. The city would take civil action only if the company misses those new deadlines, Medlin said. The goal isn’t to fine Greenfire, he said—it’s just to get the building fixed.

Greenfire has had seven months to repair damage inside the former tobacco auction warehouses from what city inspectors determined to be longtime leaks resulting in water damage and wood rot. After the collapse and subsequent inspections, the city condemned the building and two organizations central to the area’s arts community, including The Scrap Exchange and a portion of the operations for the Liberty Arts bronze-casting foundry were forced to relocate.

Medlin began his “demolition by neglect” investigation soon after the collapse, but suspended it and allowed the company to make the necessary repairs by the end of January. Now that the repairs still aren’t complete, Medlin said he had to resume the investigation.

“To my knowledge they did not do any repairs to the portion of the building where the roof collapsed,” Medlin said, adding that, as of last month when he entered the building, there was still a tarp covering the roof breach in the building at 611 Rigsbee Ave.

Greenfire has so far spent $105,000 to stabilize the building and has committed another $20,000 for more repairs, said Managing Partner Paul Smith. But there’s still that hole, covered by a tarp. Economically, it doesn’t make sense to replace the roof at a cost of more than $1 million when the company has long-term plans to totally redevelop the site, Smith said.

So the company has applied to Durham’s Historic Preservation Commission for permission to engineer a work-around—modifying the flow of rainwater around the hole to avoid further damage, but leaving the hole and deferring more holistic roof repairs until the grander redevelopment is underway. (The developers need the Commission’s permission because Liberty Warehouse is a historic landmark; The hearing is set for March, Smith said.)

Smith said he’s currently working on the long-term plans for Liberty with lots of input from local leaders, business people and the stewards of Durham Central Park. Greenfire has already hosted one meeting with the stakeholders envision the future of the buildings, which have a 250,000-square-foot footprint.

But if Medlin decides that there is evidence of demolition by neglect, the company could be forced to permanently repair the hole in the roof instead of erecting a temporary solution until they’re ready to rebuild the whole property.

Another alternative, Medlin said, was that Greenfire could apply to have Liberty Warehouse’s designation as a historic landmark removed. The company would no longer be eligible for any tax credits for owning a historic property—but the property also would no longer be subjected to the same regulations and scrutiny.

Smith is hopeful, naturally, that the city doesn’t find Greenfire has been neglectful of the historic building. He says he’s also looking forward to progress on the company’s other high-profile sites, particularly the former site of the Woolworth’s department store at Main and Parrish streets. As for the former SunTrust tower just across the way, Smith says Greenfire is still planning a boutique hotel for the site.

The company pulled construction permits last summer, in time for a deadline that made Greenfire eligible for $4.2 million in public incentives and financing. Construction on the hotel must be completed by July 2013 for the company to still be eligible for the financing, said Kevin Dick, director of Durham’s Office of Economic and Workforce Development. To his knowledge, no additional construction has occurred on the hotel project since the initial permits were pulled last July, Dick said.

Greenfire is developing partnerships for both the hotel and the former Woolworth’s site, Smith said. He declined to say whether the company is entertaining offers to sell the SunTrust building, but said Greenfire has always been open to discussions on the sale of its properties, especially the few holdings that aren’t critical to the company’s “overarching strategy”.

“Obviously, we don’t want to hold up any possible development opportunities downtown,” Smith said. The company sold one of its buildings near historic Five Points last year, a property at 108 Morris St. slated to become a restaurant.