Construction work has begun to convert the site of a former North Lawrence asphalt plant into a $1.25 million business park.

A group of investors led by Lawrence developer Tim Allen has started work on the North Town Business Park on the site of the former LRM Industries asphalt plant at 725 N. Second St. The project will feature a 57,500-square-foot building that is expected to attract contractors, repair shops, light industrial tenants and other service-related businesses.

Allen said new development in North Lawrence, including the announcement that Topeka-based Protection One would move its corporate headquarters into the former Tanger Factory Outlet Center, was a factor in his decision to start the project.

“North Lawrence is getting to be a better place to be all the time,” Allen said. “What’s happening down there at the old mall is good for everybody.”

Steve Glass, president of LRM Industries, also is in an investor in the project. His company operated an asphalt plant on the 4.5-acre site from 1966 to the early 1990s. It has been vacant since then.

Glass said he thought the property was a good candidate for redevelopment because the city had made improvements to the area’s drainage during the past several years. He also said North Second Street continued to become busier as more people used the city’s eastern interchange to the Kansas Turnpike.

The project will be unique because the building’s units will be sold rather than rented. Allen said he would sell space in the building using a business-condominium concept.

“We think there are a lot of small businesses out there that would rather own than rent,” Allen said.

Prices for the units haven’t been set. Allen said the project was expected to be completed by the first of the year.

The project was the largest one started during August, according to the city’s monthly building permits report. City officials issued permits for $6.95 million in August, up from $6.61 million in July and $5.79 million in August 2003.

For the year, building permit totals are lagging behind last year’s figures. City officials have issued permits for $74.03 million, a decline of 19 percent from the $92.44 million issued through August 2003. The total also trails the five-year average of $92.14 million.

Single-family permits also are down for 2004. City officials have issued 178 permits, down from 205 a year ago and down from the five-year average of 221. For the month, 26 single-family permits were issued in August, up from 20 in July and 18 in August 2003.