CCP 05-17-1999 - Laserfiche WebLink

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~ Direction for development of Morris Communications property Page Two May 17, 1999 e Where are we at now? Morris Communications, as their name implies, are not real estate developers. They are approaching a point where they will be making a long-term decision on what to do with the property. The professional representatives of Morris Communications have informed the City that there appears to be three courses of action from their perspective: I. Take the property off the market and forget about developing it; 2. Sell the property to a developer who wishes to do something less than office; or 3. Sell to the CitylEDA. The professional representatives of Morris Communications have requested Staffto find out if the City/EDA would interested in purchasing the site. They have also indicated to Staff that the CitylEDA could purchase the site at a substantial discount from its estimated market value of $1,466,400. The range of numbers for the property's acquisition that their real estate appraiser previously provided Staff was in the $500,000 ($0.62/s1) to $600,000 ($0.74/s1) range. Take the property off the Market This scenario obviously has the lowest short term cost to the City. However, it would be reasonable to assume that the long term development costs would be much higher given that the City would no longer be dealing with a willing seller (ie., condemnation). Additionally, if a developer did come forward to build an office building on this property the actual development time would also be substantially be increased due to the time required to acquire an unwilling seller. Lastly, from a developer's perspective having the budget and time unknowns related to the acquisition of this property and possibly the A TS Steel property may be significant enough to cause a developer to pass on doing a project on this site and move on to "easier" pastures. e Sell to a Developer to do somethinl! besides Office This scenario would obviously put the new owner desires at loggerheads with the City's stated objectives (policy and ordinance) to place an office development on this property. The City would be required to expend unknown amounts oftime and money, if the City wishes to maintain its currently stated development objectives for this property. Sell to the Citv/EDA Short of finding an Office developer for the site, this scenario would appear to have the lowest long term cost to the City. If the anticipated selling price is realized, then the City should be able to recoup its investment with any user it could place on the site (ie., the properties to the north generally sold for $1.30/sf to $2.25/s1). The City would be paying for an "opportunity cost" to preserve its vision for the subject property and could wait until the market is ripe to implement that vision and the current owner could go back to the communications business. .