3/10/2011 - Update downtown redevlopment

Letter for Mayor Eugene Melton

Re:  Economic Development and Downtown Revitalization

 In the past two weeks many things have come about at City Hall.  I understand that you might have concerns, so I am going to lay out for you the business plan that makes this the thing to do.

 On Monday, February 28, a standing room only crowd attended a meeting at City Hall in opposition to a thrift store tenant's plans to locate downtown in the former Food World location.  The City agreed to enter into a dialogue with the property owner and the tenant to see if there might be a way to locate this business in an area other than downtown.

For more than a year, the City has been working on a long-range downtown redevelopment plan.  Because of the slow economy, we were thinking that we had plenty of time to get this in place before development picked back up.  Suddenly, things started to happen.  Long before this issue with the thrift store came to our attention, we were dealing with a developer trying to buy options on property in the downtown area, and with a land owner who was notifying  tenants that their leases might not be renewed. We found ourselves in a situation where we were unable to help, and stood to lose several businesses that might not be able to relocate in our city. Then the thrift store issue came along. As a council we found ourselves looking at an issue that might possibility set the City back in our efforts to promote our plan to redevelop downtown. The business plan was put together as follows:           

The present property owner paid $5.5 million +/- in 2005 and the purchase price today is $5,650,000.00.

The mortgage to be assumed is $3.9 million with a monthly payment of $31,619.18.

The reason for assuming the mortgage is because of a penalty clause in the amount of $750,000.00 will take effect if the note is paid off before 2015.

The lease agreements today more than pay the monthly note.

The Food World space of 38,000.00 sq. ft. would be reconstructed to provide more tenant spaces to accommodate businesses being displaced in other parts of downtown.

The plan is for the City to continue to use this property as long as our Redevelopment Authority and the City has a public need.

Once it is determined this property no longer is needed for a public purpose it will be sold and developed in keeping with our redevelopment plan and we feel the property will bring a higher price than the current purchase price.

As you can see we have thought this out very carefully. We see this plan as an investment in the future of downtown which will pay our City a big dividend while protecting the City’’s tax base. If this was just a move to keep thrift stores out of Trussville it would be a bad move. I see this as the City taking a very difficult problem and finding a win-win solution that protects our City, its businesses and its community today and for the future. I hope this helps you see how we came to our decision to take the action we are taking.

Gene Melton

1-888-619-9997

 

 

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