Tags: Crestwood News
November 20, 2013 - The Crestwood Court property is in the process of being put up for sale with a broker, according to Mayor Jeff Schlink.
At last week's meeting, Schlink gave the Board of Aldermen an update on the redevelopment progress, which included Angelo, Gordon & Co. hiring a company to assess the mall property. That assessment, according to Schlink, shows that the property is not what the city believes it to be.
"It's in a very big disadvantage not being closer to the highway, and access is a significant issue for the property," he said. "They were proposing razing that building and putting in a park. Nothing but a park."
Angelo, Gordon & Co. and Centrum Partners LLC purchased the former Westfield Shoppingtown Crestwood in 2008.
Schlink previously told the board Angelo, Gordon & Co. presented an option on how to use the mall property that he did not believe was in the city's best interest. That was the park concept, which he did not reveal at that time.
The results of the pending Brownfields Assessment will have "zero impact" on any decision to sell the property, according to Schlink. The assessment investigates the impact the property could have on the environment due to lead-based paint, asbestos and other environmental concerns. Centrum agreed to the study in August, though results have not yet been presented to the board.
Centrum and Angelo, Gordon & Co., according to Schlink, are "very much in touch with each other" about the property's redevelopment status.
Centrum proposed the District at Crest-wood, an open-air entertainment and retail venue for the mall site that would include restaurants, a movie theater and an upscale bowling venue.
As proposed, the total redevelopment cost would be roughly $121 million, with economic assistance in the form of tax-increment financing, or TIF, a transportation development district, or TDD, and a community improvement district, or CID, reaching roughly $34 million, according to revised numbers presented to the city.
"They are very clear," Schlink said. "They know that (Centrum's) entertainment district as of right now has not gone forward and will not go forward with the current proposal. We certainly offered to them multiple times through this board, through work sessions, to modify that proposal.
"I was very clear with Angelo, Gordon on that request and (Sol) Barket (of Centrum) is certainly aware of that, and as of right now they've given me no timeline that they're going to come back with a revised proposal."
Ward 1 Alderman Darryl Wallach suggested giving Centrum a timeline to revise its redevelopment plan. However, Schlink said there would be no legal grounds for Centrum to "abide by that timeline."
City Attorney Lisa Stump said if the city would set a timeline, it would then have to determine what would happen if Centrum did not meet the deadline.
Schlink said he will send an email to Centrum on behalf of the city requesting to take the redevelopment "out of neutral and to move it forward from a development perspective."
Wallach questioned if the city should rescind Centrum as the developer, but Schlink said the company would still be involved in the project because of its role as part-owner of the property. Doing so would also create "some legal problems" for the city, according to Schlink.
Ward 4 Alderman Dan Tennessen questioned whether changes had been made to the proposal as was expected, but Schlink said he made it clear that "where the ball sat was in their (Centrum's) court."
"I cannot force them to make any changes. It is entirely up to them as to what, if anything, they're going to do next," Schlink told Tennessen. "They're very aware of what's going on. Do you think there's something that they need to know that they don't know?"
Tennessen said he believes Schlink is "difficult to communicate with and not very direct," to which Schlink replied that Barket has given the city contact information, and Tennessen is "more than welcome to reach out to him and visit with him."
In response to Schlink's email, which was sent Nov. 14, Barkett stated that Cen-trum has not arrived at a "revised proposal that makes enough sense to warrant a re-submittal."
"As you know, we have studied big-box retail extensively and since our last rejection to engage a consultant," he wrote. "We did embark on another campaign to find some larger users to consider the site. Our efforts to date have come up less than short, we have yet to find one user to kick off a large box (power) type of center."
There is also an "outstanding issue" with Angelo, Gordon's request to install a fence around the mall property because the desired fence does not align with city codes, according to Schlink.
"They've been very receptive to working with us to get their fence installed ...," Schlink said. "They are not very optimistic that that property is actually going to sell. So selling the property I don't think — it's possible, but according to them, the chances are not very high."
In response to a question from Ward 1 Alderman Richard Breeding, Schlink said using eminent domain to take control of the mall property would cause the city to be responsible for property taxes and in-surance on the property.
However, Barket wrote that Centrum "would view that as the most likely way to recoup some of our equity."
"Courts usually lean towards property owners in these types of situations in terms of value and we would most likely come out of it in such a way that would be satisfactory to us," Barket wrote.
"I do want to mention that our carry on the property is $1 million a year simply in taxes, security, electric and so forth," he wrote. "If the city is in a position to take on that responsibility and expense, we would work with you to come up with a value that works for everyone. That value will have to be north of $10 million, but we would be happy to explore that option with you if the city finds that to be an attractive option."