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Lechner will be paid $66,000 for sale of Mehlville's St. John's School site


February 02, 2005 - Staff Report

The Lechner Realty Group Inc. will be paid $66,000 for representing the Mehlville School District in the sale of the St. John's Elementary School campus, according to information obtained by the Call under the provisions of the Missouri Open Meetings and Records Law.

Superintendent Tim Ricker signed a contract Jan. 24 to sell the 5.85-acre St. John's property at the corner of Will Avenue and Lemay Ferry Road to Greater Midwest Builders for $1.1 million. The Board of Education had voted unanimously in a March 9 closed session to list the property for $1.2 million, according to minutes obtained by the Call under the provisions of the Open Meetings and Records Law, also called the Sunshine Law.

The sale is contingent on several factors, including an environmental assessment, soils testing, engineering reports, rezoning of the site by St. Louis County from R-4 Single Family to an appropriate zoning allowing residential multifamily condominium units, and approval by Greater Midwest Builders of a feasibility study regarding the company's contemplated development of the site, according to the sale contract. Under the terms of Lechner's exclusive listing agreement with the school district that has been obtained by the Call, the firm will re-ceive 6 percent of the gross sales price.

Greater Midwest Builders had submitted the $1.1 million offer for the sale of the St. John's site in November. After negotiations between the district and the company, a proposed sale contract was presented to the board during a Jan. 11 closed session.

Board members voted unanimously to approve a motion that "if the proposed buyer for the St. John School property makes an offer based on a sale contract substantially similar to the contract presented to the Board of Education at this meeting, then the superintendent is authorized to execute that contract on behalf of the Board of Education.''

During a Jan. 20 closed session, Assistant Superintendent for Finance Randy Charles "advised that the prospective buyer of the St. John School site was not initially accepting of changes by the school district in the sale contract. However, the district's real estate broker believes the differences to be minor and continues to pursue the matter with the goal of a signed agreement in the next day or two. Should the superintendent execute a sale contract on behalf of Mehlville School District, he said, information will be released to the public,'' according to draft minutes obtained by the Call.

Several proposed offers from prospective buyers for the St. John's property ranging from $600,000 to $1.1 million either were withdrawn or rejected by the Board of Education, according to information obtained by the Call.

Mehlville School/Community Relations Director Patrick Wallace would not permit the Call to speak with Ricker about the sale. Citing an undocumented district "practice,'' Wallace said the Call's questions must be submitted in writing. The Call, like virtually all newspapers, will not submit written questions to public officials or anyone in lieu of either a telephone or face-to-face interview.

Mehlville's previous refusal to release the listing agreement with Lechner Realty is one of three purposeful violations of the Sunshine Law alleged in a lawsuit the Call filed in May against Ricker, the district and the board. The lawsuit is pending.

The St. John's campus originally was to be the site of the school district's new early childhood center, now called the John Cary Early Childhood Center, which is being built on the Beasley Elementary School campus. The early childhood center is the final new building that will be constructed under the Proposition P districtwide building improvement program, now estimated to cost nearly $89 million.

Mehlville administrators first informed Proposition P Oversight Committee members of their concerns about the Will Avenue site Nov. 25, 2003. However, the board had voted in a Nov. 17, 2003, closed session to begin negotiations with the Lech-ner Realty Group for a listing agreement for the St. John's site.

Minutes of a Sept. 15, 2003, closed session state, "Dr. Tim Ricker outlined estimated construction costs for site preparation of the St. John School campus for construction of the planned early childhood center. He also described problems with site elevations that are impacting the building design. He stated he has been contacted by a developer who is keenly interested in the site and who has suggested availability of other sites within Mehlville School District that would be less costly for school district development. Dr. Ricker commented on details of that conversation and asked for authority to pursue this interest. There was lengthy consideration of favorable aspects of the proposal.''

During a Sept. 29, 2003, closed session, the issue was discussed again with the minutes stating, "Dr. Ricker and Mr. Randy Charles discussed legal requirements for a confidential listing the St. John campus for sale during a search for other available property. Board members considered a time line for all action pertaining to location and construction of the early childhood center.''

Gino Pucci of Lechner Realty was present for part of the closed session, according to the minutes, and "was invited into the meeting to present options for determining the highest and best use for the St. John site.''

As reported by the Call in December 2003, Ricker said the district did not issue a request for proposals seeking the services of a real estate broker.

"We didn't do an RFP,'' he said then. "We're using (Lechner) based on our past practice.''

Asked when the district last used the services of the Lechner Realty Group, Ricker said then, "I couldn't actually tell you when the last time was.''

During a closed session Dec. 15, 2003, the board voted to approve a 90-day exclusive listing contract with Lechner Realty for the St. John's site.

Board members voted to extend the listing contract for an additional four months during a March 9 closed session and voted in a July 22 closed session to extend the listing contract for an additional six months. Board members voted in a Jan. 20 closed session to extend the listing agreement with Lechner for an additional four months, according to draft minutes.

As previously reported by the Call, Ricker denied the newspaper a copy of the listing agreement Dec. 19, 2003, because "in that contract is confidential information that could reveal on pricing, so that we're not going to be releasing the details of some of the components of that."

On April 2, the Call formally requested a copy of the contract, which Ricker denied a second time. In an April 13 letter, Ricker claimed that the agreement was an exemption under the Missouri Open Records and Meetings Law, stating that the contract "clearly relates to the potential sale of real estate by Mehlville and public knowledge might adversely affect the legal consideration received for the real estate."

The newspaper on April 23 then submitted a formal request for a redacted version of the contract, explaining to Ricker that the Call would like to view parts of the contract that would be considered public information. Ricker's response to the request, dated April 28, denied the Call's request for a third time, again claiming that the contract was exempt under the Sunshine Law.

On July 26 — two months after the Call filed its Sunshine Law suit against Ricker, the district and the board — Ricker sent the Call a redacted version of the Lechner listing agreement, stating, "Without waiving our contentions that the entire document is exempt under (the Sunshine Law) and that the board has no obligation to redact information from this or any closed record, the board is providing the non-exempt portion of the document to your newspaper. The remainder of the information in the listing agreement is exempt according to (the Sunshine Law) because public knowledge of the transaction might adversely affect the legal consideration thereof and has been omitted.''

The previously redacted parts of the listing agreement state:

• That Lechner would serve as the district's sole and exclusive agent with the exclusive right to sell the property for a purchase price of "to be determined by the owner in its sole discretion.''

• Owner herein discloses any noted exceptions to the warranties or representations called for herein: "The existing building improvements likely contain asbestos and lead paint. The property is to be sold 'as is, where is' without warranty.''

After receiving the redacted listing agreement from Ricker, the Call learned of the existence of an addendum to the listing agreement and requested that addendum under the Sunshine Law.

A redacted version of the addendum was provided to the Call Aug. 5 by Thomas A. Mickes, one of the attorneys representing Mehlville in the Sunshine Law suit filed by the Call.

The previously redacted parts of the listing agreement addendum relate to commission and state:

• "A. If owner sells property to JHB Properties Inc. or any party related to JHB Properties Inc., then the total commission payable by owner shall be Four and One Half percent — 4 1/2 % — of the gross sales price up to Six Hundred Thousand dollars — $600,000 — and Six percent — 6% — of the gross sales price, if any, in excess of Six Hundred Thousand dollars — $600,000 — to be split between broker and any other brokers participating in the sale and purchase.''

• "B. If owner sells the property to any purchaser other than those identified in subparagraph A, then the total commission payable to broker shall be Six percent — 6% — of the gross sales price, to be split between broker and any other brokers participating in the sale and purchase.''

In his letter to the Call, Mickes wrote, "As you will note, I have redacted from paragraphs 2(A) and 2(B) the identification of a prospective purchaser with whom negotiations have been ongoing.''

However, according to closed-session minutes obtained by the Call, a motion "to accept the Berra (JHB Properties) offer of Sept. 8, 2003'' was unanimously rejected by the Board of Education Feb. 2.

The existing building on the St. John's campus was built in 1922. In 1981, the school ceased offering classes to elementary school students and then served as St. Louis Community College's South County Education Center. A new South County Education and University Center at the corner of Lemay Ferry and Meramec Bottom roads opened in the fall of 2003.

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