The last key piece of property for downtown redevelopment plans is now in place - the ownership is, that is.
At its April 23 meeting, the Redevelopment Agency voted 4-1, with Councilwoman Marby Lee dissenting, to adopt a resolution approving the purchase and sale agreement for the 5,227-square-foot property at 17450 Monterey Road and the 10,890-square-feet of vacant land north of El Capri Restaurant for $1.9 million.
The city didn't appraise the property. Toy said his department reviewed comparable sales, like how much the city paid for the Downtown Mall.
"As the last piece of the puzzle, this property's purchase was the overriding concern," he said. "The owner had a price, a value that was what he thought he needed to be at."
The city estimated the properties were worth $1.15 million and $300,000 for the 17450 Monterey Road lot and the vacant land north of El Capri, respectively.
Toy said the city didn't appraise the land since the owner's $1.9 million asking price was already more than what the city estimated the property would have been appraised for.
"We knew his price was higher than the comparable market rates," he said.
"If we got the property appraised, we would still be in the same place."
The purchase will allow the agency, comprised of the five members of the Morgan Hill City Council, including Morgan Hill Mayor Steve Tate, to start looking for a developer for the first major project in downtown redevelopment, which could include 10,000 plus square feet of retail, movie theaters, up to 40 residential units and a structured parking garage, according to the staff report.
Tate said the purchase will help kick-start development on Third Street, which is planned to become a pedestrian-friendly promenade similar to the one in Santa Monica and along Monterey Road.
The larger piece was considered a key property because of its location, between the Granada Theater and the Downtown Mall. The redevelopment agency closed on these properties in January and February.
The city came to an agreement with property owners Paul and Diane Swing after a complicated negotiation process, said Garrett Toy, director of Business Assistance and Housing Services.
Councilman Greg Sellers said the complicated purchase agreement taxed the council, but in the end he thought the purchase would be worth it.
"We'll be able to make much more of a statement (with a contiguous development) than we would have been able to make if it was left alone,"
Sellers said. "In the long run, I think it will be obvious that (this was the right move)."
Marby Lee, the one dissenting voice in the vote to approve the purchase, said she's not against doing things for downtown, but that sometimes even as much as you want something, you have to say no if it's not a good thing.
"I thought the terms are not in the best interest of the city, both this deal and in the long term," she said. "It's a lot of money. I have told this to Paul Swing, he has every right to get the best deal for his property. I on the other hand have the responsibility for looking out for the city's interests."
When city officials indicated to the Swings they wanted to buy the land, the Swings offered another piece of land he thought may be of interest to the city, located north of El Capri Restaurant.
Another stipulation of the agreement is that the Swings' company Techcon would lease a vacant space adjacent to the police station at 16200 Vineyard Boulevard from the city for a 10-year period.
Property owners Paul and Diane Swing were not available for comment by press time.
Natalie Everett
Natalie Everett Natalie Everett is the education and city reporter for The Times. Reach her at (408) 779-4106, ext. 201, or neverett@morganhilltimes.com.
POST A COMMENT
If you are under 13 years of age you may read this message board, but you may not participate.
Here are the full legal terms you agree to by using this comment form.
