Second offer made on Moss, Evans sites
Published 1:34 am Tuesday, February 25, 2003
By By MIKE VOSS, Contributing Editor
Washington's City Council wants the two parties trying to buy the former Moss Planing Mill site – and possibly the former Evans Seafood site – to submit their "best and final" offers by March 6 so it can decide who gets to buy the property.
The council expects to pick a buyer at its March 10 meeting.
Moss Property Partners, LLC reviewed its offer with the council Monday. MPP is a joint venture between Washington Betterment Partners, LLC and about 25 local investors, according to MPP spokesmen Fred Fletcher Jr. and Wayland Sermons, attorney for MPP.
In August 2002, Washington Betterment Partners suspended its plans to build a hotel and conference center on the Moss site, saying economic conditions then did not favor pursuing the proposal. WBP's original plans called for some residential development after the hotel was built.
"The principals of Davidson &Jones Hotel Group and Washington Betterment Partners remain convinced that Washington qualifies for and is deserving of a first class inn and conference center once the economy returns to a level of feasibility. It is to that end that MPP will vigorously pursue its development until all options are exhausted," reads a Feb. 18 letter of intent signed by Fletcher, operating manager for WBP and MPP.
Jay Mahan, president of Davidson &Jones and a WBP principal, told the council the hotel and conference center plan remains a "proper waterfront development" and that using all of the Moss site for residential development would be a "tragic underutilization of the property."
"What we found is there is strong interest locally in us continuing the pursuit" of building a hotel and conference center on the Moss site, Mahan said.
MPP proposes to buy the Moss and Evans sites for $1,775,000, or the Moss site alone for $1,565,000. MPP would make a down payment of $375,000 to the city.
The MPP proposal calls for reserving about 4 acres of the 8.03-acre Moss site for the hotel and conference center, which likely would not be built right away. MPP would reserve the 4 acres for eventual development of the hotel and conference center until the earlier of the following "triggering" events occurs:
According to the MPP proposal, in the event none of the "triggering" events occur, MPP would be free to continue with development of the reserved property as permitted under the current B1H zoning classification.
The MPP plan calls for building about eight to 12 townhouses on Water Street at the east end of the property and about 40 to 50 luxury condominiums along the eastern and southern property lines.
The proposal calls for the city to conduct a market-based urban design plan for the downtown business district inclusive of the Moss and Evans sites. MPP would pay $15,000 toward the cost of such a plan.
"This proposal gives you money in about 45 days," Sermons told the council, referring to the down payment that would come after the council and MPP sign a purchase agreement and close on the property.
Under a proposal submitted by East West Partners Management Co. to the council last month, East West would not close on the property until after all permits (for boat slips) needed for the project are approved, which could take about a year. East West would not buy the property if permits for boat slips are not approved.
MPP would not make approval of boat-slip permits a condition to close the deal, Sermons said.
East West proposes to build townhouses and single-family homes on the Moss site.
The East West proposal offers $1,725,000 for the Moss and Evans sites, but with interest the city would receive $1,783,250. Under the East West proposal, the city would net $1,709,213, which reflects city expenditures for capital improvements of $192,600.
Under the MPP proposal to buy both sites, it would pay $1,775,000, but with interest the city would receive $2,020,000. Under that plan, the city would net $1,872,500, which reflects city expenditures of $185,000 for capital improvements and a sales commission.
Under the MPP proposal to buy just the Moss site, the city would be paid $1,565,000, but with interest the city would receive $1,817,875. Under that scenario, the city would net $1,670,375, with city expenditures of $185,000.
The MPP proposal caps the city's cost of improving Water Street, installing a pump station, building a connector street and constructing two piers to connect the property to the adjacent boardwalk to $125,000. The East West proposal could cost the city $160,000 to make the improvements.
East West has a copy of the MPP offer, City Manager R.L. Willoughby told the council.
Councilmen Ed Booth and Ed Gibson indicated a preference for the MPP proposal because of the local investors associated with it. During the meeting, Sermons declined to identify investors, saying MPP continues efforts to acquire more investors.
"You will know everyone of them," Sermons said.
Mayor L. Stewart Rumley indicated his preferred plan.
"I'd go with MPP2," he said, referring to MPP's offer to purchase only the Moss site.
The MPP offer gave the council two options to consider when it comes to the Evans site.
Under the first option (to be exercised anytime within 18 months after closing on the Moss property):
Under the second option, if the city declines the first option, MPP will buy the Moss and Evans properties for $1,775,000.
In other business, the council decided to use in-house resources to search for a new city manager.
The move likely will save the city about $5,000. It had received proposals from two companies seeking to help the city in its search to replace Willoughby, who retires April 1. Both proposals carried a base price of about $10,000. By using city personnel to do most of the work, the council determined it could cut that figure in half.