Concerned Wrote : "... If a prospective buyer cannot even get a bank or other financial institution to finance his offer, why should she act as a bank when there are concerns about his ability to develop the property? Looking at pictures on the Trolley Station Facebook Page, it appears the property was "safe" enough to host a public viewing with families in attendance in 2010 - that does not seem to gel with the premise that she has not made efforts to work with the community or that it has been "dangerous" for almost a decade...."
Concerned: The city is seeking a court order that would allow it to enter the property, tear it down, and put the bill on the property tax duplicate. The owner has refused to do any work to stabilize the deteriorating structures over the past decade, and was quoted recently in the Dispatch as saying she was unable to do so in any reasonable timeframe. There are no good alternatives under her ownership. This property is at a point of crisis.
Columbus Compact Corporation thus made an offer to purchase the facility from the owner, with owner financing for up to 5 years, at appraised value. The Compact committed to immediately investing up to $75,000 cash over the next six months to maintain and secure the buildings from further deterioration while it pursued development partners and financing. The current property owner would maintain a mortgage on the facility, and would receive mortgage payments from the Compact. If the Compact did not execute, the property -- which has been secured and stabilized -- would revert back to the current owner. If the Compact secured development partners and financing, the current owner's mortgage would be paid and the property developed.
This proposal was done at 100% business risk to the Compact, to secure a "win-win-win" situation. The owner wins through a net turnaround of $20,000 per year to her (mortgage payment, plus Compact assuming stormwater and tax bills), and she gets out from under the prospect of Environmental Court. By providing owner financing, she gains $343,000 from a situation of court-ordered demolition, because the buildings -- which she paid $230K for and have a land value of just $87K, would not be demolished leaving a +/-$200K demolition bill on the property -- causing her to lose her initial investment of $230K + $200K demo bill - $87K sales price = $343,000 benefit of the deal.
The community wins because at a minimum historic buildings are preserved, and with a change in ownership with a proven community-based developer at the table there is potential for a great economic revitalziation plan priced at $10.3M (summarized on the Friends of Franklin Park Trolley Barn website at: http://www.facebook.com/pages/Friends-of-Franklin-Park-Trolley-Barn/139543339419770?ref=hl). This development is feasible, and would be financed by state and local historic tax credits, private debt, equity and likely some very reasonable amount of government subsidy (the public-private partnership Walker mentioned in an earlier post). This is exactly how these types of things happen.
In exchange for this, the Compact merely carries a lien on its 100% at-risk and speculative no-interest investment which is only designed to save this historic treasure, but will not of itself generate a dime in revenue. The Compact's win is certainly not financial, but lies in saving an important Columbus landmark and thus contributing to the revitalization of this great neighborhood.
The Community Visioning Session held in 2010 was not held at the property -- which is clearly too dangerous for such an event -- it was held at Central Community House. Nor was the event envisioned, sponsored, or participated in by any way by the owner other than allowing access to the property: it was done by the Compact at our own time and expense. And we did take people on a carefully-guided tour with paths marked by Caution Tape, so they could set foot on the property with well-managed risk. Please look at the pictures on the website to get a sense of the hazards on the site (and those pictures do not show the most dangerous conditions). And, yes, everyone who took the tour was informed of the hazards and required to sign a liability release and waiver to enter the premises.
The Owner's cooperation to date has been merely allowing the Compact -- at the Compact's full risk and expense -- to access the property to complete environmental, structural, architecture, planning and marketing studies. These efforts by the Compact -- for which the Columbus and Ohio Historic Preservation Offices and the Ohio Community Development Finance Fund played critical support roles -- are the only concrete attempts beyond the also very critical advocacy that have been undertaken to save this complex. The Compact's work has given "legitimacy" to the advocacy of neighborhood leaders and groups like the Franklin Park Civic Association and Trolley Barn Block Watch, who are not howling in the wind, but are able to talk with certainty and conviction about a specific, realistic, credible, and financible plan for improvement that they participated in crafting and that they would like to see take place.
The owner has done nothing but patchwork repair under code enforcement order when a portion of the wall collapsed onto the adjacent residential property. She has not capped the exposed brick on the top of that and other walls that allows for water infiltration/freeze-thaw that is destroying the structural integrity of the walls. She has not installed gutters to keep roof runoff from softening the grond and undermining the foundations that is causing the walls to show severe stairstep cracking as they sink and break away from their lateral support. Nor has she done anything to arrest the cave-ins of three roofing structures on the site with the most severe roof collapse looking imminent with another heavy snow load -- a roof collapse whose weight, height, and speed could pull down the walls. Nor has she accepted multiple above-market offers to sell or ground lease the property. We have offered reasonable prices on our terms, and we have offered her price on our terms, and she has refused both. She has at times offered owner financing, and then turned around and rejected it. Owner financing does not cost her a dime, and it turns a 10-year money-losing situation for her into an immediate monetary gain: I can see no rational reason why she whould not do it happily. She is in a financial box, and taking the property with her. She just got a lifeline offered by the Compact that will save her money, and save our community treasure.
My belief is that she has lost about $10K a year, for each of the last 10 years, and wants someone to bail her out of her loss in buying the building ($231K) and losing $100K holding the building. And she wants a profit on top of that. But the facility is only valued at $189K (land and buildings). She simply lost money speculating in the real estate market, continues to lose money on this property every day that goes by, and doesn't want to realize her speculative business loss. (Then again, Nationwide Arena got bailed out ... maybe the City and County will bail her out, too.) We will see if she will accept the help and join in a financial partnership which is nothing but a "win" for her, to save the property.
So Concerned, those are the true facts.
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