Reinhart Agent Asks Saline to Lower Price, Make Property Easier to Sell

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 06/21/2014 - 18:01

The City of Saline should drop its asking price and tear down existing structures if it wants to sell its Monroe Street property to a developer.

That was the advice of Reinhart Realtor agent Rick Mangan, who appeared by City Council June 16 to provide an update on efforts to sell the 3.5 acre parcel at 207 S. Monroe St.

The city, which bought the parcel for $100,000 in 2011, broke off an easement to serve People’s Park and hopes to sell the rest of the property to a residential developer. The property is listed for $275,000.

Mangan told city council that there have been discussions with potential buyers. At one point a company which specializes in senior and assisted-living housing signed a letter of intent to purchase the property and build 50 units on the site.

“They started out pretty good. They offered the list price of $275,000. After that it went downhill. I think the biggest thorn in the whole thing is that they seemed to want to live here and not pay taxes. That wasn’t going to go over well,” Mangan said.

Mangan said the company withdrew its letter of intent recently because it is dependent on federal financing. This site didn’t qualify for federal financing because it wasn’t within two blocks of 40 businesses.

But currently, after nine months on the market, there are no serious discussions taking place.

Mangan said there have been discussions with smaller developers.

“Over time what we’ve found is there’s a real difference in value, depending on whether you are a high density user or low density user,” Mangan said.

Mangan said the high density users will have a longer development timeline, cause more criticism from neighbors and cause more traffic. But they can pay a higher price. Condos could also be possible, but financing can be an issue for the end user.

Mangan recommended the city engage the market to find developers to build single-family homes.

“Six to eight homes. That’s about all you get on this,” Mangan said. “The low density user is looking at high infrastructure costs. So cost per unit is higher.”

To make up for the higher costs, a single-family-home developer needs to reduce costs somewhere. Mangan said suggested that savings should be land acquisition cost.

He asked council to drop its asking price to $200,000.

Developers also want an “easier” property to work with.

“There are two buildings on there that need to be taken down,” Mangan said.

Mangan also said the city could make the property more attractive by conducting a Phase 1 environmental study. Most of the property, however, was assessed by the city when it was purchased in 2011.

Council meeting Lee Bourgoin suggested council discussion the issue at a work session June 30.

“To come to a decision without deliberation, I don’t think that’s the right approach. We should talk about it amongst ourselves, and ask questions, back and forth,” Bourgoin said. Council member David Rhoads and Mayor Brian Marl said they supported the idea of having the discussion June 30.

Councillor Dean Girbach said he was fine with the idea of removing the properties on the site. He said when council purchased the property it was recommended that the structures stay up in case a buyer wanted to restore them.

“I’m fine with removing the buildings to improve the saleability of the land,” Girbach said.

Rhoads told Mangan it wasn’t easy to find the property on the Reinhart website and asked if there was an easier way to bring it to attention. Mangan said Reinhart was currently working on its websites.

The work meeting will take place at 6 p.m., June 30.

Tran Longmoore's picture
Tran Longmoore
Tran Longmoore is a veteran community journalist. He is founder and owner of TheSalinePost.com. He is co-publisher of The Saline Post weekly newspaper. Email him at [email protected] or call him at 734-272-6294.

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