Council OKs sale of State Road site
February 14, 2010 – Steve Wiandt, recordpub.com
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Cuyahoga Falls -- With Council's approval Feb. 8 of the city's intention to sell the former State Road Shopping Center property, Cleveland developer Robert Stark can start signing businesses to be part of the plaza he plans to build at State Road and Portage Trail.
"I appreciate Council's vote," said Mayor Don L. Robart. "It shows they have a vision, along with the administration. It's nice to get this behind us, because now for the first time Bob Stark can actually go out and start getting leases and lining up vendors. I think that's what the community is really anxious for."
With its 10-1 vote on Feb. 8, Council agreed to sell the 25.29 acre site to Stark Enterprises (or Portage Crossing LLC) for $3.79 million. He has up to two years to close the deal.
Stark will now begin seeking tenants for Portage Crossing. Prior to closing the sale, the contract gives Stark up to a year to enter into sufficient pre-leases or pre-sales for the development to be "financially feasible." After that year, Stark is allowed two six-month extensions subject to approval by the mayor. Further extensions would need Council's approval.
"There is much [for Stark Enterprises] to accomplish before the names of selected stores are announced," Community Development Director Susan Truby told the Falls News-Press. "The developer will keep us posted on their progress and when announcements can be made we will be certain to let [the Falls News-Press] know immediately."
If the developer is unable to accomplish the project, Truby said the city will send out new letters to prospective developers.
Prior to the vote on the agreement, Councilwoman Carol Klinger (R-at large) made a motion to require Council's approval of all extensions past the first year. The motion failed 8-3 with Klinger, Kathy Hummel (D-at large) and Mary Ellen Pyke (R-2) voting in favor of it.
Ordinance 'a gamble' Councilwoman not willing to take
The new development, which will be called Portage Crossing, will be anchored by a grocery store and face Portage Trail, according to the developer's plans. Built in the 1950s, State Road Shopping Center was anchored by several large department stores and faced State Road. All of the stores that made up the shopping center have been demolished. Crews continue to pulverize asphalt to fill in the stores' basements.
In addition to buying the land, the city will invest $5 million in the project for public infrastructure to support the area, Robart said in a letter that was published Feb. 7 in the Falls News-Press, and the private developer will invest more than $44 million in the project. "Over the life of the project, the city will more than recover its investment in increased taxes and utility payments," the mayor wrote.
"I believe the passage of this ordinance to be a gamble that I'm not willing to take," said Klinger, who cast the dissenting vote. "Not only is it the biggest giveaway in the history of our city, it encumbers already limited city revenues at a time of the greatest recession in more than 75 years."
Klinger said she objects that the taxpayers' investment of $11 million into 25 acres of "development ready" land is bringing a return of only $950,000, or approximately 9 percent. "This transaction is outrageous," she said, "and then we are spending $443,000 of the taxpayers' money to purchase the vacant BP station which will be turned over to the developer."
The contract includes the purchase of the BP station at State Road and Portage Trail. The city and Stark are each paying half the cost of the purchase.
Klinger questioned giving 75 percent of the purchase price -- $2.8 million -- back to the developer. She noted that although the administration says this money is for public infrastructure, the contract "clearly" states it is not restricted to infrastructure construction.
According to the contract, $2.8 million will go into a separate account (the "State Road Account") where it may be drawn on by the developer to reimburse for costs of Phase I private improvements including construction of retail structures and parking areas, drainage, utilities, lighting, landscaping, paving and striping.
"Can we afford such generosity when we are laying off police officers?" asked Klinger. The city's requirement in the contract to pay for $2.5 million in other infrastructure improvements to surrounding streets also drew criticism from Klinger. "In the case of State Road, we still owe $150,000 for the last improvement," she said.
Changes proposed
to roads
In a Jan. 19 committee meeting, Council talked about Stark's plans to eliminate the center left-turn lane on State Road from Graham Road to Schiller Avenue and replacing it with a landscaped median. A city official stated that "could happen" but not before a traffic study is completed.
"I'm ecstatic that this development is moving forward. Cuyahoga Falls will not be disappointed," Council President Diana Colavecchio (D-5) commented to the Falls News-Press.
"We are extremely gratified in the Council's confidence in us," Stark told the Falls News-Press, "and are excited to begin, in earnest, the work of making Portage Crossing a reality. We will be launching a Web site, www.portagecrossing.com, to allow everyone to follow our progress, ask questions and offer suggestions."
Truby said she is "pleased with City Council's thoughtful deliberation and final vote on this important project for our community. Portage Crossing will indeed transform this area of State Road and Portage Trail forever."
When asked about green space, Truby said there is no "green" requirement for a retail project. "[When] it reaches the planning commission and all facets are designed and on paper, only then will we be able to address the various portions of the project," she said, "such as draining in parking lots and other issues where a 'green' philosophy may be applied."
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