Sunday, December 4, 2011

BAIT AND SWITCH: Scheme makes park, school land pay off BIG for developers

Land prices start out low -- then soar 

COLUMBIA, 12/4/11  (Beat Byte) --  An averaging scheme that in 2007 had principals of St. Charles Road Development (SCRD) crowing about land they were selling the school district at what seemed like a sizeable discount -- $900,000 for 79 acres supposedly appraised at $2 million -- will pay off handsomely in 2011 with the sale of more land for another new elementary school and a new city park near Battle High.

Here's how the scheme worked.   The SCRD Pugh-Atkins-Wolverton-Lemone partnership "came to the rescue" with land for Battle High in 2007, when several competing parcels -- including the famous "Vemer tract" -- created an explosive controversy.

Calling it part "gift" and part "sale," the group played up the discount though school district officials later found themselves on the hook for $2.9 million in additional infrastructure costs, some of which will no doubt serve SCRD.  Wolverton's company, R. Anthony Development, has a residential subdivision planned near the new schools and proposed park. 

Fast forward 4 years, when Pugh, Atkins and partners announced yet another sale to Columbia Public Schools for a second new elementary school -- 32 acres in the same St. Charles Rd. area, but this time for $1.5 million, or about $50,000/acre.  This month, the development team is back again, offering 30 acres to the City of Columbia in the St. Charles Rd. area for a park.  

The price for this acreage:  $681,000.  
Question:  In the last two deals, what happened to the big discounts?   Answer:  They vanished, giving an average price over all 141 acres --- high school, elementary school, and city park -- of roughly $21,000/acre.  
Second question:  Did school district officials, city officials, and the Pugh-Atkins-Wolverton-Lemone partnership either know or agree before the Battle High site was sold that the other land sales would follow in subsequent years, all but erasing what seemed to be a great deal in 2007?   If so, why didn't they publicly disclose?

If not, why aren't public officials demanding the same discount today, especially given that the economy and real estate has plummeted since 2008?

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