City officials on Monday removed a resolution from their agenda supporting the Smyrna Downtown Area Development Corporation’s intention to sell the site of the former Hickory Lakes apartment complex to Vinings-based Southeast Capital Companies for $13 million. Council members did not discuss or vote on the sale and it has not been finalized.
Downtown development officials are appointed by the city’s seven-member City Council.
A $13 million sale would mean a $3 million loss on the property the city has spent $16 million purchasing and razing. That loss jumps to $5 million when considering the roughly $478,000 in interest paid in August, another $898,000 that is due in interest on Feb. 1, 2014, and the 5 percent commission the city’s Realtor, NAI Brannen Goddard, stands to receive, which would be $650,000 on a $13 million sale.
Those numbers don’t include the amount of property tax revenue the city lost when the site was purchased and removed from the tax rolls.
The property that once housed a 726-unit apartment complex at the intersection of Old Concord Road and Windy Hill Road was purchased with the goal of controlling the city’s destiny, Smyrna Mayor Max Bacon told the MDJ in late July.
Smyrna has undergone an effort in recent years to raze aging apartment complexes, and more than 10 percent of apartments in the city have been removed.
Southeast Capital Companies, the buyer being considered by the city, is a real estate acquisition firm that specializes in development of multi-family, single-family, and mixed-use projects, according to its website.
Representatives of the company did not return a phone message Monday afternoon.
Councilwoman Susan Wilkinson, who sponsored the agenda item, declined to talk about the specifics of the sale but said she wants the property to become a positive for the community.
“I’m open to different things, actually,” Wilkinson said about her thoughts on what the site should become. “Anything that’s an improvement that will help to stabilize the neighborhoods around there, I think would be a plus.”
Wilkinson was not on the council in 2010 when the site was purchased and can’t say if she would have supported the purchase.
“I don’t know what I would have done,” Wilkinson said. “If I wasn’t in that environment at the time, I can’t say what I would have done.”
Millions spent on private property
Hickory Lakes isn’t the only property Smyrna has purchased hoping to have a say in its future. More than $20.1 million of taxpayers’ money has been spent in the last five years by the city purchasing private property for redevelopment.
Smyrna Elementary School was also once a 144-unit apartment complex called Smyrna Commons and was purchased by the city.
The city had to buy part of that property to build a connecting road between Ward Street to a new commercial development, called Belmont Hills, at the corner of Atlanta and Windy Hill roads.
But when the complex went up for sale, the city jumped on it. The Smyrna Downtown Area Development Corp. spent $4.6 million for the property that also provides public recreation space. Another $2.5 million in renovations was also spent before the city knew about the school board’s interest in turning the site into a new school.
A property, intended to be a retail center at Dunton Street and Concord Road but containing only the 15,000-square-foot steel frame of a building that was never finished, was put under contract last month and is set to make the city a $100,000 profit.
About 6.3 acres representing 22 parcels on Concord Road were purchased by the city between 2007 and 2011 for improving the road. This time, though, the money for the $5.75 million purchase came from special purpose local option sales tax funds.
Mayor Bacon previously told the MDJ he does not want Smyrna to get into the real estate business.
“My philosophy is not to go out and buy a lot of property when it comes available and try to hold onto it until you find somebody,” Bacon told the Journal in late July. “These properties, all four of them, they all became available and there was an opportunity to do something with the property that was going to make our community better.”
Bacon could not be reached for comment by phone and left Monday’s council meeting immediately following adjournment.