The fate of the Engine 209 site in downtown Gainesville is still undecided, but developer Tim Knight will not be building there.
The Gainesville City Council unanimously approved an agreement Tuesday that releases Knight’s option to purchase the 1.7-acre property at Jesse Jewell Parkway and West Academy Street. The Northeast Georgia Health System now has 150 days to decide whether it wants to purchase the land from the city for $1.2 million.
Knight said Tuesday he was approached by the health system about the land and is no longer interested in developing it. He told The Times in December that three mixed-use plans for the property were being considered. When the project was first announced in May 2017, it was expected to have 30,000 square feet of street-level restaurant and retail space with about 150 market-rate apartments above.
Knight said he now hopes to dedicate his time to Parkside on the Square, the upcoming development on the Spring Street side of the Gainesville square that will have restaurants, retail and 32 condominiums.
In December, the City Council voted to hand the Engine 209 property over to the Gainesville Redevelopment Authority. While municipalities are required to take the highest bidder’s offer when selling land, state law allows for development authorities that can be more selective when making land sales.
The authority is offering the land to the health system for $1.2 million as part of an agreement reached when the city took over the health system’s contract for the 6.8-acre property at 110 Jesse Jewell Parkway on the midtown end of the pedestrian bridge. The city closed on that property in November and paid $10 million.
Knight Commercial Real Estate will be paid $100,000 by either the city or the health system as reimbursement for his investments so far, which includes architecture and design work. According to the agreement, the health system would pay the costs at closing, or the city would pay Knight if the health system does not close on the property within 150 days.
City Manager Bryan Lackey said if the city ends up paying Knight, the money would come from the city's economic development fund, which is mostly funded by land sales by the city. That fund had $3.2 million in it as of Thursday.
“Our part of this agreement simply formalizes the commitment NGHS made to reimburse Knight Commercial Real Estate if we decide to close on the property,” health system spokesman Sean Couch said in an email Tuesday. “Our team is still performing due diligence and evaluating how the property might fit current or future plans.”
If the health system does not purchase the property, it would stay in the hands of the Gainesville Redevelopment Authority.
If the health system builds there, any of its buildings would be required to have at least two stories, according to the city’s contract with the health system. If anyone else builds there, that developer would be required to construct a multi-use building with at least three stories. Before any construction could start, plans would have to be approved by Gainesville’s city manager.
NGHS would also be required to grant the city an easement to build an electronic sign to promote community events.
Officials hope to relocate Engine 209 to other city-owned land, possibly to be incorporated into a larger park. The engine has been at the site since 1991.
“That train really needs to be in a place that is convenient and can be better utilized by the public, and also a cover put over it so we don’t have to paint it every two or three years,” Mayor Danny Dunagan said in December.