The issue: The city of Gainesville closed Nov. 19 on a 6.8-acre property at 110 Jesse Jewell Parkway after the Northeast Georgia Health System first made the $10M offer and then approached the city to request it take over the contract. City officials have said they want to have control over future development in midtown, which they hope can be revitalized.
Gainesville officials seemed to be in quite a hurry to spend $10 million to control a prime piece of real estate that had been sitting vacant in midtown for more than a decade.
Amid their rush, officials didn’t get an appraisal on the property.
An appraiser told The Times that downtown property sold recently has gotten anywhere from about $700,000 an acre to $2.7 million an acre. The city paid Gainesville City Center LLC $1.47 million per acre for this land.
The city in 2008 sold a 1-acre piece of this land for $2 million to City View Plaza LLC, which later became Gainesville City Center LLC. It was the appraised value of the land at the time.
The 6.8 acres on the midtown side of the pedestrian bridge is no doubt a unique and prominent property. The price may be appropriate, but it’s hard to say without having an appraisal.
And the purchase was announced at a meeting for which the public agenda had no mention of this deal. Though legal, the city doesn’t garner trust from us or its residents when it spends $10 million without any public input or appraisal.
City officials are responsible to the taxpayers when spending funds, whether those funds are directly from property taxes or from a capital fund including transfers from other funds and hotel/motel fees. We have to admit to being more than a little curious about a fund from which the city can write a $10 million check whenever the notion strikes, and in which it says there are millions more if needed.
What Gainesville gained with the purchase is control.
Officials still want to see the land developed, but it became clear years ago that a planned $35 million City View Center featuring a 13-story hotel and two 11-story office buildings was not going to happen.
Those dreams from city officials and the developers at one time included 8,000 square feet of retail space, a 5,000-square-foot conference area, 995 parking spaces and an enclosed pedestrian walkway over Jesse Jewell leading to what was then the Georgia Mountains Center. Construction of at least part of that development was to start in 2009.
The Great Recession slowed development across the county and the project stalled.
Meanwhile, the city pushed forward with the pedestrian bridge, which was meant to “pull everything together” and “unify the whole area” between downtown and midtown.
The bridge spanning Jesse Jewell Parkway opened in the fall of 2012. It was quickly dubbed the bridge to nowhere, as land on its southern end remained vacant despite the grand plans. The nickname has stuck so well there’s a craft beer named after it.
But Mayor Danny Dunagan said then that it was “the bridge to the future.”
Six years since the bridge was completed, the land on the other side is still vacant, but perhaps we’ve finally reached Dunagan’s future, in which the city realizes a revitalization of the gritty, industrial midtown, an area of about 212 acres bounded by Industrial Boulevard, Queen City Parkway, E.E. Butler Parkway and Jesse Jewell Parkway.
The economy and real estate market have ticked up significantly since the city last tried to get the land developed. And now might be just the right time for the city to involve itself in securing the future of midtown.
But exactly how the city has involved itself in the process, and the philosophy behind doing so, is certainly worthy of some public discussion.
The mayor says developers are interested in the property. Where were those developers when the property was owned by Gainesville City Center? Can the city do better as property developers than those in the private sector?
Ask elected officials about the move and they all circle back to control of the property. The mayor still wants to see a convention center. At least a couple of council members say they don’t want to see medical offices. Hospital officials suggested residential housing for future doctors in training.
Meanwhile Northeast Georgia Health System also gained control in this deal. The city agreed to allow the health system the right to prevent competing medical businesses on the property.
Northside Hospital was never actually interested in the property, despite rumors to the contrary, but now if it or any other competitor wants to locate on this property, the city has agreed to limit that free market competition.
The city now finds itself in control of development for that property and that of the old Hall County jail on Main Street in midtown, which the city purchased in 2012 for $7.2 million.
That expense was supposed to be more than covered by lease payments from a private prison company that was already occupying the space, according to the mayor.
Within a year, the prison firm broke its lease — the city’s agreement laid out no penalty for that — leaving taxpayers on the hook for the bill.
By 2017, the city demolished the jail. The city still owes about $5 million on the jail property, but says it may soon have news on development plans for it.
We’d love to see midtown revitalized, bringing in tax revenue and creating the envisioned artsy, cool part of town with room for something like a brewery or distillery, art galleries and good food.
For more than a decade we’ve been waiting for what “could be” to materialize.
At this point, the city has some $20 million invested in property ownership in midtown, betting on a future interest by private enterprise that will justify the land speculation with public funds. To date, that interest hasn’t materialized; we hope it does, and soon. We also hope it doesn’t come at the expense of massive tax abatements used as a lure to bring investors to town.