Deal presents problems for Carson City
December 22, 2006
Future development of about five acres in north Douglas County could mean that Carson City will see fewer new national retailers and less sales tax revenue.
A Douglas County official said Friday that the commissioners’ decision to grant $24.7 million in redevelopment funds to a developer purchasing two parcels south of Topsy Lane will spur a larger 100-acre development just south of the county line.
Carson City officials said this future development means the city may not be able to compete for large national retailers, who could be more attracted by the cheaper land costs across the border after this hefty contribution.
This is the second proposal for this area of north Douglas County. Developers AIG Baker walked away from a similar deal in 2005. At that time, Douglas County’s Redevelopment Agency offered more than $11 million in funding to help with improvements, but AIG said it wasn’t enough.
Carson City Mayor Marv Teixeira said Carson City can make redevelopment deals on vacant properties, which the city plans to do with the new Kmart owners to get the property fit for big-name tenants, but the city is approaching build out, unlike Douglas County.
“It will be hard to compete,” he said. “People have a high opinion of their dirt and their dirt, by the time it’s done, will be free.”
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Joe McCarthy, economic development and redevelopment manager, said north Douglas County is naturally attractive to retailers because of the availability of land and lower cost. This is good for shoppers, but not necessarily for competing counties.
“The difficulty comes on the fiscal end, Carson City must still attract retail in order to afford the services it provides to its citizens,” he said.
Douglas County Manager Dan Holler said Carson City has been just as aggressive in securing retail tenants.
“Competition goes both directions,” he said. “If you see some of the offers they’ve made to some folks, it’s the same thing.”
Holler views the county’s $24.7 million investment as the catalyst of a much larger development, which may include two Carson City auto dealers.
“The goal is for everyone to come together in a joint partnership agreement to have this large 100-acre development, a total of 600,000 square feet of development,” Holler said. “If we’re wildly successful that’s what will come into place.”
The 4.8 acres, owned by Jim McCowan and Kay Capurro, is expected to close escrow with Riverwood Redevelopment LLC in early 2007. This development could generate $750,000 in sales tax revenue for Douglas County, Holler said.
Efforts to reach McCowan and Capurro were unsuccessful. Their parcels are surrounded by an 87-acre parcel owned by Carson Auto Mall LLC, which is owned by Carson City auto dealers Michael Hohl and Dink Cryer. They also own another 32 acres north of Topsy Lane, on the east side of Highway 395.
Holler said the $24.7 million will be given over 16 years to Riverwood, headed by Reno developer Jay Timon, only after he secures tenants for 25,000 square feet of the future development. The total development is expected to be 30,000 square feet, and is located across from the Best Buy shopping center.
Douglas County’s redevelopment area includes property in north Douglas County, the Genoa area and Ridgeview, Holler said.
One Carson City commercial real estate agent is optimistic about the city’s chances.
“They (Douglas County) are throwing a lot of money at a developer to get something done,” said Bruce Robertson, broker with Sperry Van Ness in Carson City. “I think Carson City is just as competitive. I don’t think you are going to see a decline in interest in Carson City.”
Carson City also has undeveloped potential, located in the heart of the city near the future freeway.
Linda Ritter, Carson City manager, said the city has the potential to use a similar type of redevelopment deal with the future developer of the Lompa Ranch.
The Lompa Ranch went on the market in August with an asking price of $76.6 million. The ranch is the largest, undeveloped piece of land left in the city. The city could offer financing that covers the cost of infrastructure, such as roads, curbs, sewer and water lines.
“The Lompa Ranch has great possibilities, but it also has its challenges,” Ritter said. “We stand ready to work with any developer that purchases this property.”
• Contact reporter Becky Bosshart at firstname.lastname@example.org or 881-1212.