Urban renewal commissioners signed off Tuesday on a resolution authorizing the use of eminent domain to acquire property needed to accommodate the development of a new shopping center.
Officials have been able to negotiate the acquisition of all but about 2 acres needed for the first retail development within the urban renewal project area. Tulsa-based Vector Securities plans to build a 102,537-square-foot retail shopping center on the 10.5-acre tract with a separate 6,700-square-foot restaurant.
City Attorney Roy Tucker said parcels already acquired — or ready to be — from private individuals have been bought at an average cost of $2 per square foot. The group that owns the remaining 2 acres wants $4 per square foot, but its principals will not sell those parcels unless urban renewal commissioners agree to buy all the land it owns within the project area at a cost of about $2.6 million.
An agent acting on behalf of the Muskogee Urban Renewal Authority was authorized earlier this month to offer $3.15 per square foot for the 190 parcels owned by the Reynolds Group. Tucker said Reynolds rejected the counter-offer and a discussions of a co-development plan emerged, but commissioners feared it might set a precedent and put them at a disadvantage.
“I am not trying to be difficult ..., I am just trying to raise awareness ... (and) as a commission we have an obligation to these people to make sure everything is equitable,” Commissioners Robert Goolsby said. “We are here as a commission to do what is right for the future development of this area and for the city of Muskogee, and we have to recognize what’s good for all the landowners.”
Rickey Hayes, a retail consultant hired by the city, said he liked the idea of a co-development agreement with Reynolds that would allow the investment group to sell land directly to developers. But he expressed concerns about commissioners being locked into a position where they would have to pay $4 per square foot for land in an area designated for residential projects and potentially put developers of that area at a disadvantage.
“Do you want to let him push us in that corner of having to buy him out at his number?” Hayes said. “Those multi-family guys, they can’t pay $4 — there is no juice in it.”
Goolsby and other commissioners agreed, saying property farther south from Shawnee Bypass likely would appraise for less than that which abuts the thoroughfare. Planning Director Gary Garvin acknowledged Vector’s proposal places a graduated value on the land within its project area that is based upon its distance from Shawnee Bypass.
While there was some hesitation about authorizing a condemnation action, City Manager Howard Brown Jr. argued in favor of that option. He did recognize the value of giving Reynolds one last chance to sell the 2 acres for its asking price without attaching to it parcels outside the Vector project area.
The co-development agreement seems like it’s a little too much — we don’t have the upper hand there, and that is why we have this tool,” Brown said about the power of eminent domain. “We just have to look and see if what we are doing is consistent with the urban renewal plan.”
The blighted area designated for urban renewal is bounded by Chicago and 11th streets on the east and west and Shawnee Bypass and Talladega Street on the north and south. The area targeted for the first retail development project is bounded on the east and west by Sixth and Ninth streets and on the north and south by Shawnee Bypass and Katy Street.
Urban renewal commissioners divided the 90-acre urban renewal area into three project areas. The largest area targeted for first-phase development has been set aside for big-box retail projects, while the second- and third-phase areas was set aside by commissioners respectively for commercial infill and residential development.