February 24, 2007 in Business

Owner says property worth $150 a square foot

By The Spokesman-Review
 

Inside

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Spokane architect Glen Cloninger considers the half-block of property he owns across the street from the city’s new Convention Center to be among downtown’s most desirable development sites. As such, he said, it’s worth nearly $9.5 million, or about $150 per square foot.

“It’s the crème de la crème. That’s where it’s all going to happen,” Cloninger said of the property’s development potential.

The land covers about half a 120,000-square-foot block of property the Spokane Public Facilities District wants to acquire for future Convention Center expansion and parking.

But Cloninger and the PFD have been locked in disagreement over the property’s value for years.

Kevin Twohig, PFD executive director, said Cloninger’s asking price is unreasonable in light of a confidential property appraisal.

“The last request we received from Glen was unjustifiable. We’re willing to pay a reasonable, justifiable amount for any property acquired for a public purpose — and that has to pass the scrutiny of the state auditor,” Twohig said.

By comparison, Mick McDowell, a Spokane commercial property owner and PFD board member, said he paid $34 per square foot for the ground on which he built the new AmericanWest Bank building, at the corner of Browne Street and Riverside Avenue.

When it comes to Cloninger’s holdings, McDowell said: “We are absolutely willing to take the high road and offer appraised value plus a condemnation premium. But that’s roughly half what he thinks it’s worth. Prudence tells us there are comparables out there, where ground is similar or superior, that sold for $40 to $60 a square foot in 2005.”

On Tuesday, the PFD board is expected to vote on a resolution recommending eminent domain be used to acquire the estimated 63,000 square feet of property Cloninger controls.

Cloninger said he is upset by the notion.

“The property is definitely available and it’s available for a fair price — and they don’t have to condemn it to get it,” he said.

However, he believes his land is worth as much as the near-acre of downtown riverfront property that’s home to the YMCA. The city’s Park Board, Cloninger said, is willing to pay about $150 per square foot for it. The Park Board is exercising a right of first refusal to match a private developer’s offer for the YMCA property.

Cloninger maintains even at that rate, the city could be getting a bargain for his half of the south block compared to what it might pay if it goes to court. Cloninger said any lawsuit that ended in his favor could saddle the city with attorneys’ fees and court costs.

“I don’t want to hold the city hostage,” Cloninger said. “But I don’t want to be bullied. And I’m not willing to wholesale it.”

If the PFD board votes in favor of eminent domain, it’ll hand its resolution over to the city, which has the ultimate say on whether to move forward with condemnation proceedings.

One city councilman said he’s not a big fan of eminent domain.

“I’d be disinterested in pursuing that tack, but I wouldn’t dismiss it,” said city Councilman Brad Stark. “But there is such a thing as public benefit.”

Twohig said he hasn’t given up on reaching an out-of-court sale.

“I think we’ve just got to sit down and work it out. But at this point, I have not been given any further directives by the board to negotiate with Glen,” Twohig said.


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