The most intensely debated item at Monday night's town meeting was the proposed lawsuit against the granting of an occupancy permit for the Immigration and Customs facility in town. After a long, sometimes emotional but always civil debate, the results were tallied and the article was defeated.
The second issue of note was the proposed appropriation for one hundred thousand dollars for the appraisal, engineering and other costs associated with the possibility of moving forward on preparing for either the sale or development of the land locked parcel. The article was defeated but the information presented was interesting.
Most of the presentation and debate surrounded what we already know about the land. There was one revelation that made me pay very close attention. That was the current holders of the "right of first refusal option."
We need to go back twenty years to put the option in context. After the eminent domain taking the town lost a court case in the valuation of the property. The town had valued it at what it was being taxed which was $835,000. The rest is history as the coalition of 35 owners sued and won a $10 million value judgement. The town subsequently negotiated that down to $8.6 million.
Included in that negotiation was a 20 year right of first refusal option on any development deal that the town might later engage in. The developers wanted the option in case the true reason for the taking was that the town wanted a deal of its own for the property and had someone waiting in the wings. The town granted the option so as to reduce the settlement value since there was no hidden agenda develoment wise in taking the property.
The owner of this option would be Cadillac Fairview. They were the developer that had assembled the parcel through a collection of purchase and sale agreements. It is not clear if they ever owned a single acre of the land. Only that they had assembled the parcel and had acted as the front development company for the proposal to develop the parcel as an office park.
At the time of the proposal and subsequent eminent domain taking, Cadillac Fairview was touted by themselves as well as supporters of the project as a wonderful company that had the go power to build development jewel for Burlington that would be a "win win" situation for the town.
In a rather humorous aside, during the eminent domain debate, the frontman for Cadillac Fairview, Kerry Hunnewell, described the town as "xenophobic" apparently because they dare oppose his lofty plans. Well shortly there after, the company went bankrupt and most of their holdings were sold off to a company called Prentiss Properties.
It may be worthwhile to note that at the time the Cadillac Fairview proposal was made, the town was without fifty percent of its water production from the main well field because of chemical contamination, the sewer system was like a geyser, and the water distribution system pressure was barely enough to get a decent shower.
Back to the option. It was to last for a period of 20 years which was the length of time that the town would take to pay back the $8.6 million bond that had been floated to pay the judgement. Up to this point it had been assumed that the option remained with Prentiss. This is where we get enlightened on Monday night. The trail of the option went from Cadillac Fairview to Prentiss Properties after the bankruptcy and then to the Washington State Teachers Fund. Apparently, they had been one of the institutional lenders that under wrote some of Cadillac and Prentiss developments.
The true revelation occurred when the town administrator announced that the option now rests in the hands of a local developer that had recently completed a PDD mixed use development in town. Is this the reason why the town management and influential players in town government want to move forward with plans for the property now?
It is one thing to have a far away group with a paper option that doesn't mean a whole lot. It is quite another to have a local group with a track record of achievment as well as a cadre of influential political and legal supporters championing their cause.
The town administrator announced that there had been increasing interest in the land and that he anticipated the issue "heating up" quite a bit tis year. This seems to be counter intuitive when you consider that we have 3 and one half million square feet already approved but remaining unbuilt and we are likely heading into recession.
However, since the option has a little more than two years to run before it expires, anyone who had expended money for the purchase of that option would be in a hurry to try and lock in a deal before the whole world might get a chance to make a proposal.
If that is the case then you can be sure of two things, the option owners will come forward with some sort of "win win" situation for the town presented with the help of their legal team and poltical supporters. The other thing that you can be sure of is opposition to any such foolishness. If the town is ready to move forward then any proposals should be free of any constraints on the town and any advantage to its owners that an option would provide.
