The two new parking decks planned for downtown Greensboro have taken a bizarre twist. According to the most recent information, the Westin Hotel-February One Place parking deck looks like it’s a go and The Carroll Companies parking deck at Bellemeade and North Eugene streets will not be built.
According to sources close to the City Council, although it is not on the Tuesday, April 24 agenda, a deal to settle the lawsuit filed by Cone Denim Entertainment Center owner Rocky Scarfone against the City of Greensboro has been reached and may be added to the agenda.
Scarfone will reportedly receive about $500,000 from the city plus a number of other concessions. Scarfone filed a lawsuit challenging the city’s right to condemn an easement he owns that runs across the parking lot that the city purchased to build the parking deck.
The City Council voted on Dec. 19, 2017 to condemn the easement, which runs from Davie Street to the back door of Cone Denim at 117 S. Elm St. Scarfone argued that losing access to his back door for entertainers to unload and load their equipment for shows would put Cone Denim out of business. He also asked the court for a temporary restraining order (TRO) to prevent the city from building the parking deck until the lawsuit over the easement could be settled.
On Jan. 29, Superior Court Judge Andy Cromer heard the arguments and said he hoped to make a ruling on the TRO request by Feb. 16. The city had agreed not to start construction until after Cromer made a decision, which still has not been made. So there was in effect a TRO even though the TRO wasn’t granted, and the city has demolished one building but has not started construction.
Scarfone said that the city would not have to pay the value of the easement if it shut off the access to his backdoor but would be required to buy his business, which he valued at about $5 million.
So when negotiations started, the city had offered $55,000 for the easement and Scarfone wanted about $5 million for his business.
What makes this ever so fascinating is that the city paid $1.1 million for the entire parking lot and now the city will pay more than $500,000 for an 8.5-foot easement from Davie Street to the back door of Cone Denim, almost half of what the city paid for the entire lot.
The total cost to the city will be much higher because it hired Bruce Ashley of Smith Moore Leatherwood to represent the city in the lawsuit and the cost of delaying construction for four or five months has to be considered.
And that assumes that the deal worked out between the city staff and Scarfone is approved by the City Council.
Monday, April 23, Carroll Companies owner Roy Carroll, who owns this newspaper, received a call from Greensboro Mayor Nancy Vaughan informing him that the deal to build the parking deck at Bellemeade and Eugene was off and that the city would build a parking deck a block away on Commerce Place instead.
Carroll said, “I was about as shocked as I could be to receive the mayor’s call yesterday that they were going to a plan B.”
He added, “We stand to lose hundreds of thousands of dollars as a result of the city’s departure from good faith negotiations over the deck that the city authorized us to design. Our company has extensive man-hours invested and we have given notice to tenants we have on our parking lot due to the city’s pressing us to move forward on this project.”
Carroll also questioned the wisdom of building a free-standing deck, instead of following what had been the City Council policy to only build new parking decks as part of a larger downtown development project.
Carroll said, “To build a free-standing $25 to $30 million dollar parking deck to support a single $15 million project is not good planning and I would be in opposition to any such deck regardless of where it’s built.”
Neither Vaughan nor City Manager Jim Westmoreland returned calls to comment on the decision not to move forward with the Carroll project and begin the process of building a free-standing parking deck.
Carroll had been planning to build a parking deck, office building and hotel on that property at some point in the future, but he moved his plans up in order to accommodate Project Slugger – a nine-story office building to be built next to First National Bank Field on the corner of Bellemeade and Eugene. The nine-story office building needed to have guaranteed parking to make the deal work, so Carroll agreed to go ahead and build what would be a city-owned parking deck on the site, with the hotel and office building over the deck to be added later.
Delays in getting the project underway resulted in Project Slugger being reduced from nine stories to six stories. Carroll at one point offered to donate the land to the city for the parking deck as long as he retained the air rights to build over the deck.
After the city paid $2.5 million for all the land for the Westin-February One parking deck, which is a similar deal – with the developer building the deck for the city – the question of why Carroll was being asked to donate the land when the city was buying the land for the Westin Hotel project was raised.
When asked about the new plan to abandon the Carroll project and build a free-standing parking deck, President of Downtown Greensboro Inc. Zack Matheny said, “I don’t even know what the city is thinking.”
Matheny participated in some of the negotiations and said, “We’ve been working on this well over a year and shaken hands on the deal three or four times.”
Matheny said Monday was the first he had heard of a plan to abandon the plan to build a deck with The Carroll Companies and build at a different location. He said he spoke to Vaughan and asked her, “Why didn’t somebody call me about switching locations. Couldn’t you let me know what you’re doing and how you’re doing it?”
Matheny said he didn’t know anything about the new deck being proposed. But it appears the city will also have to purchase the land for the proposed deck on Commerce Place and start from scratch with the design. It doesn’t appear the city will have a partner in building the Commerce Place deck and that it will most likely be a free-standing deck without a hotel and office building on top. Past city councils had decided not to build anymore free-standing decks but to only build parking decks as a part of larger projects, like the Westin Hotel project and the Carroll project.
Carroll had earlier announced that he hoped to be able to build the tallest building in the region on the Bellemeade and Eugene streets site.
The City Council passed the first resolution setting the terms for designing the Bellemeade parking deck on May 2, 2017; that resolution notes that it is the result of eight months of negotiations.
On Sept. 19, 2017, the City Council passed a resolution stating that Project Slugger would be required to rent 265 parking spaces from the city at market rates in the parking deck to be built at 415 Bellemeade St. with “retail, office, hotel and residential building below and above the new City parking deck.”
On Dec. 19, 2017, the City Council – by an 8-to-1 vote with Councilmember Michelle Kennedy voting no – passed a resolution, “Authorizing the city manager to enter into a project involvement and cost sharing agreement with CHI Greensboro LLC for the Construction of the Eugene Parking Deck and Authorizing a not to exceed amount of $30,000,000 for the project.”
So the city has been in the process of negotiating this deal for over a year and a half, has passed three resolutions in support of the project and has agreed to pay up to $2 million for the design of the project and, at this late date, the city is backing out of the project and is going to start over with new negotiations and a whole new parking deck project.
It’s difficult to imagine that this is going to work out as a good deal for the taxpayers of Greensboro. Paying hundreds of thousands of dollars to design a parking deck that will not be built isn’t good stewardship of the city’s money, nor is it good for downtown development.
The agreement with Project Slugger states that the parking deck will be completed by Jan. 1, 2019. Since the construction of the deck has not started in April 2018, and now the city is embarking on a whole new project, it appears that deadline will be missed by months if not more than a year.
Because of delays in getting underway, Project Slugger has already been reduced from nine stories to six stories. You have to wonder if more delay is not going to cause additional problems for that proposed office building.
So as things stand, acquiring the land for the Westin-February One deck is going to cost the city over $3 million instead of the $2.5 the city was estimating, and, with no plans in place, the cost and the timeline of the proposed Commerce Street deck is difficult to estimate.