The Florida developer who submitted the sole plan for revitalizing the former downtown mall site offered the city $1.5 million for the property.
In a secret appendix to the developer’s offer, Heritage Financial Group proposed the city sell the 17-acre site for $1.5 million and offered two approaches to the deal.
The Bristol Press has a pending Freedom of Information request to get a copy of the appendix, but hasn’t received word whether the request will be honored or not. In the meantime, the newspaper secured a leaked copy.
The city has spent about $8 million to buy the property, raze the mall, hire contractors and cover the associated legal bills.
The developer’s conceptual plan calls for creation of a “live, work, play community” that would include upscale stores, restaurants, offices, housing and amenities ranging from a train station to a dog park.
The Bristol Downtown Development Corp. is reviewing the offer and plans to discuss it at a meeting on June 16, though several officials said they didn’t intend to talk in public about the money the developer was willing to put on the table.
The “Letter of Intent” sent by the developer is signed by Mark LaPoint for Heritage Financial Group. It’s dated May 27.
LaPoint, who could not be reached for comment, is cited in the plan as Heritage’s front man for the Bristol project.
LaPoint is currently the project manager for the Meadow Creek Golf Estates in Mission, Texas, a border town about an hour away from Brownsville, a project that appears to have some connection to Heritage Financial Group.
In the letter given to the city, LaPoint offers to pay $10,000 within 10 days of the acceptance of his offer and another $150,000 later as an initial down payment.
The deal then proposes the buyer take out a first mortgage to pay for feasibility studies, engineering, lawyers and the like, basically any costs associated with the property’s development.
At the same time, the city would take a second mortgage on the property for $1,350,000, with a payment of $350,000 due within 24 months and the entire balance due within three years.
The deal also includes a provision that says, “Terms and conditions of this agreement must remain strictly confidential and may not be released under any circumstances without written permission” from Heritage Financial Group.
An alternative arrangement is even more complex, though it again calls for the buyer to pay $10,000 within 10 days of the acceptance of the deal.
After that, the city would form a limited liability corporation registered by both the city and Heritage Financial Group.
Once created, the city would transfer 75 percent of the new company to Heritage in exchange for a $1.5 million note and mortgage “containing a three-year balloon,” with Heritage paying for lawyers, site plans and the like.
Heritage would “manage, develop, market and sell the property,” probably over a three to five-year period, and use any financing it secures only for development of the site.
Once all the expenses are satisfied, the offer continues, Bristol would get 40 percent from the net proceeds of the development to satisfy the $1.5 million note. After that, the city would get 25 percent from future sales of the developed property.
Once the “horizontal development” is done, Bristol would retain a 20 percent interest in any “vertical construction projects built on the developed land by” Heritage.
Again for the second alternative, the terms of the deal are supposed to remain “strictly confidential.”
The numbers mentioned are well below the figures that city officials have long said they hoped to get for the mall site.
It also remains unclear whether Heritage Financial has the track record and finances to complete a project of the scale envisioned in Bristol.
If the BDDC opts to skip the deal, it would basically return to square one, with no offers on the table and no immediate prospects. Officials would likely try again to see if developers would be interested, perhaps with a less restrictive outline of what the city would like to see on the property.
Copyright 2008. All rights reserved.
Contact Steve Collins at firstname.lastname@example.org