CPC demands $17.5 million (or more)
Rejecting at least two private bids, leaders of downtown's for-sale parking company have declared that they won't consider any offer below $17.5 million and have once again extended the deadline, thereby hinting that the City of Charlottesville (for whom it has already been twice extended) is the favored buyer. That's a blow to the other would-be deal-makers, neither of whom saw their proposals sent to a shareholder vote.
"I don't know why they keep extending the deadline," says would-be buyer and company shareholder Richard Spurzem. "The sales process doesn't seem to be handled very professionally."
Contacted by mobile phone, CPC chair Jim Berry said, "I have nothing to report, Hawes. Thank you very much for calling."
Originally, there was an April 1 deadline for purchase offers, which is the date Spurzem bid $9.3 million. More recently, fellow shareholder Spencer Connerat of Clearwater, Florida, bid $16.3 million through a company called Collective Resource Corp.
"I'm tired of this stork dance," says Connerat.
As previously reported, the City of Charlottesville is paying law firm Williams Mullen over $200,000 to tell it whether to buy CPC. Last year, the City bankrolled a $153,000 design contest for two downtown asphalt blocks including the CPC parking lot, but the Williams Mullen study, at $252,400, is the biggie.
A Freedom of Information Act request shows that billings by May 28 hit $209,550. That includes several five-figure payments to experts:
Â¢Ã¢â??Â¬Â¢ $45,000 to Tourney Consulting Group LLC for engineering assessments,
Â¢Ã¢â??Â¬Â¢ $22,000 to Property Valuation Advisors Inc. for appraisals,
Â¢Ã¢â??Â¬Â¢ $53,340 to Lansing Melbourne Group for parking business valuations.
"We selected these firms to partner with us," Williams Mullen notes in a June 2007 document, "because of their reputations and their expertise. The breadth of the team's expertise covers any conceivable legal, business, and asset valuation issue."
The largest area of spending has come in the form of invoices from Williams Mullen attorney Bryan D. Wright. By the end of May, he'd spent nearly 221 hours on everything from giving status reports to City officials to searching for "intangible assets." Despite waiving some of his usual $350/hour fee in the final days of the report's compilation, his billings total over $60,000.
His firm's report, withheld from public view by the City Attorney's office, is expected to show the City how to create a new "parking authority" and pay for the massive purchase with 20-year, general obligation bonds.
A letter from a sale-assisting lawyer lays out the specifics to would-be bidders: that there's no time for due diligence other than a "brief period" for environmental study, and any bidder needs to put half a million dollars into escrow to be considered.
"Once again, the City has wasted hundreds of thousands of dollars," says former City Councilor Rob Schilling, who recalls several closed-door meeting for a Council "salivating" at the idea of buying the parking company's surface lot in order to craft a dream development.
"That should be a market function," says Schilling. "The City's proven time and time again," he says, in an apparent reference to the Omni hotel which cost taxpayers over $11 million, "that it shouldn't be in the real estate development business."
Calls to City Economic Development director Aubrey Watts, the City's point-person for the potential acquisition, have not been returned.
–updated 4:18pm, Monday, July 28