Commissioners reject proposals to buy administration building, will bid the property

Commissioners reject proposals to buy administration building, will bid the property

As appeared in The Times Tribune by Jeff Horvath on February 8, 2018. 

SCRANTON — Lackawanna County commissioners rejected proposals Wednesday from two developers hoping to buy the county Administration Building.

Instead of selling the six-story structure at 200 Adams Ave. to either Scranton-based DFM Properties or Allentown-based Jefferson-Werner LLC — the two firms that submitted proposals in July to purchase it — the county will solicit sealed bids for the property and sell it to the highest responsible bidder, county General Counsel Donald Frederickson said.

After meeting with both parties late last month, commissioners voted unanimously Wednesday to reject the proposals-both of which contain multiple purchasing options- after Frederickson explained that the majority of those options involve the county selling the building and then leasing office space there until the former Globe Store on Wyoming Avenue is ready to house government operations.

Noting that the county already owns the Administration Building, Frederickson said selling it and then renting the space “didn’t really make a lot of economic sense.”

“So what we’re suggesting is that those proposals be rejected … and then we place the building out for a straight bid,” Frederickson said.

The county plans to advertise the building for bids within the next 30 days. Sealed bids will be received by the county Controller’s Office and opened publicly. A minimum bid price has yet to be determined.

“We’d like to get this done within the next 30 days, and it has to be done prior to conclusion of 2018,” county Chief of Staff Andy Wallace said, explaining that proceeds from the sale of the building have already been factored into the 2018 county budget as revenue.

The 2018 budget includes a $1.3 million revenue line item titled “sale of assets,” with the asset being the Administration Building.

If awarded the opportunity, Charles Jefferson of Jefferson-Werner intended to retrofit the Administration Building with a restaurant, retail space and at least 50 apartments. Those plans, outlined in the firm’s proposal have not changed and the firm will submit a bid for the building during the bidding process, Jefferson said, noting he “understands (commissioners’) rationale” for rejecting the proposals.

DFM’s proposal suggests the firm also planned to install 50 rental units, as well as office space and an artist showcase space. Company owner Don Mammano said he respects commissioners’ decision and, after revaluating his position and interest in the building, likely will submit a bid for the property.

What the eventual high bidder decides to use the building for remains to be seen, but officials said it must be returned to the tax rolls.

“We will be signing some sort of contract in 2018 that this (building) will be taken over in 2019,” Commissioner Patrick O’Malley said. “I hope that lots of people come in and bid, and I think whoever gets it is getting a great building in a great location.”

In other business Wednesday:

n Wallace announced that commissioners will vote Feb. 21 on whether to purchase a property at 1360 Wyoming Ave.

The property, located near the Lackawanna County Prison, would likely cost $850,000 to $875,000 and may serve as the new location of central court and other court functions, Wallace said. The public is invited to comment on the potential purchase prior to a vote at the Feb. 21 commissioners’ meeting.

n Cummings said she stands by her belief that arts organizations that put on uncensored, adult performances should not receive county funding, but said after the meeting that she will not sue either the Scranton Fringe Festival or its executive director. She suggested last month she might sue over a social media post she found defamatory.

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Rejected proposals

DFM Properties’ rejected proposal, dated July 14, included three options:

n Option 1: Buy the building for $2.2 million, offer the county free space to operate the backup 911 center for three years and allow the county to remain as a tenant for as long as it needs while charging a negotiated rent starting Jan. 1, 2018.

n Option 2: Buy the building for $2.3 million in Oct. 2017, start charging the county $10 per square foot for rented office space starting Dec. 1, 2017 and provide rent-free space for the backup 911 center for three years.

n Option 3: Buy the building for $1.9 million and include a building located at 614 Wyoming Ave. valued at $375,000, and provide rent -free space for the backup 911 center for three years. The rent and terms of a lease agreement with the county would be negotiated before closing on the buildings, according to the proposal.

Jefferson-Werner’s rejected proposal, dated July 14, included two options.

n Option 1: Buy the building for roughly $2.1 million and immediately lease the property back to the county at a rate of $7.50 per square foot of space on floors one through six and $2 per square foot of space in the basement for a term extending from the date of sale through March 31, 2019. The tenant is responsible for all costs of operating the building.

n Option 2: Buy the building for $1.35 million at a mutually agreed upon date no later than March 31, 2019. If the county sells the building on March 31, 2019, and requires additional time to vacate the premises, the terms and conditions set forth in Option 1 would be extended for one year.


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