“Basically they’ve come back after the inspections and said that it needed about $400,000 worth of work and they want to shave that from the price,” Welch said. “So the trustees now have to take a look at it and see whether it’s worth doing that or moving on.”
This is the fourth offer the trustees have received, all previous deals failed. If the trustees agree to the price drop it would be close to the first offer the township received from Regency Centers, Kroger’s landlord. They wanted to build a giant Kroger Marketplace and needed the Activity Center and some other adjacent properties for the project.
Rob Walters, co-owner of Quattro, told the Journal-News previously the only thing that could possibly “derail” the sale is if they are denied a special use permit or other necessary approvals. His company planned to renovate the building and lease it to Higher Ground Education to operate a Guidepost Montessori School, a company they have worked with on 35 other Montessori school projects.
He could not be reached for comment about the new negotiations.
“I think a lot of times what these corporations will do, they’ll make offers on things to take them off the market,” Welch said. “Then they go in their with their inspections to see if it’s a gem. Then if they find anything about it that they don’t like, they’re just going to write it up. Basically they’re throwing mud against the wall and they’re going to see what sticks.”
The sales agreement called for $25,000 in earnest money and a 60-day due diligence period — which expired last week — to do a detailed inspection of the property. An additional 60-day period is allowed while Quattro seeks permitting and possible other requirements, and a 30-day extension if requested. If Quattro fails to meet the deadline for notifying the township it plans to back out, they lose $10,000 of the earnest money.
This renegotiation is much like the deal that failed with Dr. Mohamed Aziz who wanted to create medical offices in the space. He said he’d buy the property for $1.9 million earlier this year but rescinded the offer when the trustees refused to drop the price $300,000 after he found how much he would have to spend on required upgrades.
The Activity Center came into play after Community First Solutions stopped providing senior programming in 2019. Shortly thereafter the township agreed to sell the building to Kroger’s landlord Regency Centers but that turned out to be a two-year debacle.
The deal was contingent on Regency Centers being able to acquire the Activity Center, the Providence Bible Fellowship church, a sliver from Chesterwood Village and easements and agreements with about 10 other property owners to complete the complicated deal.
The trustees gave Regency extensions of the timeline that was set in the purchase agreement to March 2020. The company had 90 days to acquire the church and Chesterwood properties and six months to complete due diligence. However three 90-day extensions could be requested at a cost of $50,000 each. The trustees agreed to amend the contract giving Regency another six months with $100,000 due September 2020. Regency cancelled the deal just before the payment would have been due.
Another deal fizzled in July, the trustees were set to approve an agreement with a local family to create an event center but the offer was rescinded because financing failed for the $2.3 million offer.
Welch said if the deal with Quattro also falls through it won’t be a disaster.
“The township remains in the driver’s seat on this thing,” Welch said. “Because as a government entity we don’t owe taxes on it, which is a holding cost for anybody in private business. It’s paid for so there’s no interest on it or payment that we’re making. We have pretty inexpensive insurance, our holding costs are like next to nothing.”
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