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The agreement cancels the need for a jury trial scheduled for April that would have determined the price LURA would have had to pay Dillard’s for its Longmont store. In December, a three-member commission determined a preliminary value of $6.3 million for the Dillard’s store and property, the same amount submitted by Dillard’s appraisers. LURA appraisers had valued the store at $3.03 million.
The settlement also means LURA can take title to the store as soon as the agreement is finalized next week, paving the way for demolition and construction to begin on an $80 million redevelopment of the Twin Peaks Mall by developer NewMark Merrill Mountain States.
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As part of the agreement, LURA will pay Dillard’s $500,000 to help the retailer cover legal costs. The Longmont City Council, which also acts as LURA’s board, will vote on Tuesday on an ordinance to approve those additional appropriations. The city council on Tuesday will also vote on a resolution to approve the settlement agreement with Dillard’s. In addition, the council, acting as the LURA board, will vote on a resolution to approve the transfer of title of the Dillard’s property to Newmark Merrill.
In an email Friday morning, Longmont mayor Dennis Coombs said he couldn’t talk about the settlement until Tuesday because the negotiations remain ongoing.
“This is extremely exciting,” Coombs said in a press release from the city announcing the deal. “… I know that city council and staff have put in tremendous amount of work on this project and it’s gratifying to see the fruits of that labor.”
The settlement helps halt the mounting legal fees the city faced in taking the condemnation case to trial. LURA is taking the Dillard’s store by the power of eminent domain to help facilitate the redevelopment of the ailing mall that opened in 1985. Dillard’s, which owns its store and the seven acres on which it sits, has been an unwilling seller and holds a reciprocal easement agreement that gives it veto power over any redevelopment at the site.
“The city was on the hook for these fees regardless of the outcome,” mayor pro tem Brian Bagley said in the press release.
Following the commission’s decision, LURA could have taken title to the story by depositing the $6.3 million in escrow with the court until the final price was determined by the jury, thus allowing redevelopment to begin. But the city’s press release indicated that had Thursday’s settlement not been reached that redevelopment “would have been delayed by several months.”
Longmont assistant city manager Sandi Seader said she couldn’t speculate on what the impact on the overall redevelopment project would have been had the jury price come back in Dillard’s favor at $6.3 million.
“It’s unclear what would have happened if this deal would not have been made,” Seader said Friday.
Certainly, Seader acknowledged, the project would not have been able to move forward as quickly.
In a statement released through the city, Dillard’s vice president of real estate Chris Johnson said: “We have enjoyed serving Longmont residents for the last 16 years as a premium fashion destination, as well as a place of employment for man Longmont-area citizens. We are sorry to be finally leaving Longmont but glad that the parties were able to resolve this dispute without further litigation.”
The mall redevelopment, dubbed Village at the Peaks, will be partially financed with tax-increment financing, leveraging future property and sales tax generated by the project to invest in its construction. The city has committed $27.5 million from bond proceeds to assist with the project.
Village at the Peaks is a proposed 481,000-square-foot shopping center. It is 50 percent preleased, according to the city’s press release. A Whole Foods Market, Sam’s Club and Regal Cinema 12-screen movie theater are planned for the site.