NewMark Merrill plans an $80 million to $85 million redevelopment of Twin Peaks Mall into the open-air Village at the Peaks, which is slated to open in early 2015. Boulder District Court Judge D.D. Mallard awarded the title of the Dillard’s Longmont store to the Longmont Urban Renewal Authority last week in the eminent-domain case. LURA is made up of Longmont’s elected city council members. Eminent domain is the legal right of a public entity to take private property after compensating the owner.
Attorneys for Dillard’s Inc. (NYSE: DDS) will appeal the court ruling, they said in a court document filed Tuesday. But unless Mallard or an appellate judge decides to stop the title transfer, NewMark Merrill can proceed with the mall redevelopment. Dillard’s also has requested that a jury trial be set to determine the price of the store. No jury trial date has been set, however. Boulder District Court representatives did not return a call requesting comment on Thursday.
In the meantime, an independent, three-person board of commissioners may set the price for the Dillard’s store, based on the court document filed in conjunction with Mallard’s ruling. Allen Ginsborg, managing partner at NewMark Merrill, said Thursday that he expects to “post the funds” for the store once the price has been set by a board.
If the property-value decision happens before the city of Longmont puts together a financing plan, “the amount will be paid by NewMark Merrill and then reimbursed to them by the public financing package,” said Rigo Leal, a city spokesman, in a recent email response to questions from the Boulder County Business Report.
“It can happen as quickly as the court is prepared to proceed with appointing the board,” Ginsborg said about the timing of the case. “As soon as the board comes to the amount … NewMark Merrill would post the funds.”
City officials have pledged $27.5 million in a planned municipal-bond financing scheme toward infrastructure costs for the redevelopment project. Dillard’s is “an eligible cost,” Ginsborg said Thursday. “Eligible costs” include things such as demolition, and public improvements, as governed by state law, Ginsborg said. He said he expects to pay a total of about $35 million in infrastructure costs in the redevelopment project.
A funding mechanism called “tax increment financing,” is expected to be used to pay back the municipal bonds. Such TIF funds come from the increased property and sales tax revenues generated from a redevelopment project.
“These things evolve. We’re confident that the outcome will continue to proceed, and that we will continue to redevelop the project,” Ginsborg said Thursday.
Dillard’s and LURA attorneys named three nominees each to serve on a board of commissioners in response to a request from Mallard. By state law, a three-person board or a jury can decide the price of a property in an eminent-domain case. Once the property title passed to LURA and to NewMark Merrill, Dillard’s loses its veto power.
Dillard’s attorneys nominated:
* William R. Gray, a Boulder attorney and a partner in Purvis Gray LLP who specializes in personal-injury cases.
* J. Marcus Painter, a Boulder attorney who chairs Holland & Hart LLP’s real estate practice.
* Joe Bourland, a business consultant and owner of The Regiment Shop in Boulder, a men’s clothing store.
LURA attorneys nominated:
* Scott R. Osgood, a Boulder attorney who specializes in property, business law, estate planning and probate law.
* B. Scot Smith, founder of The Colorado Group brokers in Boulder.
* Murray Richtel, who served as a Boulder District Court judge for 19 years and now works for the Judicial Arbiter Group in Denver.
Before the eminent-domain case was filed by LURA in May, negotiators offered Dillard’s $3.6 million for the property. Dillard’s representatives have said they want $5 million.