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School Board Rejects $2.5 Million Bid For Palm Coast Parkway Property It Bought For $3.5 Million

| June 22, 2018

The old ITT building the school board bought for $3.5 million in 2001 as it was being demolished in 2016. (© FlaglerLive)

The old ITT building the school board bought for $3.5 million in 2001 as it was being demolished in 2016. (© FlaglerLive)

For the second time in 10 months the Flagler County School Board turned down an offer for its 7.2-acre property on Palm Coast Parkway, site of its old adult education building, even though the $2.5 million offered was $500,000 above the highest of two appraisals of the property.


The board split 2-2 on the offer from Michael Collard Properties, the Winter Park-based retail developer that had offered $1.8 million last year. A split vote is a failed vote. (Board member Maria Barbosa was absent Tuesday evening.) Michael Collard Properties re-developed Island Walk, what had been the decaying Palm Harbor shopping center and is now among Palm Coast’s more vibrant commercial zones again. The developer had similar intentions for the school board property, once home to the hulking building that had been ITT’s headquarters.

The school board bought the property in 2001 for $3.5 million, the equivalent of $5 million today, in inflation-adjusted dollars. In 2005, before the bursting of the real estate bubble, the property’s three appraisals fell between $4.1 million and $5.2 million. In 2013 and 2014, additional appraisals placed the value of the property—which still included the building—between $1.1 million and $1.55 million.

There had been no more recent appraisals when Michael Collard Properties offered the $1.8 million last year. The building was demolished in April 2016. The board earlier this year asked for new appraisals ahead of a request for proposals. Heffington and Associates’ appraisal came in at $2 million, Cooksey and Associates came in at $1.75 million.

Board members Janet McDonald and Colleen Conklin found the $2.5 million offer too low. Andy Dance and Trevor Tucker voted to accept it.

“We are in need of capital funds,” Dance said, making the motion to accept the offer. “We have immediate needs for bus replacements that we could push to the front, 55 buses that eventually most of them need replacing now. We can jump start that as well. We may not have in the future a purchaser that has the same interest in the property that we do now.” A new bus costs around $145,000. Revenue from the sale would make possible the purchase of 17 buses.

 “Any time you have appraisals at $1.75 and $2 million and you get a half million dollar over the appraisal, to me that’s a good decision,” Tucker, who chairs the board, said.

Conklin said she’s not as concerned about the district’s capital funds because it will be getting additional dollars from the state in that pot. “I’m just not certain exactly where the market is going and what is happening with the market and whether or not now is the time to let go of that property,” she said.

McDonald last year said the property is worth $5 million. She opposed selling it for the one offer on several grounds, even questioning the quality of the two appraisals.

“Doing some personal research, the appraisals were passed by different professionals in the industry and they were found to be inappropriate comparatives that were used, and certainly sale prices that were not in the current market,” McDonald said. “We’re basing a decision on an appraisal of old sale figures, so if you projected those figures right now they would be higher. As the appraisal itself said, this is an expanding market, we are at the beginning of an expanding market. The other properties on Palm Coast Parkway are valued much higher and they are closing at a much higher rate. A lot of the properties that were used as comparables were not really in the same ballpark.”

McDonald also opposes using revenue from the sale for school buses, and called the bidding process unfair. “I heard that most realtors did not know it was even available,” McDonald said of the property. “When you don’t seek out a commercial advertisement, when you don’t seek out putting it on the MLS in appropriate ways, we don’t get the range of people who might be interested in this to bid for it.”

The board did not decide what to do with the property next, other than to let it sit.

 

 

 

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11 Responses for “School Board Rejects $2.5 Million Bid For Palm Coast Parkway Property It Bought For $3.5 Million”

  1. Duncan says:

    I agree with McDonald. Why would you not be transparent and offer the property up for sale a normal way; list it on MLS; why limit the scope of potential buyers. That in itself should shady.

    Wow “A new bus costs around $145,000”. That is crazy! I never would have guessed that they were so expensive.

  2. taxpayer says:

    I completely agree with Duncan.

  3. Anonymous says:

    If they want to sell it do it the transparent way like McDonald said. Put it on the market and put your price on it. No need to settle for an offer of a low-baller. The board members that voted for the slimy deal need to be replaced—-they are not fit to serve and certainly are not doing what’s best for those they represent. Sounds like another Barbara Revels and Bruce Paige deal like what went down when the old SICK Bunnell hospital was purchased by the BOCC if you ask me.

  4. woody says:

    School board math,buy at 3.5 millon pay to have it demolished turn down 2.5 millon wait and do a back door deal and sell it for 1.6.

  5. Anonymous says:

    I also agree with Mrs. McDonald. Why sell this piece of property without a proper offering and proper advertising. It kind of sounds like somebody may know more than they are telling about selling and buying of this property and Mrs. McDonald has done the right thing by at least slowing things down a bit. If the school board is broke let them sell off other prime real estate, i.e.: the water front on the intercostal not far from the million dollar lots sold on A1A, and go buy a darn fleet of school buses. The taxpayers need to see for themselves just how much property this school system owns, and figure out why this palm coast parkway needs to be sold so urgently. Just Saying!

  6. Diane says:

    Once the property goes into the MLS won’t there then be a 6 % commission that needs to be paid? Typically property without a building is a cash deal for land only. You should have taken the deal !

    Shame on the school district in waiting until 55 school buses need to be replaced ! Who is in charge there ? This miss management of the school bus fleet is clearly not qualified and should be dismissed ! Someone on the school board needs to be accountable…………..

  7. Anonymous says:

    The school board and the county should not be in the real estate business. If they have land that they don’t need then they should put it on the market and pay off debt!!!!! Lower our taxes!!!!! I am not shocked that it was the two MEN on the board who voted in favor of the sale–they think with the wrong head. Thank GOD for women school board members!!!!! Jane needs to be voted in office in the General Election for County Commission, District 4 and replace Nate McLaughlin!

  8. palmcoster says:

    Mrs McDonald you are so right! Do not give it away for 2.5 when we paid 3.5….that place should not be let go for less than 4 million after all these years! Otherwise is just plain fraud and throw away our hard earned taxes!

  9. palmcoaster says:

    A school bus 145,000 c’mon!! Put it out for bid please!! A 30 seat School bus new at $64,000, a 50 or more seat can’t be 145,000: http://www.nwbus.com/school-buses-for-sale/2018-starcraft-quest-30-passenger-school-bus—b17091/ . We get fleeced here when it comes to these government contracts and even worse, buying in quantities should be cheaper. Graft galore in all these overpriced government contracts! Thank you for not giving in Mrs McDonald.

  10. Fernando Melendez says:

    In agreement with McDonald, there is too much shifting going on right now in the market in the right direction to lose out on a much better deal. That was the right decision.

  11. Anonymous says:

    The property was bought for 3.5 with a viable sound building on the property. By the time the school district was done with it because of lack of proper maintenance the building needed to be demolished. I think if the board of Ed wants to be in the real estate business….. they should give up their seats and change careers .

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