Artist’s rendering provided by the City of Stonecrest
The city of Stonecrest has closed on its purchase of the 131,000-square-foot Sam’s Club building and property, slated to become Stonecrest’s new City Hall and municipal complex.
The city completed the $3 million acquisition with Sam’s Real Estate Business Trust of Benton, Arkansas at 3:56 p.m. on Monday, March 2, Deputy City Manager Plez Joyner said today.
Mayor Jason Lary called the deal “monumental.”
“This was a monumental move for the city. We will have a home for our new City Hall and all associated future services,” said Lary. “We purchased this building for one third of its value, and ownership is better than renting any day any time,” the mayor said.
Lary said the city is in the third year of its five-year lease on the 35,000-square-foot City Hall space located in the Stonecrest Center building at 3120 Stonecrest Boulevard.
Lary said he expects the design and construction of the Sam’s Club building to take about a year and the city would negotiate its exit from the current location at the appropriate time.
“I’m going to put together a citizens’ architectural committee so that they can have a say-so in what our City Center will look like,” said Lary. “We’re going to start working on that right away.”
Joyner said the Sam’s Club building can only be used for government-type services due to its tax-exempt status and seller’s agreement with Sam’s Club. The restrictions include but are not limited to using the building for grocery stores, clothing stores, distribution centers, gaming establishments, internet fulfillment centers, involuntary detention centers, night clubs, bars and other adult activities.
Joyner said in addition to establishing a City Hall and other city services, the city could also use the building for state and county offices such as a tag agency or health services.
The city’s financial advisor, Ed Wall, who negotiated the city’s tax anticipation note (TAN) to cover the purchase of the Sam’s Club building, said the city got a good deal. The TAN will cover the cost of the purchase of the Sam’s Club building until the city’s bonds are sold to repay the debt later this month, Wall said.
The city council approved the TAN for the Sam’s Club building at its Feb. 26 special called meeting in a 4-2 vote. Councilmembers Jazzmin Cobble and Tammy Grimes voted against the measure.
In the special called meeting of the Urban Redevelopment Agency on Monday, March 2, four members of the agency approved a resolution authorizing the city’s newly created Urban Redevelopment Agency to pursue the purchase of the bonds. Councilmembers Jazzmin Cobble and Tammy Grimes had notified the council last week that they were unable to attend the meeting.
Wall said the city secured a 3.18 percent interest rate for a 20-year, tax-free bond to pay for the $3 million purchase of the Sam’s Club building and a 3.56 percent taxable, 10-year bond for the Sears building, which the city is purchasing for $2.1 million. Joyner said the closing date for the Sears building is scheduled for March 30.
“The annual payment (for both buildings) is about $350,000 a year and that’s about what the city is currently paying now to rent their current city hall,” Wall said.
Joyner said the city had to spend an additional $75,000 for the Sam’s Club and Sears building transactions because the city was delayed in obtaining approval for the bonds after four members of the council—Jazzmin Cobble, Tammy Grimes, George Turner and Rob Turner—staged a walkout on Feb. 10. The group walked out in protest after a motion failed in a 2-2 vote to excuse Cobble for missing two council meetings last year. Council members George Turner and Rob Turner voted to excuse the absences. Mayor Jason Lary and Councilman Jimmy Clanton voted against the motion. City officials said Cobble would have to forfeit her seat, based on the charter. The bond referendums were up for vote that night but no city business could be conducted because there was no quorum. Only Councilman Jimmy Clanton and the mayor remained for the meeting. They honored high school students for their work on a survey concerning the future of the city’s Parks and Recreation Department.
Joyner said the city was able to pull the deal together to make the new Stonecrest government center into a reality, despite adversity.
“I also want to recognize the unwavering and visionary support of Mayor Lary and the Stonecrest City Council whose keen eye for this awesome opportunity trumped all adversity to complete the crystallization of our New Stonecrest Government Centre into a reality,” Joyner said in a March 2 e-mail to council members and city officials.