R.I. agrees to above fair market value price on property

Originally Posted Online: Nov. 22, 2012, 10:59 pm
Last Updated: Nov. 23, 2012, 9:58 am
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By Eric Timmons etimmons@qconline.com

Rock Island apparently is paying a substantial premium over assessed fair market values for properties the city is purchasing at Watch Tower Plaza to create a home for a new Walmart Supercenter.

The city has agreed to a price of $1.75 million for two key properties, at 3720 and 3800 11th Street. That's $1.3 million more than the properties were sold for three years ago, and about the same amount above the fair market value of $419,000 according to South Rock Island Township Assessor Susie Carpentier's assessment.

The properties are among nine that the city council agreed to buy this week for a total of $4.8 million.

The city plans to demolish the buildings at Watch Tower and some adjacent properties and then sell the site to Walmart for an as yet undisclosed price. City officials have said the price will be lower than the city's costs to prepare the site.

Kevin Wittenauer, an investor from Coal Valley, purchased Watch Tower in late 2009 for $442,000.

The $1.75 million price approved by Rock Island's City Council this week was negotiated on behalf of the city by Ted Rebitzer, a real estate broker based in Davenport.

City officials had worked to keep the proposed Walmart deal under wraps for months, with Mr. Rebitzer working in the background with owners of properties in and around Watch Tower.

Mr. Rebitzer said the $1.75 million agreement for the 60,000 square foot shopping center and 1,700 square foot out-lot, was based on an "arm's length" appraisal of the property by the owner's bank.

"They had a bona fide appraisal that was commissioned by their lender," Mr. Rebitzer said. "It's a legitimate number."

The property was in decline and headed for foreclosure in 2009 when Mr. Wittenauer stepped in with financing to buy it. He said he put "a ton of dough" into the property and increased the occupancy rate from 30 to 70 percent by bringing in new tenants.

New rental revenue had boosted the value of the shopping center as shown in the private appraisal of the property, Mr. Wittenauer said.

"It was very hard to argue with the appraisal, and he did put money into the building," said Jeffrey Eder, the City of Rock Island's economic development director.

Mr. Wittenauer said he was unaware the site was being purchased by the city to bring in a new Walmart until he heard about it through the media, although he had "some inklings" about who might be behind the offer for his property.

"I certainly didn't get a Walmart premium," he said. "If I had known they were interested the price would have been 20 percent higher."

Between 2011 and 2012 the assessed value of properties in South Rock Island Township including Watch Tower fell by 2.5 percent, according to Ms. Carpentier.

Watch Tower would have been reassessed if substantial improvements had been made that could have increased the value of the property, Ms. Carpentier said.

At Monday's council meeting, nine purchase agreements for lots at the Watch Tower site on the west side of Rock Island were approved.

They included agreements for four houses along the 9th Street at the back of the shopping center, all of which had shown declines in assessed value.

The houses at 3917, 3923, 4003 and 4009 9th Street each had fair market values of less than $52,000, based on assessments by South Rock Island Township. The city has agreed to buy the homes for $125,000 each.

Another property the city has agreed to purchase is the State Farm insurance agency at 3700 11th St. Aldermen approved an option to buy the property from Christine Elsberg for $450,000.The fair market value of the property, according to the assessor's office, is $303,720.

The $450,000 is estimated as the cost to Ms. Elsberg to replace the building. She also will get $50,000 for moving expenses and up to $30,000 for architectural and engineering fees for the new structure, according to the agreement published by the city.

Also agreed this week by the city council was a $600,000 agreement with VFW Post 1303 at 3715 9th St. No assessed value is available for the property as it's tax exempt. Post Commander P.J. Hymes said the Post will close Dec. 30 and a new location has yet to be found.

The Walmart Supercenter, once open late next year or in 2014, will generate an estimated $1.3 million in sales tax revenue for the city.


Local events heading

  Today is Monday, Sept. 22, the 265th day of 2014. There are 100 days left in the year.

1864 -- 150 years ago: The board of education has granted Thursday as a holiday for the children, with the expectation that parents who desire to have their children attend the Scott County Fair will do so on that day and save irregularity the rest of the week.
1889 -- 125 years ago: The guard fence around the new cement walk at the Harper House has been removed. The blocks are diamond shape, alternating in black and white.
1914 -- 100 years ago: The Rev. R.B. Williams, former pastor of the First Methodist Church, Rock Island, was named superintendent of the Rock Island District.
1939 -- 75 years ago: Abnormally high temperatures and lack of rainfall in Illinois during the past week have speeded maturing of corn and soybean crops.
1964 -- 50 years ago: Installation of a new television system in St. Anthony's Hospital, which includes a closed circuit channel as well as the three regular Quad-Cities channels, has been completed and now is in operation.
1989 -- 25 years ago: When the new Moline High School was built in 1958, along with it were plans to construct a football field in the bowl near 34th Street on the campus. Wednesday afternoon, more than 30 years later, the Moline Board of Education Athletic Board sent the ball rolling toward the possible construction of that field by asking superintendent Richard Hennigan to take to the board of education a proposal to hire a consultant.

(More History)