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Utica DDA to sell downtown property to General Sports Entertainment

By: Kara Szymanski | Shelby - Utica News | Published March 12, 2019

 The Utica Downtown Development Authority is in the process of selling the vacant lot known as “Parcel C,” shown here with the star, in the downtown area to General Sports Entertainment, which plans to build health-care-related businesses at the site.

The Utica Downtown Development Authority is in the process of selling the vacant lot known as “Parcel C,” shown here with the star, in the downtown area to General Sports Entertainment, which plans to build health-care-related businesses at the site.

Graphic by Jason Clancy

UTICA  — The Utica Downtown Development Authority is in the process of selling a parcel of land located next to the Clinton River in downtown Utica and across the street from Memorial Park on Auburn Road.

The DDA is putting together a contract to amend its agreement with General Sports Entertainment in order for General Sports Entertainment to purchase the vacant property that it has been leasing.

The empty lot was often used for event parking and is located just east of the river. The lot is known as “Parcel C” and is 1.4 acres. The property was previously appraised at $90,000 and is being sold for $102,500.

“The contract is currently being written. When the contract is complete, it will be presented to the (Downtown Development Authority) for approval. Selling the property does not release GSE from the requirement to build on the site or the time requirements of the extension,” said Utica City Councilman Gus Calandrino in an email.

Calandrino said that the DDA currently has ownership of the property.

“The Utica Downtown Development Authority is the owner of this property and agreed to enter into the sale (with GSE),” he said.

Mayor Thom Dionne said that the city’s attorney and GSE’s attorney are currently working on the agreement. He also said that GSE had been leasing the property and decided to purchase it.

“They had the option in (the) lease when they began the lease and chose to buy the property,” said Dionne.

GSE is also currently leasing the land it has the baseball field on, and a parking lot nearby.

GSE leased the property years back with intent to build on the property, but it has been using it for parking.

“GSE doesn’t pay any taxes to the city. The one opportunity for Utica to generate income from the baseball project was a requirement for GSE to develop the southwest corner of the DDA parking lot known as Area C. Per the original ground lease, GSE was required to complete the Area C development by Aug. 1, 2018. The development was to include residential, commercial or mixed-use buildings. The previous administration projected the tax revenue generated by this development would be up to $75,000 per year,” said Calandrino. “None of this happened.”

Calandrino said that GSE had recently been granted an extension on the agreement that it had with the city.

“City Council granted GSE an extension on the construction obligation until 2020. During this time, GSE must pay the city $5,000 per year as partial compensation for the lost tax revenue — a far cry from the projected tax revenue of $75,000 per year,” he said.

Calandrino said that it was not really expected of GSE to build due to the lease.

“It was not really reasonable to expect a business entity to build on land they didn’t own. Ownership of the parcel will make financing easier if that’s the route GSE needs to take. GSE also had the right of first refusal if the DDA wished to sell the parcel to a third party anyway,” he said.

“GSE will own the building and be the landlord,” he said.

The money profited from the sale of the property will not go directly toward another project right away, but the DDA will receive the funds to decide later.

“The DDA will vote to decide how proceeds are spent, but I would expect some to be used for projects we are planning in Grant Park. The DDA also has some very exciting plans in the works for revitalizing the streetscapes in the downtown area and along Van Dyke and M-59,” he said.

Calandrino said that he thinks the purchase of the property will not only benefit the city, but also its residents.

“With the fourth season of baseball about to begin, I’m pleased Utica will finally begin to see some tax revenue, even if it’s far below what was previously promised. City government must do everything we can to increase the tax base. We can no longer afford to have our small city subsidize for-profit entities on the backs of our taxpaying residents and businesses.”

Dionne said that health care businesses are planned to be coming to downtown Utica on the property.

He said that this is a step toward bringing in more businesses to downtown Utica, and he hopes it inspires more businesses to add to the growth of the downtown.

“I think selling (the property) is a great benefit for the city because GSE agreed to build a new mixed-use property there, and it will be a spark to some interest in the development in the downtown district,” said Dionne.

“The property purchase was always contemplated to happen as part of the overall agreement with the city of Utica for the development of Jimmy John’s Field. We are excited that this next phase of development of the property adjacent to Jimmy John’s Field will be moving forward as part of the continued development of downtown Utica,” Dana L. Schmitt, chief operating officer of the United Shore Professional Baseball League, said in an emailed statement.

For more information on the purchase, call the city of Utica at (586) 739-1600.