Commissioners Table $14.2M Old WHS Offer, Broker Cites Economy, Town Regulations To Justify Price

Published Tuesday, July 16, 2013 at 9:47 pm

By Jesse Wood

July 16, 2013. The Watauga County Board of Commissioners entertained, and eventually tabled, a $14.2 million offer for the old Watauga High School property at Tuesday night’s board meeting.

A last-minute addition to the meeting’s agenda, the offer came from Atlanta-based Fuqua Acquisitions, which submitted a letter to County Manager Deron Geouque last month expressing its interest in the 75-acre property for mixed-use development.

The old WHS is completely demolished. Photo by Ken Ketchie

The old WHS is completely demolished. Photo by Ken Ketchie

That letter included a $12 million figure with a 7 percent broker’s commission coming off the top. Tuesday’s $14.2 million offer includes the same 7 percent broker’s commission.

Chair Nathan Miller noted that the price was too low, and when he asked the other commissioners if the offer was enough money, they mumbled “no” in unison.

Also, County Attorney Four Eggers noted that the contract would need minor changes for the municipality to be in accordance with state law.

Robert Armstrong, a broker with KW Commercial speaking on behalf of Fuqua Acquisitions and himself, mentioned the Town of Boone’s multi-family housing regulations that were introduced in February – “every nut and bolt has to be nailed down” – and the state of the economy when justifying the offer to the commissioners.

“It’s an extremely onerous site to develop because the city of Boone expects development in one phase. It totally drives this deal into the ground,” Armstrong said. “The site has numerous challenges not only with topography but with how you piece this deal into one phase. It puts tremendous burdens on developers.”

Armstrong told the commissioners of how he was involved in an $27 million offer on the property nearly seven years ago that was not accepted because the board at the time was seeking $36 million to $37 million before the Great Recession.

“We came in and made a substantially higher offer, [yet it featured] substantially less challenges from a developer’s point of view,” Armstrong said.

When Templeton Properties backed out of its $20 million offer on the old WHS after the customary inspection period in May, he cited similar concerns. 

The Town of Boone explained its reasoning for the regulations in a statement in April. It noted that the one-phase restriction could be bypassed if a financial guarantee was provided by the developer, reasoning that a developer might build the apartment portion of a development and never follow through with the commercial side. 

The commissioners directed staff to fine-tune the contract and work on a counter offer.

Currently, the asking price is $20 million.  

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