- Associated Press - Tuesday, July 28, 2015

July 28—When it comes to the federal courthouse building, city discussion Monday highlighted two main factors — city leaders aren’t interested in being a landlord for commercial space and, at present, there isn’t a sense of urgency to sell the property.

The Aberdeen City Council discussed the next step for the federal courthouse on Monday. No votes were taken. Instead, the topic was turned over to City Attorney Ron Wager, City Manager Lynn Lander and City Finance Officer Karl Alberts.

“What you’ve handed us is not simple,” Lander said.

While there seems to be a general feeling that commercial leases shouldn’t undercut present commercial rates for space downtown, Lander said, as a private business owner, he would probably offer a lower rate to secure a lease.

“You’ve got us in a real precarious position,” he said. “It’s like you’ve put us in a land mine.”

Downtown building owner Heath Johnson said if Aberdeen is looking to add the most value to the federal courthouse building, more tenants is the answer.

“It’s much more valuable if it’s full,” he said.

At the same time, Johnson said, the city should be cognizant of the downtown rental rates so the city doesn’t offer a rate that undercuts other building owners downtown.

Coming from the perspective of a commercial realtor, Johnson said, placing a value on this particular building will be a challenge because it’s a unique building.

Selling the federal courthouse building is an option, and one the council would consider, but none felt selling the building was an urgent necessity.

The city purchased the federal building for $525,000 and invested another $200,000 in renovation work. Three federal offices currently lease space at a rate of $171,000 per year, but three-quarters of the space is still available, and the current income on the building doesn’t cover the bond payment and ongoing operational costs.

The final bond payment on the federal building will be paid in 2019.

The current space is leased by the General Services Agency, a group that negotiates leases for federal offices. The present five-year lease gives the GSA the option to renew for another five years.

Lander said if the GSA sought additional space in Aberdeen and the agency considered the federal courthouse building, some renovation work would be needed on the second floor because it presently doesn’t meet GSA’s accessibility requirements.

Wager said selling the building will not affect the present lease with the GSA and there’s no legal impediment to putting the property up for sale or making additional space available for lease.

“I’m comfortable with holding onto it until the right person wants to buy it,” Councilwoman Jennifer Slaight-Hansen said. “I feel like we made a commitment to keep the court here, and we made an investment for the next couple years.”

Councilman Todd Campbell said the right thing to do is to get it back in private hands.

“Looking for a potential buyer is the wisest thing we can do, rather than renting it out ourselves,” he said.

One caveat to the sale, however, is being mindful of who buys the property.

Councilman Rob Ronayne said the city doesn’t want to find itself in a position where the new owner doesn’t continue to meet GSA requirements and the city is faced with the need to take ownership of the building again to maintain the federal courthouse space in Aberdeen.

The council gave no indication on a lease rate or potential sale price at Monday’s meeting.

In other news

— The council postponed discussion on an ordinance amendment that would give the city authority over the city-owned parking lots attached to city buildings. Maintenance of these lots is currently overseen by the Parking Board, a group that is overseen by the Aberdeen Downtown Association. Several people were in attendance at Monday’s meeting. Downtown association Executive Director Heidi Appel said many were there to represent the parking board and encourage postponement of this discussion, which will now take place Aug. 17.

— Eric Vetter of Aberdeen presented information on the 25th Anniversary celebration of the American with Disabilities Act. Events take place all week, Vetter said, and culminate on Friday with events planned from 6-10 p.m. on Second Avenue Northwest. Live music, square dancing, information booths, karaoke, games and a picnic meal are planned.

Follow @ElisaSand_aanon Twitter.


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