Rick Breneman to council: "I'm not trying to paint a doomsday picture for you—which it sounds like that's what I'm doing—but this is a tricky thing to navigate, no doubt, for you guys to try to maximize your investment." [Columbia Spy file photo]
JOE LINTNER | COLUMBIA SPY
Rick Breneman of Breneman Site Construction, who has been overseeing the McGinness remediation project for the borough, provided options for the future of the site at Thursday's Columbia Borough Council Workshop. Breneman characterized the endeavor as "a tricky thing to navigate."
(Breneman didn't delve into the progress of remediation, except to say the project is expected to be done by Thanksgiving. Based on introductory remarks by Heather Zink, council president, he was asked to speak about the sealed bid process and restrictions, and how fast to proceed.)
Developers require 2-3 years for due diligence
Breneman explained to council that developers typically need 2-3 years for due diligence, permitting, and planning before construction begins, and they generally won't pay for the property until they've secured development approval and identified tenants or buyers. He cited the Belmont Shopping Center as an example, which took eight years from concept to breaking ground.
Breneman also said that in the development industry, the due diligence period is when developers are creating conceptual designs and developing a budget for all costs of the project. "And then they're going to look at what the return on investment is going to be," Breneman said.
Borough zoning reduced the pool of developers
Breneman noted that the borough's zoning change from housing to commercial/light industrial reduced the pool of potential developers. "And quite honestly, there has to be a demand. There has to be a demand for what it is that land is zoned for," Breneman explained.
Two potential sales approaches
He discussed two potential sales approaches: a public auction (which likely won't meet the borough's financial expectations and could result in buyers sitting on the land), or working with the EDC's proposed schedule (which will require negotiating on timelines and payment terms).
Of the first option, Breneman said, "You can go down the road of public sale and advertise and see if there's any interest, but my guess is that the interest you're going to see, you're not going to be happy with the return." He emphasized that developers need flexibility on timelines, because they can't afford to carry land costs for years without generating income
Over-55 housing
Breneman said council could also consider over-55 housing as an option, because it wouldn't burden the school system and would expand the number of potential buyers. "That's not a bad idea, because again instead of just looking at a group of people this big, it opens it up a little bit more and maybe makes it a little bit more appealing," Breneman said.
In August, council heard from commercial realtor Kevin Wolfe, who laid out several options for the site, including data center, industrial, recreational, retail, and office space. Of those, only office, retail, and recreational were considered feasible and would require "significant marketing," according to Wolfe.
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