The Town of Middleburg last week received responses from two companies interested in buying and redeveloping the town-owned Health Center property, located at 14-16 S. Madison St. Those firms are Old Ox Brewing Co. and the partnership of Treptow Development Co. and St. Mawes LLC.
Business and Economic Development Director Jamie Gaucher said that the town is looking to find better uses for the 0.26-acre property, both socially and economically, after owning and managing it for 39 years. According to the request for proposals, the town has determined that redevelopment is outside of its mission and beyond its expertise.
“We’re looking at options,” Gaucher said, adding he thought it would be “more beneficial” to solicit ideas from the private sector.
Gaucher said that selling the property, which includes a 3,400-square-foot building that previously housed the Middleburg Police Department and now has three tenants, would allow the town to generate about $1,030 annuallyfrom property taxes, based on the town’s rate of $0.165 per $100 of assessed value and the property’s $624,400 value as listed by the Loudoun County Assessment Parcel Database this year.
While the town is responsible for nearly $80,000 annually in maintenance of the property, it collects only about $41,000 annually from lease payments. The town is unable to profit from this revenue, however, since a stipulation in the property’s 1939 incorporation document requires the property owner to donate all generated revenue to charity. According to Health Center Advisory Board member Howard Armfield, about $30,000 is donated each year.
Armfield said that when the property is sold, all money from the sale would be set aside to continue such donations for years to come. The property’s advisory board now makes a recommendation to the Town Council as to which nonprofits should see that income. “The town is operating this building at a loss,” Gaucher said.
Aside from economic reasons, the town is also looking to have the property redeveloped from a social standpoint. Gaucher said the town would like to see more energy and people on Madison Street, which sits in the heart of Middleburg’s historic district. He said that redeveloping the property to accommodate a mixed-used facility or residential complex could help to accomplish this. “That’s something that we’re very interested in,” he said.
As for the three tenants leasing space in the building—a Pilates studio, a counseling service and a doctor’s office—Gaucher said that they would have to work out their lease agreements, which end Dec. 31, with the new owner. “The town would be hopeful that those tenants would not be displaced,” he said.
A proposal review committee made up of Gaucher, Armfield, Vice Mayor Darlene Kirk, Councilman Philip Miller, Town Administrator Martha Simms and Planning Commission ChairmanEric Combs will now be evaluating the two responses.
The committee will be reviewing each proposal’s offered purchase price, the quality of the improvements they have proposed, the schedule of work, the proposer’s financial resources, the compatibility of the proposed redevelopment with the surrounding neighborhood and the total value of the proposed redevelopment to the community in terms of human and economic welfare.
Gaucher said the committee would also be reaching out to several other firms who initially expressed an interest in responding to the request for proposals, but ended up not doing so.
He is hoping to have a recommendation on a single firm ready for the Town Council on June 14. If the council accepts it, the next step would be to enter into negotiations on a development contract with the selected firm.
Gaucher said that it’s plausible for redevelopment of the property to begin later this year.