2003-01-30 Special Meeting
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 29
SPECIAL MEETING, JANUARY 30, 2003 PAGE 482
ASSEMBLY
The New Hanover County Board of Commissioners held a Special Meeting on Thursday, January 30, 2003,
at 5:30 p.m. in the Assembly Room of the New Hanover County Courthouse, 24 North Third Street, Wilmington, North
Carolina.
Members present were: Chairman Ted Davis, Jr.; Vice-Chairman Robert G. Greer; Commissioner Julia
Boseman; Commissioner William A. Caster; Commissioner Nancy H. Pritchett; County Manager, Allen O’Neal;
County Attorney, Wanda M. Copley; and Clerk to the Board, Lucie F. Harrell.
Chairman Davis called the meeting to order and advised that the purpose of the Special Meeting was to
consider the purchase of additional property at Marketplace Mall. He stated that the Board had previously discussed
this acquisition in Closed Session and decided to hold a public meeting to receive public input. Staff will make a 30
minute presentation followed by a 30 minute period to receive comments from the public. After completion of these
items, the Board will discuss and then vote on whether to purchase the additional property.
Chairman Davis requested Finance Director Bruce Shell to make a presentation.
Finance Director Shell reported that his presentation would begin with the sale of the Annex Administration
Building located at 414 Chestnut Street, and the sale of the Human Relations Building located at 402 Chestnut Street,
which will create the need for additional space at Marketplace Mall. It is important to understand the link between
the sale of the two buildings and the need for additional space. He presented a map showing the location of the two
buildings that the County will sell to Swain and Associates if an agreement is reached.
The Annex Administration Building, comprised of 21,000 square feet, was built in 1957 and purchased by
New Hanover County in 1982. This building was recently appraised by a certified appraiser at approximately
$965,000, and a sale price has been negotiated with Swain and Associates in the amount of $920,640. The Human
Relations Building, located at 402 Chestnut Street, is comprised of 1,300 square feet and was built in 1952. The
County purchased the building in 1994, and it was recently appraised at $180,000. A sales price has been negotiated
with Swain and Associates at $180,000. This means that New Hanover County can sell both buildings for $1,100,640.
The new Administrative Annex at Marketplace Mall is located in the center of the County. Slides were
presented showing the inside and outside of the building and how the space is currently being utilized to allow for one-
stop shopping through the coordinated location of the Inspections Department, Engineering Department, Water and
Sewer Finance Department, Planning Department, Parks Department, and Fire Services with ample parking for the
public and County employees.
A map and chart were presented showing the additional 46,674 square feet that New Hanover County has an
opportunity to purchase at a cost of $57.37 per square foot:
Corning Space16,700 sq. ft.$1,419,500
Utility Area* 2,000 sq. ft. -0-
Gold’s Gym Area13,000 sq. ft. 978,180
Center Mall14,000 sq. ft. 280,000
Total$2,677,680
* The utility area was part of the negotiated agreement.
If this additional space is purchased, the plan is to move the Environmental Health Division of the Health
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Department from 2029 South 17 Street to Marketplace Mall. This move will provide an additional 1,300 square feet
of badly needed space for the Environmental Health Division and at the same time move this function near other
County Departments that serve construction and development needs. It will also free up some additional space for the
Health Department which is in need of space.
The Board of Elections will be moved to Marketplace Mall to provide additional space for this department
and free up space for the Register of Deeds Office to expand its quarters in the basement of the New Hanover County
Historic Courthouse. The relocation of Elections will provide a central location in the County and provide a secure
storage area where voting machines and booths can be stored and maintained.
The Tax Department will also be moved to Marketplace Mall. In addition to being located in the center of
the County, Marketplace Mall offers ample parking spaces, which has been a major issue for the public when visiting
the Tax Office located at 320 Chestnut Street. This department will gain approximately 2,000 square feet. An office
will still be available in downtown Wilmington for payment of taxes.
When the lease on Gold’s Gym expires in January 2004, consideration is being given to creating additional
space for the Information Technology Department, and a satellite office for Property Management.
Finance Director Shell advised that the cost for purchasing the additional 46,674 square feet is $2,677,680 with
renovations estimated at $1,500,000 for a total of $4,177,680. With the sale of the Annex Administration Building
located at 414 Chestnut Street and the Human Relations Building located at 402 Chestnut Street, the County will receive
$1,100,640. The net amount borrowed will be $2,777,680 financed through upcoming Certificates of Participation with
an annual debt payment of $215,000.
Commissioner Caster asked if furnishings were included in the purchase price.
Finance Director Shell responded that furnishings were included in the total purchase price.
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 29
SPECIAL MEETING, JANUARY 30, 2003 PAGE 483
Finance Director Shell presented a spread sheet of the projected impact on the County Budget for the next four
fiscal years. The debt service for next year will be $130,000 since there will be no principal payment for the first year.
Each year thereafter, the debt payment will be $215,000. With revenue received from the current lease on Gold’s Gym,
the County should come out ahead for the first year with a small cumulative cost over the next four years. There will
be no significant impact on the budget.
Finance Director Shell advised that it would be difficult to find a better price for the amount of space.
Acquisition of this space would allow more County functions to be centrally located and better coordinated to serve and
accommodate all citizens living in New Hanover County.
In closing, Finance Director Shell stated that when the Corning space is completely vacated at Marketplace
Mall, the County will have an option to purchase the remaining space as part of the arrangement. This a no-cost 2-year
option that will give the County an opportunity to purchase another 48,481 square feet of space facing College Road
with 542 parking spaces. This space would provide one-stop-shopping for all County services in one location.
Chairman Davis requested Mr. David Swain and his son Mr. Jason Swain to make a presentation.
Mr. David Swain expressed appreciation to the Board for allowing him to speak and stated that his comments
would be focused on downtown Wilmington. He advised that Swain and Associates had been in Wilmington for 12
years, and the company’s developments are Renaissance Park, a retail center in the Forum, the Merrill Lynch Building,
the Wildflour Bread Building, Bank of Wilmington at the Forum, and development of the Monks Corner area adjacent
to WalMart consisting of Carrabba’s Grill, Ruby Tuesdays, and Cracker Barrel. Merchants in the Forum are relocating
from Raleigh, Charlotte and Atlanta, which brings a higher tax base to New Hanover County and promotes good growth
in the community.
Mr. Swain spoke on his desire to develop in downtown Wilmington but stated that it had been difficult to secure
a good return on an investment because of excessive prices for buildings and property. After meeting with Mayor
Peterson and DARE, Inc. in the last two weeks, he would like to provide good development in the downtown area. The
company feels that a statement can be made with the 21,000 square foot Annex Administration Building in conjunction
with the Human Relations Building. This will be a difficult project because of the exodus by some merchants from the
downtown area, the lack of retail traffic, and the poor economy.
In an effort to renovate the Annex Administration Building, Mr. Bruce Bowman of BMS Architects was
contacted to see how the building could be renovated to be appealing and attractive to the surrounding area. Mr.
Bowman met with the Historic Commission and was informed that the building would have to retain its 1950 vintage
appearance. A preliminary design has been prepared, and Mr. Bowman will make a brief presentation.
Mr. Swain advised that since the renovation of the Administration Annex Building could not occur overnight,
he had contacted Mr. Don Reynolds, founder of Port City Java, to see if the Human Relations Building could be used for
a coffee shop. A response has been received from Mr. Reynolds and he will make a brief presentation.
In concluding his remarks, Mr. Swain reiterated his intention and commitment to be a part of the City and the
County and offered to answer questions.
Chairman Davis requested Mr. Bruce Bowman to make a presentation.
Mr. Bowman presented slides showing the new look for the 414 Chestnut Street Annex Administration
Building. The 1950 vintage was retained by incorporating a new window system, recessing the lower floor to add
dimension to the building, and using another material and different paint for the exterior of the building to provide an
attractive street appeal that will greatly enhance the site. He complimented Mr. Swain for improving this property and
offering an attractive building to some viable tenants.
Chairman Davis requested Mr. Don Reynolds to comment on the coffee operation.
Mr. Don Reynolds, CEO of Port City Java, a company operating coffee establishments in the southeastern part
of the United States, reported that he was pleased to have an opportunity to do something for the downtown area. He
proposed that a separate Corporation would be formed consisting of East Coast Community Development, Inc., Port City
Java, and Mr. David Swain to upfit, equip, and turn the Humans Relations Building into a coffee shop café with the
business donated to the Corporation. East Cost Community Development, Inc. would oversee the operation of the coffee
shop and hire people who do not have many economic opportunities. He advised that in conjunction with this
Corporation, he has envisioned setting up a rotating Advisory Board comprised of different groups, such as UNCW and
Cape Fear Community College, to allow 100% of the profits from the coffee shop to be set aside to provide scholarships
for minorities.
In closing, Mr. Reynolds advised that this proposal would allow him to return something of value to the
downtown area, which is where he began his successful business. He also noted that he was interested in providing a
place without the sale of alcoholic beverages in the Fourth Street area where people can go and enjoy the atmosphere.
Hearing no comments, Chairman Davis stated that regardless of what is voted upon by the Board, he has the
utmost respect for Mr. Swain and Mr. Reynolds for their interest shown in trying to make a difference in our community.
Chairman Davis opened the meeting to receive public comments.
Ms. Kathleen Sharma, a resident and owner of a business in Wilmington, expressed concern for moving
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 29
SPECIAL MEETING, JANUARY 30, 2003 PAGE 484
employees from downtown and stated that she was not thrilled with the way her County tax dollars were being spent.
She suggested using available space in the downtown area to meet the space needs of the County.
Ms. Catherine W. Ackiss, owner of Catherine’s Inn Bed and Breakfast House located at 410 South Front Street,
stated that she was speaking on behalf of the Residents of Old Wilmington (ROW). She reported at the last meeting of
the Board of County Commissioners, she presented a resolution opposing the move of more County employees out of
the central downtown business district. She expressed concern for sustaining a vibrant, diverse downtown environment
with a healthy daytime economy without the presence of County employees. She requested the Board to find additional
space in the downtown area.
Ms. Nancy Bullock, representing a large contingent of downtown retailers, reported that government employees
represent 35 percent of workers in the downtown area. The loss of these employees will hurt the downtown economy,
disperse government services, and undermine the success of the 25-year revitalization plan for downtown Wilmington.
She advised that the County’s investment in the downtown area for a number of years has been greatly appreciated and
stated that hopefully the County could work with downtown groups to find a better solution to its space needs.
Mr. Bo Hale, the founding president of Hale Building Company, a commercial general contractor working
primarily in New Hanover County, advised that he supported the decision to move the Inspections Department to
Marketplace Mall and he would support the decision to move more departments to this centrally located accessible site.
As a builder, he visits the Inspections Department daily, and it has been a pleasure to walk into one building to secure
permits from the Inspections Department and visit the Planning Staff or Engineering Staff if some problems are
experienced during a construction project. He advised that prior to the move, his access to County departments was
extremely limited by a lack of parking and overcrowded quarters for the departments located in the Annex
Administration Building. The Marketplace Mall space has the proper access, and other citizens using County services
will benefit from moving more departments to this central location.
In closing, Mr. Hale informed the Board that he had worked with Mr. Swain on numerous occasions and stated
that he is a person of great vision with an on-going concern for the health and welfare of this community. To allow Mr.
Swain to perform a project in downtown Wilmington will have significant impact on the future revitalization of this area.
Mr. Richard Donaldson, General Manager of the Porters Neck Company, advised that he supported the purchase
of more space at Marketplace Mall because County services are more efficient and easier to reach for persons living in
northern New Hanover County. With the amount of future growth predicted to occur in this part of the County, it would
be wise to move more County services to Marketplace Mall to accommodate this new growth.
City Council Member Laura Padgett expressed appreciation to the Board of County Commissioners for
providing the public an opportunity to speak. She urged the Commissioners to stay in the downtown area because
persons owning businesses need for these employees to remain in the central business district. It is critical for
government to keep its employees downtown where they can continue to be the stable base of economic support. She
requested the Commissioners to find suitable space for its employees in the downtown area.
Hearing no further comments, Chairman Davis expressed appreciation for the comments received and closed
the public comment period.
Chairman Davis spoke on County commitments to the downtown area and presented the following investments
that have been made by the County since 1997:
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Judicial Building Annex: The Allen W. Cobb, Sr. Judicial Annex was opened in 2002. In addition to the
renovations being made to the 1991 Judicial Building, an additional 40,000 square feet of courtroom and office
space was constructed at a cost of $12,000,000.
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Library Renovation: The 3 floor of the Main Library was renovated to provide office space and community
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meeting space at a cost of $3,600,000. This renovation enabled the space on the 2 floor to become additional
library space, which was badly needed.
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Parking Deck: Adjacent to the Main Library is a parking deck consisting of 648 parking spaces that was
constructed at a cost of $8,900,000.
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Cape Fear Community College: New facilities, purchase of property, and renovations to existing buildings in
the downtown area have cost the County $23,443,000.
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Other Improvements:
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•The former City Office Building located at 138 North 4 Street was purchased from the City at a cost
of $1,100,000 and renovated to house the N. C. Department of Juvenile Justice and Delinquency
Prevention and the Juvenile Court at a cost of $1,295,000.
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•The 3 floor of the Bell South Building was purchased and renovated at a cost of $1,131,000 to house
the Vice and Narcotics Division of the Sheriff’s Office.
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•A Training Facility located at 211 North 2 Street was renovated to provide training and meeting
space for the County at a cost of $23,000.
In closing, Chairman Davis advised that New Hanover County has invested a total of $50,392,000 in downtown
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 29
SPECIAL MEETING, JANUARY 30, 2003 PAGE 485
Wilmington since 1997. Regardless of the decision made, he is proud of what the County has contributed to the central
business district, which in his opinion shows a definite commitment by the County to support downtown Wilmington.
Chairman Davis asked if any member of the Board would like to comment.
Vice-Chairman Greer commented on the recent joint meeting with the City Council regarding consolidation
where a decision was made to develop a Consolidation Study Commission to prepare a plan to be presented to the voters
in the November 2004 election to let them decide if they want a consolidated government. An agreement was also
reached for the City and County to look at merging functions, such as water and sewer, which does not require voter
approval. With the County and City needing more space, this is an excellent opportunity to provide space for future
consolidation of City and County governments or functional mergers of City and County departments. To purchase this
additional space will free up badly needed space in the New Hanover County Historic Courthouse and in the County
Administration Building. He stated that he was in favor of acquiring the space, which in his opinion, is a positive step
in the right direction.
Commissioner Boseman advised that she felt this was an excellent opportunity for a reputable developer to put
money into downtown Wilmington. The renovation of this site will improve the entire block and increase the tax base
for both the City and County. She also noted that it was most unfortunate that PPD was discouraged from locating in
the downtown area.
After hearing no further comments, Chairman Davis requested direction from the Board.
Motion:
Commissioner Boseman MOVED, SECONDED by Commissioner Pritchett, to sell the 414 and 402 Chestnut
Street Buildings for $1,100,640 and purchase the identified 46,674 square feet from Swain and Associates for
$2,677,680.
Finance Director Shell noted that part of the Buy and Sell Agreement negotiated with Mr. Swain includes a 2-
year option to purchase the additional front space. The County is not obligated to purchase the space, but this item
should be included in the motion.
Chairman Davis asked Commissioner Boseman and Commissioner Pritchett if they would amend the motion.
Amended Motion:
Commissioner Boseman MOVED, SECONDED by Commissioner Pritchett, to sell the 414 and 402
Chestnut Street Buildings for $1,100,640 and purchase the identified 46,647 square feet of additional space from Swain
and Associates at Marketplace Mall at the negotiated price of $2,677,680, including the 2-year option to purchase the
additional front space.
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Vice-Chairman Greer reminded everyone that when the 3 floor of the Main Library was renovated, it was
discovered that employees from the Annex Administration Building needed to be moved as soon as possible because of
the poor condition of the building. A great deal of discussion was held about tearing down the building and temporarily
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relocating employees from the Annex Building into the newly renovated 3 floor of the Library The members of the
Library Advisory Board were quite upset about the renovated space not being used for library purposes. Then, Staff
found the space at Marketplace Mall and the County acquired the space and moved the Annex employees to the mall.
Now a well respected developer has made an offer of $920,640 to purchase the Annex Administration Building and will
renovate it into an attractive structure to be rented to tenants in the downtown area which will increase the tax base and
bring in additional people. This is a plus-plus situation for all parties involved, including the City of Wilmington,
particularly since an agreement has been reached to open a coffee shop with 100 percent of the profits being given back
to the community. The County cannot afford to pass up this opportunity.
Chairman Davis stated that he agreed with the first purchase of property at Marketplace Mall because there was
an emergency need to move the employees from the Annex Administration Building. However, to purchase additional
space is another issue, particularly under the current budget constraints and poor economic conditions. There is no
emergency need to justify the purchase of additional space which will increase the County’s debt. After refusing to
increase the property tax for three years, he does not feel that additional debt should be incurred when the County
Manager has already been told that State and Federal funding will be reduced during FY 2003-2004. He stated that the
offer made by Mr. Swain would be a shot-in-the-arm for downtown Wilmington, but in these economic times, he cannot
vote to increase the County’s debt.
Commissioner Caster noted that he was swayed when he thought about the Annex Administration Building
becoming a disaster for the County because it could not be sold and would be costly to demolish. When seeing the plans
for renovating this building into an attractive, useful structure in the downtown area, which will attract more people into
the community, he feels this is a win-win situation.
Second Amended Motion:
After further discussion of how the motion should be worded, Commissioner Boseman
MOVED, SECONDED by Commissioner Pritchett, to sell the 414 and 402 Chestnut Street Buildings to Swain and
Associates for $1,100,640; purchase 46,674 square feet of additional space at Marketplace Mall identified on the map
as the Corning space, utility area, Gold’s Gym area, and the Center Mall from Swain and Associates at the negotiated
price of $2,677,680, including the 2-year option to purchase the additional front space; and authorize Staff to enter into
the appropriate Buy and Sell Agreement. Upon vote, the motion CARRIED 4 to 1. Chairman Davis voted in
opposition.
ADJOURNMENT
Hearing no further comments, Chairman Davis called for a motion to adjourn.
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 29
SPECIAL MEETING, JANUARY 30, 2003 PAGE 486
Motion:
Commissioner Boseman MOVED, SECONDED by Vice-Chairman Greer, to adjourn. Upon vote, the
MOTION CARRIED UNANIMOUSLY.
Chairman Davis adjourned the meeting at 7:15 p.m.
Respectfully submitted,
Lucie F. Harrell
Clerk to the Board