Saturday, July 12, 2014

Train station appraisal takes dive

November 04. 2013 11:28PM

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An outside appraiser estimates a downtown Wilkes-Barre tract containing a historic train station and strip mall is worth $1.88 million — less than a third of what the government paid for the 6.24-acre property seven years ago.

The Luzerne County Redevelopment Authority bought the property for $5.8 million in April 2006 using federal community development funds provided by the county.

The authority sought the fresh appraisal as part of its plans to publicly seek proposals from developers interested in buying and revitalizing the site at the corner of Market Street and Wilkes-Barre Boulevard.

Authority Executive Director Andrew Reilly attributes the $3.9 million value drop on the real estate market decline and difficulty identifying comparable train station properties.

The property is divided into three pieces — the station, strip mall and a corner lot that once housed a train car sold for scrap.

The appraiser — Congdon Hynes Appraisal LLC — said its appraisal of the 4.16-acre train station portion of the property at $1.06 million was an “extraordinary assumption,” Reilly said. This means there could be “significant variables” due to a lack of sales data on similar properties, he said.

The authority had paid $3.56 million for the portion containing the train station.

“This is not an everyday kind of real estate parcel, so it’s very difficult to value this particular piece of real estate,” Reilly said.

Congdon Hynes valued the vacant 0.22-acre corner parcel at $102,000 and the strip mall on 1.86 acres at $720,000, Reilly said. The authority paid $2.24 million for these two parcels combined.

Urban’s viewpoint

County Councilman Stephen A. Urban, who supported the project as a prior commissioner, said Monday the purchase was based on two appraisals that both concurred the three-parcel property was worth $5.74 million.

“We did our due diligence. The amount was based on a market appraisal,” he said.

The primary appraisal before the 2006 purchase had been performed by Alan Rosen, of Rosen Real Estate Inc. Stanley Komosinsky, a certified general appraiser from Hazleton, performed a review appraisal concluding that Rosen’s $5.74 million was accurate, Reilly said.

Urban also blames the value decline on the condition of the train station, which has been vandalized and is missing sections of stolen roofing material.

“They let the station deteriorate and have not fixed it up,” Urban said.

Rosen said Monday the commercial development market “tanked” after his appraisal. He said his estimate was based on the “highest and best use” of a prime lot at a busy downtown location.

“There’s a lot of potential there in the right developer’s hands,” he said.

Prior county commissioners had initiated the property purchase from Wilkes-Barre businessman Thom Greco to preserve the station and provide a home for county-related offices renting space elsewhere in the city’s downtown, including a senior center and tourism office. Urban said the site also was envisioned as a link if a passenger rail connection to New York City ever materialized.

The project came to a halt last year when county Manager Robert Lawton cancelled an additional $2 million community development allocation to the cash-strapped authority to fund the restoration. Lawton cited a lack of job creation.

The new appraisal, which is hundreds of pages, has been forwarded to authority members for their review and will be provided to interested developers, Reilly said.

The authority staff will meet this week to finalize the proposal seeking developers and identify where it should be posted to attract the most attention, Reilly said.

The authority will consider all offers for the entire site or one of the three parcels, he said.

“Someone could offer nowhere near the appraised amount but have a viable plan to redevelop the site and create jobs. It’s what the market will bear. I don’t think anyone really knows what to expect at this point,” he said.

Historical Society

The county Historical Society had asked the authority to donate the entire property to its organization to ensure the 144-year-old New Jersey Central train station is preserved, but authority officials decided to see if anyone else is interested before considering that request.

The train station, which is on the National Register of Historic Places, still contains original paneling, molding and stained glass windows, though the windows have been put in storage because of an attempted theft.

Historical society officials estimated they would have to raise around $2 million to demolish the station’s deteriorating additions constructed in 1975 and restore the original structure.

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