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A development group has asked a Luzerne County authority for more time to pay $1.08 million owed on its purchase of a 6.36-acre downtown Wilkes-Barre tract that includes a historic train station.

The Luzerne County Redevelopment Authority board has agreed to grant Market Square Properties Development LLC a one-year extension on its letter of credit, although it will start charging interest at a percentage still under negotiation, said authority Executive Director Andrew Reilly.

The authority sold the property at the corner of Market Street and Wilkes-Barre Boulevard to Market Square for $1.2 million in 2016. Market Square is an investment group led by engineer and developer George Albert.

Under that sales agreement, Market Square paid $120,000 and had up to 18 months to pay the remaining $1.08 million. Market Square is now the deeded property owner.

The authority is not in financial risk because Market Square had to submit an irrevocable letter of credit guaranteeing the authority $1.08 million if Market Square encounters unforeseen problems coming up with the money, Reilly has said.

Since then, the authority has approved a few extensions on the letter of credit because Market Square requested time to resolve pending litigation involving the parcel.

Reilly said Wednesday the litigation was again cited as the sole reason for the latest extension request. Authority officials view the letter of credit as a last resort because forcing payment that way could negatively impact Market Square and its development plans, he said.

“The authority wants a first-class development there,” Reilly said.

In addition to restoring the brick train station built in 1868, the $7.5 million to $8.5 million project called for three new structures housing eateries, a grocery store or other retail/commercial tenants, the developer has said.

However, Albert has said multiple lawsuits filed by Thom Greco have halted development plans, including construction of a Burger King. Greco has said he embraces development but was forced to pursue litigation to protect his existing lots in the complex, which house McDonald’s and Citizens Bank — parcels he owns with his company, TGRG LLP.

Attorney Francis Hoegen, who represents Market Square, said Wednesday he and his clients are optimistic the litigation will be concluded next year.

“With any luck, it will be determined in our client’s favor. Then we would proceed and close the transaction with the Redevelopment Authority, which has been a terrific partner in this unforeseeable event,” Hoegen said.

Hoegen said the developers have cleaned up the parcel by adding a new road and lighting, carving out building pads and remodeling a strip mall now called the Market Street Business Center.

“These guys spent a lot of money in good faith that this is going to work out. As soon as litigation is over, hopefully we’ll see the development start to come in,” Hoegen said.

Reilly said the authority received no indication the project was in jeopardy, only that prospective site tenants were reluctant to commit until litigation was resolved.

Albert could not immediately be reached for comment Wednesday. He said in June he was “very close” to securing all tenants for the former New Jersey Central train station, which also will house his office, with a goal of starting renovations this year.

Because it is a historic structure with complex architectural features, the station renovation will cost about $1 million, or $250 a square foot, he has said, noting he could build a new structure at that amount. The station is on the National Register of Historic Places.

The county’s Convention and Visitors Bureau is one of the prospective station tenants.

During this week’s budget work session, bureau Executive Director Janet Hall told Luzerne County Council she has once again factored relocation expenses into the proposed 2019 budget, including increased rent and office supplies. The bureau is now housed in rented space on Public Square.

Hall told council the additional funding likely won’t be spent because the move is probably not going to occur in 2019. The bureau is not funded by the county’s general operating budget, with most of its revenue obtained from a county hotel tax.

A development group has asked a Luzerne County authority for more time to pay $1.08 million owed on its purchase of a 6.36-acre downtown Wilkes-Barre tract that includes this historic train station.
https://www.timesleader.com/wp-content/uploads/2018/10/web1_station.cmyk_-1.jpg.optimal.jpgA development group has asked a Luzerne County authority for more time to pay $1.08 million owed on its purchase of a 6.36-acre downtown Wilkes-Barre tract that includes this historic train station. File photo

By Jennifer Learn-Andes

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Reach Jennifer Learn-Andes at 570-991-6388 or on Twitter @TLJenLearnAndes.