CARTHAGE — A real estate company that owns the old Walmart site is asking the city of Carthage to reconsider the termination of an economic development agreement.
City commissioners last month decided to terminate an existing Chapter 380 agreement with Action Properties, which owns the former Walmart building at U.S. 79 and the Carthage Loop. City Manager Steve Williams said Monday that decision was because the company wasn’t meeting the terms of the 2014 agreement, which is based on the number of new jobs brought to the city.
David Nichols with Action Properties said the company has brought jobs to the city, but it just can’t prove it.
“Now, if you drive out there today, based on what the building was before we took it, you can naturally see that we’ve invested millions of dollars in that building,” Nichols said. “We’ve brought five, six tenants to that building. And there have been jobs created because of that. The problem I’m having is, I can’t prove how many full-time jobs there are because they’re not sharing the information with us and refuse to.”
Nichols is proposing to base the agreement on occupancy rates. Williams reminded commissioners Monday that at their last meeting they had decided that was “not what the contract said, and last time you had said ‘No, we’ll stick with the contract.’” Commissioners on Monday voted to table the issue for further consideration before taking any action on Nichols’ proposal.
The 2014 agreement had the city agreeing to rebate 75 percent of 1 cent of the city’s sales taxes to Action Properties for a 10-year period, with a cap of $500,000. Action Properties had brought in Bealls, Dollar Tree, Little Caesar’s Pizza and AT&T to the old Walmart site, and Nichols said Monday they were hoping to eventually find a tenant for an additional 15,000 square feet of the building.
Bealls, Nichols said, recently had decided to leave the building, until they were persuaded — and paid $125,000 — to, instead, convert the site into one of their Gordmans stores.
It’s an ongoing battle real estate companies face, he said, because the retail environment is struggling right now. Landlords across the country are seeing stores request rent reductions because of lagging sales.
“If we don’t grant them these rent reductions, sometimes they leave,” Nichols said. “We don’t want them to leave any more than you guys would or anything like that, but in order to make the numbers work in pencil, sometimes you have to take that chance and roll the dice and maybe bring someone else in.”
It’s situations like that when an economic agreement can help, Nichols said. Nichols told commissioners the original agreement just wasn’t feasible to complete.
“I’ve been talking to Bealls. I’ve been talking to Dollar Tree to try to get something that will help verify, and they’re just not willing to give us that information,” Nichols said. “I understand the document’s signed and it’s executed, but I’m basically here to throw myself on the mercy of the court and plead with you guys to understand it’s not a situation where we think you guys are being hard to deal with or anything like that. It’s just something that cannot be proven from our end, from our side.”