A seemingly straightforward real estate deal between the city of Camas and owners of a Camas City Hall-adjacent building turned messy this week, after a retiring state legislator accused the city of using its condemnation powers to “unfairly compete on the open real estate market.”
In a guest column sent to The Post-Record on Dec. 10, Washington’s 18th District Rep. Liz Pike (R-Camas) called the city’s threat of condemnation to obtain the former Bank of America building in downtown Camas for $1.6 million “one of the most underhanded government tactics” she had ever seen, and said “it casts a dark shadow on the elected leaders in our community.” (Pike’s full column is on page A4 in this issue.)
Pike’s ire stems from a bidding war for the downtown Camas building, which city leaders plan to renovate and use as an expanded city hall.
Camas City Administrator Pete Capell said Monday the city reached out to the building’s four owners — Jerry and Marilyn Nies and Gina and Todd Stevenson, who purchased the property at auction in March 2017 for $535,000 — after the building’s tenant, Bank of America, announced it was closing its Camas branch.
“We indicated we wanted to lease the space quite a while ago,” Capell said. “We needed additional space and that building was very convenient.”
Instead of leasing the building to the city, the property owners told Capell they were more interested in selling the property.
“They indicated that one other party was interested in the building and that they would sell it to the highest (bidder),” Capell told The Post-Record on Monday.
The city had an appraisal done on the building, and the value was set at $1.325 million.
Capell said the sellers had already set an asking price of $1.5 million, and city leaders indicated they were willing to pay the asking price to secure the space.
Finding more room for a growing city hall was crucial, Capell and Camas Mayor Shannon Turk said this week, as the city’s current space is “bursting at the seams” and estimates for building a new city hall are between $30 million and $40 million.
Capell said he met with executives from Riverview Community Bank after discovering they were the other party interested in the 528 N.E. Fourth Ave. property.
“They were founded in Camas and are still a Camas business, so I wanted to meet with them and discuss our interest in the (former Bank of America) building,” Capell said of Riverview. “They suggested we look at the Riverview Bank building instead (located on the other side of Camas City Hall), but we decided that building wouldn’t suit us as well.”
Capell said the Riverview Bank representatives he met with told him they could not offer more than the appraised value for the Bank of America building.
“I thought that was odd,” Capell said Monday. “I think they lied to me.”
Capell said he then talked to Camas City Council members in a closed executive session and got approval to offer the asking price of $1.5 million for the former Bank of America property at 528 N.E. Fourth Ave.
The sellers, he said, accepted the city’s offer the day after Thanksgiving and the two parties, according to Capell, “shook hands and talked about some details, and put together a purchase and sale agreement.”
Jerry Nies, one of the owners of the former Bank of America building, said Tuesday that his business partner may have talked to Capell, but that he (Nies) was not on board with a sales agreement at that point in the bargaining negotiations.
Later that day, Capell said, Riverview Community Bank came back with an offer that was $50,000 higher than the city’s bid of $1.5 million.
Since the sellers were technically under threat of condemnation by the city — in the state of Washington, every city has the legal ability to condemn property to use for city hall purposes — they did not have to pay the Real Estate Excise Tax (REET), which would have, according to Capell, saved the property owners nearly $25,000.
“Since Riverview’s offer was not much higher than ours with the additional REET savings, I was thinking this wasn’t right,” Capell said Monday. “I was on the phone with both sellers and they said they had told Riverview what our offer was. I thought that was very unethical and not very fair.”
When Riverview upped their offer to $1.68 million a few days later, on Nov. 26, Capell said city leaders were taken aback.
“We did tell them (the sellers) we were going to pursue condemnation if they didn’t accept our offer,” Capell said Monday. “We said we would increase from $1.5 million to $1.6 million, and that was what they accepted.”
Nies, who also is vice chairman of the Riverview Community Bank Board of Directors, said he would have liked to see Riverview move into the space, but added: “I know (the city of Camas) needs to expand, and that estimates for building a new city hall are around $40 million, so I do see that this is good for the community,” Nies said.
Camas Mayor Shannon Turk said Monday she also believed the $1.6 million purchase price, plus possible $400,000 to renovate the building, will benefit the city and its taxpayers.
“I think Pete said it last week — we are bursting at the seams inside city hall,” Turk said Monday. “We needed more space, not only for new staff, but to accommodate the growth the city is planning in the North Shore area. Building a new city hall would cost 30 to 40 million dollars, so this saves the city millions.”
Turk said the city’s purchase of the former Bank of America building has additional benefits for taxpayers, including more public, city-owned parking spaces in downtown Camas, where finding a parking spot during popular events can be nearly impossible.
“We also lease space for our fire marshal, so this allows us to save money by moving the fire marshal’s office into city hall,” Turk said. “It is a good thing for the city and for the taxpayers.”
Capell agreed that purchasing the former Bank of America building — even for $275,000 over its appraisal value — is a win for the city and its residents.
“It is adjacent to city hall, so we can conduct city services right there, and now we’re decades away from having to build a new city hall,” Capell said.
In her guest column, Pike questions how the city can afford to purchase this property and asks: “At a time when the city grapples with how to pay for more fire and police officers, where does the new millions of dollars come from to pay for this property and the historic Leadbetter House also recently purchased by the city?”
As noted in The Post-Record’s first story about these real estate purchases, “Location, location, location: Camas secures prime properties,” published in the Dec. 6, 2018 issue, the city will receive $2.5 million from Clark County’s Legacy Lands program to purchase properties along Lacamas Lake, and recently issued bonds to match those funds. Issuing those $10 million bonds came with a $980,000 premium, which the city will combine with $1 million from its REET funds to pay for the Bank of America building purchase and any necessary renovations.
Capell said Monday he never intended to “get into a mudslinging thing,” with Riverview Community Bank executives or the property owners.
“Our hope was that none of this would get out and that we would continue to have a good, professional relationship with Riverview Bank,” Capell said. “But if they’re going to claim unfair practices on our part, I want to tell the rest of the story.”
Riverview Bank representatives did not return calls for comment in time for this paper’s deadlines.