Why the city of Charlotte is taking a loss on a prime piece of Eastover real estate

Why the city of Charlotte is taking a loss on a prime piece of Eastover real estate
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If the city of Charlotte wants to mess with your land, there’s not a lot you can do. Don’t fight City Hall. But do ask them nicely for a good price.

The story of how the city came to own — and ultimately take a loss on — a prime piece of Eastover real estate is a pretty interesting example of government short-sightedness in action. And it’s a reminder to always negotiate.

The story started in the early 2000s when people in Eastover complained of flooded roads and even homes. The city decided to conduct a $14 million three-part stormwater management project. That meant putting down a lot of pipes and paying people for easements on their land.

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One of those properties was a piece of land right at the corner of Providence Road and Vernon Drive. It’s next to a lot of impressive homes, but there wasn’t one on the property (and there still isn’t). In early 2004, the city was planning to pay $69,413 for an easement to put pipes through the land. But the property owner pushed then-Mayor Pat McCrory and the City Council for them to buy the whole parcel. He argued that the city was going to damage the land to the point where he wouldn’t be able to put a house on it.

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The city didn’t really want to go to court over the valuation and figured when the project was complete they would recoup the costs. So the next thing you know, the city council authorized a purchase price of $360,000 for the whole piece of land — despite the fact that the property had just been assessed at $225,000.

McCrory noted that prices were going up in Eastover and people were tearing down $300,000 homes and building $1 million ones. A couple of years went by and the stormwater project finished up. You know what happened next: The real estate market crashed, and the city continued to hold onto the land.

When it came time to sell, the city initially got a bid of $362,000. So far so good. But then buyer took a look at the land appraisal. It didn’t go so well. The appraiser found that the soil composition wasn’t proper for home construction and some $70,000 of improvements would need to be made. That knocked the valuation of the land down to $210,000. Whoops.

The latest offer the City Council is expected to quietly accept Monday came in at $221,000 from Ross Allen Custom Builders Inc. A home is going to be built on the land after all.

Someone may be getting a deal, but it’s not the city.

(Photo credits: City of Charlotte)

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