A group of landowners in the downtown arena footprint say they're being low-balled by Sedgwick County -- railroaded toward eminent domain proceedings in an effort to acquire their land for pennies on the dollar.
Those landowners say they're trapped in a take-it-or-leave-it scenario with the county -- unable to get questions answered and incapable of beginning face-to-face negotiations with the county.
They allege the county's low-ball offers for their property are an attempt to fit the land acquisitions into an arena budget tightened by cost overruns and slowing sales-tax revenues.
"When you ask them questions, they refuse to answer them," says John Belford, whose electrical business sits squarely in the middle of the arena footprint. "The only alternative is a counteroffer, with no discussions.
"... That doesn't seem like a negotiation. It's intimidation."
Sedgwick County officials admit that negotiations are stalemated in the acquisition of many parcels in the arena footprint, and that the prospect of several condemnation proceedings is growing. However, they claim one of the reasons that things have stalled is because landowners want far more for their property than either private or county appraisers think the buildings are worth.
Sedgwick County Commission Chairman Ben Sciortino flatly dismisses the landowner complaints.
"They're smoking Mexican Marlboros," he says.
But Michael Elzufon, a Minnesota developer who has bought several downtown buildings for condo and business use, disagrees with Sciortino. Elzufon says he would quickly "say goodbye," to one of the offers made by the county to Belford.
Sciortino, who counts the landowners among his district constituents, and Assistant County Manager Ron Holt, the county's point man on the arena project, are unwavering in their commitment to a paper-oriented process that avoids one-on-one negotiations to avoid legal fallout.
The landowners
Belford just wants to talk to someone at Sedgwick County. He says the county is offering him $30 a square foot -- around $200,000 -- for a 6,700-square-foot building customized in 1999 to house Belford Electric, 600 E. Waterman.
The building includes all the "bells and whistles an electric company would need," Belford says, and it's going to be tough to replace. "I've made them a counteroffer, but I've got questions."
Those questions to the county are going unanswered. Instead, Belford says, county officials are referring all questions to Grubb & Ellis | Martens Commercial Group, which is serving as the county's private appraiser.
"If I owned a building that was occupied with businesses and offices, and someone walked in and offered me $30 a square foot, I'd say, 'Goodbye.'" Elzufon says.
Belford, Matt Devins of Prairie Print, Joel Kelley of Cablecom Inc., and landowners Mike McGill, Daniel and Cheryl Phillippi met this week with the Wichita Business Journal, representing, they say, about 85 percent of the property owners in the area.
They say the Grubb & Ellis appraisals are 30 percent and more below what the landowners think is fair market value.
Steve Martens, president and CEO of Grubb & Ellis, says his contract with Sedgwick County prevents him from commenting on the arena land project.
Garnering fair market value for property in a developing downtown is a challenge, says Ed Wolverton, president of the Wichita Downtown Development Corp.
"The comparable-sales comparison that you do is always done with the presumption of a willing buyer and a willing seller," he says. "That's clearly not the case here. You can't fairly say these purchases are a true arms-length deal."
The buildings, while valuable to developers, are meaningless to the county, which is only trying to clear a path for the proposed arena.
That shouldn't matter, says Belford, who has a second building at 326 S. Commerce St., that also sits in the arena footprint. He recently found a number of mistakes in the county's appraisal of the building.
"I countered on that property a little over a week ago," he says. "They've got the building listed as cinder block. It's brick. You don't think that makes a difference? They're about 50 percent off on that building, more than $50,000 on a $95,000 situation."
The landowners say the county's appraisers fail to take into account the rising price of downtown property, plus the "replacement costs" of relocation. Sedgwick County does have relocation money available to displaced arena landowners, on a case-by-case basis.
"The problem is this," Kelley says. "Fair market value isn't close to replacement cost. Why should any of us have to step back in our businesses into something less than what we've got?"
Daniel Phillippi wants Sciortino to get involved as an advocate for his constituents.
"We voted in a county commissioner," he says. "Can't we ask him to take a look at our side, at the information we have supporting our values?"
The answer is no, Sciortino and Holt say.
"We're talking through our agents," Holt says. "Until the property owners can provide us with conclusive information that the appraisal is flawed -- that something has been missed, that something is not included -- then the offer they have is what it is."
And that's fine with Sciortino -- who reiterates that the landowners are asking for more than their property is worth.
"I'm very comfortable with this process," he says.
The reason for that comfort is simple, Sciortino says.
"When I started seeing the first appraisals from Grubb & Ellis, I fell out of my chair," he says. "To say they were higher than the county appraiser isn't strong enough. They were four or five times above what the county appraiser has them valued. I was almost catatonic at some of the appraisals Grubb & Ellis gave us."
And some of the arena footprint landowners have protested those county tax appraiser values as too high, Sciortino says.
"So I take exception to their claims that we're not trying to give them fair market value," he says. "If we have to go to eminent domain, then that's what we'll do."
