On Monday, city council members will consider rezoning the former site of the Hickory Lakes apartment complex at the intersection of Old Concord and Windy Hill roads to build 197 single-family homes. The city invested property to buy the land and raze the aging complex.
Vinings-based Southeast Capital Companies, a residential developer, has been lined up to buy the property for about $14 million, according to Eric Taylor, the city’s administrator. He did not know the projected closing date.
The homes will start in the $350,000 range, Taylor said.
Plans call for the houses to be a minimum of 2,000 square feet, with about five homes occupying an acre of land. Common areas, which will be maintained by a homeowners association, will be included in the development. The development will also have a detention pond to reduce the chances of flooding during a major weather event.
Although it appears Smyrna is taking a loss on the property, Taylor said he doesn’t see it that way.
“The intent was always to transform the use of the property to serve as a catalyst for redeveloping that side of Smyrna,” Taylor said. “We took down a very large, crime-ridden apartment complex that was a driver for how surrounding residential and commercial properties was used. … We consider it an investment that will eventually more than break even for the city via not only this specific site, but also the halo effect on surrounding sites.”
Councilman Wade Lnenicka said he is not sold on that logic. While he likes the concept of high-quality, single-family homes on the property, he thinks the city will end up with a net loss of $15 to $20 million over the next 20 years.
“That is even after accounting for additional revenues coming to the city from the project, for example, the annual property tax revenues from all the homes,” Lnenicka said.
Councilwoman Teri Anulewicz, who voted in favor of purchasing the property four years ago, said Monday night’s decision has the potential to be “transformative.”
“When you’re talking about running a city as opposed to running a business, we can make decisions based on a very long-term return on investments,” Anulewicz said. “When you’re a business, you’ve got to pay shareholders; it’s a very short turnaround.”
“It truly was an absolute investment in the future of northern Smyrna and it is going to be paying off dividends that are quantifiable and not quantifiable for decades to come,” she added.
Lnenicka, who was the sole dissenter of purchasing the land in 2010, said he does not believe cities should be in the real estate business.
“Local governments are not trained or equipped to engage in the speculative real estate market,” he said. “Local governments do not have that expertise, and they should not be speculating in markets with public money.”
Now Lnenicka wants to sell the property “for its highest and best use and return it to private ownership.” He said he’s weighing the options when it comes to Monday’s vote.
“Is it better to ‘take the bird in the hand’ and move forward?” Lnenicka asked. “Or, is it better to wait for ‘two birds in the bush’ that may or may not ever arrive, and take the chance that things might get better later?”
City council meets at 7:30 at City Hall, 2800 King St. in Smyrna.