The city of Santa Ana has paid $1.4 million for a small strip of commercial property needed for a road-widening project that one councilman said was a terrible deal for the city.
The transaction, to be finalized later this month, involves taking 30 to 40 of the more than 300 parking spaces at a shopping center at West McFadden Avenue and Bristol Street. The city acquired the land through eminent domain to widen Bristol Street.
"If you think we paid too much for it, you're right," said Councilman Ted R. Moreno. "There was a lack of leadership [on the project] at all levels at the time. Basically, what the [shopping center] owners are losing for $1.4 million are parking spaces that were never used."
Attorney Gary Weisberg, who represented the Koh family--which owns part of the shopping center--said the final purchase price was negotiated after "a hard-fought battle" and includes damages owed the property owners for what they say is a loss of business.
Documents show that $381,000 of the purchase price is for the actual cost of the land, which measures 434 by 35 feet. The rest is to compensate the Kohs for other damages, including the loss of parking and the number of entrances into their property.
"I know that when you look at it only as a $1.4-million sell-off, it looks like these guys [Kohs] walked away with everything," Weisberg said. ". . . But there's a lot more to it. These were hotly contested, tough negotiations with some major disagreements. We think that the final deal is good for everyone."
For instance, Weisberg said, the $1.4-million price included damages suffered by the Kohs when the homes bought by the city across the street remained vacant for months and were occupied by transients.
"The abandoned homes not only lowered property values but made it unpleasant for some people to shop at the center," Weisberg said.
In addition to the $1.4 million, Santa Ana also agreed to pay the family $37,900 to relocate the signs and lights that had to be moved from the condemned strip, said Souri Amarani, the city's project manager.
Both sides were far apart in their estimates of what the Kohs deserved for the property. The city listed the land's fair market value at $381,000, but an appraiser hired by the city listed it at $403,000. The Kohs' appraiser said it was worth $2 million.
Early in the negotiations the city offered to pay $650,000, and the Kohs countered with $1.8 million. Then the city made what it called its final counteroffer of $850,000.
