HomeOpinionOpinion: Regency Mall proposal is designed to bamboozle citizens

Opinion: Regency Mall proposal is designed to bamboozle citizens

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Any person with real estate development experience had a good laugh listening to the proposal about the Regency Mall. The current owner and proposed developer, the Cardinale family, has never had any intentions of developing the property and never will. There are a couple of ways the whole thing could play, though.

Scenario 1

The most likely scenario is that nothing will happen. The Cardinale family will not develop the property because what is being proposed is not financially feasible. A grocery store has not committed to the site, and stating one will be part of the project is disingenuous at best. Grocery stores do not make location choices based on conceptual drawings and pipe dreams. They base decisions on facts, and the facts are the area has declining population growth, low wages, low housing values, low disposable income and failing schools. It also has growing crime.

MORE: New development proposed for Regency Mall property

All of the above reasons are also why market rate apartments will not be built on the site. It is possible some component of affordable tax credit housing could be built but standard market rate apartments will never be built on the Regency Mall site. If crime and failing schools are not enough of a reason, financing will prohibit it from being built. No lender is going to loan millions of dollars to build brand new apartments in that part of town because rents sufficient to justify cost of construction can’t be generated. As interest rates go up and inflation gets worse, the likelihood of market rate apartments being built shrinks.

Scenario 2

A very likely scenario is that Cardinale will use its influence to get the city to rezone the project and then sell it. Multiple projects have been proposed in the past for the site only to fail because Cardinale refused to sell for less than $50 million. After the Mayor Hardie Davis Jr. land lease fiasco, that price jumped to more than $70 million. Even with getting the property rezoned and entitled for a bunch of different uses, it won’t generate a sales price of $50 million. I will make the prediction that if Cardinale sells it, the company will generate $25-30 million as a sales price.  That purchaser will either shelve the project until the timing is more feasible or they will completely alter the project to something that is feasible.

MORE: Augusta Economic Development Authority has no connection with Regency Mall redevelopment project

Scenario 3

The city could get involved and bail out the project. Mayoral candidate Steven Kendrick held a press conference announcing the new mall development but was very careful in the language he used. He indicated that as of now, no one is asking for tax incentives, bonding or any government assistance. The way that was worded makes it clear that the Cardinales will ask for it at the most opportune time. Cardinale knows that the city is so desperate to see something happen with the site that leaders will do anything to claim credit for a win on the site despite the cost to taxpayers. Hardie Davis Jr. proposed the worst deal I have seen in 16 years of working in real estate as proof of this thought. Kendrick’s announcement reeks of the same. Government assistance will be part of the project if Cardinale ever is involved in any development.

Summary

At the end of the day, the property is owned privately, and the owners should be able to do whatever they want with the property as long as it meets county regulations. In the meantime, Augusta’s leadership should use its powers under the new blight ordinance and code enforcement regulations to put incredible pressure on the mall’s owners either to demolish the buildings or to sell the site to someone who will develop it. Cardinale is not going to develop the site and trying to convince the citizens of Augusta otherwise is going to be a painful lesson for Kendrick and his campaign for mayor.

Joe Edge is the publisher for The Augusta Press. Reach him at [email protected] 

9 COMMENTS

  1. SCENARIO 1: NUTTIN WILL HAPPEN AS IS MOST OFTEN THE CASE IN AUGUSTA.
    SCENARIO 2: PROPERTY WILL BE SOLD TO DISNEY FOR A BUILDING OF HORRORS.
    SCENARIO 3: KENDRICK WINS AND USES HIS POSITION FOR A/RC TO BUY PROPERTY FOR A SHERIFF TRAINING FACILITY ON COMBATING CRIME IN AUGUSTA.

  2. Well stated. If Kendrick should win the election and the proposed regency development doesn’t happen, he’ll go down in flames. If Johnson wins the election and the development doesn’t happen, Kendrick will say yes because he was not elected.

  3. I am in agreement with this article’s “scenarios”, but truly believe, that this was a complete run-off campaign shell game with nothing to back it up. As I said previously, the fact that Cardinale did not send ANY form of representation, proves that if they were actually contacted by Kendrick, they were not willing to provide “legitimacy” to the “Regency Mall Press Conference”. Cardinale is not going to put any more money into this questionable investment of theirs. They are only going to get excited if there is OPM (Other People’s Money) on the table. Proof of this is the fact that they have only sunk money into the property by way of ripping up most of the asphalt, so they did not have to pay the storm water fee. It is going to take more money than the ARC Development Authority has access to. Further proof of the “shell game”, is the fact that the Development Authority president, nor Authority, were even aware of any discussion with Cardinale. Based upon the location of the former Regency Mall, I can see no one jumping at the chance to live there. The criminal activity in and around the site, is what caused the mall to die. The area has not been “disinfected” to this day. It is going to take some higher power than Steven Kendrick, to get this thing kicked into gear.

  4. Augusta already has property that it owns but is in disrepair and money for the repair is not available. Of course I am referring to the boat house, that was once a restaurant. Why does the city want to enter into another impractical project doomed to failure with the city left holding the ball?

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