Port of Olympia set to sell 3 Lacey warehouses for $9.6 million. Was it a good investment?
The Port of Olympia is set to sell three Lacey warehouses for $9.6 million, prompting some commissioners to ask whether buying the properties met the port’s expected return on investment.
The three warehouses are in a light industrial area of northeast Lacey at Commerce Place Drive and Willamette Drive. The 2016 Port Commission approved the acquisition of the property for $6.5 million.
The buyer is 1892 Holdings LLC, otherwise known as Corliss Management Group, Secretary of State corporations data shows. Corliss, a residential and commercial real estate developer, has addresses in Lake Tapps and Seattle, the data show.
The commission only discussed the possible sale on Monday. On Dec. 11, the port commission will vote whether to declare the property surplus and approve the purchase and sales agreement.
The transaction comes with a 70-day buyer due diligence period, and one of the Lacey buildings is in the middle of a roof replacement, said Warren Hendrickson, the port’s director of operations.
Hendrickson touted the return on investment for the port, pointing out the difference between the purchase and sales prices, but Commissioner Bob Iyall had more questions.
Iyall asked whether roof replacements and other building maintenance costs had still resulted in the expected investment return for the port. Hendrickson said it did.
Commissioner Joe Downing, who was part of the commission that approved the property purchase, wanted more information, too. He asked for a one-page summary that shows what the port paid for the property, what it invested in the property over the years and what revenue the port achieved by owning the buildings.
The port commission was previously shown a one-page summary along those lines, interim Executive Director Rudy Rudolph said, but he said he would make it available again.
The port issued bonds in an amount not to exceed $17.75 million to refund some remaining port bonds from 2008, repay a line of credit and to acquire the Lacey warehouses, The Olympian reported in 2016.
After the bond is repaid, net proceeds will go into the port’s real estate reinvestment fund, Rudolph said.
Commissioner Amy Evans Harding, who is a commercial real estate broker, said the future five-person Port commission should consider whether to use bond financing or conventional financing in any similar situation.
