Mayor Mike Bell smiles after signing a memorandum between the city and Chinese investors. From left are Councilmen Wilma Brown and Mike Craig, buyers agent Scott Prephan, and Councilman Rob Ludeman.
Mayor Mike Bell said the sale of The Docks would be the first step for the two investors from China.
"One of the frustrating points about this is trying to get people to understand that this is a good thing for all of us," Mr. Bell said.
Council voted 10-2 to authorize the Bell administration to proceed with the already negotiated sale price of $2.15 million with Dashing Pacific Group Ltd., which is made up of Wu Kin Hung and Yuan Xiaohona from China.
Councilmen D. Michael Collins and Lindsay Webb cast the two "No" votes.
Both said they were dissatisfied that Mr. Bell did not get an appraisal of the property before the sale price was negotiated or before council was asked to vote.
Mr. Collins also said the mayor's staff was "not transparent" with part of the deal because a $121,114 debt owed to the city by restaurateur Tom Cousino's company from back rent on the now-closed Navy Bistro and Tango's would be rolled into the sale -- giving the new owners the option of attempting to collect that money.
"They are shifting it into the purchase price and basically wiping the debt clean," Mr. Collins said.
Ms. Webb said she was also concerned about an issue raised Tuesday by Martin Sutter, president and chief executive officer of Genoa Bank, a lender to Mr. Cousino which is still owed about $750,000.
Other councilmen acknowledged receiving a number of complaints from Toledoans about the sale to foreign investors but said the benefits outweighed those complaints.
Council debated the sale during a three-hour economic development committee meeting beginning Tuesday morning and then voted on the sale during its regular meeting in the afternoon.
Councilman Rob Ludeman opened the committee hearing with a warning that anyone attempting to discuss the ethnicity of the buyers would be escorted out of council chambers by a police officer.
During that committee hearing, it was revealed that the city could not use the money from the sale to pay down the remaining $1.64 million bond the city owes on the property without incurring large penalty payments.
Mr. Collins accused the Bell administration of misrepresenting itself by claiming that debt would be erased through the sale.
Mr. Bell Tuesday said he would consider recommending placing the money into an account set up to annually pay down the bond amount, which would alleviate that strain on the city's budget.
He also said the city should start building a "rainy day fund," which has not existed for several years since the city's budget began pushing into the red year after year.
The sale of city assets such as The Docks has been part of Mr. Bell's plan to balance the city books.
Councilman Mike Craig, whose district includes East Toledo, Tuesday morning urged his colleagues to support the sale even without an appraisal and regardless of Mr. Sutter's statements that it should be sold at a later date to local investors.
Mr. Sutter said Mr. Cousino borrowed money from the bank and the U.S. Small Business Administration for internal renovations and contents in his restaurants at The Docks.
The bank could take the contents of the building or rent it out to another entity or leave it vacant and pay the rent itself, Mr. Sutter said.
Mr. Craig said he hopes Genoa Bank is "made fully whole," but stressed that the city has no liability regarding that loan, which is a leasehold mortgage agreement.
"The biggest risk we have here is putting a chill on investors," Mr. Craig said regarding The Docks sale. "They can go spend their dollars anywhere we don't want to chase them away."
Scott Prephan, the local representative for Dashing Pacific Group, likewise said the investors are aware of the agreement and it would not affect the sale.
Mr. Ludeman last night echoed Mr. Bell's repeated comments on the potential that selling The Docks to Dashing Pacific Group presents.
"I think it is huge," Mr. Ludeman said. "Combined with the memorandum of understanding the mayor signed [for the Marina District], in the grand scheme of things, the redevelopment of that entire area will be a cornerstone for Toledo and will help us, I hope, attract both domestic and other foreign investment in our city."
Ms. Yuan, chairman of Dashing Pacific Group, last night forwarded a memorandum of understanding to Mr. Bell pledging the company's intent to buy and develop part of the once-polluted Marina District in East Toledo into a mix of hotels, restaurants, and condominiums.
The mayor signed the agreement, which is not legally binding, in his office while before reporters.
"The delegation from your region headed by you and Deputy Mayor Dean Monske that recently visited our city has had a profound impact on my partner and me," the document states in the opening line. "While I had never heard of Toledo before, now I cannot stop thinking about your city."
The document also states: "Our interest in The Docks is only a starting point for our overall vision to invest in your community and to help move Toledo to a new level."
Mr. Prephan said Dashing Pacific Group plans to fill the vacant restaurant spots and could repave the parking lot and add more lighting to the exterior of the buildings.
Closing on the property will not occur for about 30 days.
Also included in the deal is a $107,500 real estate broker's fee to A.A. Green Realty of Bowling Green. Mr. Prephan is the broker who arranged the deal.
-- Ignazio Messina
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