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Staying positive despite financial hit the McNair House property sale cost the borough: Editorial

Posted 11/1/17

The math on the recent McNair House property sale is not good. It’s not good at all.

As we reported last week, the Middletown Industrial and Commercial Development Authority approved sale of …

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Staying positive despite financial hit the McNair House property sale cost the borough: Editorial

Posted

The math on the recent McNair House property sale is not good. It’s not good at all.

As we reported last week, the Middletown Industrial and Commercial Development Authority approved sale of the historic McNair House to private investors Oct. 17 — for $235,000 less than the borough purchased it in April 2014.

That doesn’t include another $20,000 the borough spent to demolish a small commercial building in the front in 2015, in order to make room for a large pavilion — known as a “trellis” — that was to be the cornerstone of the authority’s downtown streetscape project. That project, of course, never happened.

No current MICDA members were on the authority when it purchased the McNair House property for $325,000 in April 2014. It wasn’t worth that much then. According to Dauphin County records, the property had a fair market value of $256,498 in April 2014, based on an assessed value of $195,800 as set by the county.

Mayor James H. Curry III and Middletown Borough Council member Ian Reddinger are two current members of the authority, and both have stated that previous members overpaid for the McNair House. Former Chairman Matt Tunnell responded to the Press & Journal: “I don’t have any comments on the disposition of that property.”

So we don’t know exactly why it happened the way it did. But the purchase was a poor one at that price.

Was it a bad decision to then sell it for $235,000 less? We are going to try to look at the bright side. 

The borough did make some money off the property. Borough Finance Director Kevin Zartman told the Press & Journal that the tenants of the property pay MICDA $1,560 total in monthly rent. That includes a separate small building on the East Emaus Street side of the property that has been leased for several years by David Craig for Craig’s computer and audio repair business. That total times 42 months, the approximate amount of time the borough has owned the property, totals about $65,500. Good news, but it also had to pay for upkeep as the landlord during the time, and the property also was not on the tax rolls for the last 3 1/2 years. So that $65,500 takes a bit of a hit.

But we are staying positive …

Craig gets to stay at the location, where he has been since 2012.  

The property will be put back on the tax rolls.

Reddinger previously succeeded in getting council to agree to pledge all proceeds from sale of the McNair House to a fund that goes toward buying new equipment for the police department.

The corner of Union and Emaus streets won’t be turned into a parking lot, as some predicted, or feared.

The people who bought the property are bullish on Middletown. Adam and Virginia Germak already own several other properties in the borough, including the former Cooper insurance building in the 200 block of South Union Street.

The Germaks plan to invest money into improving the property and make it their home. This is good news. Craig said the property has fallen into disrepair under borough ownership.

That corner is one of the key spots in Middletown. With the Brownstone firmly entrenched on one corner, and the Tattered Flag growing on another, it will be nice to have some certainty moving forward about the McNair property.

Could MICDA members have held out for more money? Maybe. But we don’t have a problem with the sale. In 2015, after the authority razed the commercial building, the county lowered its assessed value of the property to $139,200. So yes, the Germaks are getting a bargain. But we hope they will be good stewards of the property.

MICDA wanted to wash its hands of this purchase, which never amounted to what it intended to accomplish. Cutting bait and moving on seems a wise choice. 

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