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Archive for Tuesday, June 29, 2010

Two Lawrence developers part ways — meaning prime piece of real estate is about to be auctioned

A 155 acre piece of land near Lecompton is going up for auction. The land will most likely be used for industrial purposes.

June 29, 2010

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A legal soap opera has set the stage for a high-stakes, multimillion dollar property auction that has left economic development leaders concerned about the future of one of Lawrence’s most promising industrial areas.

About 155 acres at the northern edge of the Lecompton interchange on the Kansas Turnpike will be sold to the highest bidder at a July 15 sheriff’s auction.

Douglas County District Judge Peggy Kittel ordered the sale as part of a lawsuit that pitted Russell and Penny Tuckel against members of the Duane Schwada family after the two sides began disagreeing about their joint ownership of the land.

Now the future of the land will be determined by whoever can produce the largest cashier’s check.

“I don’t know how it is going to turn out,” said Penny Tuckel. “All I know is I would call it a prime real estate opportunity.”

The auction will be open to any bidders, but tough rules apply. The court has set a minimum bid of $1.29 million, and the successful bidder will have just two hours to present a cashier’s check for the full amount.

Project at stake

The auction is drawing a lot of attention in economic development circles, in part because the site has been mentioned as a likely location for Berry Plastics to build a 600,000-square-foot distribution center. A change in ownership could complicate those efforts.

“There’s always a concern about what will happen and who the owners will be and whether they are truly in favor of having industrial development at that property like the current owners are,” said Beth Johnson, vice president of economic development for the Lawrence Chamber of Commerce. “But we’re just waiting to see because there is not much else we can do.”

Community leaders have placed an emphasis on landing the Berry Plastics distribution center. The center, which would be the largest industrial building ever constructed in the county, would bring 11 new jobs from a Berry facility in Topeka, plus 350 construction jobs.

But Johnson and others have said the project is important because it would provide more assurances that Berry will keep its large plastic drink cup manufacturing facility in Lawrence for the long term. Berry’s Lawrence manufacturing plant employs about 950 people.

The Berry project is at a point where delays are becoming a concern. The project hopes to use $11.7 million worth of federal recovery zone bonds, which would allow Berry to finance the project at a lower interest rate.

The city and county are working with the state to keep those bonds earmarked for use in Douglas County, but Johnson said there is a risk that the state could pull the bonds to be used in other parts of the state.

Johnson also said she believes the site offers Lawrence one of its better chances of attracting other industrial users. Concept plans that were revealed as part of the lawsuit between the Schwadas and Tuckels revealed the 155-acre site could accommodate seven industrial lots ranging from 81 acres to three acres.

“The access that property has is just second-to-none compared to everything else we have in the community,” Johnson said.

The site is involved in two other lawsuits. Neighbors of the property have filed lawsuits alleging the property was not properly annexed or rezoned. The rezoning case in ongoing in Douglas County District Court. The neighbors recently lost a decision on the annexation case, but they have filed an appeal with the Kansas Court of Appeals. Evan Ice, counselor for Douglas County, said it likely will take several months for that appeal to be resolved.

A messy breakup

Both members of the Tuckels and Schwadas declined to comment about why the two families, which have been doing business together since the 1970s, have parted ways in such an odd manner.

Steve Schwada, president of Venture Properties, which owns a half-interest in the 155-acre tract, called the issue a “private business matter” and declined to comment.

Penny Tuckel also declined to go into specifics.

“I think I’ll just let the court files speak for themselves,” Tuckel said.

The families have been involved in two lawsuits. In one lawsuit, the Tuckels alleged that Duane Schwada had withheld $4.5 million in cash disbursements from about a dozen partnerships that he has with Russell Tuckel. The lawsuit alleges Schwada improperly withheld the disbursements in an effort to “squeeze” Tuckel to “create an incentive for him to sell his interest to Mr. Schwada at less than fair market value.”

In court filings, Schwada has denied those allegations, and has said the cash was needed as legitimate working capital for the companies.

Both parties agreed in February to dismiss that suit. No terms of a settlement were released.

In the case regarding the 155 acres, Schwada’s Venture Properties sought to have the property “partitioned” after the two sides differed on how the property should be developed.

But both sides wanted the western half of the property, which is the side Berry has expressed an interest in using for its distribution center. Kittel ruled that the way to resolve the dispute was for the entire property to be sold the highest bidder, with proceeds being split between Venture Properties and the Tuckels.

The lawsuit files contain several allegations, including that both sides were negotiating behind the other’s back with potential tenants for the property.

The Tuckels also alleged that Venture had allowed refrigerators, paint and other debris to be dumped in a pond at the site. Penny Tuckel this week, though, said she believed that situation had been resolved and the property was in good condition.

Comments

LJ Whirled 4 years, 5 months ago

I'm confused: The largest industrial building ever constructed in the county would bring 11 new jobs. Eleven? Is this a Huh? or a Duh! ???

Brian Hall 4 years, 5 months ago

And 11 people that already have jobs.

But don't forget the 350 construction jobs. The 350 temporary construction jobs.

John Hamm 4 years, 5 months ago

Hey, it's a "distribution center." Probably controlled robotic ferrys moving material from the warehouse to the docks and vice versa. Don't need nearly as many people as you used to.

devobrun 4 years, 5 months ago

Why would refrigerators be dumped?

Because they contain freon and the dump won't accept them.

Where does one dump refrigerators in this world?

I just returned from California where I rebuilt a kitchen.

They don't want reefers in their dump either.

How does one dispose of a fridge without paying Price Appliance $100 (to drain the freon) for an icebox worth nothing?

Schwada and Tuckel are developers.

Their story is utterly unimportant to the community because they make money and they loose money. It's what developers do. A doctor healed a patient today. Yawn.

George_Braziller 4 years, 5 months ago

At least far west Lawrence gets a temporary respite from adding more of the butt-ugly stuff that has gone in over the last ten years.

irvan moore 4 years, 5 months ago

Why did the judge set a minimum bid and why the quick time on payment? It kind of looks like one or the other of the two interested parties is gonna be the winner. I'd really like to see Dougie step in and blow up the whole deal.

kernal 4 years, 5 months ago

Why doesn't Berry Plastics look at the old industrial site in North Lawrence that is now,or soon will be, owned by the city. It's near the Turnpike. I don't live anywhere near Lecompton, but I think it's a really stupid idea to put a big industrial plant at that site.

Imbecilenamedjim 4 years, 5 months ago

The neighbors recently lost a decision on the annexation case, but they have filed an appeal with the Kansas Court of Appeals.....why would these people file an appeal? Who are these people?

greenstrings 4 years, 5 months ago

Bring in a renewable energy plant, such as wind turbine manufacturing. Create a course study at the University or somewhere in Lawrence (more job creation).Then open up the grid to allow for redistribution of energy under provisions allocating funds to green homes. Perhaps the smoke from the Westar stacks will push the turbine a bit! Renewable energy is likely to be the next industrial revolution. The technology is further developed on on the up and up to power plants self sufficiently with minimal industrial waste. Plastic cups provide jobs, jobs are good, our progressive direction should be to find alternative solutions to the waste in our society. We do have the ability to destroy our planet, as well, the people to seek new methods, without sacrificing job development.

Jay Keffer 4 years, 5 months ago

Is there anyone that Duane gets along with?

puddleglum 4 years, 5 months ago

Or steve for that matter.

when I ask about these people, all I hear from others are words like "friendless, slimeball, but I personally don't even know them

Imbecilenamedjim 4 years, 5 months ago

Homeslice, the article above is clear the Tuckels alleged things about Duane and his family, so why do you ask "is there anyone Duane gets along with". Maybe a better question would be "is there anyone the Tuckels get along with" It's seems the Schwada's were attacked, nowhere does it say any of the allegations are true. Do the court records uphold the Tuckels allegations, I doubt it. Who besides Chad considers Penny Tuckel a developer, what has she developed? When? Where? Why didn't Russel comment, is he hiding...

hipper_than_hip 4 years, 5 months ago

Will Berry Plastics pay for the water , sanitary sewer, and storm sewer to be run out to the site, or will the city be responsible?

Berry got $11M in stimulus money to build a warehouse that's going to create 11 permanent jobs?

Jeteras 4 years, 5 months ago

WIND FARM!!! come on that area has more wind than the people that own it currently..

Michael Capra 4 years, 5 months ago

schwada made tuckel millions and penny is mad because russ never gave her any of it ,now she is trying to get herself a mill or two and show them both who there dealing with

Michael Capra 4 years, 5 months ago

This comment was removed by the site staff for violation of the usage agreement.

Michael Capra 4 years, 5 months ago

This comment was removed by the site staff for violation of the usage agreement.

Boston_Corbett 4 years, 5 months ago

Since Merrill has most of the ideas for development, I guess this is his time to open his piggy bank and start bidding.

Michael Capra 4 years, 5 months ago

I will out bid merrill and his merry men

Michael Capra 4 years, 5 months ago

schwada and tuckle were partners for years and made lots of money and russ goes and retires, 6 months later penny the boss files law suit.You dont need this russ your better than this take controll and end this the lawyers are the ones who win not penny the boss

kristyj 4 years, 5 months ago

Since it's right off I-70, how about someone puts in a Motel 6, Cracker Barrel & outlet mall?

puddleglum 4 years, 5 months ago

please take your motel 6, cracker bbl. and outlet mall back to topeka, where it belongs. thankyou

russfarmrjoe 4 years, 5 months ago

Let the peons hold their hands high at the auction, its only money.

50YearResident 4 years, 5 months ago

Don't forget the City of Lawrence could buy it and dump all the contaminations from the Farmland Property there.

Michael Capra 4 years, 5 months ago

penny is allready spending the money at walmart on a new ball and chain

JustNoticed 4 years, 5 months ago

Come on, Vito. Try some punctuation. Try to make some sens.

artlover 4 years, 5 months ago

Can't they just donate the land to the hippies, homeless, Northern Iowa Purple Panthers, beavers and the strippers ....

As an outsider I must ask, does anything ever get accomplished in this town? Y'all need hobbies and if this is yours ......well ....good luck on your journey.....

artlover 4 years, 5 months ago

A) I have never been to or will ever I visit Lawrence.

2 do they have toasted cheese sandwiches for $1?

C) My friend Kirk was there in the 60's and said the college chicks were easy.

thelonious 4 years, 5 months ago

Two "Lawrence developers" are now fighting amongst themselves - this is what always happens when piranhas have devoured everything around them (Lawrence economy) and have to start looking at each other to suatain their voracious appetites.

Good luck, Lawrence developers (aka piranhas) - and may the strongest piranhas enjoy eating the others!

scopi_guy 4 years, 5 months ago

I thought from the title, they might be trying to re-auction off the house out east of town with the meth activity.

artlover 4 years, 5 months ago

Do they have loose meat sandwiches in this town?

Richard Heckler 4 years, 5 months ago

National surveys (through American Farmland Trust) show that county costs in services required by farmland and open space generally is only 35 to 60¢ for every $1.00 in revenues they generate, producing a net gain for counties.

In contrast, residential use in counties costs $1.11 to $1.60 in services for every $1.00 generated.

Consensus says developed farmland = tax increase

New infrastructure = tax increase

A tax increase that leaves the voters out!

bevy 4 years, 5 months ago

I'm sick of seeing our beautiful countryside destroyed by cheap development. 11 jobs! Whoopee! We got more than that when they built the Smash Burger on 6th street, and they didn' t have to destroy 100+ acres of rangeland.

headdoctor 4 years, 5 months ago

Seems to be a slight hitch to your thought process. It isn't "OUR" beautiful countryside. That property isn't owned by the public. Guess you missed that part of the story.

gccs14r 4 years, 5 months ago

There is no such thing as property ownership. An occupier of a piece of property may have a social contract for exclusive use of a property for a period of years in exchange for something of value or a promise to perform some act, but that contract does not exist in perpetuity and will eventually expire if for no other reason than because of plate tectonics. In the shorter term, with as many people as we have on the planet now, the more greenspace we can preserve, the better.

Michael Capra 4 years, 5 months ago

Im in for 1.29 million that will only give penny the boss sardochi 635.000 lawyers get 50 percent she nets 317.250 and she can sue for more when she gets a divorce and gets half from russ

Michael Capra 4 years, 5 months ago

oh I forgot to tell u russ hid all his money from penny now thats funny

Michael Capra 4 years, 5 months ago

its buried on 500 acres hope that helps u out penny

igby 4 years, 5 months ago

Why would anyone with money need a partner? Partners are a liability and 99% of the time they are dead weight and have to be bought out later because they expect returns to be peachy all the time even in a downed economy.

Zachary Stoltenberg 4 years, 5 months ago

I'll believe it when I see it. Sounds like a drummed up story to dupe an unsuspecting investor. Wonder how much they paid the LJW or if they were just naive enough to fall for this story. These two have been in business together too long, I just think the whole thing is a farce.

igby 4 years, 5 months ago

Could be an elaborate income tax shuffling plot backed by a court ordered sale at a loss for both on paper and then a gain on the next year with all the tax shelters from the business roll-outs. Think about it. Give em' a TIF Too. Lol.

crackers 4 years, 5 months ago

One thing fer certan, plummers at the industrious site need knot worry about water leeks. cuz there aint no water to run in them pipes

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