City Recoups Shops at Prescott Gateway Economic Development Investment
Thursday, October 10, 2013
Over two years ago, the City of Prescott acquired the commercial property upon which the Shops at Prescott Gateway are situated. Through an innovative lease-purchase agreement with Red Development, the property was developed and 10 new businesses have since opened, including Trader Joe's.
The City acquired the 7.1 acre property at below the appraised value for $2 million in 2011. Just two years into a 20 year lease-purchase agreement, Red Development has executed its option to purchase the property and it paid back the full amount of the City's investment on October 10.
"This is great news for Prescott," said Mayor Marlin Kuykendall. "The City purchased this property with negligible risk and the benefits have exceeded all expectations. We now have the only Trader Joe's in northern Arizona, a boost to our sales tax, new jobs and this once undeveloped property is now a thriving shopping center."
The City has benefited from this investment in multiple ways including:
- With a regional trading area, the development is generating a substantial increase in net additional sales tax.
- The City has already received 20 months of lease payments, a return on investment totaling $204,260.