IRS filing reveals price of Kimball Art Center property sale
Developer paid $7.5 million for the high-profile Old Town location
October 6, 2017
The property along Main Street that once housed the Kimball Art Center was widely expected to command a premium price when it was put on the market in the fall of 2014.
The historic building and associated land preside over one corner of the high-profile intersection of Main Street and Heber Avenue. And there appeared to be prospects for a significant redevelopment of the Kimball Art Center building itself as well as development on the substantial patio space steps off the intersection.
The sale of the property to a developer in 2015 was one of the most closely watched transactions in Park City in recent years as the real estate industry, the preservation community, Main Street supporters and interested rank-and-file Parkites monitored the process.
The property was listed with an $8 million asking price. The sale price was not made public at the time of the deal. The not-for-profit Kimball Art Center, though, has identified the sale price in an annual filing required by the IRS. The Kimball Art Center's filing for 2015, known as form 990, shows the property sold for $7.5 million. It was just a 6.25 percent reduction from the asking price. The IRS filing also shows there was approximately $700,000 in costs or sales expenses related to the transaction, leaving the organization with a little less than $6.8 million in proceeds from the sale.
Utah is a state where real estate sale prices are not considered public information, known as a non-disclosure state. It is rare for sale prices to be made public in Park City, particularly when such a prominent property is involved. The Kimball Art Center's IRS-required disclosure provides an unusually detailed look at the sale, though.
California-based Columbus Pacific Properties acquired the property, splitting the deal between three entities under its corporate umbrella, County Courthouse documents showed at the time of the transaction.
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"We had a few folks who came forward with offers. We proceeded with a buyer we thought made a fair offer," said Dan Lemaitre, a member of the Kimball Art Center's board of directors and the board's treasurer, adding that a potential buyer's ability to close on an acquisition was also a factor in the decision to accept the Columbus Pacific Properties' offer.
He noted there were few comparable real estate transactions to guide the price. The $7.5 million price was "fair value," he said.
Jan Wilking, the listing agent, also said it was difficult to set a price based on comparable sales since the property is unique. He said the former Kimball Art Center location is "one of the few development properties that were remaining on Main Street.
"I think it was a very fair price," he said.
The Summit County Assessor's Office later assigned a market value to the property of just less than $7.9 million. The land accounts for approximately $4.6 million of the value while the building accounts for the remainder. It was the first value assigned to the building and land in years since the property was not on the tax rolls under the ownership of a not-for-profit organization. Property taxes in 2017 were $61,699.80, according to the Assessor's Office.
The sale price was one of the last pieces of information that remained unknown after a widely publicized process that started with City Hall's rejection of the designs of a Kimball Art Center expansion proposal. The organization put the property on the market after the rejection, selling to the Columbus Pacific Properties, and then moved the Kimball Art Center to temporary quarters along Kearns Boulevard. The Kimball Art Center intends to develop a permanent facility in a City Hall-supported arts district planned in Bonanza Park. The concept involves the municipal government selling a parcel in Bonanza Park to the Kimball Art Center for the development of a permanent facility.
The nearly $6.8 million in proceeds from the sale will be critical for the organization as it prepares to build a permanent facility. Lemaitre said most of the $6.8 million will be put toward developing a facility while the rest of the proceeds were used to create an endowment designed to provide ongoing financial support to the organization.
The $7.5 million sale price is also an important figure in the context of the continuing discussions between Columbus Pacific Properties and the Park City Planning Commission about a redevelopment. The proposal does not involve normally lucrative residential square footage and instead seeks commercial spaces and an event space. The idea of putting an event space in the project has stirred opposition in the neighborhood. People who live on streets like Park Avenue and Woodside Avenue, just west of the property, claim the event space would be noisy and draw too much traffic. The Columbus Pacific Properties side counters that steps can be taken to reduce the impacts of an event space on the neighborhood. The issue has not been decided. The developer has said the event space is important to the overall financial success of the project.
A representative of the ownership did not immediately return a phone message seeking comment.