JC Penny at StoneCreek Crossing. Photo by Sean Batura.
By SEAN BATURA
StoneCreek Crossing, the southside shopping center that received $6 million in incentives from the city — including a $4 million incentive in late 2008 — is listed for sale in a foreclosure auction to be held at the Hays County Courthouse on Feb. 1.
According to county records, StoneCreek Crossing, LP, executed a promissory note in 2007 that has matured. The promissory note is payable in the original principal amount of $38,642,443 to lender Amegy Bank National Association, which requested that all real property, fixtures, and personal property on the approximately 95 acres at StoneCreek be sold for cash to the highest bidder.
Amy Madison, President and CEO of the Greater San Marcos Economic Development Corporation, said a legal team with the City of San Marcos will “certainly” be looking into the matter today to determine how the foreclosure sale would affect the city’s Chapter 380 development agreement with the StoneCreek Crossing developers.
The Chapter 380 agreement, under which the city offered $6 million in sales tax rebates to the developers, allowed Target, JC Penny and Bealls to move from Springtown Mall to their current location by early 2009.
Springtown, which now is nearly empty, has suffered from economic blight and increased burglaries ever since. Several attempts by the city to incentivize re-development at Springtown have fallen after public opposition.
Madison, who learned of the foreclosure Tuesday and came was not involved with the creation of the Chapter 380 agreement, said she is not sure whether the stores at StoneCreek Crossing have made enough money to trigger the rebates. The terms of the Chapter 380 agreement include city rebates payable only when sales tax revenues increase to a certain point, and are capped.
Madison said the Chapter 380 agreement probably is not transferable to whoever buys StoneCreek Crossing, at least not without council approval.
The terms of the Chapter 380 agreement also include guarantees of improvements to the nearby exit ramps, the access road and drainage. Former Mayor Susan Narvaiz once said the drainage problems in the area would have cost the StoneCreek Crossing developers $4-6 million to fix.
Madison, who attempted to contact the StoneCreek owners without success, said she does not know the precise nature of their financial difficulties.
“Attracting new tenants to a development like this has been challenging,” Madison said. “It speaks to the issue that they’re dealing with right now.”
Madison said the city probably will not be greatly affected by the foreclosure sale. Madison said the foreclosure sale’s major result would be the loss of a relationship cultivated between the city and the StoneCreek Crossing owners.
“It is unfortunate that the owners of StoneCreek Crossing are having these difficulties,” Madison said. “I think they’re really good guys. I’ve enjoyed working with them. They really tried hard. I think they got hit by an unfortunate situation in the marketplace. I just hope that the new buyers will be as involved and have the interests of San Marcos at heart like the previous owners did.”
StoneCreek Crossing owners were not immediately available for comment.
(Editor’s note: The above has been revised to say StoneCreek Crossing received a $4 million incentive from the city in late 2008.)Email | Print