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Madison County discusses challenges selling county property because of longstanding tenant noncompete
Summary
Commissioners said a multiyear lease containing noncompete terms with an existing tenant (referred to as TFC) has repeatedly blocked offers on county outlots; staff said relisting and allowing buyer due diligence is a possible next step.
Commissioners spent a sustained portion of the Jan. 6 meeting discussing county-owned property that the board has tried to market and sell. Commissioners said a long-standing lease with a tenant they identified as TFC includes a noncompete clause that has deterred buyers and repeatedly forced legal work.
"Their contract is so solid... they have a noncompetitive clause," one county official said, describing a lease that limits certain types of businesses and discourages prospective buyers. Board members said past attempts to work through TFC's legal staff and litigation have cost the county tens of thousands in attorney fees without changing the tenant's position.
Staff and a commissioner who handles property sales said the county has remodeled an office suite and engaged a realtor, Tim Weber, to list that space. "Tim Weber... should be back with me next Friday on exactly what that's gonna cost and what he thinks we can get," one staff member said.
Commissioners described renewed interest in several parcels, including a roughly 1.4-acre outlot near a gas station and additional frontage lots, but said potential buyers halted offers when they were asked to pay for substantial geotechnical and parking-lot studies during due diligence. One participant said a buyer asked for more than $20,000 in studies and then declined to move forward.
Board discussion included the trade-offs of trying to proceed through expected legal costs versus relisting and allowing a buyer to pursue due diligence: "We can always relist them, see what their offers are," one commissioner said. The county also discussed the prospect of selling an entire building and moving offices, but noted logistical constraints about where to relocate county services.
Next steps identified at the meeting included asking the realtor for a market assessment and pricing, exploring relisting parcels to test current offers, and continuing to consult county attorneys regarding whether litigation or negotiation with the tenant is warranted. Commissioners did not authorize litigation at the meeting.
The board did not take a binding vote on sale strategy; staff will return with more detailed recommendations and market information.
