Committee hears A1 market analysis, directs appraisal and advances draft option agreement for south-side Lennox industrial land

The joint DOC funds economic development committee heard a market-comparison presentation and moved to pursue a certified appraisal as the next concrete step in securing industrial land on Lennox’s south side.

"So I'm Drew O'Brien with A1 Development Solutions," said Drew O'Brien, the development consultant who presented the comparables-based analysis to the committee. He told members he narrowed sales to large, mostly row-crop parcels near municipalities and found regional comparables in Minnehaha, Lincoln, Clay and Union counties. "The analysis showed an average of about $15,000 an acre," O'Brien said, framing that figure as an expected market value based on recent sales.

Why it matters: Committee members said a certified appraisal will be needed if the city or a quasi-public entity later seeks bank financing or wants a nonpartisan valuation the public can rely on. Members also highlighted the difference between a vendor market analysis and a certified appraisal and pressed for terms that protect public funds if a seller later declines to proceed.

After discussing payment logistics, committee members agreed to recommend covering up to $1,000 toward a certified appraisal and to place a request to do so on the full city council’s upcoming consent agenda. The group emphasized the appraisal must be done by a certified appraiser agreed to by the city and that the fee could be credited at closing if the property is later purchased.

The session also reviewed a draft option-agreement concept presented by O'Brien. The concept would use a multi-year option (an example 5-year term) with annual option fees, a sunset clause obligating the city or development corporation to purchase any remaining acreage at a pre-agreed price at the end of the term, and a tiered per-acre minimum price schedule for resale to industrial end users. O'Brien described a proposed upside-sharing formula in which 80% of net increases above the minimum sale price would go to the seller and 20% to the city, a structure meant to motivate sellers while allowing the city to recoup infrastructure investments.

Committee members flagged tradeoffs the draft seeks to manage: seller discomfort if land values rise during a long option term, the need for perimeter utilities (and often interior roads and site work) to make parcels build-ready, and the expectation that larger industrial users will require site-specific improvements. Members recommended developing a subdivision layout, estimating interior infrastructure costs, and preparing tax-revenue projections that could justify paying above-appraisal prices in some cases.

Bryce Cely of the Metro Growth Alliance reviewed potential funding mechanisms, from bank syndication to state and federal grants and loans. Cely warned that the state-level infusions that helped build Foundation Park in the past may not recur and recommended careful coordination on appraiser selection and on which funding sources are most likely to apply to this property type and scale.

Next steps: The committee directed staff to (1) obtain a certified appraisal (members discussed a two‑to‑three week timeline), (2) have A1 meet directly with the seller to test the option-agreement concept and feasibility, and (3) place the appraisal funding on the city council consent agenda for formal approval. The committee did not take a final purchase vote; it limited action to these preparatory steps.

The committee adjourned after reiterating those tasks and confirming follow-up communications between staff, A1 and the seller.