The City of Missoula is going to study the feasibility of buying a 2.29-acre chunk of land near Southgate Mall in order to combine it with another 13.5 acres of city-owned land. Then, a private developer is planning to buy the entire chunk in order to build homes and mixed-use buildings.
The owner of the smaller chunk of property, Tollefson Properties, LLC, bought the parcel last year for $1.3 million and is offering to sell it to the city for the same amount, according to city senior redevelopment project manager Annette Marchesseault.
The parcel is right next to a city-owned 13.5-acre chunk of property called Southgate Crossing. A developer, Chris Kemmerly, owner of Miramonte Companies, has been selected by the city to purchase the 13.5 acres. He has plans to build 28 single-family homes on the site, with hundreds of more units possible along with mixed-use buildings. But the agreement has yet to be approved by the Missoula City Council.
Apparently, Kemmerly would also buy the 2.29-acre property as well.
“This (2.29-acre parcel) is a critical parcel to maximize the development potential of the area being referred to as Southgate Crossing, which the city purchased last year, by creating contiguous property ownership between Mary Avenue and Dixon Avenue,” Marchesseault told the board.
The purchase price for the new parcel is about $13 per square foot, while the city paid about $15 per square foot for the Southgate Crossing property.
On Thursday, the Missoula Redevelopment Agency’s board of commissioners voted to spend up to $50,000 in Tax Increment Financing to cover the costs of due diligence for the parcel. If the due diligence finds no serious environmental issues or other concerns, the board also approved using $1.3 million in TIF to buy the property.
“We are lucky that we have this opportunity,” said board member Tasha Jones. “That was an awkward missing piece of this, to the redevelopment of this area. It would have remained this kind of outlier or undeveloped property or subject to some other sort of planning.”
The city bought the Southgate Crossing chunk for $5.88 million last year. There could eventually be between 100-200 housing units on the site, according to estimates from Miramonte.
Reporter Griffen Smith contributed to this story.
David Erickson is the business reporter for the Missoulian.
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