Friday, November 08, 2002

Future of Hyneman's Mud Island land remains murky

Memphis Business Journal [link]
by Kate Miller

Three months after an early morning landslide sent tons of dirt into the Wolf River just south of the Auction Street Bridge, the harbor is clear but the future of Kevin Hyneman's 21 acres on Mud Island remains murky.

"As we speak we're still waiting on a report from our geotechnical engineer, which is going to give us the reason for the cause of the failure," Hyneman says. "Once we receive that, then we'll be able to determine exactly what we can do with the property, then seek proposals from different contractors who specialize in this type of problem and they'll do a design-build for going in and actually fixing the problem."

Larry Cooley, principal in the Ridgeland, Miss.-based geotechnical engineering firm Burns Cooley Dennis, Inc., says he is still waiting on some data but a report should be released within a couple of weeks.

"We have determined the cause," Cooley says. "There is a way to remedy that."

He would not give details on either.

Hyneman says the prospect of future litigation is likely the cause of the delay, though no lawsuits have been filed to date.

Hyneman was within 30 days of closing on a sale of the land to a joint-venture development team consisting of Belz-Turley and the Riverfront Development Corp. when the landslide occurred. He had agreed to sell the land for $2.6 million plus interest and 11 city-owned acres on the north end of Mud Island, in an area where he has already built many single-family homes.

Henry Turley and RDC president Benny Lendermon say they are still interested in developing the land, but their future involvement is far from certain. The Harbor Town-like development previously planned might not be possible.

Lendermon says the mudslide actually affected only a very small amount of land in the planned development, possibly seven lots. But while it has a small impact on the total amount of land to be developed, the lost lots could make or break the deal.

"This project wasn't a gold mine to start with," Lendermon says. "It took a lot of time to put this together because the profits were very slim and you had to be very creative to make it work financially for everybody. So, saying that you take a piece out and take some lots out and take away some revenue -- it probably hasn't reduced the cost any -- it makes the situation that much harder to do."

Turley says the partners estimated each of the lots affected by the mudslide to be worth about $175,000 each, or $1.225 million for seven lots. But Turley says if the land where the mudslide occurred isn't developed, then the partners could charge more for the lots behind them since they would have the view of the harbor.

There would be no such way to make up for other costs.

One is the cost of carry, the interest, taxes and insurance payments that Hyneman is currently paying and would be transferred to the new owners. Hyneman has said he pays between $125,000 and $130,000 in interest a year and $20,000 to $25,000 in real estate taxes. The developers will have to carry this cost longer because of the delays.

No comments:




NOTICE: Compilation copyright 2005-2010. This site contains copyrighted material the use of which has not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of historical, aesthetic, economic, environmental, and other issues relating to the Memphis Riverfront. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to this website. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission from the copyright owner.