Condemned Chandler business wants more $

The owners of Lloyd's Complete Auto Supply Co., whose downtown Chandler property was condemned for a new City Hall, have released their own appraisal of the site's value, about double the city's estimate.

Meanwhile, construction crews are slated to work on getting a second floor off the ground beginning Monday, said Teresa Makinen, spokeswoman for the contractor, Sundt. The result will be a 120,000-square-foot, five-story, mostly translucent building hovering above the east side of Arizona Avenue, straddling a closed-off and reconfigured Chicago Street.

While city officials appraised the value of the 45,000-square-foot Lloyd's site at slightly more than $1 million, former business owners Mike and Mark Pace put the value at $2.3 million, said Glenn Brockman, assistant city attorney.

A trial, in which a jury could set the final price, could begin in October, he said. So far, the two sides haven't spoken about a possible settlement.

"There have been no formal discussions," Brockman said.

Chandler officials condemned the land last year to make way for the new City Hall. At the time, the city posted a $2 million bond to take immediate possession of the property.

Lloyd's had been a longtime downtown Chandler business, passed down from father to sons.

"It's been a continuous business on that location for 58 years," said Doug Martin, the lawyer representing the Paces, from the firm Martin & Bell. Martin said he was reluctant to discuss the land's value given the pending litigation.

Chandler's existing City Hall occupies portions of the second and third floors of the privately owned Chandler Office Center, on the southeast corner of Arizona Avenue and Buffalo Street. But that lease expires at the end of next year.

Last summer, the City Council added a $74 million budget for the City Hall project to the capital projects list, putting it in the queue for construction. In September, the council added an additional $6 million to expand the project's budget to include space for the Vision Gallery and a project involving terraces. The additions brought the total budget up to $80 million.

The council in April approved an agreement with Sundt that pegged construction costs at about $47 million, nearly $4 million less than officials had anticipated, bringing the project's total cost, including such things as land acquisition and designs, down to $76 million, officials have said.

Work is expected to be complete in mid-October 2010. Critics of the project ask why officials are choosing to build now, when Chandler is slashing jobs and services to balance its budget.

City officials contend Chandler has been saving the money for years to build the new City Hall, and waiting five years could drive up the price by $10 million. They also argue employees' salaries are an ongoing expense that can't be solved by using one-time funds, and that using City Hall money to balance next year's budget would hurt the city's bond rating, which means higher interest rates.

The project is supposed to create 500 jobs and pump about $4 million into the local economy, and $90 million statewide, city officials claimed at the groundbreaking.

The new City Hall is also expected to act as a catalyst for private developers to come and redevelop the downtown into a pedestrian-friendly community core, officials have said.

All told, the city had to acquire property from about 10 private landowners for its new headquarters. In four cases, including the Lloyd's case, the city used eminent domain. The other three cases have been settled, said Sharon Joyce, the city's real estate manager.