A Franklin nonprofit organization is putting off the purchase of a vacant piece of property near Interstate 65, where a motel once stood.
Unpaid taxes and other outstanding debts on the former Red Carpet Inn property total more than $180,000. The Franklin Development Corp., which had tried to arrange to buy the property, now plans to wait until it can obtain it at a lower price through a tax sale.
But that sale likely won’t happen until at least early next year. Unless a new buyer steps in, the visible location just west of I-65 on State Road 44 won’t be developed for a new business, such as a hotel or restaurant, any time soon.
And the city might have to wait a year or more before it can recoup the money spent to demolish the condemned motel last year.
In the Red
Built: The motel on State Road 44 near Interstate 65 was built in 1976 as a Lee’s Inn and later became Red Carpet Inn. The most recent owners purchased it in 2006.
Closed: Part of the building was shut down by the state fire marshal’s office for safety reasons in July 2011, and the city condemned and ordered demolition of the building in November 2011.
Demolished: Franklin paid $79,500 to tear down the building, and the demolition was completed in May. The city has placed a lien on the property in order to recover that money when someone purchases the vacant land.
Purchase: The Franklin Development Corp. had made an offer of $75,000 to purchase the property from the bank. But officials recently discovered that unpaid taxes and other outstanding debts on the property total more than $180,000 and are putting off the purchase. They may consider buying the property at a future tax sale.
“It won’t be any time soon for there to be a resolution on this property,” said Craig Wells, Franklin Development Corp. president and chief executive officer.
The organization, which was created by the city and funded with tax dollars, tried to buy the land so it could market it to potential businesses. The city demolished the former motel building after it was condemned because of structural issues.
The company that owns the site has gone through bankruptcy, Wells said, and the Franklin Development Corp. was trying to work out a deal with the bank that has the mortgage.
The agency was trying to buy the property for $75,000 from the bank, and pledged to pay the city back $79,500 for the demolition.
But total taxes and liens on the property, including the demolition cost, are $180,298. The bank would have to pay that amount in order to take ownership of the land, which is about $25,000 more than the total amount offered by the Franklin Development Corp.
The former Red Carpet Inn property will be listed during a county tax sale in October, unless someone buys it before then, Wells said. He doesn’t expect anyone to buy the land in that sale.
After that time, the county could decide to either auction the property for a portion of the amount owed or give it to the Franklin Development Corp., Wells said.
That sale could allow the development corporation to get the property and potentially erase other debts currently on the property. The process could erase the lien from the city to recoup the demolition cost, which Mayor Joe McGuinness said he wants back.
“They made a promise last year. They said that they would make good on that lien that is on the property. It’s $79,500, what the cost of the demolition was, and they would reimburse the city for those expenses,” McGuinness said.
Franklin Development Corp. intends to pay for the demolition, Wells said. That payment, however, will be delayed until the organization can buy the property, he said.
The county hasn’t set a date for the next tax sale yet, Wells said. He hopes the county will be willing to help the development agency get the former Red Carpet Inn site.
“It’s kind of in the county’s hands at this point. We would like to. The whole reason we want to purchase this property is so we could help get that area out there developed,” Wells said.
City officials think the site is an important location, because whatever development might occur there would be one of the first businesses people see when entering Franklin from the interstate.
A large hotel, a restaurant or a grocery store are possibilities McGuinness said would be beneficial to the city’s east side.
Wells doesn’t have a specific type of business in mind for the site but said that if the agency buys the property, officials would consider proposals that support the idea of that area being a gateway into the city.