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State threatened with lawsuit over sale of Pullman Yard property

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State threatened with lawsuit over sale of Pullman Yard property

The Pullman Yard in Kirkwood. Photo by Dan Whisenhunt

The Pullman Yard in Kirkwood. Photo by Dan Whisenhunt

This story has been updated. 

A losing bidder has threatened to sue the Georgia Building Authority over its recent decision to sell the Pullman Yard property in Kirkwood to a developer who wants to build a film studio on the site.

The GBA held a surprise vote on the project on April 19, voting to sell to the winning bidder, Atomic Entertainment, for $8 million. Other bidders in the room were under the impression that there would be a second round of bidding that would include a “best and final offer.” Now one of those bidders, JoJo Investments, has sent the GBA a letter protesting the bid award.

“JoJo Investments, LLC reserves all legal rights with respect to this action and we will explore all litigious paths to protect our interests in respect to this property,” the April 25 letter says.

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Adam Rosenfelt, with Atomic Entertainment, declined to comment. Cindy Presto, the attorney for the GBA, acknowledged receipt of the letter.

“The protest is directed at both the solicitation process and at the award,” she said in an email. “The Georgia Building Authority is responding to the bid protest in accord with the published Bid Protest policy of the agency.”

Michael Ledford, with JoJo Investments, confirmed that he sent the letter. He pointed to a flow-chart in the bid package that said there would be a “best and final offer process.” Ledford bid $5.7 million, close to the minimum of $5.6 million. Two of the other bidders also kept their bids close to the minimum. Ledford said the bid package “mislead us all.”

“As a citizen of the state, I felt like GBA nor the board did what they needed to do to maximize the value of the property,” he said.

JoJo’s proposal involved a mixed use development and would’ve also included a film production and music production space.

Here is a copy of the protest letter …

Protest of Pullman Yard Award v4

While Decaturish wasn’t able to reach GBA for comment on the letter, State Property Officer and GBA Executive Director Steve Stancil did give an interview on April 20 about the property sale. The interview was part of a larger story about the deal, and attempts to reach Rosenfelt for comment on the larger story were unsuccessful.

The vote to sell the property was expected to occur in June, not April.

When asked why the board decided to vote to sell Pullman Yard this month, Stancil said the state has been anxious to unload the property, which it has owned since 1990.

“We’ve had a terrible time with people coming on the property and vandalizing it,” Stancil said. “Last week they arrested seven people out there. We mend the fence every day.”

Last year, a man form Dunwoody died when he climbed up a ladder and attempted to walk across a roof of one of the buildings. He fell through a fiberglass skylight. Stancil also says that representatives for one of the bidders were arrested for trespassing on the property.

“I ain’t got time and people to go out there and babysit this property,” Stancil said. “We need to get it on the market, get it sold, let somebody else deal with it.”

But the property had been in GBA hands for more than 25 years. Why the sudden urgency to get rid of it?

“We don’t have any use for it anymore,” Stancil said. “We tried to sell it six, seven eight years ago … We didn’t get any bids that were responsive. They were all off the wall, crazy stuff. Economic times were not as good we decided we’d wait. We decided this was probably the best time to put it on the market.”

Decaturish also obtained copies of emails showing that Stancil had communicated with Rosenfelt before the property went on the market in December. Rosenfelt was allowed access to the property and made an unsolicited offer of $8 million in September, emails show. At the time, he made the offer using the company name of Station at Pullman Yard LLC. In a reply to Rosenfelt, Stancil reminded Rosenfelt that the GBA has to go through a public bid process, telling him the GBA is “not able to negotiate as you do in the private sector.”

Stancil said the GBA had made the property available to other interested parties as well before the property officially went on the market in December.

“We escorted or allowed a number of parties on the property for various reasons,” he said.

Stancil said the minimum bid for the property was set at $5.6 million on the basis of one of two appraisals. The other appraisal determined the property was worth $8.5 million or more, he said. GBA went with the lower appraisal for the invitation to bid.

He also said the bid process itself was misunderstood. Stancil said the GBA was only looking for the bidder who made the highest offer. The state wasn’t interested in what the property to be used for, which is why it was sold using an invitation to bid instead of a request for proposal.

“It’s going to have to be rezoned,” he said. ” …Even if we had gone through a process where we had done a RFP and we had chosen one we liked, it didn’t mean anything because once the property goes back into private hands it becomes a city issue.”

When asked what he would tell other bidders who thought they were treated unfairly, Stancil said the process was fair.

“They should’ve put in their best offer when they had the chance,” he said.

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