The deal is done. On Tuesday, August 12, Main Street Arena and Yellow Cab of Charlottesville owner Mark Brown completed his purchase of all shares of the Charlottesville Parking Center, the for-profit entity that owns and/or operates two downtown parking garages and one lot.
“I felt that CPC owned assets that were important to the future of downtown Charlottesville,” said Brown, 33, a 2003 UVA grad who majored in economics and becomes an even more significant player in downtown development with the nearly $14 million purchase.
Of the nearly 88 percent of CPC shareholders who voted, all were in favor of the sale, but that didn’t mean there were no objections. Developer Richard Spurzem, who said he owned less than 3,000 of the 407,309 shares, has publicly objected to the $34-per-share price (the parent company of C-VILLE Weekly also owned a single share). He voiced concern that CPC’s former executives didn’t seem to actively seek higher bids and expressed frustration that his own offer of just over $9 million in 2008 was ignored but was followed within months by a letter to shareholders saying nothing less than $17.5 million would be considered.
“The real question is who might have paid $17 million in 2008 that they turned down or turned away,” said Spurzem earlier this month.
Spurzem is not the first to criticize CPC. In 2007, former shareholder Spencer Connerat, pushed for a buyout by Wachovia that he said could have garnered $43 a share. No such deal was ever taken to shareholders, and it became one more chapter in the company’s contentious history when Connerat, who’d publicly criticized CPC management, accepted CPC’s offer of $120 for his three shares and another $5,000 for his silence.
Connerat, who lives in Florida and who has said his family still owns nearly 1,500 of CPC stock has declined comment on that episode or the terms of the current deal, and expressed praise for CPC leadership and good wishes for Brown.
CPC leadership has expressed delight at the sale.
“We’ve been trying to sell the company for years and years, and this is by far the best offer we’ve had,” said CPC chair Jim Berry after the shareholder vote.
Although Brown’s purchase is final, Spurzem is exercising his right of appraisal, a process by which he’ll submit his own valuation of his shares to Brown. If Brown disputes Spurzem’s figure, the matter could end up in court. Brown said he’s confident the price he paid for the shares was fair and described Spurzem’s pursuit of an appraisal as “an emotional decision based on hurt feelings, not economic reasons.”
Spurzem brushed off Brown’s assertion but said he still has concerns about whether Charlottesville’s other major development players were directly approached about a possible acquisition. Among those major players, at least one says he was contacted by a broker for CPC but was not interested. “I have my hands full,” said Ludwig Kuttner, developer of the Frank Ix property and owner of Central Place on the Downtown Mall.
Brown’s purchase puts him at the heart of another significant downtown project, the development of a two-block plaza and permanent home for City Market that would cover both the CPC lot and the adjacent city-owned metered lot that has been the market’s longtime home on Saturday mornings. The developer behind the design, Keith Woodard, said he had been aware that CPC had been for sale several years ago, but he had not been directly approached by CPC management and hadn’t followed up.
“I had too many things going,” said Woodard, who said he’s been in discussion with Brown about the future of the lot for the past six months.
“We designed Market Plaza with future expansion in mind on that site,” said Woodard, noting that there’s no deal yet arranged for him to buy or lease the land from Brown.
“The timing would be such that we’d need to complete Market Plaza on the city owned lot before we could go ahead,” said Woodard.
Brown said he’s hopeful about striking a deal with Woodard.
“I would love nothing more than to see Keith do a very nice two-block development,” said Brown. While he expressed enthusiasm for that project and the future of downtown Charlottesville, he voiced concerns about Court Square, considering county officials have discussed moving the court system away from the historic downtown location to more spacious digs. Brown said he hopes to speak with county and city officials in coming weeks to see if there’s something CPC can do to help keep the court system downtown.
As for what the transaction means for those who park downtown, Brown said there won’t be any significant changes. He’s keeping the CPC staff including longtime General Manager Bob Stroh, and he won’t be jacking up parking prices—something that would require collaboration with the city even if he wanted to do it.
In fact, starting September 1, Brown said, the prices at the city owned lot will by $.50 to $2.00/hour.
“Given that all my business is downtown,” said Brown, “I’m not going to take any measures to discourage people from living, working, and coming downtown.”
–Story updated with Keith Woodard quotes at 1:13pm on August 18.