|City Announces Agreement to Acquire McClung Warehouses
|July 9, 2013 -
Mayor Madeline Rogero today announced an agreement by the City of Knoxville to settle an outstanding lawsuit and acquire six properties on West Jackson Avenue from a bankruptcy trustee for $1.45 million. These include the historic McClung Warehouses.
The properties at 501, 505, 517-19, 523, 525 and 420-512 W. Jackson Ave. were formerly owned by Mark Saroff and have been in receivership since 2010. The total area of the six lots is about 1.7 acres. The agreement will go to City Council for approval in two weeks.
The City plans to stabilize and secure the properties and issue a Request for Proposals for their private development.
"We look forward to getting these historic properties into the hands of responsible owners who will give them new life and continue the momentum of our downtown revival," Mayor Rogero said.
The following is a brief timeline of the McClung Warehouses' history:
1893: The first of the McClung Warehouses is constructed by C.M. McClung & Co. The company was founded by Calvin McClung, a member of a prominent Knoxville family who was one of the original trustees of Lawson McGhee Library and is the namesake of the Calvin M. McClung Historical Collection. The warehouses served as the railroad shipping headquarters for the company's regional mail-order business, which sold agricultural equipment and other goods. The McClung company in various forms operated the buildings until the early 1980s.
1991: Mark Saroff acquires 523 and 525 W. Jackson Ave.
1993: Mark Saroff acquires 501, 505, 517-519 and 420-512 W. Jackson Ave.
2001: City Council directs KCDC to create a Jackson/Depot Redevelopment & Urban Renewal Plan, covering an area bounded by Magnolia Avenue on the north, North Central Avenue on the east, Broadway on the west and the southern boundaries of the parcels on the south side of Jackson Avenue on the south.
February 7, 2007: A fire destroys three of the existing McClung Warehouse buildings, and damages others. The remaining buildings date to 1911 and 1927.
February 2008: KCDC designates the remaining McClung Warehouse buildings and properties at 517, 523 and 525 W. Jackson Ave. as blighted and issues a request for redevelopment proposals for them. No proposals are received by the June 13, 2008, deadline.
August 2008: KCDC votes to begin acquisition of the Saroff-owned properties.
February 2009: Saroff sues KCDC and the City of Knoxville, claiming inverse condemnation and seeking in excess of $4.2 million.
June 2009: KCDC rescinds its plan to acquire the properties.
February 2010: A U.S. Bankruptcy Court judge approves a petition by Saroff's creditors forcing Saroff into bankruptcy. Attorney John Newton Jr. is appointed as bankruptcy trustee, taking charge of the properties and of Saroff's lawsuit against the City and KCDC.
July 2013: The City of Knoxville reaches a proposed agreement with the bankruptcy trustee, to settle the lawsuit and acquire the properties for $1.45 million. The agreement will need City Council approval to proceed.
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