[Shasta County] Developer wants to buy Stillwater Business Park

Blog note: this article references a grand jury report questioning the viability of the business park.

A Southern California company that develops land around the world wants to buy the remaining 15 lots in Stillwater Business Park.

The Redding City Council in closed session Tuesday will consider whether to continue discussions with Panattoni Development, which has offices in the United States, Canada and Europe.

The Economic Development Corp. of Shasta County has received a non-binding letter of intent from Panattoni that gives details about how it would like to structure a purchase agreement to develop the park.

EDC President Tony Giovaniello said Panattoni’s interest in Stillwater is exciting but he cautioned that there is no deal yet.

“That said, there are many points of alignment and we are pleased with the progress we are making,” Giovaniello said in a news release. “If the consideration by the City Council leads to an agreeable framework, the next step would be to negotiate a purchase agreement.”

Giovaniello said any agreement would likely include a joint marketing effort to identify companies to occupy the park.

Headquartered in Newport Beach, Panattoni, per its website, has worked with more than 2,500 companies across the globe while developing millions of square feet of industrial and office space.

For example, Panattoni has partnered with Dermody Properties to build approximately 1.25 million square feet of new industrial space in the Reno-Tahoe area.

Calling Panattoni “the real deal,” Redding Councilman Brent Weaver said, “I think it’s certainly encouraging and I look forward to learn more.

“This type of company has relationships in the industry and can come in, develop it (Stillwater) out and fill it with the type of businesses would like to have in there.”

The city is eager to see activity inside an industrial park that has sat dormant since it opened in April 2010.

To date, the city has sold one lot, to Lassen Canyon Nursery, but the Redding company last year postponed its plans build at Stillwater due to the economy. Lassen Canyon paid $840,000 for 16.75 acres in late 2015.

“I certainly think the city has been eager since the day it opened,” City Manager Barry Tippin said. “I don’t think the council has changed in its eagerness to sell the park, certainly the public pressure is higher.”

Indeed, Stillwater, almost from the day it opened, has been a lightning rod.

Last May, the Shasta County Grand Jury took the city to task over the business park, questioning the viability of Stillwater while recommending several steps to trigger activity. But the city questioned the report’s findings and made few pledges to follow the grand jury’s lead.

Redding especially took issue with the grand jury's $40 million price tag for developing and marketing the park, saying the actual cost is closer to $28 million. 

The City Council, working with Tippin, has made it clear that developing Stillwater is a priority. The council in September approved a range of incentives to draw companies there.

H2 Renewables, an East Coast company, wanted to build a renewable hydrogen plant in Stillwater but last November put the project on hold because it did not have a gas company to partner with.

The city still owes millions on the park and it’s not clear whether a deal would pay off what is owed.

Tippin said the park needs to be appraised again. It was last appraised in 2014 at $14 million, a figure that exceeds the debt owed on Stillwater, he said.

“It’s a priority for me, to pay off the debt,” Mayor Kristen Schreder said.

Vice Mayor Francie Sullivan agreed.

“I think the obvious answer is, of course we will try to get rid of the debt,” Sullivan said. “I am not in any position to say that that is the first thing we will do, but, obviously, that would be a goal.”

Sullivan noted that she would assume any offer would be full asking price "so they don't have to get in any kind of discussions about prevailing wage."

Weaver said it’s too early in the process for him to comment.

But he added, “Obviously, we would like to retire as much debt as possible and get the property turned into something that is economically viable for this region.”

Tippin said how the debt on Stillwater would play into any deal would be a part of the negotiations should the City Council on Tuesday decide to move forward.

Meanwhile, the city spent years developing the business park in its vision, including design and use guidelines and the types of jobs it wants to see in there.

Design standards played a big part in why the city in 2016 rejected an offer from Emerald Kingdom, a Redding greenhouse manufacturer that decided to relocate to Red Bluff instead.

“Certainly, from the city’s perspective, those are still important elements,” Tippin said of the conditions placed on development in Stillwater. “Now, if the council has us move forward with negotiating a contract — I’m not sure what Panattoni’s thoughts are — but certainly that would be part of the discussion.”

Panattoni did not return a phone message seeking comment.

April 30, 2018

Record Searchlight

By David Benda