WHEELING - Howard's Diamond Center owners Seth and Howard Posin rebuffed the city's previous attempts to purchase their former downtown Wheeling location, but city officials hope they will reconsider under different circumstances.
Now that the 1125 Market St. building appears to be damaged beyond repair - as the result of a wall collapse allegedly caused by the city's demolition contractor on an adjacent project - City Manager Robert Herron said officials plan to renew their pursuit of the property, one of three they failed to reach an agreement to buy a few years ago.
Such action could be months away, however, as the property remains the subject of federal litigation between Howard's Diamond Center and its insurance provider, Hartford Fire Insurance Co., over that company's refusal to pay the jewelry store's claim on the damaged building.
Photo by Ian Hicks
Wheeling officials plan to renew efforts to purchase the former Howard’s Diamond Center property in the 1100 block of Market Street.
"There won't be any negotiation until that lawsuit is complete," Herron said.
Regardless of whether the city succeeds in acquiring the property this time around, Herron said, the building must come down. It lacks a roof and has sustained damage to all three of its floors.
"We're going to take enforcement action if they don't tear it down," he said.
Herron did not rule out purchasing the building as is and then razing it, however. Seth and Howard Posin could not be reached for comment Monday.
The former jewelry store, vacant since the business moved to The Highlands retail development in 2010, was one of three buildings in the 1100 block of Main and Market streets the city had unsuccessfully attempted to acquire, along with Vocelli Pizza and Panda Chinese Kitchen, which are still in business there. City Council chose to move forward with plans to clear the remainder of the block and market the land for development.
Dore and Associates of Bay City, Mich., began tearing those buildings down in April 2012, but work ground to a halt after an Oct. 25 wall collapse during demolition of the former Feet First building - the last of the city-owned structures slated to come down. It didn't resume until this past April, and the contractor is still finishing its responsibilities at the site, which include spreading topsoil and grass seed.
Meanwhile, Hartford maintained the incident was not a covered cause of loss. That prompted the Posins to sue the insurance company for almost $700,000 in damages. To date, Howard's Diamond Center has not sued the city or Dore and Associates over the damage to its building.
Howard's Diamond Center's insurance policy with Hartford lists "full value replacement cost" of the downtown building at $647,400, "business personal property replacement cost" at $16,400 and debris removal coverage of $25,000, according to court documents. The property was appraised at $68,200 in 2008, and its most recent assessed value is $29,588 - which using the typical 60-percent standard of assessed value versus appraised value would translate to an appraised value of $49,313.
After both parties agreed they likely could resolve the matter without a trial, U.S. District Court Judge John Preston Bailey set a Dec. 1 deadline for mediation in the case. Once the litigation wraps up and the building is removed, Herron said the city will again try to buy the property from the Posins and increase the amount of land it has available to attract potential developers. He declined to speculate on terms of a potential offer.
The city has about $600,000 in undedicated funds remaining from a $3.1 million Tax Increment Financing bond sale in December 2011. Almost $1 million of that was spent on property acquisition and demolition for the 1100 block project, with another $140,000 spent to purchase a parking lot north of the Century Equities building which the city also plans to market for future development.
Another $1.4 million - including $400,000 for restoration of the 1100 block demolition site - has been set aside for planned projects such as renovations to Market Plaza, upgrades to the Capitol Theatre and assistance to Wheeling Jesuit University in moving its physical therapy program into the Stone Center downtown.