Group with interest in Dumplin Creek cools on idea
Neyland Land Associates, the group that had expressed the most interest in acquiring the Dumplin Creek property, no longer believes the time is right to buy one of the county’s most visible commercial properties.
There were no representatives of the group at the foreclosure auction for the property Wednesday, and they didn’t respond to messages from The Mountain Press that afternoon.
Thursday, however, owner Joe Fielden Jr. emailed a statement outlining their position.
“While Neyland remains interested in the project, based on the lack of demand generated from our initial marketing efforts we do not believe it is the right time to move forward,” Fielden said. “We are simply not ready to risk our own capital, nor do we believe funds from the taxpayers of the city of Sevierville or the state of Tennessee should go into the project at this time.”
NLA had convinced the Sevierville Board of Mayor and Aldermen to set aside $4 million and apply for another $4 million from the state to build a road that would serve the project. Mayor Bryan Atchley said Thursday that the city won’t proceed with that project unless NLA or another developer is set to improve the property.
“The only way it would have continued ... is with Neyland,” he said. “If another developer came in I’m not saying we wouldn’t do it, but there’d have to be a new agreement.”
Representatives of Sevier County Bank have said that some other groups expressed interest in the property besides NLA, but have not named them. At least two people signed up to bid on the property Thursday, but no one did so. The lenders acquired the property at a value of $12.5 million. The project is important to the city because sales tax revenues from the project could help it to pay down bonds used to finance construction of the Sevierville Convention Center and other improvements in its Central Business Improvement District. Sales tax revenues from within the district, which run along Highway 66 from Interstate 40 to downtown Sevierville, go toward paying those bonds. When the project started, city officials hoped another set of developers would complete a large commercial project alongside the Convention Center. Like Dumplin Creek, however, those plans were delayed by the recession and lenders eventually foreclosed on the original developers. “We’re still OK there,” Atchley said. “Dumplin Creek is not the only site being looked at to be developed in our Central Business Improvement District. There are several other people looking at several other places.”
However, he said he wasn’t surprised to hear NLA wasn’t getting the response it hoped for when it marketed the property. “We know the economy is doing better, but it isn’t back to the boom we saw in the early 2000s.”
The fate of the property is also important to Sevier County Bank and the other lenders that bankrolled the project.
They sued Turley for $25 million last year, saying he had failed to pay loans he had personally guaranteed that were tied to the property. Turley had obtained the loans in 2007 and 2008, according to a complaint filed in Knox County Chancery Court, and the principal on the loans came due in 2010. SCB was the lead agency providing the loan, which was also backed by Tennessee State Bank, Mountain Commerce Bank, Citizens Bank of Blount County and Citizens National Bank of Athens.
When they originally announced the plans to foreclose, Sevier County Bank CEO Matthew Converse indicated they hoped that would help them complete the complicated negotiations with NLA. Thursday, he said they’d come to realize NLA had reservations before the auction but that two other developers are interested in the property.
“There are two additonal parties that are very interested and qualified from the bank’s perspective,” he said. In the meantime, the Dumplin Creek property represents a small percentage of SCB’s real estate holdings. “We’ve got the capacity to hold it for an extended period without any problems,” Converse said.