The borough assembly is moving toward lowering the asking price for the former Wrangell hospital by almost half and hiring a real estate agent to sell the property.
The assembly at its Nov. 22 meeting accepted an ordinance to reduce the asking price and set a public hearing on the ordinance for Dec. 20, at which time members could vote on the proposal.
The Bennet Street lot has been vacant since the SouthEast Alaska Regional Health Consortium’s new medical center opened in February 2021. The borough has been looking actively – and unsuccessfully – for a buyer for about seven months.
After attracting no offers during a 30-day bidding period last June, the borough listed the property on a surplus website at the direction of the assembly, which preferred the method over Borough Manager Jeff Good’s recommendation that it enlist the assistance of a real estate agent.
The website is used by government agencies across the nation to sell old police cars, school buses, office equipment and real estate. The borough had sold the former National Guard armory for $110,000 using this method, but it has not seen similar success in its attempt to sell the hospital property on the website.
Letting the property sit vacant is a costly endeavor. Heating, insuring and maintaining the building costs the municipality $8,000 per month — nearly $100,000 yearly. And as long as the property is borough-owned, it does not generate tax revenue.
The building’s original price tag was $830,000, encompassing the full appraised value of the land and structure. Since hazardous materials including asbestos are in the 50-year-old building’s roofing, tiles, wallboard and fire-rated doors, demolition would be costly. The property “very likely has a negative value,” said borough Economic Development Committee member Jacob Hale at an Oct. 19 meeting. “It costs more to fix than it's actually valued at.”
The new asking price up for assembly consideration is $470,000, which is the appraised value of the land only. The borough may entertain even lower offers, according to a staff presentation to the assembly, but such offers would have to create economic development opportunities for the community.
All assembly members except Jim Debord voted to advance the price reduction and the hiring of a real estate agent at the Nov. 22 meeting, setting up a final decision for Dec. 20.
“I’m afraid it’ll be stripped and dumped,” Debord said in an interview after the meeting, explaining his no vote. “Whoever buys it is going to get in over their head and strip the place and leave us with an eyesore.”
Though he thinks the reduced price is too cheap, he would support “giving (the property) away under the stipulation that they would tear it down and have a good building site.” Debord worked in the building as a therapist until construction of the new Wrangell Medical Center.
“We believe that listing for the land-value of the (Wrangell Medical Center) will elicit serious buyers for the property,” Good wrote in the ordinance’s summary statement.
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