Tuesday, February 07, 2012

Old airport price could have been lower

PANAMA CITY — The story of how the final purchase price of the old airfield in Panama City went from $56.5 million placed in escrow in 2007 to $51.4 million this week is a short tale of twin, two-word phases, “complicated contract” and “intense negotiations.”

Airport attorney Franklin Harrison said Tuesday the minimum purchase price set in the contract with St. Andrew Bay Land Co. always had been $45 million, although the larger amount was set aside.

Because of the length of time between December 2007 and the anticipated final closing, a series of detailed specifications was placed in a complex contract before the new owner would accept the land, including environmental testing and cleanup, Harrison said.

“We did some environmental cleanup that pushed the price to $50 million,” Harrison said. After that, “it was just a matter of sitting down and negotiating” to get the price to $51.4 million.

The sale is supposed to go through either Wednesday or Thursday, enabling the Airport Authority board to receive the money and finally settle a $50.37 million construction loan with Regions Bank used to build the Northwest Florida Beaches International Airport near West Bay.

As late as March 2011, Harrison was telling airport board members he was pushing to raise the purchase price to a hard floor of $51 million as the environmental cleanup continued.

In addition, the final closing on the land was delayed in December, 2011, because there still were disagreements over whether the exact terms of the contract had been met, he said.

Harrison said Tuesday one of the reasons the final price was accepted by both the airport and St. Andrew Bay Land Co. was the parties did not want to hire breach of contract experts and environmental consultants if negotiations broke down.

Both types of experts had been lined up and ready to go, but the process of going that route was expensive, he said.

“We looked at the realities of the situation and that is what we came to,” Harrison said. In the end, “there was a willing seller and a willing buyer.”

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