By Neil Johnson njohnson@gazettextra.com March 28, 2022
JANESVILLE
Some Janesville City Council members called it a “logical next step” while others said the move “puts the cart before the horse.”
Either way, the council voted 5-2 Monday to direct the city to negotiate buying the 100,000-square-foot former Sears building at Uptown Janesville for $1 plus about $6,000 in closing costs to groom the property as the potential spot for a new ice arena and convention space.
The move will give the city control over the former Sears property at 2500 Milton Ave. and launch a design phase that over the next three to six months will flesh out what it will cost to clear the defunct former Sears building and construct the Woodman’s Community Center, a proposed two-sheet ice arena and conference center, on the same parcel.
Under the agreement, the city would have the option to transfer ownership of the site back to Uptown Janesville’s owner, RockStep Capital, if the city eventually decides not to go forward with the arena project.
The council’s decision came after more than hour of council members asking probing questions of city officials and Uptown Janesville’s owners, including whether major anchor tenants at the shopping mall, including Dick’s Sporting Goods, would sign off on the $28 million proposal that would replace the current single-sheet ice arena south of downtown.
Heather Miller, one of the council members who voted against the city forging a purchase agreement, wondered why the city needed to move on the project now.
As the council deliberated whether to pursue ownership of the Sears property, Tim Lindau, a local real estate attorney who represents RockStep Capital, told the council that as recently as last fall, RockStep had nearly moved to sell off the Sears property to another buyer.
Lindau said that near-decision came during a period of the COVID-19 pandemic when talk about the ice arena project had cooled off and the mall faced rolling retail closures and public health lockdowns that led to increased mall tenant turnover.
He said the council’s decision to pursue the city taking ownership of the property “really matters” to RockStep.
Tim Koltermann, a partner with RockStep, said the city’s commitment to buy the Sears building is “literally the first step in the reinvigorating” the mall.
He said an ice arena and multiuse sports and conference center space would provide a “constant source for a potential supply of shoppers.”
“That is what the mall needs,” Koltermann said.
Jennifer Petruzzello, the city’s neighborhood services manager, is taking the lead on crafting a $7 million grant funding request for the ice arena proposal. She told the city council Monday that under earlier concepts formed through council discussion, the city has told its design consultants to pursue project plans that would cost no more than $28 million. She said that works out to about a $24 cost per year for 20 years for the average Janesville homeowner. A private friends group, made up in part by people involved in the Janesville Jets junior hockey team that would be a primary tenant of the new facility, says it is committed to raising $7 million for the project.
The move to get the Sears space under city ownership, Petruzzello said, would give the city legal control over the property to move deeper into design work she said would determine whether an ice arena at the mall is feasible for the city.
Paul Williams, the other council member who voted against the move Monday who is up for reelection next week, said he is not convinced an ice arena can be built for $28 million given the specter of “30% inflation” in the cost of construction materials.
“Even though I’m going to have some people mad at me, I will be voting no,” Williams said.
Petruzzello said the consultants the city is working with can now access the Sears property and ramp up design and cost analysis work. She said the consultants would provide regular updates to the council on possible costs for the project as the planning process rolls.
Council member Paul Benson, who moved Monday to authorize the city negotiating to buy the Sears and is also up for reelection next week, said the city’s getting a linchpin property for what he considers a fair price.
“The city, as I see it, is the main beneficiary of this contract because we acquire a building that’s worth $3 million for $1,” Benson said. “Normally, those contracts cost much, much more than that.”
Some council members pressed RockStep to disclose how close it is to getting its anchor tenants and lienholders to sign off on an ice arena project at the former Sears.
Lindau said the city’s move Monday would inspire confidence, but he said talks with the anchor tenants, including Dick’s, is one significant remaining challenge that could take weeks.
“We’re working as hard as we can already to get their consent,” Lindau said.
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