The viability of developer Mark Nicholas’ 117-bed hotel project is still unknown after a legal notice scheduling a new foreclosure sale of its 2-acre site next month was published Tuesday.
Nicholas, who previously told Starkville aldermen and The Dispatch he had secured new financing for the project and was not heading toward foreclosure, did not return a phone call Tuesday.
An attorney listed in the notice confirmed the sale’s scheduled date but declined to comment further on the situation.
Published in local media outlets, Tuesday’s notice mirrors a similar announcement from September: two deeds of trust associated with 2.03 acres east of Nicholas’ completed Cotton Mill Marketplace are listed for sale on Nov. 1.
The previously scheduled property sale was “delayed,” according to attorneys.
Last week, Nicholas collected about $909,000 from a tax increment financing reimbursement after aldermen approved a plat for his completed Cotton Mill Marketplace storefront and its associated infrastructure.
Nicholas played off financial issues with the hotel parcel to aldermen last week, saying construction should begin this month. In a previous interview, he said the TIF reimbursement and his newfound financial standing “were not connected.”
“We had a contractor that could not deliver on the pricing that we all agreed upon when we started planning. I fired him and hired another. In between that time, the bank out of Minnesota pulled the plug on me,” Nicholas said on Oct. 4. “We’ve secured other funding and are moving forward.”
The Dispatch on Tuesday could not independently confirm the new financial status or if the property would continue heading toward foreclosure.
The original deeds of trust cited in the recent legal notice reference promissory notes combining at $10.79 million. Both were dated July 1, 2014, and had Jan. 1 maturity dates.
The Dispatch could not ascertain how much was owed or paid on either note, if Nicholas had negotiated new terms or if the new financing he previously mentioned would cover the debt.
However, in the legal notice of foreclosure, Stearns Banks National Association claims Nicholas defaulted in performing the “terms, conditions and stipulations” set out in the deeds of trust.
Further complications to the project’s future come after Community Development Director Buddy Sanders confirmed Tuesday that Nicholas contacted the city for building permits associated with the development.
If the development comes to fruition and Nicholas constructs public infrastructure, a previous TIF agreement with the city would allow him to receive reimbursements for completed roadways, water and sewer connections and other projects.
The city could issue TIF money for infrastructure classified as private, since the road connecting Cotton Mill Marketplace and Spring Street was not dedicated as a public thoroughfare.
Miss. Code Ann. 21-45-9 states municipalities may also fund private improvements if their governing bodies make a finding of fact that subsidizing such projects is in the best interest of the city.
The total TIF for the marketplace and hotel developments was previously capped at $4 million.
Mayor Parker Wiseman confirmed the city does not owe Nicholas any TIF funding at this point since the marketplace project was reimbursed and no projects associated with the hotel development are eligible at this time.
Carl Smith covers Starkville and Oktibbeha County for The Dispatch. Follow him on Twitter @StarkDispatch
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