BERLIN – The section of Heron Park containing the large dilapidated industrial building is worth about $100,000, according to an early 2021 appraisal.
Parcel 57, one of multiple lots that makes up Heron Park, is valued at $100,000 in a March 18 appraisal report.
“A former chicken processing facility, vacant for many years and in generally poor condition,” the appraisal reads. “Improvements contain about 66,954 square feet. There are several sections, of varying description built over the years, starting about 1950. We conclude that the cost to put the improvements in usable/tenantable condition exceeds value.”
The town purchased the roughly 60-acre Heron Park property in 2016 for $2.5 million. In early March of this year, the town hosted a listening session to gather input on the potential sale of parts of Heron Park—Parcel 57 and Parcel 410. Parcel 57 is the 9.35-acre southwest portion of the property off Old Ocean City Boulevard, adjacent to the railroad tracks while Parcel 410 is a 10-acre section that runs behind Cropper & Sons. While Parcel 410 was valued at $770,000 prior to the listening session, officials at that time were still waiting on the appraisal of Parcel 57.
The appraisal for Parcel 57 considers various questions, including whether the large building on the site could be put in usable condition. With building stabilization costs estimated at close to $3 million, the appraisal deems that option not financially feasible.
Appraisers also considered the demolition of the structure. The demolition and site clearance are expected to cost more than $550,000. The site, which is zoned residential, could be broken into about 33 lots, according to the report.
“Based on a review of sales and offerings of raw residential land in the vicinity, we estimate a unit value of $20,000 per lot, or $660,000 for a cleared, clean, level site, equivalent to a cornfield of piece of level pasture, with sewer and water at the lot line,” the report reads. “Client provided a Budgetary Estimate for Heron Park – Demolition, dated October 2020, by DBF, of $552,480. This is the estimated cost to remove the existing building and perform related site clearance. It does not include any work related to the creation of a residential subdivision. The property would then be equivalent to raw land.”
According to the report that would put the unadjusted as-is value at $107,520 (the $660,000 value subtracted by the demolition cost of $552,480).
“The market might well add for profit, holding/carrying cost, liability, a minimum of 20% to the demolition cost figure, making an adjusted demolition cost of $662,976, which would leave an as-is value of effectively $0. We conclude that the as-is value of this property is near zero. We have concluded a token figure of $100,000 for as-is value. The market would probably consider any offer.”
While officials have had the appraisal for some time, they were just informed this week what they thought was a draft appraisal was actually the final appraisal. Mayor Zack Tyndall believes the true value of the property will be unlocked in a modified state, whether that’s through demolition of the building or repurposing of it. He added that the town on Wednesday submitted an application for a strategic demolition grant for the site. The application was accompanied by letters of support from Sen. Mary Beth Carozza, Del. Wayne Hartman and Del. Charles Otto.
“I think it’s a really solid grant application,” Tyndall said.
At the same time, there are still parties interested in both of the parcels.
“We’re not going to put all of our eggs in any one basket,” he said.
Tyndall said the town was open to proposals and that anyone interested in Parcel 57 or Parcel 410 was encouraged to reach out to municipal officials.
“We’ve had no formal offers so far just a lot of interest,” he said.