What if state government could come up with an initiative that spurred economic development, helped revitalize fallow areas of Raleigh and made plenty of money for taxpayers? Sounds like a worthwhile effort. And if such an effort were underway, why would anyone go out of their way to kill it?
Yet that is exactly what the new Cooper administration has just done, by pulling two parcels of surplus state-owned real estate off the market after they had been listed for sale.
The old Rex Hospital site, at the corner of St Mary’s and Wade Avenue, houses the Employment Security Commission. The building itself is dilapidated and the interior looks much as it did when the hospital moved during the early 1980s, with state employees working in former patient rooms, and files stacked up in tiled shower stalls. The nursery in which many in Raleigh spent a few of their earliest days is still there, filled with furniture and papers. It is some of the least efficient, most depressing office space you will ever see.
But it is a beautiful piece of land – 16 acres in the heart of Raleigh, gently rolling, with ancient trees. In midst of massive demand for real estate, the site could be transformed into an attractive residential development, earning an estimated $30 million for the state, returning the site to Raleigh’s tax rolls and allowing the hardworking employees there to move to more modern and productive office space.
The site at the intersection of Blue Ridge Road and Reedy Creek Road, directly across from the North Carolina Museum of Art, is even more underutilized. The museum is growing, having just opened an extraordinary park to complement the new building opened in 2010. The entire Blue Ridge corridor is a strategic area of redevelopment for the City of Raleigh’s master plan, with the museum and the growth of “new” Rex Hospital spurring significant interest in turning the area into an attractive destination. Estimated value for the state’s land: $20 million.
The state must have a pretty good use for such a valuable parcel, approximately 26 acres in the heart of this emerging neighborhood, right? Actually, the state uses it to park cars and store textbooks – uses that can easily be moved to less valuable locations (the state owns 20 closed prisons, any one of which would make a fine textbook warehouse for as long as hard copy textbooks are still being used in public schools).
For years Raleighites have driven by these sites, shaken their heads and wondered why the state needed to own such valuable land and use it so inefficiently. Under Gov. Pat McCrory, state government began to think more intentionally about how it owned and occupied real estate, and the state began to sell some surplus sites.
The effort has been a success in its early days, raising over $60 million from sales of property including Dix Hospital, the Blount Street houses and a closed prison in Charlotte. Each of these sites was badly underutilized by the state – beautiful parkland occupied by rundown office buildings, historic homes left to crumble, the prison facility simply shuttered, with all of the furniture and equipment still piled high inside. They will be revitalized under private ownership, the neighborhood will improve, the city will earn tax revenue and economic growth is facilitated.
The sale of these two Raleigh sites could earn taxpayers about $50 million – for comparison, that’s how much the public schools have requested for textbooks and digital learning, or what it costs to send another 10,000 4-year-olds to pre-K for a year. The sites have already been listed for sale and generated significant interest, given buoyant market conditions.
Responsible stewardship of state-owned assets is not a partisan issue. We can think of no good reason to stop an effort that has so many beneficial effects.
Lee H. Roberts served as State Budget Director from 2014-2016; John J. LaPenta Sr. served as Deputy Secretary of Administration and Director of Project Phoenix until last week.