Two school parcels could yield nearly $4 million, study shows

By Maureen Robertson

Tasked with analyzing five Ramona Unified School District properties, a Carlsbad firm has determined that two of them could be sold to net about $4 million for the district.

Eric Hall of Eric Hall & Associates LLC discusses the asset management study his firm did for Ramona Unified School District. Sentinel photo/Maureen Robertson

“The market is improving every day,” Eric Hall of Eric Hall & Associates told district trustees at their November meeting. The two sites ­— 39 acres behind Ramona High School at Hanson Lane and San Vicente Road and 32 acres adjacent to Hanson Elementary in the 2500 block of Boundary Avenue — are the district’s most recent land purchases.

The district bought the RHS property in 1999 for $1.19 million and acquired the Hanson Elementary property by eminent domain in 2002 for $953,000.

Hall’s recommendation is to form a surplus real property advisory committee and sell the RHS land. About 22 acres are buildable and about 17 acres are vernal pool and wetland, he said. Considering what he called “broker opinion of value,” the land could sell for $2.2 million to $3.2 million, depending on the number of units built.

Working with Hall on the study was Mark Kagan, an attorney and real estate broker. They said a developer could build a mobile home park, apartments or condominiums on the high school property.

The 32 acres adjoining Hanson Elementary has low-density residential zoning for single-family homes.

“We think 4.3-acre parcels would be very likely here,” Hall said, estimating sale value at $786,000.

  • The 187-page Asset Management Study recommends the district keep the other three properties: 5.02 acres at 1710 Montecito Road, Ramona Community School’s former location; 4.92 acres off Bellemore Drive between Gantry Way and Staples Way in San Diego Country Estates; and 20.15 acres that includes Ramona Elementary School, Head Start, Montecito High School, Future Bound, Administration Center, bus barn and maintenance yard, and

    Ramona school board member Dawn Perfect asks a question during a presentation of the asset management study of five district properties. At left is trustee Rodger Dohm. Sentinel photo/Maureen Robertson

    Wilson field.

Part of the former Ramona Community School is home to Arriba Teen Center, which pays the district $1 a year, and the district rents another part to the Special Education Local Plan Area, North Inland, for about $33,000 a year.

Because most of the Montecito property is floodplain, it has the potential of yielding one or two homes and could be sold for $97,890, said Hall, a retired public school administrator who started his company in 2006. His recommendation is “to continue to seek tenants that may be consistent with the education design of the site, and certainly continue to lease it, as you are gaining revenues.”

Among pitfalls of the Estates property are:

• The county has issued as many building permits as the planned community allows, and

• Of the 53 homes for sale in the neighborhood, only 19 are traditional sales through a realtor.

“The balance are properties that are owned by a bank or under some kind of distressed sale,” said Hall.

Mark Kagan of Eric Hall & Associates explains why he thinks it makes sense for the district to continue to lease school property on Montecito Road and to seek additional tenants there rather then sell the property. Sentinel photo/Maureen Robertson

He recommended a 4-H program or horticulture operation as the highest and best use of the Estates property. Among other suggestions are a working farm, recreational vehicle parking and self-storage.

“Due to the circumstances here, we found it very difficult to establish any value (for sale of the land) at all,” he said.

The study divides the 20.15 acres in town center into three sections: Ramona Elementary at Eighth and D streets; the district office, Head Start, bus area, maintenance and transportation, Montecito High School and Future Bound; and Wilson Field. It places total value of the 20 acres — five blocks south of Main Street and bounded by D Street to the north, Eighth Street to the east, I Street to the south, and Ninth Street to the west — at $1.5 million.

While the highest and best use of Ramona Elementary would be to rezone it for commercial use, “we looked at the Ramona real estate sales and trends and listings, and it’s an extremely soft market,” Hall said. A number of Main Street properties are vacant, and rents are low, he said.

If commercially zoned, the land is worth about $1 million, the study states.

“However…it is highly unlikely a developer would pay this value since the average commercial rent for retail, industrial and office space is so low that it will not support the debt service after the cost of acquisition and construction,” the report continues.

If the property had residential-office, its value would be about $74,000, but it is unlikely a developer would be interested in this market, according to the report.

“We recommend that you not sell now, but potentially reevaluate when the market is stronger,” said Hall.

Closing a school could save money, but it also could add costs. Of Ramona Elementary’s 505 regular education students, 30 are bused to school. Relocating the students would mean transporting nearly all of the students to another school, and the majority of them would qualify for free transportation.

“If you could get a lot more value and there was a lot more demand for commercial, potentially the cost of transporting kids and operations and buses might be minimal if you could get significantly additional dollars,” said Hall.

The report places value of Wilson Field at $116,870 and the rest of the property at $363,600, but states that a buyer is unlikely in this depressed market.

The complete report is on the district’s website, www.ramonausd.net.

Trustees in April approved spending $32,500 from the district’s developer fee fund for the study.

A key financial challenge the district faces is a $25 million loan a previous board approved in 2004. With interest, the money owed is about $35 million, according to the district. Selling some district property is among ideas that have been discussed to help pay off the loan.

Superintendent Robert Graeff told trustees he and staff would prepare some recommendations for their Dec. 19 meeting. Trustees, who held a community workshop in August to discuss long-term fiscal planning for the district, are expected to schedule a second workshop for January.

Related posts:

  1. Should Ramona Unified close a school?
  2. Trustees ask voters for $66 million
  3. Crop report shows jump in wine grape production in 2012
  4. Ramona Unified school schedules and office hours
  5. Ramona school board approves $45 million budget

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Posted by Maureen Robertson on Dec 6 2013. Filed under Featured Story, News, Ramona, Schools. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.

4 Comments for “Two school parcels could yield nearly $4 million, study shows”

  1. Ramona Resident

    We have still not heard a word from RUSD as to the operational cost savings that could be realized by closing a school and consolidating students to the remaining sites, nor have we heard anything about additional operational savings that could be realized by reducing non-critical administrative staff at all sites. During the government shutdown many federal agencies shut down significant parts of their organizations that were deemed non-critical. I find it impossible to believe that there are absolutely no savings to be found in reducing administrative staff. Not to single them out, but do we really need as many assistant principals and counselors at the high school? I went to RHS and we had one assistant principal and two counselors. Why so many now? Just one example…

  2. sandra j

    it is ridiculous to value the montecito property based on its possible use as residential property when it's yielding 1/3 of that annually as a rental. evaluating it as an income property, if it throws off $33k/year, it could be worth $500k to $1m or more.

  3. MWorkman

    Selling property in this market place, in this community, on spec is silly. No new project would be approved. You'll get far from top dollar. No project is worth much in Ramona because all the crap you have to go thru to get anything passed. The ONLY way that would fly is if you could "steal" the property, which defeats the purpose. But I guess it took spending more than $32K to convince those singing the same ol tired song. Retail? All low end. Two dollar stores and a Goodwill.

  4. MWorkman

    High school counseling is much more involved than it used to be. College requirements alone have created a larger demand for more counselors to be more involved in students' academic careers. As far as assistant principals, I can't make that case for certain. But I can offer up this: I know of two schools in this region who have an asst principal in charge of technology and on-line services. Including monitoring campus related social media. It's a a different world. Not justifying what everyone has, but may be not valid any longer to compare to what they had when we went to school.

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