A deal for a downtown Fresno card room to purchase a parking garage and retail space blocks away appears to have fallen apart.
Brixton Capital, which partnered with Club One Casino, has pulled out of a deal in which it would have paid $1.7 million for the so-called spiral garage at the corner of Fulton and Inyo streets.
Related Story: Did City Hall Get Top Price for Spiral Garage? Some Say No.
The plan was for Club One to move from its current location at Van Ness and Tulare to the spiral garage location.
Corey Eagle, Brixton’s principal, confirmed he emailed Deputy City Manager Laura Merrill on Tuesday morning to inform the city Brixton no longer will be involved in the deal, which was brokered in December. Brixton is a private real estate firm based in Solana Beach.
Eagle declined to say why his group walked away.
Partner Sends Email to City
“Thank you very much for the kind offer to extend, as we believe (owner) Kyle Kirkland and Club One Casino will make a great success for its business at this location, and will be a terrific boon to the city’s continued and ongoing revitalization efforts downtown,” Eagle says in the email. “However, at this time, for various unrelated considerations, Brixton is not going to be proceeding on the acquisition and development of this property.”
Related Story: Council Asks Why It Wasn’t Told of Audit Before Spiral Garage Sale
Eagle said he wished Club One well. “I hope they have success,” Eagle said. “It is going to be a wonderful deal. It will be really cool. We have other reasons (for pulling out) that really aren’t relevant.”
Eagle declined to answer questions about the relationship between Brixton and Club One. He noted in the email that Club One was working with the city to “try and facilitate an assignment of the DDA (agreement), but at this time that has not happened and may not be viable.”
Club One Casino CEO Kyle Kirkland remains optimistic. In an emailed statement, he said, “We (Club One Casino) are still invested in the project and continue to believe it would be transformative for the area. We have ideas on how to keep it moving forward and intend to meet with City representatives in the next week or so to talk through alternatives.
“It’s my sense that projects of this magnitude always go through a few iterations on the path to success,” Kirkland said.
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Questions About the Deal
In December, Kirkland said his company would invest up to $15 million to rehab the property. He said it would be a 24-month project.
The purchase agreement called for Club One to allow the Fresno Grizzlies access to the garage during baseball season. The Grizzlies’ ownership group had made a competing offer for the property.
The deal was not without controversy. Club One presented the highest bid to buy the city-owned property, which needed millions in upgrades to both the 585 parking spaces and 50,000 square feet of retail space. At the time, Club One assured the city it was willing to invest $15 million on the project.
The council voted 6-0 to approve the deal in December 2018.
Next Steps by Club One, City Unclear
Downtown developer Terance Frazier complained that the appraisal price was too low and that the bidding process wasn’t conducted fairly. Escrow for the deal, known as a disposition and development agreement, initially expired June 30, but City Manager Wilma Quan offered to extend it by 180 days.
However, Brixton declined. In in the email to the city, Eagle wrote that Brixton “has effectively terminated the Disposition and Development Agreement since we did not deliver the required affirmative Notice of Approval.”
City councilman Miguel Arias, who represents downtown Fresno, said he plans to meet with Kirkland and Mayor Lee Brand about the project.
“At that time, we will evaluate options that are in the best interest of everyone, especially our tax payers,” Arias said.
