Kettering Health Network and the city of Miamisburg have completed an uncommon land deal that started in 2002 to create jobs, and ended this month with the $10 purchase of property valued at $4.4 million.
The health network, Miamisburg’s largest employer, paid less than the cost of a casual restaurant dinner to buy back the 4.7 acres on Leiter Road on the Sycamore Medical Center campus it sold to the city for $1.5 million, Miamisburg records show.
KHN made that purchase after it “successfully fulfilled all their obligations” in the deal, according to the city.
As part of the 17-year-old agreement, after buying the land “the city subsequently leased that tract back to KHN under the terms of the land” deal, according to city records. “KHN then constructed a two-story office building on the city-owned land and used the city’s $1.5 million….purchase price to offset the cost of construction.”
The agreement also required KHN to essentially pay Miamisburg’s debt service for the land, plus interest, according to the city.
Additionally, by the lease’s 2017 expiration, KHN was obligated to have a $51 million payroll in the city and an income tax liability of no less than $898,000 annually, Miamisburg records show.
When the deal was signed, the city collected from KHN about $337,700 a year in income taxes annually, records state.
That same agreement – assuming KHN met all its obligations – called for the land to be returned to the health network for $10, according to the city. The Leiter Road acreage is now valued at $4,399,220, Montgomery County Auditor’s Office records show.
The Miamisburg City Council approved the sale Nov. 19, and the transaction was completed three days later, according to the auditor’s office records.
Structuring a land deal in this way “for us, it’s not very common,” Miamisburg Development Director Chris Fine said. “To my knowledge it’s the first time we did a deal like that.”
Fine said the city has since approved a similar agreement with the former Dayco building on Prestige Plaza Drive - the site of KHN offices - near the Ohio 725 interchange of Interstate 75.
But, he added, “I think in both situations we’re talking about relatively significant job creation on both projects.”
Fine said he did not know how many jobs the 2002 deal created. But he said the city’s main interest in the agreement was the income tax ability created.
Attempts to reach KHN officials about the agreement were unsuccessful.
Kettering Medical Center bought the former Dayco building in February 2012 for $4.05 million, according to county records.
It then sold the land to Miamisburg seven months later for an undisclosed price, county records state.
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