(Photo by Shelby Herbert/KFSK)
The owners of Wikan Enterprises Incorporated, a diesel engine repair facility in Petersburg, are seeking to purchase the property they currently rent from the Borough.
Following months of negotiations, Petersburg’s Borough Assembly has landed on a price.
The land in question has a special designation — called, tideland property. Under this arrangement, Petersburg’s Harbor Department has collected rent from the Wikan family for the last three decades. Now, Sheri and John Wikan are looking to sell the repair shop so they can retire. But in order to do that, they need to own the entire property — from the building that houses their business, to the land directly beneath it.
This summer, the Assembly set a new precedent for the Borough by greenlighting the sale of leased tideland property. They directed Borough Manager Steve Giesbrecht to begin negotiations with Wikan Enterprises. The land was appraised at $100,000, and Giesbrecht proposed selling it for $154,000 — which included the next 55 years of rent from the Wikans’ lease agreement.
John and Sheri Wikan made a counter offer of $83,000, saying it was unfair to extend their responsibility to the entire life of the lease. They were also unhappy about being charged the cost of the property appraisal: $4,500.
The Assembly agreed to walk back the length of the remaining lease from 55 years, to just two. Those two additional years would wrap up the Wikans’ five-year interim lease period. However, they kept the cost of the property appraisal in the price.
The Assembly unanimously voted to set the price of the property at $113,000 — about $40,000 down from the original price. Sheri Wikan said she’s satisfied with those terms — other than the inclusion of the cost of the appraisal.
There are about a dozen other properties in Petersburg’s Marine Industrial Park that are also in this kind of arrangement, netting the Harbor Department about $160,000 a year in rent payments. The lost revenue from the Wikans family’s 55-year lease will come out of the Harbor Department’s budget.
To soften that blow, the Assembly considered altering the motion to ensure that the proceeds from the sale of the land would return to the Department’s coffers. However, that amendment couldn’t pass, because Borough Code states that the money must go into the Borough’s Property Development fund.
