Carson City Board of Supervisors: Ormsby House permits extended, property to go on market

Building and other city permits for the iconic Ormsby House have been continued by a unanimous vote of the Carson City Board of Supervisors Thursday with the expectation that the property will be put up for sale this year.

The permits received a 90-day extension on Dec. 15, 2016 under conditions that civil improvements be made to the property's extension, notably the drive and entry ways off Curry and Eighth streets.

Most of those improvements have been made, said Carson City Community Development Director Lee Plemel, despite weather and utility setbacks over the winter.

"They substantially completed those civil improvements in conformance with this in as much as they could with conditions outside of their control," he said.

Plemel said the contractor, Metcalf Builders, ran into a conflict with an NV Energy fault running along Curry Street. There was also the issue of an extremely wet winter that delayed some of the improvements.

Tom Metcalf of Metcalf Builders said that the string of dry weather is helping to steadily reduce the moisture content of the ground. But he said he is also aware of upcoming weather changes that could bring more moisture.

"Our moisture content is getting lower and lower every day," he said. "But we are also cognizant of an approaching weather system next week that may bring more."

Metcalf said the issue with NV Energy's vault along Curry Street has been resolved. A problem had arose with that utility vault and the property's Curry Street exit for the contractor's heavy construction equipment.

"The driveway apron onto Curry street was the exit for our paving equipment," he said. "We ran into some problems with NV Energy, but we've been able work with them. And just recently we were able to extend paving onto concrete portion of the driveway apron to Curry Street."

What's left of the civil improvements is being done as the soil dries out, he said.

"What we're waiting on now is literally the sub base for the moisture content to go down," Metcalf said. "Once that goes down, we can then proof roll it, get up to our 95 percent compact, add our last three inches of base, and we're done."

All work done on the Ormsby House since September has been outside improvements, he said.

According to ownership spokesperson Kimberly Fiegehen, the Ormsby House will be put up for sale and marketed by Colliers International this year.

Ted Stover of Colliers International said Thursday that the property has the potential to attract a lot of interest from buyers in the hotel and casino industries.

"I plan on putting it out to market within the next week," he said. "It's a dynamic robust market right now, and the amount of capital coming into this area is absolutely staggering. We've got a lot of contacts from casino operators who want to be in this area, so we have a high degree of confidence in selling this property."

When asked by the board if the property would be marketed for other uses besides hotel and casino, Collier said it's possible, but that is not the plan to begin with.

"There's a large market for repurposed properties, but I don't see that happening with this property," he said. "There's too much done to it and too much value in it as a hotel-casino."

He said with all of the work that has been done to it thus far, marketing the Ormsby House as a hotel-casino makes the most sense given the current market.

"Initially we are going to be marketing it as a hotel-casino," he said. "There are a lot of improvements that have been done, and it makes the most sense to market it as-is."

Should the Ormsby House need to be marketed as a repurposed property, Stover said he doesn't see much of a departure beyond a franchise hotel featuring convention space.

Supervisor John Barrette asked about the motivation of current property owners to sell.

"We need a willing buyer, willing seller situation," he said. "How willing is the seller at this juncture?"

Fiegehen replied saying the owners were very willing and motivated to sell.

"We are very, very motivated," she said. "There is a lot of money in that building. They are very open minded about what the market is."

Carson City realtor Garrett Lepire expressed concern over granting another extension to the Ormsby House permits, saying the process has continued to drag on with little progress to show for it.

"My biggest concern is that it still hasn't been on the market for six months," he said. "It sat there for 45 days up to Nevada Day since the last review (in September)."

He also said he was concerned about the length of escrow for the property, noting that it could take more than a year from the point of sale.

"We could be looking at 2020 before it's all done," Lepire said. "That would be two decades that the property has been vacant."

Stover had said the escrow could be completed in as little as six months after sale, but that would also depend on any issues tied up with its gaming license. In which case, the process could take longer.

Supervisor Karen Abowd said continuing the permits and allowing the property to sell now is in everyone's best interest, including the city and its vision supporting a revitalized downtown.

"If we revoke the building permit, it will devalue the building and the whole goal is to continue the revitalization of downtown," she said. "That building is a key part of it. I want to see it sold. If we can enable that, it is extremely important."

Ormsby owners were granted a building permit extension of 18 months from September 2016, and its next review will be Sept. 7, 2017.

The Ormsby House, owned by Don Lehr and Al Fiegehen, closed for renovations in 2000 and has yet to reopen, despite periodic work that has been done to its interior over the years.