Nine parcels of Rochester-area land owned by the state Department of Transportation, including a lakefront property in Webster and two parcels totaling 40 acres in Livingston County, are scheduled for auction Feb. 27.
The sale, at Region 4 headquarters on Jefferson Road in Henrietta, is the third in the last six years for the regional office. Similar auctions have taken place throughout the state.
The first here, in 2008, resulted in the sale of three properties for $694,300. The second, in 2010, generated $326,500 from three sales. Six properties were listed for each auction.
"We've been doing these on a more regular basis," said Thomas Finch, a real estate specialist at the Henrietta offices. "It's a matter of identifying the properties that we have and having the staff and the resources to put into an auction. There's quite a bit of work involved."
DOT appraisers have set minimum bids for each of the nine parcels. Five are in Monroe County, two are on Route 332 north of the city of Canandaigua and two are east of I-390 and south of South Lima Road in Geneseo.
"We believe we're at very fair prices, very reasonable prices," Finch said. "We are obligated to receive a fair return and fair market value. We're monitored by other agencies such as the state comptroller's office.
"It's not like a railroad option where we're just going to keep going down till somebody buys it. We have a starting price, a fair price, and we need to receive that. If we don't sell the property, we just put it back into our inventory."
Lake Ontario frontage
The highest of the appraisals is $92,500 for the vacant Webster land between 90 Lake Road and 112 Lake Road with 145 feet of Lake Ontario frontage.
"We fully expect to sell the Webster property," said Steven Wanamaker, a real estate specialist with the DOT's Office of Right of Way in Henrietta. "Lakefront property is very desirable. We've had a lot of interest in it. This is an area that's very attractive. We don't know what the town will allow somebody to build on that."
The DOT acquired the Webster parcel as part of an abandoned railroad corridor, DOT officials said. Lake Road was a state highway at the time, and officials were considering building a permanent bridge over the Irondequoit Bay outlet. The additional right of way would have been needed to do that, officials said.
The DOT does not determine what can be done with the properties, he said.
"One of the main questions we get is what can be done with the property," he said. "A lot of that will come down to your local zoning and your building office."
State property is typically not zoned, Finch said.
"Our property may be in a residentially zoned area, but there is no zoning associated with our property," Finch said. "Once we sell, the town will decide what the zoning will be on that property.
"People shouldn't assume that there's a particular use that they'll be able to put the property to. It's important to talk to the town and get an idea of what they will and will not allow."
The Webster parcel is part of the town's waterfront development district, said Donald Hauza, deputy commissioner of the Department of Public Works. The waterfront district runs the length of the town's Lake Ontario shoreline and includes portions of Irondequoit Bay.
"They can use it for a single-family dwelling and any of the other normal uses that are listed in that particular zoning district," Hauza said.
Low-density residential development and certain commercial, recreational and open space uses are permitted, the town code states. Building heights cannot exceed 30 feet, with the Town Board authorized to set lower maximums for a particular parcel if scenic views are compromised.
Two of the five Monroe County parcels are vacant land in residential areas of Irondequoit. One abuts the east property line of 434 Liberty Ave. The second abuts the east line of 288 Lake Breeze Park.
"In talking to the town, we know that those lots were historically used for dumping yard waste and things like that," Finch said of the Irondequoit sites. "So we suspect there's probably some unsuitable material in there that would have to be removed before somebody can build there."
The two other Monroe County properties are in Chili and Greece.
The Chili parcel is 1.14 acres of vacant wooded land on the southwest corner of Ballantyne Road and Scottsville Road. The L-shaped Greece parcel is 0.24 acre of vacant, commercially zoned land on the northwest corner of Newton Road and West Ridge Road.
The largest tracts in the portfolio are the Geneseo parcels. They are a 26-acre heavily wooded property east of a Niagara Mohawk utility corridor and a 14-acre parcel not far from the South Lima Road overpass of I-390.
Both were part of farmland bisected by the construction of I-390.
"Now the farmer has no use for this land because he can't get to it," Wanamaker said. "Even though we technically didn't need all of this for the highway, (the two parcels) were damaged so much by it that we ended up purchasing the land from them. That's how we end up with a lot of our properties in the auction."
Both parcels are vacant and inaccessible because they are surrounded by privately owned land.
"They're probably best used by a neighbor because they can direct the access to the property," Wanamaker said.
"But we can't just sell it to one neighbor because there's a guy down here, there's someone up here. ... They do have to get put up for auction, even though they may not be the most desirable to the general public."
The Ontario County properties are a nearly 2.9-acre tract on the east side of Route 332 south of Yerkes Road in the town of Canandaigua and 1.1 acres on the east side of Route 332 south of Clover Meadow Lane in Farmington.
The nine parcels are the remnants of DOT acquisitions of property for highway projects.
"We often take a portion of the property for the actual highway use, and what's remaining may not be of economic value to the owner, and we will buy them out," Finch said.
"We don't pay taxes on those properties, so we're taking productive property out of the private domain and putting it in the public domain. We have to maintain it. It adds to our liability. No one is able to use it. Municipalities can't collect taxes on it."
The state is exempt from local property taxes except in rare cases such as sewer lines.
"When we sell it, we put it back on the tax rolls," Finch said. "Most people that buy our property will then do something with it, so we're stimulating economic activity. We've seen some very nice projects come out of property that we've owned."
In addition to public auctions, the DOT sells properties directly to interested buyers, most of whom own property abutting the state-owned land, Finch said.
"That tends to be our largest amount of business, people coming to us and saying, 'I need just a little bit more land, and I border state land,'" he said. "Sometimes a few thousand square feet may be the difference between a development and not a development.
"If people think they can put state property to use, they should contact us. If we can't sell it, we may be able to issue a permit where essentially we'll rent it to them."
The DOT also conveys properties to municipalities for public purposes.
"We have strict criteria that it's got to be for another public purpose," Finch said. "We actually put reverter clauses in our deeds that say if you stop using it for this public purpose, it comes back to the state."
The DOT, for example, recently conveyed a 10,000-square-foot parcel to the city of Rochester for the upcoming expansion of World of Inquiry School 58 on University Avenue.
It also conveyed 1.4 acres of surplus property to St. John Fisher College for the construction of a maintenance building. The sale freed up on-campus land for the expansion of an educational building.
Next month's auction took 12 months to develop, including approvals from local and state agencies and sometimes from the Federal Highway Administration. The appraisals are done in conjunction with municipalities.
"We always involve the locals," Finch said. "From the beginning, we let them know where we're looking to dispose of a property in their neighborhood or town.
"We like to know what feedback they may have or any concerns they may have. And we share any information we think is pertinent."
1/11/13 (c) 2013 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email email@example.com.