JOHNSON CITY, Tenn. (WJHL) — East Tennessee State University’s Foundation has owned the 5-acre University Plaza shopping center, home to Earth Fare supermarket and a contiguous strip center, since last December, News Channel 11 has learned.
ETSU didn’t publicize the $6.85 million purchase at the time, but Vice President for University Advancement Pam Ritter discussed the decision after ETSU’s Board of Trustees meeting Friday.
“We did not seek it out,” Ritter said, adding that with the purchase, “we are landlords.”
She said then-owner, ETSU alumnus Mitch Cox, approached the foundation last year and said, “‘If anyone is going to own it other than me, I would like it to be the university.'”
The property is bounded by West State of Franklin Road, Greenwood Drive, the ETSU campus and, on the west, three privately owned lots around 4 total acres that front State of Franklin.
“When you look at our landscape, we’re landlocked,” Ritter said. “So it would make total sense to do that.”
Ritter said she took the idea to the Foundation board, which had “quite a few conversations about it” before pulling the trigger. She said sitting on a cash-flow-generating property “is not our number one priority.”
A pro forma budget predicted $200,000 of annual net income, and Ritter said the financials are trending well 11 months into ownership.
Ritter said tenants were immediately notified by Cox. His company is continuing to act as the leasing agent, and how long the plaza remains a commercial enterprise is an open question.
“We do have to earn money because we support students and things like that, but the long-term plan is ‘keep it as is until we see a need,'” Ritter said. “And there may not be a need for 20 years or 100 years.”
That said, five acres contiguous to the campus is hard to find. The land to the plaza’s east is owned by Trigg Enterprises and is currently occupied by a recently closed Bojangles Restaurant. An oil change business is just east of that and then Knight’s Pizza. Put it together with the plaza and the result would be a significant chunk of land.
“Would we consider?” Ritter said when asked about the prospect of buying the other three properties. “Absolutely. We would look at everything but that’s not our main function. It would be a definite case-by-case basis.”
When asked about the kind of deal ETSU got considering Cox approached them, Ritter answered the question with a question.
“Did I say he’s an alum? Yes, he’s a very generous man. We’re very pleased with the relationship.”
Records show the center has almost 46,000 square feet of retail/commercial space and carries a tax-appraised value of $4.1 million.
“Right now the plan is it’s working fabulously and we’re not changing anything,” she added.