Calling the deal "transformational," the West Haymarket Joint Public Agency on Monday approved a land swap with South Canopy LLC.
South Canopy LLC, which includes brothers Will and Robert Scott, will purchase the lot at Canopy and Q streets, next door to the Hudl headquarters building, for $1.55 million.
In turn, the JPA will purchase property at 215 S. Seventh St. from the Scotts for $2.064 million.
The JPA plans to demolish the Demma Fruit Co. building at that site and use the land for a plaza and entry to the neighboring block, which is owned by the JPA, and on which the city plans to create a 10-acre "west park," something it hopes will serve as a catalyst for further development in the area, especially housing.
Mayor Chris Beutler, one of the three JPA members, said the deal will serve as a linchpin to help spur housing and other development in the south Haymarket area.
"It's making a very bright future possible for the south downtown area," he said.
Councilman Carl Eskridge, who also is on the JPA, said purchase of the former Demma Fruit property was "critical" to the city's plans for that area.
"I'm excited to see what this can bring to us," Eskridge said.
Not everyone sees the land sale and purchase as a positive thing.
The JPA has encountered criticism for the prices paid. The $2.064 million the JPA is paying for the South Seventh Street property is more than $200,000 above what it was appraised at. South Canopy bought the property in 2017 for $2 million.
Jane Kinsey, representing Watchdogs of Lincoln Government, said South Canopy "seems to be making a tidy little profit of $64,000 on this project."
Kinsey also reiterated criticisms she made at an earlier JPA meeting that the makeup of the JPA will change in a few months, with both Beutler and Eskridge not running for re-election.
South Canopy is paying $1.55 million for the Canopy and Q streets property, which is well below the appraisal price of $1.95 million.
However, the price appears to be in line with what other pieces of JPA-owned land in the area have sold for.
The 0.74 acres of land at 601 P St., where Olsson built its new headquarters building, sold for $486,465 in April 2013. It was valued for tax purposes at $486,500 until last year, when the value doubled.
The 0.79 acres across the street at 600 P St., on which the Hudl building sits, sold for $700,000 in October 2015. It was valued at $518,500 until last year, when the value went up to $1,036,900.
Chief Assistant City Attorney Chris Connolly said at an earlier JPA meeting that the main reason the purchase price for the Canopy and Q street lot is below market value is because of restrictions put on the property.
According to the sale agreement, South Canopy must build a 100,000-square-foot, six-story, $15 million building, with a courtyard accessible to the public, on the land.
It must submit a building permit for the building by Nov. 1, 2021, and have substantial footings and a foundation in place by May 31, 2022, or the city will have the right to buy back the land.
Will Scott said plans are for the building to be a mix of retail, office and residential space. He said he hopes to attract another corporate headquarters to the area to join Hudl and Olsson.
Scott called the lot next to Hudl, "one of the best pieces of real estate in the city, and even in the Midwest."