Molly Davis, Staff Writer
Posted: 01/18/2012 04:38:10 PM PST

REDLANDS – Historic preservationists cautiously celebrated after receiving word that cinema owner George Krikorian is in default of an agreement with the city that could lead to his purchase of a historic downtown packing house.

At their Tuesday night meeting, Redlands City Council members, acting as the Redevelopment Agency board, received notice from Economic Development Manager Michael Lengyel that Krikorian’s company, ShowProp Redlands LLC, is in default of its Conditional Property Disposition Agreement, which could lead to the potential sale of the MOD Packing House.

In the agreement, approved by the agency board in July, ShowProp could purchase the Third Street packing house, which sits adjacent to the Krikorian Redlands Cinema 14, for $260,000, to be used as a gourmet grocery store.

Historic preservationists and concerned citizens, worried that the packing house could be torn down if purchased by ShowProp, spoke to the council over the summer in favor of a sale of the building to a buyer interested in donating it for the Redlands Historical Museum.

The staff report explains that in October, ShowProp expressed concern over how the state’s elimination of redevelopment agencies would affect the transfer of property.

But at their Nov. 1 meeting, council members approved a resolution electing themselves to become a successor agency to the Redevelopment Agency, allowing existing obligations to be carried out.

According to the staff report, city staff sent Krikorian a letter in November, “informing him that the city remains committed to the possible sale of the property provided ShowProp comply with the provisions of the Agreement.”

The report stated that “to date, ShowProp has not satisfied the obligations and conditions of the Agreement within the time established in the Schedule of Performance attached to the Agreement…and referenced in Section 305 of the Agreement.”

It was also noted by City Manager Enrique Martinez that ShowProp owes nearly $33,000 to the city for environmental consultation reports.

Mayor Pro Tem Paul Foster asked what efforts have been made to notify ShowProp of its default, to which Lengyel said “there have been a number of conversations” regarding the default.

But Development Services Director Oscar Orci told the council that a representative from ShowProp contacted Orci late Tuesday afternoon, “surprised” to hear of the default and asked for a meeting.

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