DOWNEY - Seizing a rare opportunity to accommodate a new car dealership, the City Council approved a $3.8 million sale agreement with Champion Dodge/Jeep/Chrysler last week after the dealership expressed interest in purchasing a nearly 4-acre site from the city with plans to open a new Fiat dealership in Downey.Acquired by the city in August 2010 for $2 million, the undeveloped property, located at 9715 Firestone Blvd., has been under negotiation for several months since Paul Antepara, owner of Champion Dodge/Jeep/Chrysler, approached the city, hoping to pur chase the site. Eager to help facilitate the Fiat dealership, the city developed a bold sale agreement to assist Antepara with the land purchase. First, the city will loan Antepara $3 million towards the purchase of the proposed Fiat site, valued at $3.8 million, according to the city staff report. Acting as a bank, the city will set specific terms for repayment including a 5.5 percent interest rate, a 20-year term, and a principal and interest of $247,680, payable to the city each year. City staff estimates the $3 million investment will result in a $1.8 million gain by the city over the 20-year span. In addition, the city will also provide Antepara with the remaining $800,000 in the form of a forgivable loan if he agrees to the terms of a 5-year operating covenant, which requires the renovation and maintenance of the facility for at least 5 years after the dealership opens. According to the staff report, the city will utilize community development grant money to fund the $800,000 loan. Nonetheless, the city has prepared several safeguards to protect its investments. First, the city will be placed in a first position on the property note, allowing the city to foreclose on the property and retain ownership in the event of a default. Also, per the operating covenant, Antepara will be responsible for repaying a prorated amount of the $800,000 loan, $160,000 a year for five years. City officials believe the agreement provides a win-win scenario for both the city and Champion Dodge/Jeep/Chrysler. "First, it will redevelop a prominent long-time blighted commercial property at the east entrance to the city into a new state-of-the-art Fiat dealership," wrote Brian Saeki, Downey's community development director. "Additionally, it will create at least 23 new jobs in this area, as well as generate significant new unrestricted revenue that the city could use to help pay for existing and/or new services, programs, and projects," Saeki wrote in a staff report. Fiat is the ninth largest car manufacturer in the world and the parent company of several other high-end automobile lines such as Maserati, Ferrari and Alpha Romeo. 165 new Fiat dealerships have been approved nationwide, including four in this area. Besides one location in Cerritos, Champion Fiat in Downey will be the only Fiat dealer in the region.
********** Published: April 21, 2011 - Volume 10 - Issue 1