Ability to rezone Virginia Street property may determine property's future

The possible sale of the former St. Elizabeth Hospital property by Steve Owsley could at long last be gaining traction.

On Thursday, Aug. 17, a representative of the Belmont Development Company LLC (BDC), based in Oklahoma City, Okla., will be in attendance at the meeting of the city of Hannibal’s Planning and Zoning Commission to ask for a rezoning of the Virginia Street site from local business to multi-family. The meeting in council chambers at City Hall will commence at 4 p.m.

The Planning and Zoning Commission’s decision regarding the request will be forwarded on to the City Council. The Council could tentatively take up the matter at its Tuesday, Sept. 5, meeting.

Rezoning would open the door to transforming the property into an apartment complex for seniors.

Sale rumors have been swirling for months around the former St. Elizabeth Hospital property, which Owsley acquired six years ago. During court hearings earlier this year before 10th Circuit Court Judge Rachel Bringer Shepherd, Owsley indicated that a sale of the property was imminent. Following Owsley’s March 3 hearing regarding upkeep of the former healthcare site, Sara Ehret, Owsley’s court-appointed attorney, said progress was being made on financing the transaction.

During the March Building Commission meeting, City Manager Jeff LaGarce reported that he was aware of two developers who had expressed interest in the complex, a portion of which is more than 100 years old.

LaGarce said he had spoken to one interested party two or three times.

Rehabbing the complex would seem to be right down BDC’s alley. According to its website, Belmont, formed in 2007, has as its “primary purpose” the creation of affordable housing through the Low Income Housing Tax Credit Program (LIHTC). BDC reports that since its creation a decade ago it has “fully completed 31 LIHTC developments which make up over 1,600 rehabilitated and new construction affordable housing units.”

Among the Missouri projects that BDC has completed are those in Kahoka and Kirksville.

Rezoning the Hannibal site is not the only request the city has received regarding the property. In April, LaGarce said the city had been asked to resolve its lien issues with Owsley to help clear the way for the site’s sale.

Owsley initially owed the city $3,338.32 for expenses incurred by Street Department workers while sealing the facility’s first floor doors and windows. And while Owsley has made some payments, more of the court-ordered fee remains to be paid.

Owsley also owes a comparable amount to the city for mowing and other property-upkeep work it has had to perform in recent years.

The city reportedly is not the only entity with liens against the property. In April it was reported that liens were held by a “number of banks in addition to the city and county.” It was suggested that those liens would have to be resolved before any interested developer would be willing to sign a contract.

St. Elizabeth Hospital opened to patients in 1915 as the city’s first private hospital. The building ceased being a healthcare facility in 1993.

The Chapel Hill Commercial Group purchased the property in 2007, but closed the facility in 2009 after encountering financial issues.

The site was up for tax sale in August 2011 when Owsley purchased the building and parking lot located east of Virginia Street.

Reach reporter Danny Henley at danny.henley@courierpost.com