Deed restriction challenge could be coming
SALEM – Ever since Home Depot exercised a deed restriction against a proposed Holiday Inn Express the project has stalled. A challenge is in the offing.
Last May, Rodney Herron, a partner with a Pittsburgh-based investment company, announced plans for a three-story, 70-room, multi-million dollar hotel on 1.25-acres of east-end property just southwest of Home Depot and east of Cunningham Road in Mahoning County.
The hotel would employ 25 people and was set to be “fast tracked” based on projected lodging shortages tied to the shale boom, according to Larry Kosiba, executive director of the Sustainable Opportunity Development Center.
Herron hoped for a December opening – which failed to occur – while revealing separate plans for a restaurant and banquet hall alongside
There is property access from the TerriTown Plaza and Cunningham Road, but Home Depot denied an easement based on deed restrictions, stating the hotel is not a “retail” business. Herron said the existing 20-foot sewer easement granted to the city was too small as plans called for a 35-foot easement to accommodate the Holiday Inn and address anticipated development to the north.
Rick Herron, the realtor for property owners Dave and Linda Dinsio when their 15 acres was sold to Home Depot, explained that he called Home Depot to get its blessing on the hotel from the outset. Herron, who is not related to Rodney Herron, contacted a Home Depot attorney, Jenny Evans, who advised that she could not offer an opinion on whether it was permissible or not.
Herron said she noted that “if I felt it was not a permitted use, then I was to fill out the form she attached requesting a waiver of the restriction.”
Herron believed it was not excluded after consulting a private attorney for assurances, so he disregarded the waiver form.
“He looked over the restrictive agreement noting the agreement does not exclude hotels so they are not excluded,” Herron related. “It wasn’t until a few weeks later when I did send a request for the expansion of the easement that I received a call from Home Depot’s Vice President of Real Estate, Tom Gallagher.”
“He said that a hotel was not a permissible use because it was not a retail business,” Herron said. “We went round and round with the definition of retail.”
The property is in a “wet” precinct and there are liquor permit issues. Herron said the main reason the developer wanted to locate on the north side of Cunningham Road is because the lots owned by Dave and Linda Dinsio’s on the east side of Cunningham Road are approved for liquor.
In January, Home Depot was asked if there was any way it would change its position and Stephen Holmes the senior manager for corporate communications, said, “We haven’t changed our position on this, mainly because we don’t feel the property is a suitable location for a hotel, which could have a diminishing effect on our business. Fortunately, the area has a lot of other, more suitable property for this type of use, so we’re very hopeful the developer will find another location for the hotel.”
Since then, emails have been exchanged but Home Depot has held firm.
On Wednesday, Holmes repeated the company’s previous assertions.
“Unfortunately, we don’t believe this particular property is a suitable location for a hotel, and we believe it would have a diminishing effect on our business.”
He prefaced that by saying, “We do hope they’ll be successful finding the right location for the hotel.”
Herron said that might be the case, since across the street from the proposed site, on the west side of North Cunningham Road, the Dinsio’s own several acres that are not under a deed restriction.
But Herron said, “We intend to contest Home Depot’s decision. The intended project will create jobs, spur more retail development in the area, provide needed services for the community and bring more traffic to the ‘project development’ which will increase sales for Home Depot.”