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Auto dealer withdraws expansion plans
(by Mike Klimko - October 22, 2008)
Auto dealer withdraws expansion plans
By MIKE KLIMKO
Tough economic times have dealt another blow to redevelopment possibilities in Solon.
Following the withdrawal of the Coral Co.'s lifestyle project early this month, Davis Automotive Group has pulled the plug on construction of a new dealership on the automotive campus on Kruse Drive.
The conditions were not right to move ahead with the new BMW dealership and may not be righted again for two or three years, said Jeffrey Davis, president of the Davis Automotive Group.
The cost of constructing the dealership, which would have covered 62,240 square feet, was estimated at more than $10 million, Mr. Davis said. The economy and leasing considerations prompted the delay in moving ahead, he said.
"We withdrew because of the obvious. I think we just need to wait awhile and see how things shake out. I was fairly bullish as far as the economy went, until September and August," Mr. Davis said.
"And then we said, 'Whoa, we have to see what's going to happen.' We will be investing in the present facility. We'll be working to provide an exciting experience for customers in the building, and in people," he said.
"We had no difficulty with financing. That wasn't an issue for us. Our project was over $10 million when all's said and done. I think it was just a real concern for the deteriorating marketplace."
The U.S. economy was wobbling on 66 percent consumer spending, based on his research, Mr. Davis said. Consumerism does not drive the economy as much as manufacturing does, he said.
"BMW will always be a desirable brand," Mr. Davis said. "We want to better understand what that level will be. The level really goes to the manufacturer's reliance on leasing."
The leasing of automobiles reached peaks for various manufacturers, who now want to cut back on leases, he said. BMW wants to reduce leases from 70 percent to 50 percent of their vehicles, he said.
"You need a good credit score or you will not get financing," Mr. Davis said. "They're getting fairly strict on what they're willing to finance."
Development of the vacant site of the former Days Inn off SOM Center Road (Route 91) would have led in part to the construction of a connector road linking Kruse Drive with the automotive campus.
Davis Automotive granted the City of Solon an easement of 17.5 feet located in the parking lot planned on the site, about half the width of the requirement for a dedicated public street.
Council approved a resolution to acquire the remaining 17.5 feet in easements from Mr. Tire and Ohio Bell on SOM Center Road and from Applebee's restaurant at Kruse Drive and Solon Road.
The developer also owns an easement to the drive between Mr. Tire and Bob Evans restaurant and planned to use the drive as a main entrance to the automotive campus.
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