Obsolete Assets Do Not Improve With Patience

The building was fine. That was the problem.

In 2005, the Charlotte Coliseum sat empty off Tyvola Road. More than 23,000 seats, good bones, no tenant, no purpose. The Hornets were gone, the Bobcats were headed uptown, and the city had already pledged the sale proceeds toward the new arena. The question was never what the Coliseum was worth.

The question was who would own it while everyone figured that out.

I know, because I sold it. And what that empty arena taught me is that competition does not change the price of an asset nearly as much as it changes the terms. The price got the headlines. The terms made the deal.

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The Assignment Nobody Wanted

I was a senior vice president at Trammell Crow Company when the city asked whether we would list the property. My colleagues opposed taking the assignment. Too risky. Too political. Too complex.

I proposed anyway, and I put our fee where my mouth was. Crescent Resources had a standing offer of $16.5 million for the site. I structured our commission so that Trammell Crow earned nothing unless the net proceeds beat that number.

Then came the ground rules. North Carolina law required the Coliseum to be sold through a competitive upset bid process. Every bid published in the newspaper. Competing buyers had ten days to top the last bid by at least five percent. No back channels. Anything said to one buyer had to be made available to every buyer.

Most brokers would call that a straitjacket.

We ran an effective process. Broad outreach to development firms across the country. Large advertisements in the Wall Street Journal. A secure online data room for due diligence. Roughly 100 parties expressed interest, and two serious buyers emerged: Comstock Partners of Reston, Virginia, and Pope & Land Enterprises of Atlanta.

Comstock opened at $17.82 million, and I exhaled. Our fee was alive. Five rounds later, Pope & Land won the property at $23.35 million. We closed in March 2006, roughly 40 percent above the appraisal completed in preparation for the sale.

Two professors at UNC Charlotte later published a teaching case on the transaction in the Journal of Real Estate Practice and Education. They described it as an overwhelming success from the public sector's perspective, and remarkably free of controversy given the asset's size and value.

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What the Straitjacket Actually Did

The rules that looked like a handicap were the mechanism.

A second bidder does not simply raise the number. A second bidder strips out the contingencies, the deferrals, and the risk the seller would otherwise be asked to keep.

Look at how Pope & Land bought. No rezoning contingency. They took the site as zoned, closed, and pursued their own rezoning two years later, winning approval in January 2008 for a $624 million project blending offices, retail, hotel rooms, and homes. Then the Great Recession arrived, and the site stalled for years.

Charlotte did not avoid the delay. Charlotte avoided owning it.

Someone always carries the risk of an obsolete asset. The carry, the entitlement fight, the market cycle. The only question is whether that risk transfers at closing or stays with you.

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The Asset That Went the Other Way

Charlotte offers the comparison in its own backyard.

Eastland Mall went dark in June 2010. The city bought roughly 80 acres in 2012 for $13.2 million, then demolished the mall in 2013, in part because demolition was cheaper than continuing to secure an empty building. Read that again. The cheapest version of holding was demolition.

What followed was a parade of proposals that never happened. A film studio. A ski slope. A soccer headquarters. An aquatics center. A Target. A master developer came aboard in 2018. A plan passed in 2020. The first residents moved in this past February, and a sports campus broke ground in March with roughly $41 million in public money, opening in late 2028.

Dark in 2010. Finished around 2028. Eighteen years.

Brooklyn Village in Second Ward tells a similar story on the county's side of the ledger. A development partner was selected in 2016 for a $700 million project; the county declared the developer in default in 2025, part of the site went through foreclosure this summer, and nothing vertical has been built. Marshall Park is still Marshall Park.

None of this was a failure of judgment. Public land carries public goals, and both projects attached conditions for reasons any of us would defend. But every condition narrows the buyer pool, and a buyer pool of one has no competitive tension in it. The seller ends up carrying the risk anyway. Just slower, and with less leverage.

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"So I Should Dump a Good Asset Into a Soft Market?"

Fair question, and no. Nobody is recommending a fire sale.

But waiting is not the absence of a decision. Waiting is a position, and it has a carry cost that never shows up on anyone's spreadsheet. Taxes. Insurance. Security. Deferred maintenance. Management attention, which is the most expensive line item nobody tracks. Eastland just showed you where that road ends.

Patience is not a strategy. It is a hope with a monthly bill.

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Three Questions Before You Decide to Wait

When a client with an obsolete asset tells me the plan is to hold for better conditions, I ask three questions.

1. Can you name a second credible buyer today? Not a category. A name. Charlotte had two, and those two produced five rounds of bidding and a price 40 percent over appraisal. Competition is perishable, and it moves with the cycle. If you can only name one buyer, you are not selling. You are negotiating. And the other side knows it.
2. Is anyone willing to own the unknowns, or are you financing them? A landowner sees what the entitled site down the road traded for and decides that is his number. It is not his number. His neighbor sold a permitted, rezoned site with utilities at the street. He is selling a question mark with a survey attached. The gap between those two prices is the cost of the mess, and somebody has to absorb it. The same seller then refuses to give a buyer the eighteen months it takes to close that gap. You cannot charge for a risk you will not let anyone else carry. Pope & Land accepted the zoning risk at the Coliseum and paid a full price to get it. That is the trade.
3. Is there a deadline you do not control? The Coliseum sale had a forcing function. The proceeds were already pledged toward the new arena, so the clock was real and it was not ours to move. That external deadline is what kept the process disciplined. If nothing forces your hand, ask yourself what your deadline actually is, because sellers without one drift. That is how two years of holding becomes ten.

If you are sitting on an asset that has outlived its purpose, whether a plant, a campus, a building, or a tract of land, and you have been telling yourself the market will come to you, I would welcome the conversation. Give me a call. I will give you a straight read on your buyer pool, your unknowns, and your clock. And if the right answer involves people beyond Cardinal, I will connect you with the right people.

Cardinal Real Estate Partners | 704-900-0900 | www.Cardinal-Partners.com

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