In downtown Wilmington, an undeveloped piece of city-owned land is set to change hands.

Located at 320 N. Front St., the roughly 0.25-acre tract is east of The Cotton Exchange and south of Cape Fear Community College’s downtown campus. City leaders have leased the land in recent years to The Cotton Exchange to use as a parking lot.

The property’s current lease, which the city has opted not to renew, runs through March 2024, Aubrey Parsley, the city’s director of economic development, said Tuesday during a presentation to the Wilmington City Council. The city acquired the parking lot, which includes about 20 spaces, in 1973.

Last June, city leaders commissioned an appraisal of the land, a step that was meant to inform its future and the city’s next steps. The city planned to continue using the property as public parking. “That was the plan as of the middle of last month,” Parsley said.

But then on Jan. 23, city leaders received an unsolicited bid for the property from L. Allen Ross, offering to pay $750,000 for it.

“That offer was strong and consistent with the market,” Parsley said, “so we wanted to present it to council tonight for consideration.”

The property’s tax appraisal is $255,600, according to New Hanover County property records. As part of the bid, the city received a deposit of 5% of the offer. There would be no due diligence period in the sale, which will be “as-is, where-is” and will be conveyed through a quitclaim deed, Parsley said Tuesday.

The Wilmington City Council unanimously approved a resolution authorizing an upset bid process to begin for the property. Staff members plan to publicly advertise the bid later this month.  

Other bids must be submitted within 10 days of public notice and by statute must be more than 10% of the first bid’s first $1,000 and 5% of the remainder. That means the minimum upset bid for the property is $787,550, according to Parsley. All bidders must also put down a deposit of 5% of their total bid.

If a bid is received, the upset bid process will start over and will repeat until there are no other bids submitted. If no additional bids are received, the city will move toward closing on the land within 30 days of the end of the final upset bid period.

The proceeds from the sale will be used to pay down the city’s debt. In recent months, Wilmington leaders have worked to sell off surplus properties to help offset the $68 million purchase of the Thermo Fisher building at 929 N. Front St., a deal that closed last summer.