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HAMMOND — The Hammond Redevelopment Commission on Tuesday approved a settlement concerning the site of the former Woodmar Mall.

The city will pay just over $2 million for the approximately 16-acre site and will be landlord of Carson Pirie Scott, which will pay the city $125,000 annually under terms of the existing lease. The city hopes to use the remaining land for a proposed sports complex and parking. The money for the purchase will come from the Hammond Central Allocation Area, which includes funds from tax dollars generated by businesses locating there after the allocation area was put in place.

The agreement approved by the commission Tuesday relates to a foreclosure action brought by Wells Fargo Bank as well as a suit brought by Rieth-Riley Construction Co. against the commission, the former developers of the Woodmar site, and Bon-Ton Department Stores Inc., which owns Carson Pirie Scott Department Stores, and others. Rieth-Riley filed suit in 2013 seeking compensation for unpaid work done at the oft-delayed development.

Under the terms of the agreement, the city will pay $2,070,000 for the real estate. Most of the money, $1.963 million, will go to Wells Fargo Bank to satisfy their first mortgage lien on the property. Of the remainder, $220,000 will go to Rieth-Riley to satisfy a lien they have against the property and $2,172 will go to Bon-Ton for reimbursement for repairs. The closing is expected to take place by the end of the month.

City officials have been discussing the idea of constructing a sports complex for the past year. In January, the redevelopment commission selected Madison Construction, of Orland Park, Illinois, to do design work on the center.

Initially, it was thought the sports complex might be located at the former Wal-Mart building in the Woodmar area, but the purchase of the land means the city can build a new facility. Phil Taillon, executive director of the city's planning and development department, said Wal-Mart wanted $4 million for its former structure, however, and it would have necessitated a great deal of work to put in the sports complex there. He estimated building a new facility will cost about the same amount and would have the advantage of fronting Indianapolis Boulevard. 

Taillon said the facility is expected to include two indoor soccer fields, six basketball/volleyball courts and other activities.

He estimated the facility, not including the $2,070,000 paid for the land, could cost about $12 million to construct. He said the city would seek a loan of about $9.5 million from the U.S. Department of Housing and Urban Development's Section 108 program for the project, which would be repaid through a pledge of a portion of the city's future community development block grant monies. Other community development block grant money, tax increment financing dollars and additional federal monies could potentially cover the rest of the cost, according to city officials.

Carson currently has a lease for another five years at the site. Taillon indicated the store is doing well, but Carson ideally would like to have a one-story structure as opposed to the three-story building in which they are currently housed.

"We are going to make sure Carson is happy," Taillon said.

He said at one time Carson looked at using part of the Wal-Mart building. He said ideally an outside developer could come in and lease out part of the Wal-Mart building to Carson and the rest to another tenant or tenants, but he mentioned the asking price for the building could be a sticking point. If Carson were to move into the Wal-Mart building, that would give the city additional land to use for other developments. Taillon said it could be that Carson may just want to have a separate single-story structure instead.

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Ed has been with The Times since January 2014. He previously covered government affairs for Scripps Treasure Coast Newspapers in Florida. Prior to Scripps, he was with the Chicago Regional Bureau of Copley News Service.