Rancho Cordova must pay $7.9 million to acquire a vacant property – more than 20 times what the city's redevelopment agency had offered in its eminent domain case against the property owner.
On Tuesday, a Sacramento Superior Court jury sided with Lily Co., a longtime Sacramento family company headed by Samuel Fong, which had challenged the city's valuation of its 9.5-acre Folsom Boulevard parcel.
"The numbers came in well for us," said Norman Matteoni, Lily's attorney.
According to Matteoni, the city can appeal the decision or it can "abandon" its condemnation proceedings. Lily had earlier challenged the city's right to condemn the property but lost in court.
If the city drops the purchase, it will have to pay for all of Lily's court costs and other condemnation-related expenses, Matteoni said.
Troy Holt, a spokesman for the city, referred questions to City Attorney Adam Lindgren, who did not return calls.
The Rancho Cordova Community Redevelopment Agency initiated condemnation proceedings against Lily two years ago as part of its effort to revitalize the Folsom Boulevard area.
Citing slumping real estate values, the city had estimated the value of the land at around $2.2 million. Toxic cleanup costs for the former dry cleaning site further dropped the city's proposed purchase price to $387,000.
Matteoni said the city's appraisal does not reflect a 2007 proposal by the Los Rios Community College District to buy the property for $8.6 million.
The college district signed a purchase contract for an expansion but later backed out, Matteoni said. Lily has since sued the district for breach of contract.
The city also relied on less valuable, residential-oriented properties as comparables when it came up with its appraisal, Matteoni said.
The Folsom Boulevard property is a large parcel near light rail, which should command a premium, he said.
Lily, which has owned the land since 1965, is looking to redevelop the property, Matteoni said.
The company knocked down all of the structures in 2007 to make way for construction.
Lily currently has approval to build several hundred apartment units as well as extensive retail and office space on the property, Matteoni said.
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