ST. ANN • In the days just before a top official in St. Louis County Executive Steve Stenger’s office told the County Council that a long-term lease for county office space at the former Northwest Plaza shopping mall would save taxpayers $10 million, a much different conversation was happening among county officials reviewing the lease.
“The bottom line is that any claim that this is a cost-savings measure for the County would appear to be quite inaccurate,” Ted Medler, the county’s division manager for planning and programming, wrote on June 1, 2016, to Nichalos Gardner, who was then the county transportation director.
Several internal emails reviewed by the Post-Dispatch show that despite the assurance of Stenger’s advisers that the deal made financial sense, officials in several county departments were alarmed about the expense and the length of the lease. And they were concerned about an unusual negotiation for a two-decade commitment to rent more than 150,000 square feet at the renovated mall in St. Ann, now known as the Crossings at Northwest.
The deal will cost taxpayers at least $69 million, and could run as high as $77 million, according to the newspaper’s analysis of the county’s real estate contracts. The owners of the Crossings, Robert and P. David Glarner, are friends of Stenger who have donated $365,000 to his campaign, an amount that is unparalleled in county politics. The Glarners and Stenger have repeatedly denied any quid pro quo; Stenger has called the question tiresome.
The newspaper revealed on Feb. 5 that the deal does not save money — and has the potential to cost millions. Days before the newspaper’s story, Stenger’s advisers insisted the deal saved money. But the newspaper pointed out their figures did not include millions of dollars the county will pay for property taxes at the Crossings and to rent empty space at buildings across the county that were vacated months or years before their leases ended.
In a statement emailed to the newspaper on Monday, Stenger said he was “not personally enriched by a campaign contribution and would never allow one to influence my decisions on behalf of St. Louis County.” He said the officials involved in the conversations about the Crossings lease in 2016 “based their estimates on incomplete information.” And he stuck with the claim that the county was saving money.
He said there were “numerous County staff members who wholeheartedly endorse and approve of this move” and that feedback on the Crossings from residents and employees “has already been overwhelmingly positive. They tell us that the facility is a nicer, safer and far more convenient setting to visit and to work in.”
The County Council voted 6-1 in July 2016 to approve the Crossings lease, but now the council has scheduled hearings before its ethics committee to review the deal. The first is scheduled for 4 p.m. Tuesday. Emails reviewed by the newspaper were obtained by the ethics committee chair, Councilman Ernie Trakas, in response to requests he sent to several employees in the county’s public works, some of whom are expected to testify.
“I think we obviously found documents that show that the department of public works and transportation employees as well as county counselor’s office did not see the Crossings lease as the great deal it’s been portrayed as,” Trakas said Monday. He said those officials were “customarily and routinely involved in developing lease agreements for space the county rents.”
The emails seem to run counter to Stenger’s Northwest Plaza narrative, suggesting that his administration acted against the advice of career county government employees who would normally be involved in approving real estate deals.
Under terms of the lease, the mall’s owners have “absolutely no risk,” Gardner wrote on March 2, 2016, to Medler, Stephanie Leon Streeter, deputy director of the county’s departments of transportation and public works, and Bob Grant, the deputy county counselor. “I can only imagine that looking closer at this, we are probably selling our soul to the DEVIL on this one.”
Gardner, who left in April to accept a job with the mass transit system in Washington, could not be reached for comment. Medler and Streeter, who still work for the county, also could not be reached.
Medler wrote that Anthony Badino, a top Stenger adviser who had managed the county executive’s 2014 campaign, had unilaterally negotiated the lease with the Glarners. “He negotiated it alone and then dumped it on legal,” Medler wrote.
Badino could not be reached for comment.
In a meeting with a reporter this month, Stenger’s staff could provide no evidence that before agreeing to the Crossings lease, the county conducted a side-by-side analysis of other options, from renovating current offices to renting other locations or building a new office.
But the emails unearthed by Trakas showed the county did have an analysis in 2015 comparing the cost of building new office space to renting space either at the Crossings or at another site.
“On the spreadsheet, in each case, purchasing space is more economical than leasing space,” Streeter wrote in July 2015. “Please help me understand.”
Daily updates on the latest news in the St. Louis business community.