Sticker shock and questions about the players involved in the city’s expected purchase of a north end property are the reality of the current real estate market playing out in public and not “payback” for a local businessman’s political support, according to public records and those interviewed Tuesday by The Post.
The Palm Springs City Council voted to pursue the property, located at 3589 McCarthy Rd., for use as a campus for homeless services, following heated public discussion on November 5. It was one of two locations under consideration for the project and contains three buildings with 47,000 square feet of usable space.
The current owner, McCarthy Road Productions (MRP) of Goleta, purchased the property from DST Industries, Inc. of Michigan in January 2020 for $3.5 million. MRP put the building up for sale in August 2020 for $6.25 million and settled on a selling price of $5.9 million in July 2021.
The buyer, Wintec Energy President and CEO Fred Noble, then made an unexpected offer for the city to assume the purchase while the deal is still in escrow. Walking away from the deal may end up costing him money, he said by phone Tuesday, but it’s a small price to pay if the property somehow aids those experiencing homelessness.
“There’s a certain sense that talk is cheap, and if you can do something to help your fellow man you should,” Noble said, crediting friend and local architect James Cioffi for helping him see the property’s ultimate value. “I was going to buy it for my own purposes, and I drove a really good bargain on the price.
“But Jim made mention of it being a good place for what they wanted to do, so it was offered to the city. I thought if this is what they want, and they can use it, why not.”
“There’s a certain sense that talk is cheap, and if you can do something to help your fellow man you should.”— Fred Noble
Noble’s involvement in the deal led to speculation from some that he would somehow profit, and accusations that if he were to profit it would be in return for contributions he has made to multiple local politicians and political organizations.
Forms on file with the city show Noble made more than $61,000 in combined contributions in cash and services to current City Council members during their most recent campaigns. A large portion of those contributions went to Councilmember Geoff Kors ($14,500) and Mayor Pro Tem Lisa Middleton ($19,000) during two different election cycles. Aside from cash, records show Noble also provided catering services and polling data.
“Might this be payback time for Kors, Middleton, etc.?” wrote one resident in an email to The Post. Added another: “I imagine I am not the only person raising questions around this.”
Noble said he would welcome a chance to confront anyone who thinks he stands to profit from walking away from the purchase.
“This is precisely at my cost and there is no profit in this whatsoever,” he said, adding, “I guess no good deed goes unpunished.”
The rapid escalation in the property’s value also caught many off guard, but it appears to be in line with the current state of Palm Springs real estate across several sectors. For example: The other property considered for the homeless services center, located at 4775 E. Ramon Road, was sold in 2017 for $1.8 million, and is now listed for $6.5 million.
Fritz Boudreaux, executive vice president at The Firm Commercial in Palm Springs, specializes in helping clients buy and sell commercial and industrial properties in the Coachella Valley. He said the fact the McCarthy Road site increased millions in value in less than two years is no surprise given its location.
“On a micro level, if you look at the industrial real estate market in the Coachella Valley, particularly in northern Palm Springs and all of Cathedral City, cannabis coming in and being legal has raised the price of all industrial property,” he said Tuesday. “If you are a traditional business like an auto body shop, or a glass shop, and you look at pricing, the prices are just out of reach.”