Nissan of Downey Threatens to Move to Santa Fe Springs
The owner of Nissan of Downey, which provides the city with more than $500,000 in sales tax revenue annually, said he will move the dealership to Santa Fe Springs if Downey does not act quickly to help him acquire land to expand.
Carmen Koosa, owner of the Firestone Boulevard dealership, said he has been trying without success for more than a year to buy land for the expansion through the Downey Redevelopment Agency. He said redevelopment officials have begun to repond seriously only recently, under the cloud of a possible move.
“I do generate a lot of business for the city of Downey, but nobody seemed concerned,” Koosa said last week. “Now they seemed concerned. But is it too late? I think so.”
Downey redevelopment officials continued to meet with Koosa last week to try to reach an agreement to keep him in town. Community Development Director Jim Cutts said the city tried unsuccessfully to secure key property that Koosa says would enable him to expand at his present location. The agency also offered to secure another site, but Koosa found it unacceptable, Cutts said.
‘Want to Keep Him’
“The city has been making an effort to keep him here in town,” Cutts said. “It suffices to say he brought in over half a million dollars in sales tax to the city last year. That’s important. We want to keep him in town.”
Koosa said he is attracted to Santa Fe Springs by what is essentially an offer of 6.2 acres of free land in the city’s developing auto mall near Rosecrans Avenue south of the Santa Ana Freeway. Under the offer, Koosa would pay Santa Fe Springs $3.5 million for the property over seven years with the sales tax revenue his dealership generates for the city, said Bob Orpin, executive director of city’s Redevelopment Agency.
Cities receive 1% of the 6.5% sales tax levied in California. If the sales tax revenue falls short, Koosa would have to make up the difference. The Santa Fe Springs Redevelopment Agency is still acquiring the 6.2-acre parcel, but it expects to pay $2.94 million for the property, Orpin said. The agreement would require Koosa to stay in Santa Fe Springs for at least 12 years.
As far as Santa Fe Springs is concerned, Orpin said, Koosa has signed a binding memorandum of understanding that commits him to establish a dealership in the city.
“As far as I know we have a final agreement,” Orpin said. “I would like to think we wouldn’t get into a competitive situation with a neighboring city.”
Successful Location
But Koosa, who also owns a dealership in Cypress, said he has not yet made up his mind whether he will stay in Downey or move to Santa Fe Springs. Whichever city he chooses, Koosa said he would close his Cypress dealership and consolidate his operations.
“I have to go to a city that has the attitude that growth will benefit its citizens,” Koosa said.
Koosa opened the dealership on a 5.5-acre parcel on Firestone Boulevard in 1983. It has been a successful location for the car dealer, who sold more Nissans last year than any other dealer in the nation except one, said Bill Akers, director of market representation for Nissan Motor Corp. in U.S.A. Downey Nissan sold more than 4,600 cars and trucks in 1987, while Koosa’s Cypress dealership sold 2,114, Akers said.
But Koosa says his 147 employees are crammed into a collection of aging buildings and trailers like a growing foot in an old shoe.
The auto dealer owns 4.5 acres of the Firestone Boulevard site, but leases from Downey lawyer Richard Lehn a strip of land that runs down the center of the lot. Koosa also leases a remote warehouse for auto parts and a lot for car storage.
Koosa said he would like to raze the structures on the main lot and put up a new building, which he expects to cost more than $2 million, to accommodate future growth. But he said he does not want to build on a site that is partially owned by Lehn.
“Because of this little piece of land, I have to make a major move,” Koosa said.
At Koosa’s request, the Downey Redevelopment Agency asked Lehn if he wanted to sell the property, but he did not, Cutts said. The property is in a newly formed redevelopment area, an area in which the Redevelopment Agency does not have the power of eminent domain.
“We’ve told him a number of times that the property owner . . . does not want to sell and we do not have the right of condemnation,” Cutts said.
Cutts said the Redevelopment Agency will continue to search for a site to enable Koosa to stay in Downey.
So far, Koosa said, the Downey Redevelopment Agency’s offers have fallen short and he would like to make a decision on the move in the next month. Koosa said he would like to get a break on the price of land for his expansion, but Downey would not necessarily have to match the Santa Fe Springs offer to get him to stay.
“I don’t need the city of Downey to give me something for nothing. I need them to give me a way to expand,” he said. “I prefer to stay here if there’s a way. I know I can make money here day in and day out.”
