Wrangell is one step closer to selling its old, former hospital, the Wrangell Medical Center. The borough said the prospective buyer, Wayne Johnson, plans to demolish the building to construct housing units on the property and six lots next to it.
Wayne Johnson has developed housing units in Georgia and he wants to expand his development projects to Wrangell. He traveled frequently to Alaska throughout the years, first visiting Wrangell last fall. While at Wrangell’s Friends of the National Rifle Association auction, he met Interim Borough Manager Mason Villarma.
“(I) met him and got to talking with him about his profession and his career,” Villarma said. “(He) seemed like an interesting guy. So we started chatting and served as Under Secretary of Education during the Bush administration.”
Johnson’s past experiences and his portfolio impressed Villarma.
“Then we talked about some real estate deals,” Villarma said. “He had experience in renovating like projects and has done other developments.”
In that conversation, Villarma mentioned Wrangell’s old hospital that’s been on the market since 2022.
That conversation sparked an interest and Villarma said he and Johnson talked every day until they reached a deal.
Housing units could benefit the Wrangell community
Johnson said Wrangell quickly grew on him during his visit. He and his wife leased a cabin in Wrangell this winter and plan to be here off and on.
“Well, I’m interested in Wrangell and this gives me a meaningful reason to be engaged on a continuous basis with Wrangell,” Johnson said.
When he heard about the available property, he thought it could benefit the Wrangell community.
“My vision at this moment is to explore how we can create a meaningful level of multigenerational housing,” he said.
Villarma said the community could experience a broad range of benefits if Johnson makes the purchase and turns it into housing, He said residents would be close to downtown and its businesses.
“We know that housing is a huge issue in this community,” Villarma said. “I think we’re still ahead of the game and across the region when you think about the Alder Top sale and the potential for this, but it will certainly help with accommodating that need.”
“That’s a pretty big bill for nothing”
Villarma said the City and Borough has been spending $85,000 to $100,000 a year to keep the building maintained enough so it can be sold.
“That’s a pretty big bill for nothing,” he said. “So we’re bleeding in that way, stranded asset. If we didn’t sell it, it would probably cost us about a couple million. Of course the private sector can demolish it cheaper because they don’t have to pay out prevailing wage, but we do. So $2 million, that’s something we just can’t afford.”
Johnson intends to purchase the building for $200,000, far below the appraised value of $830,000. But the six adjacent lots will be sold at the appraised value.
Villarma said Johnson plans to construct two to three-story buildings for housing units with covered parking.
So far, the borough’s Economic Development Board and the planning and zoning commission recommended the Assembly approve the sale.
Kate Thomas, Wrangell’s Economic Development Director, said the Economic Development Board reviewed the sale from the perspective of an economic benefit for the community.
“In my opinion, as stated in the report, it is in the borough’s interest to sell the land and move forward with this project, or conveyance rather, of the land from the borough to Mr. Johnson,” she said.
The final approval of the sale of the building and the adjacent six lots is tentatively planned for the April 9 Borough Assembly meeting.
Wayne Johnson will talk about his plans on KSTK this Tuesday at 1:30 during Talk on the Rock, KSTK’s live local call-in show.
