Developer Doug Price has dropped his plans to renovate the former Ameritrust complex, leaving Cuyahoga County without a buyer for the collection of empty buildings at East Ninth Street and Euclid Avenue in downtown Cleveland.



After more than a year of planning, wooing tenants and struggling to find financing, Price sent county officials a letter Tuesday telling them he was done with the Ameritrust deal after losing a potential major tenant.



Now the county, which bought the property for new offices and has spent about $40 million on it, will be left holding a vacant office complex with few prospects to sell in a battered real estate market.



The county's involvement with the complex also is clouded by a wide-ranging federal corruption probe. Investigators want to know what role County Commissioner Jimmy Dimora played in the county's abandoned plans to turn the property into a county administration complex. Separately, prosecutors have alleged that Price's company, the K&D Group, was involved with bribes paid to move the county engineer's office to its Stonebridge development in the Flats.

Between buying the property, cleaning out asbestos and other expenses, the county says it has spent $40 million. It costs the county $10,000 a month to maintain and secure the empty complex.



Price's defunct deal will leave the county with $530,000, money the developer put down as part of his bid. Taxpayers' investment in the property also is offset by the county's revenues from the complex's parking garage -- $4.1 million in receipts so far -- and a state grant of up to $3 million.



K&D bid on the property in April 2008. The recession and a crackdown on credit for commercial real estate delayed the sale, as banks and other lenders backed away from development. In October, the county granted Price a six-month extension to close the deal. That extension was set to expire June 30.



At the time of the proposed sale, county commissioners said they were willing to accept a multimillion-dollar loss on the deal because private redevelopment of the complex would help revitalize downtown. Price planned to convert the former Ameritrust Tower into a hotel and apartments. The other buildings would have housed offices and parking.





County Commissioner Peter Lawson Jones said there is no way to reconsider plans to turn the complex into a new county administration complex --commissioners' strategy when they paid $22 million for the property in 2005.

"We don't have the money to do that," he said.

Instead, the county is likely to put the complex back up for sale, listing it as one block or splitting it into parcels this year or in 2010. Commissioner Tim Hagan said he doesn't regret approving the county's purchase of the property. "We bought a building; we thought it was going to work; the economy collapsed; and there you have it," he said. "Anybody can second-guess anybody in this economy."

Price had lined up a boutique hotel and architecture firm Westlake Reed Leskosky to move into the complex, but he had struggled to find financing. He tweaked his plans, dropping designs for a new office building. He lobbied union pension funds to put money into the project. And, recently, he secured a letter of intent from Rosetta, an interactive marketing agency that employs about 400 people in Beachwood.

Less than two weeks ago, Price was prepared to ask commissioners for an extension on the deal. But then Rosetta backed off, Price said, because of a dispute over land beneath one of the buildings in the complex. The county has been leasing the small piece of property, which is owned by developer Lou Frangos. Frangos claims the county's long-term lease has expired -- and that it needs to be renegotiated, at a higher price.

The dispute is the subject of a lawsuit working its way through Cuyahoga County Common Pleas Court. Price said the lawsuit and conversations with Frangos led Rosetta to believe Price could not quickly provide them with office space in the complex.

"Without a major tenant, no lender will consider taking the risk of financing our project, even if we could acquire the real estate in pieces less than the whole," Price wrote in his letter to the county. "We are frustrated and disappointed. We have invested hundreds of thousands of dollars in this effort, only to find that performance will be impossible so long as the ground lease issue remains unresolved."

Terry Coyne, a real estate broker representing Rosetta, said he could not comment about the Ameritrust situation.

"We remain interested in downtown," he said.

Frangos, a major downtown property owner who initially joined Price's bid on the complex, said Price faced many other issues buying and renovating the property.

"I'm sure that my piece didn't have much to do with it," Frangos said Tuesday. "But if it did, what can I tell you?"

Hagan said Frangos is just trying to squeeze as much money as possible out of the county.

"This is what he thinks unbridled capitalism is," Hagan said.