Commander Premier has been put on notice: Either pay up or get out.
Cape Girardeau officials have given executives of the long-struggling aircraft manufacturer 60 days to pay back rent of about $1.2 million. If it doesn't, the city will demand the company vacate the leased property at the Cape Girardeau Regional Airport, city manager Scott Meyer said.
"We're moving forward," Meyer said Tuesday. "We've started the legal process. If they can't come up with the payments, we're going to have to move on."
Letters putting the company on notice were mailed Feb. 15 to Commander president Gary Walker and Ronald Strauss, a Canadian private investor who has promised city leaders for more than a year that he is about to close a deal to buy the company and make back payments. Commander last made a payment in December 2007 and made a total of only eight of its 56 scheduled payments, finance director John Richbourg said.
The letters, signed by Meyer, said the company's failure to pay "sublease rentals" to the city constitutes an event of default. If the money isn't paid in 60 days, Commander will have 30 days after that to vacate the 52,000-square-foot building, Meyer said.
The city's next payment of $201,380 is due April 1 toward about $2.8 million in municipal bonds that were paid to build the Commander building, Richbourg said. After the April payment is made, the city will have paid $1.2 million toward the bond's principal and interest, compared to Commander paying only $94,000, he said.
The city has already taken steps to begin marketing the building to a new company. At its meeting Monday night, the Cape Girardeau City Council authorized the city manager to call the $1.9 million principal amount of the bonds, so that less-restrictive bonds can be issued.
Under the current bonds, the facility has to be a manufacturing company that is related to air travel. If the bonds are refinanced, Meyer said, the facility could be marketed to other types of companies such as air freight.
"We could rent the space out as a hangar, storage or whatever," Meyer said. "There's other things we could do. It may not make the total payment for us, but at least we could start having some cash flow come in. Certainly, the council has been long-suffering in trying to work something out."
Strauss said he knew of the situation but reiterated that he was close to a deal, which is the same thing he told the Southeast Missourian in December.
When told that city officials had long been frustrated and have become skeptical of his promises, he said: "I know. I know. But the deal is practically done. Raising funds has been the issue that has been ongoing from the beginning. The transaction exists. It's just not been finalized. I hope it will be in time."
Mitch Robinson, executive director of Cape Girardeau Area Magnet, is already at work marketing the building for a new tenant. Magnet has sent out 300 electronic brochures to potential tenants, he said, but they have received no serious inquiries yet.
"It's really time to move forward," Robinson said. "What the council is doing by refinancing the bonds will open it up to a lot of aviation-related companies. Having Commander out really removes a lot of questions that potential tenants would have."
Cape Girardeau Regional Airport, Cape Girardeau, MO