Bids for county liquor store in Pocomoke exceed $1MCommissioners open RFP to sublease N. Worcester shop on Ocean Gateway
(April 7, 2017) Removing itself from the liquor business became less costly for Worcester County government Tuesday, when the bids for the Worcester County Shore Spirit liquor store in Pocomoke City came in shockingly high.
Five bidders submitted proposals to take over the lower county operation, which had been valued in the hundreds of thousands of dollars, with top bidder Kalpesh Patel of Berlin offering at $1.175 million.
Patel bid $950,000 for the two suites that comprise the store at the Newtowne Plaza Condominiums, including the furniture, fixtures and improvements. He also offered a 15 percent markup on the inventory already at the store, for an additional $225,441.
Patel operated the Shop Kwik in Berlin from 1994 to 2011, and since then has opened the Kwik Liquor in Millsboro, Delaware.
“In return, Mr. Patel will receive the County Commissioners’ approval and support to apply for a Class “A” Beer/Wine/Liquor license at this location,” Kelly Shannahan, assistant county administrator, wrote in a memo to the commissioners.
The county granted Patel permission to apply for the license and to be heard at the May 17 Board of License Commissioners meeting.
“Should any of the above conditions not be met and the deal was to fall through, staff further requests approval to accept the second high bid from Vinod B. Patel for a total purchase price of $801,000, and to purchase all of the inventory in the Pocomoke City store at the cost paid by the county (currently estimated at $196,036) plus a mark-up of 14 percent, for a total purchase price of roughly $1,024,481,” Shannahan wrote.
Vinod Patel, also of Berlin, owned and operated the Friendship Exxon Food Mart on Gray’s Corner Road from August 1994 to December 2006, and the Shop Kwik in Berlin from April 2004 to January 2015.
The third highest bidder was TJ Patel of Snow Hill, who owns the Food Rite there. He submitted a combined total bid of about $775,640, a price still substantially higher than earlier estimates.
Former director of the department Bobby Cowger, who resigned in protest over how the county chose to implement its exit strategy of the wholesale liquor business about a year ago, said the store was worth about half as much as the bids.
Last year, Cowger said the store was listed as an asset worth $585,000 but also carried a mortgage of about $483,000 at the time of the interview. Neglecting the amount for inventory, only the top bidder’s proposal exceeds these costs.
“There wasn’t one of us that wasn’t shocked at that bid,” Worcester County Commissioner Bud Church said. “If we can keep the competition up, we could break even or even do a little better.”
At the time the exit strategy was formally adopted in December 2015, then county attorney Sonny Bloxom estimated Worcester would end up losing between $1 million to $2 million. Cowger estimated it would end up being closer to $4 million or $5 million. Now, the final price tag of the county’s departure from the liquor business will have to be recalculated.
The commissioners also voted to open bidding to sublease the Worcester County Shore Spirits store on Route 50.
“We’re asking based on a lease price of $7,400 per month plus $1,300 per month in common area fees,” Shannahan said. Bids on the property are due on May 1 by 1 p.m.