STREETSBORO, Ohio—These days, Mark Defer, owner of Defer Tire Co. in this small northeastern Ohio city of about 12,000, sometimes must feel like he's holding a winning super lottery ticket. However, Mr. Defer doesn't hold a winning lottery ticket—but he does have an option from a major development company to purchase his dealership and the 127-acre parcel it sits on.
Pending city approval, Arlington, Va.-based Mills Corp. plans to build a 200-store shopping mall on the property. If the deal goes through, Mr. Defer, his mother and his brother—who jointly own the land—probably will become multimillionaires.
Mills is a publicly traded company that owns or has an interest in seven ``super regional'' malls and 11 community shopping centers. The company reported revenue of $90 million for the first half of 1999, with income of $14.3 million.
The Defers' property is located at an interchange of the Ohio Turnpike about 23 miles southeast of downtown Cleveland.
Streetsboro, like other formerly small, rural communities located between Cleveland and Akron, is experiencing urban-sprawl-type growth and development.
The 1.5 million-sq.-ft. mall Mills will build on the Defer property would be several times larger than most enclosed malls and is designed to be a shopping and tourist attraction. Mills broke ground for three such malls in 1998, including one on the site of the former Opryland amusement park in Nashville, Tenn.
While Mr. Defer's dealership, which he founded in 1979, has benefited from Streetsboro's growth, he said he had no intention of selling, until now.
``We had no idea, to the right buyer, what the property was worth,'' he said.
Mr. Defer's grandfather purchased the farmland in 1936, and the family has lived there ever since. He said ``countless people'' have inquired about buying the property, which his brother and his uncle still farm.
Mr. Defer graduated from college in 1975 and worked for Mohawk Rubber Co. in Akron for four years. In 1978, he took over an eight-state sales territory for Mohawk spanning from Wisconsin to Montana.
He met a lot of tire dealers and decided he wanted to set up his own shop in his hometown, Streetsboro.
Then last spring, two separate mall developers approached the family about the property. ``They were throwing out some figures that were ridiculously high, but we still weren't interested,'' he said.
However, the Defer family did decide to seek some professional advice and Mr. Defer hired an attorney. Much like an agent for a professional athlete approaching free agency might do, he said, Mr. Defer's attorney researched similar purchases throughout Ohio and provided the family with an estimate of what their property was worth.
While Mr. Defer would not divulge the amount to be paid by Mills, he said, ``We turned down a lot of offers over the years for a fraction of what this is turning out to be.
``But, there comes a time when you get a deal and you say, `This will affect the Defer family for generations to come,' and we had to make a move.''
Mr. Defer said a 1.25-acre frontage parcel across the highway from Defer Tire now occupied by a gas station sold for $500,000. However he said the per acre price Mills will pay is nowhere near that.
Allowing for a lower average price per acre because most of the Defer land does not front the highway, if Mills paid $100,000 per acre, for example, the total deal would be worth $12.7 million.
When the transaction is finalized, Mr. Defer said Mills will help him find a new location for Defer Tire near, but away from, the mall site. He said he will continue to operate the tire business for three reasons.
First, Mr. Defer said he has one employee who's been with him since the shop opened 20 years ago and two other 15-year employees. ``I think I've got the best crew I've ever had,'' he said. ``It's an employee thing.
``The second thing, I'm only 46, and I truthfully don't know what I'd do if I didn't have an office to go to every day.''
And his third reason: ``It's a fun business and I enjoy it,'' he said.
The firm is an affiliate of the Bridgestone/Firestone Inc. TireStarz program, offers all types of auto service except for glass replacement and body work, and has annual sales exceeding $800,000, Mr. Defer said.
So, how will the business change when it relocates at the edge of a 200-store shopping mall?
``We'll build the building of my dreams,'' he said.
Defer Tire currently is housed in a barn-red, metal pole building. He'll purchase a nice courtesy van and some pagers allowing his customers to visit the mall while their cars are being be serviced.
``The neat thing, even though I've been in business 20 years and if there are two slow days in a row I get nervous,...having the business be a hobby, it's going to be a whole different mindset.''