TUPELO – The Tupelo Redevelopment Agency on Tuesday allowed a contract on two lots in Fairpark to lapse instead of buying back the undeveloped property, as it did with Oby’s restaurant.

John Oxford, chairman of the group, said the decision was made for financial reasons.

“At this point, due to the economic circumstances we have to operate in, the best business decision for TRA and the taxpayers of Tupelo is to not make any major land purchases at this time,” Oxford said. “At this time, holding a strong cash position is in the best interest of what we want to do.”

As part of the Fairpark urban renewal project, a buyback option was incorporated into the majority of the commercial land sale contracts in Fairpark. If the owner doesn’t develop the property within two years, TRA, the city-created group in charge of developing the downtown district, has a year to either buy it back for the original price, offer a contract extension or let the contract lapse.

TRA first exercised its buyback powers late last year, after the owners of the proposed Oby’s restaurant chose not to sign a contract extension. At the time, Oxford said the goal of the Oby’s buyback was to “protect the integrity of Fairpark” and to allow TRA to market “this prime real estate.”

The former Oby’s property is on Main Street, next to the Renasant Center for IDEAs. The property cost TRA $265,846 to buy it back.

Oxford cited the money spent for Oby’s as part of the financial situation that led to Tuesday’s decision. TRA is funded by land sales in Fairpark and the interest on the sales.

Because the contract has lapsed, Oxford said TRA still can buy the property but is not guaranteed a price. A price would have to be reached through negotiating with the owners, Oxford said.

The land discussed Tuesday is on Main Street, next to the Coldwell Banker Tommy Morgan Realtors building.

Joey Guyton and Clay Short bought the two lots in 2007 with plans to develop the land into Fairpark Plaza, a mixed commercial and residential site.

The future of that project is unclear. Short left Tuesday’s board meeting after an executive session and declined to comment to the Daily Journal.

Contact Carlie Kollath at (662) 678-1598 or carlie.kollath@djournal.com.