City to Take Ownership of Historic Mill; Deal Nudges Out Contractor

An iconic—some say haunted—reminder of Murrieta’s past as a farming community will continue to stand tall in the city’s historic downtown area but with that, a local contractor’s plans of restoring it himself may have been dashed.

Murrieta City Council on Tuesday voted unanimously, with Councilman Randon Lane absent, for the City of Murrieta to accept the donation and deed transfer of the nearly 100-year-old KEA Mill on New Clay Avenue.

Referred to as the Old Mill, the looming concrete structure sits on a one-fourth-acre site near land that in 2003, voters approved for use as a park.

At one point, the Mill was included on an Internet site’s list of haunted places in California, but the website in 2005 attributed that to a possible urban legend.

The Mill was originally constructed around 1918 so that local farmers could bulk-store their grain prior to sending it off to various milling companies in Los Angeles, according to a city staff report prepared for Council.

Business remained steady through the 1960s and early 1970s, but the site was eventually boarded up in March 1991.

Nine years ago, at the direction of a previous City Council due to public requests, the city began exploring the possibility of acquiring the property, according to Assistant City Manager Jim Holston.

Before an agreement was reached, the owner of the Mill since 1989, Lu Tung, died. Ownership was transferred through probate to Tung’s grandson, Wellington Loh, Jr., who has agreed to gift it to the city at no cost, according to Holston.

Because the transfer is a donation to the city in its capacity as a nonprofit, Loh Investment Limited Partnership can seek a tax credit, Holston said.

Holston, who oversees the Community Services Department, said the plans are to incorporate the historic value of the Mill into the master plan for Pioneer Park.

“Eventually it will be incorporated into the park...where we will have a reproduction of an old train station that was across the street from the Mill; the Mill will become part of that scene,” Holston said.

With a price tag of more than $2 million, groundbreaking for the park is admittedly undetermined. (The Historic Downtown Murrieta Association kicked off a campaign in July 2012 in an effort to raise $1 million in donations for the project.)

The city would beautify the structure and surrounding property, but keep access to the interior of the Mill closed.

Until then, Holston said costs of maintaining the property would be minimal. Maintenance would include graffiti removal, fencing and safety measures.

Deal Nudges Out Local Contractor

The acquisition seems to makes sense for most, with the exception of Christopher Kraus, a general contractor who says he grew up playing at the Mill.

Kraus said he recently became inspired to purchase the Mill, restore it and open it as a sales-tax generating small business.

“While still maintaining the Old Mill’s intrinsic historical feel and presence, my plan would bring the mill out of the past and into the present; giving Murrieta a beautiful, useful, and enticing landmark,” Kraus said.

So Kraus contacted the real estate representative and made an offer on the property.

He also conveyed his intentions to the city, but claimed emails and phone calls went unanswered.

“The city’s discussions of acquisition only resurfaced due to my interest in purchasing the Old Mill for my personal and philanthropic business venture,” Kraus said. “...To be honest, I felt robbed.”

Kraus did not say whether he would continue to pursue the project—something he proposed would have been completed much sooner than under the city's plan.

Holston said Kraus had been contacted by city staff prior to the City Council vote, and that there was nothing that would prevent Kraus from approaching the city to help in restoration project.

The city will not be required to pay property tax on the site because it was donated, but that would change if it were to lease the Mill out for business purposes, Holston noted.

Since the property is zoned as residential, Holston said the only use currently allowed would be a bed and breakfast.

“It would depend on (Kraus’) business,” Holston said. “We don’t have enough details.”