One of the city’s major land deals intended to lead to new commercial development at Keizer Station is off.

The Keizer City Council’s decision to stick with a ban on drive-thru businesses prompted developers to cancel their purchases.

That means, for now, Keizer will continue to see empty ground on 4.6 acres of city land on Northeast Lockhaven Drive west of Keizer Station Boulevard.

And it means, for now, that Raising Cane’s Chicken Fingers isn’t coming to Keizer as planned. The chicken restaurant franchise originally planned to build on ground next to the Keizer Transit Station.

The cancellations leave the city with six acres of land it thought it had sold for a bit more than $6 million.

“We’re back to square one,” said City Manager Adam Brown.

City officials had been asked earlier this year to change city land-use rules so businesses that rely on auto traffic could build.

Neighbors in the area objected during a public hearing, reacting with particular alarm to the idea of a gas station proposed for Lockhaven Drive at McLeod Lane. Most who testified weren’t opposed to allowing Raising Cane’s to get the rule change for the transit center property.

The Keizer City Council in July signaled that it would follow the neighbors’ lead, greenlighting the change for Raising Cane’s but keeping in place the ban on the larger parcel.

Councilors put off a formal decision, opening the way for a community meeting last month.

Citizens gathered on July 9 in what’s considered the city’s living room – an open space inside the Keizer Civic Center. Councilors Lore Christopher, Shaney Starr and Dan Kohler also attended.

City Attorney Joe Lindsay recently shared notes from the session.

Traffic created by the new development troubled several people.

One said that “I’m not objecting to development. I’m objecting to traffic,” according to Lindsay’s notes. Another said, “I’ve only heard of a gas station and a drive through. I don’t want a drive-in in my neighborhood.”

“There will be one hundred cars waiting and the fumes,” one citizen said.

Clutch Industries, a Salem development company, in February agreed to buy the city’s land west of Keizer Station Boulevard. The company through an affiliate was going to pay the appraised value of the 4.6 acres – $4.6 million.

At about the same time, Raising Cane’s agreed to buy 1.4 acres next to the transit center for $1.9 million.

Both contracts gave the buyers an option to cancel under certain conditions.

But then the real estate board pieces started to move.

City officials said developers considered moving Raising Cane’s to the larger parcel, giving up on the transit center location.

Anna Lahey of the consulting firm of Kimley-Horn and Associates wrote to the city in June that Raising Cane’s was changing its plan because of traffic. 

She said representatives of Raising Cane’s determined there were several limitations for the transit center site, all affecting the flow of customers in and out of the business.

The company wasn’t aware before that property across Keizer Station Boulevard was available – and preferable to the transit center location, Lahey wrote.

She said moving to the larger city parcel would allow a better traffic flow and allow more space for a longer line of cars waiting for food.

According to Brown, that set in motion a rearrangement of contracts.

Clutch Industries terminated its deal to buy the city land, and its representative offered no explanation in response to questions from Keizertimes.

Then Raising Cane’s stepped in, offering to buy that land for the same price.

Meantime, Raising Cane’s axed its deal for the transit center site.

The city council then took the unusual step of opening up its public hearing on the land-use matter.

But at the Aug. 4 council meeting, no one appeared for the hearing.

The council then approved a revision to land-use rules – but only to permit drive-thru businesses where Raising Cane’s originally planned to go.

The effect, according to Brown, is that Raising Cane’s can’t operate on the larger city parcel. The company subsequently dropped its interest in that land.

Lahey didn’t respond to emails about whether Raising Cane’s was considering shifting back to the transit center site.

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