As I am sure you will recall, in July of 2022 I requested authority to issue a Letter of Intent (LOI) in relationship to the purchase of property located at 6128 U.S. Highway 19. The property is 2.18 acres in size and contains a 21,172 sq. ft. building on the site.
At that time, the amount being offered for the property which is critical to the redevelopment of the southeast quadrant of U.S. Highway 19 and Main Street was based on an appraisal of the property which had been conducted in November of 2021. More specifically stated the appraisal report concluded a value of $2,000,000 for the property and based on the fact that seven months had lapsed since the market data had been collected the offer was elevated by $200,000. Unfortunately though, Madison Marquette who is the current corporate owner of the property did not accept the CRA’s offer. In lieu of accepting an offer they decided to test the local market before accepting any offer relating to the disposition of the property. In that regard the property has been listed with Colliers Global Commercial Real Estate Services for just over thirty (30) days and they have received several offers on the property.
In order to remain competitive, I believe that the offer should be in the amount of $2,800,000 and should be in accordance with the following terms:
1. A payment in the amount of $280,000 upon the successful execution of a purchase agreement
2. A real estate closing scheduled to occur within (90) ninety days of a fully executed purchase agreement and
3. The remaining balance due will be paid at the time of the closing
In closing it is appropriate to note that the City owns the abutting property located to the east of the subject property and that if the property purchase is successful that the two properties will be redeveloped at the same time. In that respect, if the CRA is successful in obtaining control of this important piece of property, it is my plan to let a request for proposals within ninety (90) days in respect to the future development of the property.
RECOMMENDATION:
The recommendation is to authorize the Executive Director to prepare and release a Letter of Intent to Madison Marquette for the purchase of the property located at 6128 U.S. Highway 19 in the amount of $2,800,000.
BUDGET / FISCAL IMPACT:
There are a couple of different methods by which this expenditure could be financed and the determination should be based on the length of time that the CRA will hold the property as an asset. If the property will not be maintained as an asset of the CRA then the purchase should be facilitated through a loan from the Water and Sewer Fund with repayment at the time of title transfer. If the property is to be maintained as an asset, then the purchase should be financed through the issuance of debt by the CRA.