As you are already aware, in serving as your Executive Director a Letter of Intent to purchase the above referenced property was submitted on September 27, 2022. Although there were several parties interested in the property the award was assigned later that week to the city’s CRA contingent upon the successful negotiation of terms and conditions to ultimately be contained in a Purchase and Sale Agreement. Since that time effort has been devoted to drafting the agreement which is attached for your review. The agreement contains the following pertinent provisions:
· The purchase price is $ 2,800,000.00
· The closing date must occur on or before December 15, 2022
· A deposit in the amount of $280,000 is due within two business days after the date of the agreement
· Within two business days after the date of the Agreement the Seller shall deliver documents related to the property to the city with specific respect to environmental reports and materials and title policies and surveys.
Lastly, a deed restriction is presented in the form of a Special Warranty Deed which prohibits the property from being sold or leased to firm whose primary practice involves receiving deposits, making loans, payment processing, engaging in the sale of securities, wealth management or the sale of insurance products etc. i.e.- Wells Fargo, Bank of America, JP Morgan Chase, PNC etc.
The purpose of this agenda item is to seek your approval to enter into the Purchase and Sale Agreement as presented. Incidentally, the agreement has been reviewed and approved by the City Attorney.
RECOMMENDATION:
The recommendation is to authorize the Executive Director of the CRA to execute the Purchase and Sale Agreement related to the purchase of 6128 U.S. Highway 19 in the amount of $2,800,000.00.
BUDGET / FISCAL IMPACT:
There are a couple of different methods by which the financing of this expenditure could be financed and ultimately the determination should be based on the lengthy 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 plus interest 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.