08-12-1998 Council Agenda - Laserfiche WebLink

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515 Little Canada Road, Little Canada, MN 55117 -1600 (651) 484 -2177 / FAX: (651) 484 -4538 MEMORANDUM TO: Mayor Fahey & Members of the City Council FROM: Joel Hanson, City Administrator DATE: August 7, 1998 RE: Purchase Agreement for 2600 Rice Street MAYOR Michael L Fahey COUNCIL Beverly Scalze Jim LaValle Steve Morelan Bob Pedersen ADMIMSTRATOR Joel R Hanson The property at 2600 Rice Street consisting of the car wash, the former Modern Fence building, and a pole building located in the rear of the property has been on the market for the past number of months. A purchase agreement was executed by an individual at a price of $139,900. Due to a variety of reasons, that sale was not closed and the property is once again available. The County has an estimated market value of $168,000 assigned to this property. The total area available for purchase is 61,466 square feet or 1.41 acres. The seller's initial asking price was $179,000 or $2.91 per square foot. Given our desire to clean-up this area coupled with the potential for the relocation of businesses from the Rice Street/Little Canada Road area to this site, it is my recommendation that we proceed with the purchase at the price offered by the last prospective buyer of $139,900 ($2.28 per square foot). This offer has been tentatively presented to the sellers. (A copy of the purchase agreement is attached.) I hope to have word regarding their acceptance prior to Wednesday's meeting. It should be noted that there was recently a tank removed from this site and our offer would be contingent upon appropriate environmental clearances. The source of funding for this acquisition will be excess tax increments generated from TIF District #1 -1 and #1 -2 (Thunder Bay and North Star Turf respectively). I am not recommending we obtain an appraisal to serve as a basis for our offer given the fact that there was a legitimate purchaser at this price and given the fact that the County's estimated market value exceeds this price. To spend money on an appraisal would seem to be an unnecessary use of these funds. It should also be noted that our offer to purchase is conditioned upon the sellers waiving any and all claims to relocation benefits which may be payable resulting from this acquisition given the fact that this is a voluntary sale occurring in an open market transaction. Once acquired, it would be my recommendation that we demolish the existing structures on that site and hold it until the Rice Street/Little Canada Road area is decided upon. Should no Page 32