12-19-2012 Council Agenda - Laserfiche WebLink

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the anada 51.5 Little Canada Road, Little Canada, MN 55/174600 (651) 7664029 / FAX: (651) 766 -4048 w w w. c i.l i t t t e -c an a da. m n. us MEMORANDUM TO: Mayor Blesener and Members of the City Council FROM: Joel Hanson, City Administrator DATE: November 13, 2012 RE: Donovan Construction Purchase Agreement MAYOR Bill 131esener COUNCIL Rick Montour John Keis Michael McGraw Shelly Boss ADMINISTRATOR Joel R. Manson Attached is a draft of the proposed purchase agreement for the Donovan Construction property. The proposed purchase price is for $408,500. Ramsey County's Estimated Market Value on the property is $540,000. The appraisal commissioned by Donovan Construction yielded a value of $475,000. Based upon this information, the price negotiated is reasonable. Another component of this transaction is the existing cell tower lease. Donovan has obtained lease buyout offers of $250,000 even though the remaining income stream though the lease term ending 12/31/20 is only about $140,000. As you know, we hired a consultant that has reviewed this situation. We will have a recommendation ready for you on whether it makes sense for the City to purchase the lease or let the sale go through to a third party. We need to act on this matter by no later than December 26°i. Given the impact this item could have on the final transaction, I am recommending we go to closed session to discuss this matter. We can close a meeting to deal with the purchase or sale of real or personal property under the following conditions: ✓ Determine the asking price for real or personal property to be sold by the public body. ✓ Review confidential or protected nonpublic appraisal data. ✓ Develop or consider offers or counteroffers for the purchase or sale of real or personal property One last addition to the document is an occupancy agreement that will allow them to remain on the site past the closing date. They have informed me that they should be able to have the site totally cleared by the end of January. Some other matters we need to address once Donovan signs the purchase agreement include ordering title work, a property survey, and conducting environmental /geotechnical reviews. Donovan is presently reviewing this agreement. I have informed them that I would want a signed copy back before final approval of the City Council. Given they would like to close before year -end, I would expect to hear from them early next week. Staff would like the Council's authority to proceed with those items once a signed purchase agreement is received. Staff recommends approval of the purchase agreement, subject to any acceptable modifications proposed by Donovan Construction. 1