07/02/2007 Council Packet - Laserfiche WebLink

Home Search

WS — Item 1 WORK SESSION STAFF REPORT Work Session Item 1 Date: Council Work Session, July 2, 2007 To: City Council From: Mary Divine Re: Purchase Agreement — Anderson Builders Background The City of Lino Lakes owns three acres of vacant property zoned General Business on Lake Drive, just north of 77th Street. In January 2007 the city entered into an agreement with Anderson Builders to allow them a period of time to investigate the development potential of the site. Anderson Builders has submitted a concept plan for development of the three acres. It includes a medical clinic and specialty medical services building with professional office space, and a multi - tenant retail center totaling approximately 27,000 sq. ft., for an estimated market value of $2.5 million. At a previous work session, it was discussed that future realignment of 77th Street will require acquisition by the developer of two residential properties to the south of the existing street. A feasibility report must also be completed to establish actual costs for the realignment and to determine whether any portion of the project can be assessed to benefiting properties. In order to facilitate timely development of Phase I, it was concluded that the sale of the city property and future development/realignment would best be handled through two separate agreements. The council will first consider a purchase agreement for the city parcels at a price of $6.35 per square foot exclusive of an existing pond area for Lake Drive. The agreement restricts certain undesirable uses. Taking into consideration local market conditions and restrictions of use on the property, a second appraisal was completed in June 2007. This appraisal placed the property value, based on recent comparable sales, at slightly over $6 per square foot. Based on this appraisal, the city's TIF attorney advised that this sale is at fair market value and is not considered a subsidy. 1