06-11-2001 - Laserfiche WebLink

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moved from Denver to Dallas, which had cause some internal disruption in their system. After the first attempt to sell the property fell through, HUD again listed it and offered it to the highest bidder. The high bid reportedly came back at $160,000. Once again, the “buyer” could not secure financing, either because of the outstanding abatement order or because the bid price exceeded the building’s value by a large extent. City Staff had discussions with Kennedy & Graven staff, and we determined that to make some progress, either one of two things had to happen. The City would need to release the abatement order on the property and hope that the future owner would be fully cooperative in restoring the building, or the City would need to acquire the property itself. The benefit of purchasing the property from HUD would give the City the most control over what ultimately happens to the building. We have maintained a list of interested parties and continually receive inquiries from builders and remodelers who want to purchase the building. While we have directed them to HUD, they have been unsuccessful in attempting to deal with HUD. This year, the City reintensified its efforts to acquire the property (at a reduced rate) to facilitate its renovation. (The idea being the City would be in a better position, and would have more at stake, to turn the property around.) Staff had placed multiple phone calls to the Dallas office weekly, and only once were the calls returned. That returned call however was productive, in the sense that the case-worker assigned to the property did agree to sell the property to the City. I explained that the City would not be interested in paying what either of the two previous bidders had offered, in fact, we would pay what we had originally agreed to pay in 1998, which was in the $80,000 range. More than two years have passed since the initial purchase agreement was sent to HUD, and we all know how our property values have appreciated during this time. Even so, the representative agreed to sell the property for $80,000 to the City of Mounds View. Kennedy & Graven has drafted the required documents and will forward them to the Dallas office of the property management firm representing HUD. It is hoped they will not be lost this time. Because of the time that has elapsed since we were originally directed to work with HUD to purchase the property, staff felt it would be appropriate to bring this back to the EDA for reauthorization. Resolution 01-EDA-150 ids attached for your reference. While the agreed upon price was $80,000, staff is not completely confident that offer will be accepted, even though we had verbal confirmation. We are thus seeking authorization for expenditure not to exceed $100,000 to acquire the property, even though we hope to pay less than that. For reference, the other four-plexes in the area are assessed at $100,000, which is assumedly less than the true market value of the properties. We have standing offers to purchase the property from the City, all with the understanding that a contract for Private Redevelopment would need to be executed. The bottom line is the City has the opportunity to turn this problem property around. As I have mentioned numerous times, I feel so sorry for the neighbors who have to live next to, and across from, this boarded–up eyesore. They have tolerated the situation far too long. Assuming this purchase agreement is accepted (and is not lost) and the