Staff recommends that the City Council approve the Fourth Amendment to the Purchase and Sale Agreement (PSA) between the City of Billings and Honaker Realty, LLC & JWT Capital, LLC. The amendment extends certain contingency deadlines to facilitate the ongoing transaction while ensuring compliance with agreed-upon terms.

Initial Agreement:
On March 1, 2024, the City of Billings entered into a PSA with Honaker Realty, LLC & JWT Capital, LLC for the sale of City Hall, Park 3, and adjacent parking lots on North 27th Avenue. The transaction, valued at $2.8 million, was structured to encourage economic growth within the Central Business District through phased property development.

First Amendment (September 25, 2024):
Extended contingency deadlines for due diligence, property use agreements, and city relocation timelines.
Allowed the City to vacate the property by April 1, 2025.

Second Amendment (October 30, 2024):
Extended contingency deadlines to December 6, 2024, particularly regarding franchise agreements, parking management, and sky bridge encroachments.
Provided clarity on the approval process for the Downtown Business Partnership (DBP) regarding the portable restroom on Parcel B.

Third Amendment (December 18, 2024):
Waived certain contingencies, including the requirement for franchise agreements for hotel operations.
Extended remaining contingency deadlines to January 31, 2025.
Established a firm Closing Date of May 15, 2025, with final possession transfer by that date.

FOURTH AMENDMENT UPDATES
Waived Contingency as of January 31, 2025:
     Approval by the Downtown Business Partnership (DBP) for removal or use of the portable restroom on Parcel B.

Extended Contingencies Until March 31, 2025:
     Parking Management Agreement: Seller will provide an agreement acceptable to Buyer for managing parking on Parcels A and B.
     Sky Bridge Encroachments: Finalizing agreements and title clearance related to sky bridge encroachments.
     Additional Due Diligence Items: Any remaining due diligence matters not previously waived.
 
Financing Contingency Extended Until Closing Date:
     Buyer must obtain and finalize financing before closing.

Closing Date Confirmation:
     The Closing Date remains May 15, 2025, unless both parties agree to an earlier date.
     Seller will vacate the property no later than the Closing Date to avoid any further project delays.
     Buyer must complete the purchase by June 1, 2025, as a condition for securing project funding.

City of Billings: Ensuring alignment with city goals and contractual obligations.
Honaker Realty, LLC & JWT Capital, LLC: Developers responsible for the project.
Downtown Business Partnership (DBP): Collaborating on restroom relocation and overall project success.
Local Businesses & Community Members: Benefiting from economic revitalization efforts.

City Council may:

Approve the Fourth Amendment and allow the transaction to proceed with the adjusted deadlines.

Do not approve the amendment which may delay or jeopardize the project’s development timeline.

No changes to the original $2.8 million purchase price.

The amendment does not impose additional costs or alter financial terms.