Staff recommends City Council approval of the Fifth Amendment to the Purchase and Sale Agreement (PSA) between the City of Billings and Honaker Realty, LLC & JWT Capital, LLC. This amendment further extends key contingency deadlines to support the buyer’s ongoing due diligence and financing requirements.

Original Agreement:On March 1, 2024, the City entered into a PSA with Honaker Realty, LLC & JWT Capital, LLC for the sale of City Hall, Park 3, and associated parking lots on North 27th Street for $2.8 million. The agreement supports redevelopment of the site in the downtown core.
Subsequent Amendments:
First Amendment (Aug. 27, 2024): Extended certain contingency deadlines and allowed the City to vacate the property by April 1, 2025.
Second Amendment (Oct. 30, 2024): Extended contingency deadlines to Dec. 6, 2024.
Third Amendment (Dec. 18, 2024): Extended deadlines to Jan. 31, 2025 and confirmed a closing date of May 15, 2025.
Fourth Amendment (Jan. 21, 2025): Extended remaining contingencies to March 31, 2025 and reiterated the importance of a timely closing by June 1, 2025.

FIFTH AMENDMENT HIGHLIGHTS
Extended Contingency Period to June 16, 2025:
Parking Management Agreement: Agreement acceptable to Buyer for managing parking on Parcels A and B.
Sky Bridge Encroachments: Agreements and title clearance related to existing sky bridge encroachments.
Other Due Diligence Items: Any items not previously waived in earlier amendments.

Financing Contingency:
Buyer’s financing contingency is extended to the Closing Date to ensure project funding can be secured.

Updated Closing Date:
Closing date is now set for June 16, 2025, with an option for Buyer to close earlier (between June 2 and June 16), if all contingencies are met.
Seller must vacate the property by no later than the Closing Date.
Buyer is required to close by June 30, 2025 to remain eligible for project funding.

City of Billings: Seller and party responsible for vacating the property.

Honaker Realty, LLC & JWT Capital, LLC: Developers pursuing a significant downtown revitalization project.

Downtown Business Partnership (DBP): Involved in contingency approvals and development incentives.

City Council may:

Approve the Fifth Amendment to maintain project momentum and support economic development.
Decline the amendment, which may delay or jeopardize the transaction and related redevelopment plans.

No change to the $2.8 million purchase price.
No additional City costs incurred under this amendment.

The Fifth Amendment to the PSA extends the timeline for completing several outstanding contingency items—specifically related to parking management, sky bridge encroachments, and other due diligence tasks—to June 16, 2025. Additionally, the Buyer’s financing contingency is extended through the Closing Date. The closing is now set for June 16, 2025, with an earlier close allowed beginning June 2, 2025, if all contingencies are satisfied. These extensions are necessary to keep the redevelopment project on track while aligning with critical funding requirements. The purchase price remains unchanged at $2.8 million.