Item No. 3.
| MEETING DATE: 09/18/2023 |
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| TO: | HONORABLE CHAIR AND DIRECTORS |
| FROM: | JIM SADRO, EXECUTIVE DIRECTOR By: Miranda Cole-Corona, Housing and Economic Dev Manager |
| SUBJECT: | APPROVE AGREEMENT WITH GM PROPERTIES, INC. TO LIST THE PROPERTY COMMONLY KNOW AS A PORTION OF THE LA HABRA MARKETPLACE PARKING LOT, APN 018-381-64, PURSUANT TO THE ORANGE COUNTYWIDE OVERSIGHT BOARD RESOLUTION NO. 23-021, REQUIRING THE USE OF A LICENSED COMMERCIAL BROKER FOR SOLICITATION OF THE PROPERTY
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RECOMMENDATION:
That the Successor Agency approve and authorize the Executive Director to enter into an agreement with GM Properties, Inc. to list the property commonly known as a portion of the La Habra Marketplace Parking Lot, APN 018-381-64, for sale and solicit offers.
DISCUSSION:
The Successor Agency to the La Habra Redevelopment Agency ("SA") is responsible for winding down the activities of the City's former Redevelopment Agency. Among those activities is submitting requests for payments for recognized obligations to both the Orange Countywide Oversight Board ("OB") and the State of California Department of Finance and the disposition of any properties owned by the former Redevelopment Agency. To date, there remains one last parcel of land still owned by the former Redevelopment Agency, a 2.8-acre parking lot commonly known as a portion of the La Habra Marketplace Parking Lot, APN 018-381-64 ("Property").
On June 22, 2022, the OB directed the SA, via Resolution No. 22-026 (Attachment 1), to dispose of the property in compliance with the disposition requirements of agency-owned property under the Surplus Land Act (SLA). The OB resolution including a finding to determine whether the property was exempt for the SLA, and to solicit proposals from interested parties regarding the sale of the parking lot, to include public notices and/or advertisements of the property and inform potential purchasers of the restrictive parking covenant.
On July 25, 2022, staff began several months of conversations with the State Department of Housing and Community Development (HCD) regarding the SLA and its potential applicability to this parcel of land. On April 6, 2023, staff received a final determination letter from HCD (Attachment 2) stating that the property met SLA's qualifications for "exempt surplus land."
On July 24, 2023, the OB approved Resolution No. 23-021 (Attachment 3) directing the manner in which the SA should sell the Property. Exhibit A of the Resolution directed the SA to use a "reputable and properly licensed commercial property broker to help with the solicitation."
On August 17, 2023, staff reached out to several local realtors with a Request for Proposals for Broker Services. Staff received responses from the following brokers:
On June 22, 2022, the OB directed the SA, via Resolution No. 22-026 (Attachment 1), to dispose of the property in compliance with the disposition requirements of agency-owned property under the Surplus Land Act (SLA). The OB resolution including a finding to determine whether the property was exempt for the SLA, and to solicit proposals from interested parties regarding the sale of the parking lot, to include public notices and/or advertisements of the property and inform potential purchasers of the restrictive parking covenant.
On July 25, 2022, staff began several months of conversations with the State Department of Housing and Community Development (HCD) regarding the SLA and its potential applicability to this parcel of land. On April 6, 2023, staff received a final determination letter from HCD (Attachment 2) stating that the property met SLA's qualifications for "exempt surplus land."
On July 24, 2023, the OB approved Resolution No. 23-021 (Attachment 3) directing the manner in which the SA should sell the Property. Exhibit A of the Resolution directed the SA to use a "reputable and properly licensed commercial property broker to help with the solicitation."
On August 17, 2023, staff reached out to several local realtors with a Request for Proposals for Broker Services. Staff received responses from the following brokers:
| Name of Brokerage | Broker | Commission |
| 1. GM Properties, Inc. | Jason Jamison | 5% - split 50/50 with Buyer/Procuring Broker No reduction in fee proposed if there is no broker used by the purchaser |
| 2. Jones RE | Greg Jones | 5% - split 50/50 with Buyer/Procuring Broker 4% if no broker is used by the purchaser |
| 3. Seven Gables RE | Mary Lou Adame-Martinez | 5%- split 50/50 with Buyer/Procuring Broker 4% if no broker is used by the purchaser |
All three of the brokers are licensed commercial brokers, use multiple commonly used tools for advertising properties, such as Costar, Loopnet and MLS, and have similar commission structures. Based on prior effective and successful interactions with GM Properties on other property transactions involving the City, staff is recommending the SA approve an agreement with GM Properties, Inc. to be the listing broker for this parcel. If this Agreement is approved by the SA, staff will work with the broker to get the property listed by September 21, 2023, with an initial deadline of having offers submitted by interested parties by or before October 12, 2023. If no offers are received by this initial deadline, the listing will remain active until the Property is sold.
FISCAL IMPACT/SOURCE OF FUNDING:
There is no impact to the General Fund if this agreement is approved as the property is owned by the City's Successor Agency.
If approved by the SA Board, the broker will charge a 5% commission on the final sales price of the parcel. Should the purchaser have a representative broker, the 5% commission will be split 50/50 between listing and purchasing broker. As it is not feasible to determine what the final sales price might be at this time, staff cannot provide an estimate of the potential brokerage fee. Staff is intending to solicit the property for sale without a proposed price due to the restrictive parking covenant recorded on the parcel. Buyers will be expected to conduct their own due diligence regarding this property and any offers that are submitted will be presented for review and approval by the SA and OB before the close of escrow.
If approved by the SA Board, the broker will charge a 5% commission on the final sales price of the parcel. Should the purchaser have a representative broker, the 5% commission will be split 50/50 between listing and purchasing broker. As it is not feasible to determine what the final sales price might be at this time, staff cannot provide an estimate of the potential brokerage fee. Staff is intending to solicit the property for sale without a proposed price due to the restrictive parking covenant recorded on the parcel. Buyers will be expected to conduct their own due diligence regarding this property and any offers that are submitted will be presented for review and approval by the SA and OB before the close of escrow.
GENERAL PLAN RELEVANCE/CITY COUNCIL GOALS & OBJECTIVES:
LU 2.2 Places to Shop
LU 2.5 Places Supporting the Quality of Life
City Council Goals
Goal 5 - Development Activity and Business Assistance
Objective B: Identify underutilized commercial properties that have sales tax generating potential and work with property-owners and the brokerage community to develop land to its highest and best use
LU 2.5 Places Supporting the Quality of Life
City Council Goals
Goal 5 - Development Activity and Business Assistance
Objective B: Identify underutilized commercial properties that have sales tax generating potential and work with property-owners and the brokerage community to develop land to its highest and best use
Attachments
- OB Resolution No. 22-026
- SLA Exemption
- OB Resolution No. 23-021
- Agreement Commerical Broker Services
- Proposal