Adopt Resolution #25-037 Approving Purchase Agreement for Sale of Lot 2, Block 1, Kovar Addition; Case of RM Property Management LLC

The purpose of this case is to consider adoption of Resolution #25-037 Approving Purchase Agreement for Sale of Lot 2, Block 1, Kovar Addition to RM Property Management LLC.  On June 7, 2006, the City acquired Lot 2, Block 1, Kovar Addition, for future Hwy 10 right-of-way utilizing the Right-of-way Acquisition Loan Fund (RALF) administered by Met Council.  The approved Hwy 10 construction layout has been modified such that this parcel is no longer needed for ROW purposes.  The Loan Agreement states that if the properties are not needed for construction the property should be sold for fair market value.  An appraisal was completed by Valbridge Property Advisors with a valuation of $550,000.

Rm Golf Carts, Inc. began leasing the property from the City on May 6th, 2011.  Per the Loan Agreement (L06-03) all rent proceeds, less administration by the City, are to be remitted to the Met Council RALF Program.  The City has  passed on rent payments to the Met Council, less administration paid for, or documented by the City.  Rm Golf Carts, Inc. has notified the City that they wish to buy the parcel and building, continue operations of their business and to improve the building facade and parking lot.  Staff consulted with Met Council Staff and they have verbally approved the sale contingent on review of an approved purchase agreement.  All proceeds from the sale will be remitted to the RALF program per the loan agreement. Rm Golf Carts, Inc. has created a new ownership entity called RM Property Management LLC to acquire the real estate.  The Met Council (RALF) has reviewed this transaction and has agreed to the sale to the existing tenant without putting the property on the market.  Staff has worked with Attorney Knaak to modify the form of the purchase agreement used for Anoka County RALF Acquisition from the City for previous Hwy 10 RALF Acquisitions and it is being presented for consideration to the Council.

The City of Ramsey has adopted Ordinance #24-11 which authorizes the future sale of all RALF properties held by the City.  When each property is sold a sales resolution is required like the one presented in this case.

Rm Golf Carts, Inc. has been a good renter and business partner over the duration of their lease.  Providing an opportunity to an existing Ramsey business to purchase this parcel and make Ramsey their permanent home is fully supported by staff.  This sale will put the property back on the tax rolls and also lead to future investment in the facade and parking lot as previously noted. The city is bound by the terms in the loan agreement and the purchase agreement presented meets those terms.  The appraisal price of $550,000 is the purchase price and the Buyer has agreed to pay all of the closing costs aside from prorated real estate taxes.  The property is being sold "as-is".  In the event that the closing occurs before May 31, 2025 the City and Buyer will execute an Early Termination Amendment to Lease Agreement for 7039 Hwy 10 NW between the City of Ramsey and rm Golf Carts, Inc. which is presented for consideration.

Alternatives:
1) Adopt Resolution #25-037 Approving Purchase Agreement for Sale of Lot 2, Block 1, Kovar Addition to rm Golf Carts, Inc (as presented); subject to City Attorney review
2) Adopt Resolution #25-037 Approving Purchase Agreement for Sale of Lot 2, Block 1, Kovar Addition to rm Golf Carts, Inc (with changes); subject to City Attorney review
3) Something else
 

This action is being done as part of normal staff duties. All proceeds from the sale are remitted to the RALF Program administered by Met Council.