Approve the sale of property - Lot 3, Block 1, COR TWO (Portions of this case may be closed to the public)

Mr. Jeff Wise, of M&W Holdings, currently owns and operates a retail facility at 14590 Armstrong Boulevard. This property is located within the proposed right-of-way for the Armstrong Interchange project expected to be constructed in the next couple years. As a condition of the acquisition of his parcel by the HRA, M&W Holdings will acquire approximately 1.38 acres of land within the Sunwood Retail project currently identified as Lot 3, Block 1, COR TWO, to be platted simultaneous to closing.

Mr. Wise intends to construct a multi-tenant building containing his current liquor store operations, as well as a second tenant occupying approximately 4,000 square feet on the south side of the building. The total building size is proposed to be approximately 13,000 square feet.
Mr. Wise received Preliminary Site Plan approval, Final Site Plan Approval, and has obtained all necessary permits form the Lower Rum River Water Management Organization. The final building plans are being completed, and it is anticipated to start construction this fall.

This sale represents the first of three closings in the Sunwood Retail area, the second, a gas/convenience user proposed on Lot 5 is currently working to obtain final site plan approval and is expected to also start construction this fall. The third user, a proposed quick serve restaurant proposed on Lot 4, is currently in the final contract stage, and will work through entitlements this winter and start construction in the spring.

Because Lot 3 will be closing first, it is contemplated in this agreement that they will make what is outlined as the “initial improvements” for the Sunwood retail area. These improvements are generally described as the shared drives, utilities, and street lighting necessary to serve all three parcels. The HRA will escrow sufficient funds to construct these initial improvements  from the proceeds of the sale, and will be reimbursed in part from the buyers of Lots 4 and 5. There is a portion of the initial improvements that is attributable to the Sophia Ramsey, LLC parcels, Lots 1 and 2, that will be paid by the HRA, and netted from the land sale proceeds as a project expense.

Sophia Ramsey, LLC is the fee owner of the current Lots 1 and 2, RTC 3rd Addition, currently developed as the grocery anchored center in the project. These parcels consist of the grocer, convenience store, liquor store, and three retail buildings containing Caribou Coffee, Acapulco Restaurante, Subway, Fitness 19, and several other smaller retail/office users. Sophia Ramsey, LLC had two access points off of Sunwood Drive, and one access point off of Zeolite serving their project. With the Sunwood Drive realignment project, the westernmost access to the project was significantly modified, and as a result has encountered diminished access to their property. As part of the negotiations to accomplish the Sunwood Drive project, the HRA agreed to certain development conditions on HRA property that mitigated those access modifications. These items include:

• Construct additional parking on the north side of their existing building abutting HRA property.
• Construct a revised access drive through HRA property to their site.
• Dedicate necessary easements to ensure access to their property.

A portion of this work was included in the Sunwood realignment project, but a portion is also included in the initial improvements for this project, and will be paid from the proceeds of closing on Lot 3. A breakdown of these costs is provided in this case, and will be presented at the meeting.

The development team recommends the HRA approve the Purchase Agreement with M&W Holdings, LLC for the sale of Lot 3, Block 1, COR TWO.

N/A

Approve attached Purchase Agreement with M&W Holdings, LLC for the sale of Lot 3, Block 1, COR TWO subject to final modifications by HRA Counsel, and direct the development team to assemble all documents necessary to close.