Status of Sale of North Commons Residential Lots 1-4, Block 1,- COR III (portions may be closed to the public)

In May, 2013, the HRA was presented with four options relating to the North Commons site.  Following discussion, the HRA approved pursuing the alternative that would development the four lots on the west side of the park only.  The four house pads were previously rough graded so the work to develop the four lots would simply require construction of water and sanitary sewer services, constructing driveway aprons and sidewalks across all four lots, and constructing a storm sewer outlet for the wetland located within the park.

All improvements (sewer, water, streets) have now been completed for these four lots and they are ready for sale.  The City has received several calls, but no written offers on the lots to date.

The HRA had originally planned to build thirteen additional lots as part of this development on land to the east.  However, additional costs for construction and low lot prices made construction of these lots unfeasible at the time.  Consequently, a purchase agreement that the City had with a local home builder for one of these lots could not be fulfilled.  This builder has asked some pricing considerations in the purchase of Lots 1-4, Block 1 in exchange for dropping any claims to the prior agreement. 

The HRA authorized staff to negotiate the sale of these lots to the above mentioned home builder.  The lots were presented at "market value" (see below) and it was conveyed that one of the lots would be discounted based upon the prior agreement.  The buyer initially expressed interest in only the discounted lot, but has since withdrawn and has expressed no further interest in any of the lots.
 

The proposed park lots are fully graded and soils have been corrected on the building pads.  Due to the adjacency to the City Park these can be considered "premium lots" which will command a higher price than the smaller standard lots existing or proposed for other areas of this neighborhood.

The original pro-forma for this development showed the price range for the park lots from $50,000-$60,000.  The City had entertained purchase offers for the small non-park lots at the low end of their range, $35,000.  Market prices on residential lots have rebounded due to a short supply, and recent consultations with a real estate agent familiar with the area indicate that the listing price would be recommended at $65,000 in today's market.

The City posted the properties with FOR SALE signs and given the lack of interest by the one home builder, staff recommends that these properties be included in the listing agreement with a broker currently being considered by the City..

 

Staff recommends HRA review the pricing of these properties at the time the broker is engaged by the City.

It is recommended that these properties be listed with the pending broker's agreement.

Motion to direct staff to bring these lots forward under the broker's listing agreement currently being considered.