Consider Purchase Agreement for 6590 141st Avenue NW; Case of MDBNK, LLC (All Seasons Garage Door)

PURPOSE:
The purpose of this case is to consider the attached purchase agreement.
Property (PID# 27-32-25-44-0003) 6590 141st Avenue NW Ramsey, MN 55303.

BACKGROUND: (Property)
The City of Ramsey acquired the property on July 12, 2006 for $211,200 for redevelopment and removal of blight purposes.  At the time of purchase there was a building onsite that was demolished as part of the project.  The city is currently listing the property for $105,000 ($2.53 / SF).  Over the past few years the City has been approached by numerous parties but has been unable to find a project that works for the site.  Staff has worked with adjacent owners in the past (All Seasons and 24 Restore) but has been unable to to find a solution that works financially for the site up until this point.  The site is limited as to how it could be developed due to its small size.  The property has been marketed for nearly 12 years and the City has not been able to find a viable project. Ordinance #15-05 has been adopted authorizing the sale of this parcel.

BACKGROUND: (MDBNK, LLC and All Seasons Garage)
All Seasons Garage Door currently owns and operates its business out of 14161 Basalt St NW.  All Seasons Garage Door is a family owned business that has been in operation since 1981.  In 1992 Mark and Dara Northfield purchased the business from his father and have steadily grown the company.  Mark and Dara Northfield moved the company to Ramsey in February of 2015 and brought with it 17 employees.  Today, All Seasons has 24 employees.  As part of the purchase agreement All Seasons is requesting that access be granted from 141st Avenue NW in the event that it can no longer access Bunker Lake Boulevard. 

Notification is not required.

MDBNK LLC has submitted the attached Purchase Agreement for $73,000.  A summary of the pertinent items in the PA is below:

Listing Price: $105,000 ($2.53 / SF)

Anoka County Taxable Market Value: $105,900

Offer: $73,000 ($1.76 SF)

Earnest Money: This PA does include earnest money ($10,000.00, 13.6%).  Earnest money will become hard if a Notice to Proceed is received from the Buyer.

Right of Re-Entry Agreement: Under the proposed PA, the Developer is only willing to have this clause relating to the construction of the parking lot and connecting sidewalk; not for construction of a future building. Staff will add language to the PA to reflect this if the EDA wishes to move forward with the rest of the terms of the proposed PA. 

Other:  MDBNK, LLC is requesting that access be granted from 141st Avenue NW in the event that access is not allowed on Bunker Lake Blvd or to access a future building.   The site will be combined/merged to 14161 Basalt Street NW as part of this project.

Broker Commission: Premier Commercial Properties will receive 3.5% commission ($2,555). This is a standard real estate clause as a broker assisted in finding a Buyer for the parcel.

Net Proceeds: $70,445.

Closing Date: 30 days after the City received a Notice to Proceed from Buyer unless extended per terms of the attached PA.

Land Sale Policy: The attached PA generally meets the intent of the City's draft "Land Sale Policy" and The PA has been reviewed by City Staff and will be reviewed by the City Attorney prior to execution.  Several changes (and negotiations) have taken place between staff and the buyer.  The sale of this land and the construction of a parking lot and connecting sidewalk will result in an increase of taxable market value.
 
Buyer: The buyer, MDBNK. LLC (All Seasons Garage Door) The Company history is highlighted in the Background section.

Please note that the project still needs to go through site plan review with the Planning Commission for the proposed parking lot and sidewalk connection. The Planning Commission has reviewed the current concept plan and was supportive of moving forward from a Planning/Zoning perspective.

No funding is required.

The property has been vacant and off the tax rolls since 2006.  The proposed project is securing a future for an existing, growing Ramsey Business. Although the company is unwilling to commit to a future building and timeline to construct it, there is a good possibility it could happen.  Construction of the parking lot and connecting sidewalk will improve the conditions of the site. Based on these factors staff is recommending approval the attached purchase agreement and to enter into a Right of Re-Entry Agreement with MDBNK, LLC for roughly .95 acres of city owned land located at 6590 141st Avenue NW.

Motion to recommend the City Council approve the attached purchase agreement with MDBNK, LLC for roughly .95 acres of city owned land located at 6590 141st Avenue NW; subject to City Attorney review and approval.