Consider Purchase Agreement for 6590 141st Avenue NW; Case of City Moving and Storage (portions of the meeting could be closed to the public)

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

BACKGROUND:
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.

The Buyer is an existing Ramsey business and is currently leasing space at 6230 McKinley Street, STE C.  Based on an existing lease term ending, the Buyer would like to move into a new building on May of 2021 if possible.  Staff understands this is an aggressive timeline but is doing what we can to work with the Buyer to get this project to the finish line.  

Notification is not required.

Staff has been negotiating pricing with the Buyer over the past week.  Staff and the Buyer have agreed to a purchase price of $85,000 which is within the City approved deal range.  A summary of the pertinent items in the purchase agreement are below:

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

Purchase Price: $85,000 ($2.05 / SF)

Anoka County Taxable Market Value: $105,900

Earnest Money: This PA does include earnest money ($8,500.00, 10%).  Earnest money will become hard if a Notice to Proceed is received from the Buyer.

Minimum Improvements:  The Buyer is proposing to build a building at least 9,000 SF (depending on site setbacks/configuration)

Right of Re-Entry Agreement: Required as part of PA

Broker Commission: None. This was a City generated lead and is not part of a listing contract

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

The City process includes review of the site concept plan by the Planning Commission. Due to the timing of the letter of intent the earliest that the Planning Commission could review this item is December 3.  Due to this timing the earliest the City Council could consider approval for the Purchase Agreement is December 8.

No funding is required.

Staff recommends approval of the attached Purchase Agreement; subject to Planning Commission review of site concept plan and City Attorney review.

Motion to recommend the City Council approve the attached purchase agreement with City Moving and Storage LLC for roughly .95 acres of city owned land located at 6590 141st Avenue NW; subject to Planning Commission Review of site concept plan and City Attorney review.