Development Manager Compensation for Development at North Commons

Per the Agreement dated 4/1/2011 between the City of Ramsey HRA and Landform Professional Services, LLC, Landform is due an incentive-based compensation whereas the Incentive Compensation will be paid on all transactions (within The COR) regardless of origin or referral source. The Incentive Compensation shall be, as stated within the Agreement, two percent (2%) of the total capital cost of the end use of the parcel or property sold or development.

The City of Ramsey HRA entered into a Purchase Agreement with Purmort Homes, Inc. for the development of four (4) single family homes at North Commons. This development and sale of property (authorized for sale by resolution 14-04-067) prompts an Incentive Compensation per the above referenced Agreement. Staff has calculated an Incentive Compensation to Landform in the amount of $14,874.87. This calculation does not include the site improvement costs, which is expected to increase the Incentive Compensation figure. This compensation is due to Landform in various increments as follows; 20% at signing of the PA, 60% at closing and 20% at Certificate of Occupancy.

Staff has provided the attached Incentive Compensation worksheet to Landform. Landform is interested in negotiating a one-time lump sum payment, in lieu of the above incremental payments, of $14,000.

Alternative #1: Approve the negotiated one-time payment of $14,000 to Landform Professional Services, LLC.

Alternative #2: Approve the calculated Incentive Compensation of $14,874.87 understanding this number will increase with added "site improvement costs".

Staff is recommending Alternative #1, recognizing savings of more than $800 (also realizing greater savings given the alternative and needing to incorporate additional costs).

Motion to approve compensation to Landform per Landform's negotiated one-time payment of $14,000, thus ending obligations of payment to Landform for this specific project.