Aeon Purchase Agreement, Phase II, Amendment I

PURPOSE
Consider approving an amendment extending the term of the attached purchase agreement (PA) with Aeon Ramsey 2 LLC by one year.

BACKGROUND
See attached original PA, original CBRE property listing, and Aeon project renderings.  This city-owned property is being sold/ developed in two phases by Aeon https://www.aeonmn.org/.  They are developing the site into two apartment buildings (54-units and about 45-units).  The first phase closed in late 2017, and is under construction now.  The second phase is scheduled to close by October 13, 2018.

The developer would like to extend the closing date on the second phase of this project by one year (to October 13, 2019).  The developer is willing to make the existing $10,000 of earnest money non-refundable, and add another $10,000 of non-refundable earnest money for this extension.  The developer is asking for this extension to allow sufficient time to obtain financing.  The developer is anticipating closing will occur sooner than October 2019--however, is attempting to plan ahead.

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Staff is generally comfortable with this request because the developer is willing to make all existing earnest money non-refundable and add new non-refundable earnest money.  This type of arrangement is generally consistent with past practice (on other city owned land transactions).  The proposed project is consistent with the original deal (attached PA).  Financing for workforce housing is based on the timing of several other funding sources/ project partners.  The cycles to obtain financing from those other sources can take a year or more. 

Motion to recommend the City Council:
Approve the attached amendment to the Purchase Agreement with Aeon Ramsey 2 LLC dated June 30, 2017.