Consider Purchase Agreement for 6710 Highway 10 NW; Case of PDKP Properties, LLC (Sterling Trophy)

PURPOSE:
The purpose of this case is to consider the attached purchase agreement.
Property (PID# 34-32-25-13-0005) 6710 Highway 10 NW Ramsey, MN.

BACKGROUND:
Sterling Trophy is a trophy business currently operating in Anoka.  They have submitted the attached Letter of Intent to purchase the property for $125,000 (which is $2.30 per square foot).  The property is currently listed by the County as having an estimated market value (EMV)  (not an appraisal) of $240,300 ($4.48 per s.f.). 

The City purchased the property, with a businss and building, in 2013, and razed the building after purchase.  A previous purchase agreement (for $170,000) for a garage door company fell-through in 2014, when the garage door company purchased an existing building in Ramsey.

Notification is not required.

The property is located midway between the proposed Ramsey interchange and the proposed Sunfish lake Boulevard interchange.  Access to the site will be impacted when Highway 10 is constructed to freeway-like standards, but the timeframe for that work is not known.  The site has city sewer and water available and a storm pond will need to be installed as part of the development.

The applicant wishes to purchase the entire 1.23 acre (53,579 square foot) site for possible future expansion or subdivision. 

The trophy company proposes to construct a 4,000 square foot building that would have a small office and showroom area (1,200 s.f.) with the balance of the building being used for assembly and storage.  The property was purchased by the City in 2013 using Anoka County HRA funds.  Land proceeds from the sale can remain with the city and it is proposed that they be deposited in the City's Economic Development Fund for future projects.

The applicant also has an interest in applying for a loan from the EDA revolving loan fund to fill any financing gaps not covered by the SBA loan and buyer's equity.  

Please note that the project still needs to go through site plan review with the Planning Commission. The project is requesting a variance to front yard setback to be in line with existing buildings along Highway 10.

No funding is required.

Staff believes the attached Purchase Agreement is consistent with city's polices for selling city owned land and the proposed sales price is within the acceptable price range.  The proposed use is an acceptable use that will add to the City's tax base and be a benefit to the Highway 10 business corridor.  Staff would note: that city staff (and attorney) are still finalizing some details in the PA with the developer.  The attached PA may be updated before the EDA meeting.

Motion to recommend the City Council:
Approve the attached purchase agreement with PDKP Properties, LLC for roughly 1.23 acres of city owned land.