HomeMy WebLinkAboutPreliminary Development Agreement
Preliminary Development Agreement by and between the City of Columbia
Heights and Stadium Village Properties, LLC
THIS AGREEMENT, dated this 25th day of August, 2008, by and between the City of
Columbia Heights, a municipal corporation under the laws of Minnesota (the "City) and
Stadium Village Properties, LLC ("the Developer"):
WITNESSETH:
WHEREAS, the Developer is owner of property located at 3989 Central Ave. and also has
certain contractual rights through an Agreement dated July 20, 1982 ("Agreement"). The
original Agreement was between the Columbia Heights Housing and Redevelopment
Authority and Terry Evenson, and has been amended and assigned from time to time, and
WHEREAS, the aforementioned 1982 Agreement provides for the Developer to operate a
369 stall parking ramp with the ability to purchase said ramp on July 20,2022, and
WHEREAS, the Agreement also separately defines a plaza area ("Walkway Property")
which is leased to the Developer under a 99 leasehold year provision (as illustrated on
Exhibit A), and
WHEREAS, the Agreement allows the City to sell the Walkway with the Developer having
the first right of refusal, and
WHEREAS, the City has been approached by the Developer with a proposal that
effectively transfers the City's Walkway Property to the Developer, in exchange ofthe
Developer reinvesting approximately $500,000 in reconstructing the outside facade afthe
subject building located at 3989 Central Ave., and
WHEREAS, the Developer needs to initiate the reconstruction, due to economic and
seasonal considerations, prior to the City being able to complete all of the various processes
that are necessary to convey the property, and
WHEREAS, the City is desirous to have the reconstruction project completed as soon as
possible and is of the opinion that the end results will constitute a positive community
reinvestment, and
WHEREAS, the City elects, through this agreement, to give preliminary approval to the
subject transaction based on the understanding that the City must undergo a series of due
diligence processes and will make every effort to mitigate any situation that would make
the transaction unfeasible.
NOW, THEREFORE, in consideration of the foregoing and the obligations set forth herein,
the parties agree as follows:
1. The City and Developer agree in principle that the City will sell the Walkway Property
to the Developer, which at this time is assumed to have a fair market value of
approximately $250,000. In turn, the City will contribute a like amount of funds to the
Developer, in exchange ofthc Developcr reconstructing the fayadc of the subject
building.
2. The form of this negotiation may difTer from a cash transaction, but the end result will
be the Developer securing fee title to the Walkway Property in exchange for the facade
reconstruction.
3. City actions neccssary to complete the transaction include:
a) Securing of an appraisal
b) Processing a minor subdivision pursuant to City Ordiance 9.114.
c) Sccuring a certificate of survey
d) Amcndments to the 1982 Agreement as applicable
4. In order to defray the City's direct administrative costs associated with this transaction,
the Developer agrees to amend the 1982 Agrccment so as to transfer the responsibility
for the purchase of causality insurance on the parking ramp from the City to thc
Developer. The Developer also acknowledges that the Walkway will become taxable
property.
5. Staff will investigatc any State law issues associated with the Business Subsidy Act
(MSA) 1161.993 to 116J.995, as amcnded.
6. Both parties rccognize that the City's transaction must meet local, State and Federal
law in order to bc allowed.
7. All attempts to mitigate issues that may prevent this transaction from occurring will be
attempted in a good faith manner.
Notice for communication between the parties shall be delivered to the following:
(a) As to the City:
City of Columbia Heights
590 40lh Avenue NE
Columbia Heights, MN 55421
Attn: Scott Clark
(b) As to the Developer:
Stadium Village Properties, LLC
1313 Fifth Street SE Suite 100
Minneapolis, MN 55414
Attn: Dave Jasper
IN WITNESS WHEREOF, the City has caused this Agreement to be
duly executed in its name and behalf and its seal to be hereunto duly
affixed and the Developer has caused this Agreement to be duly
executed in its name and behalf on or as of the date first above written.
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Its: City Manager-Walter R. Fe 1st
B
By
STADIUM VILLAGE, LLC
By:
Its:
11:\Shared\Coll1lllll11ity Developmcnt\Parking Ramps\3989 Ramp\Prcliminary Development Agreement 8-IR~2008 FINAL