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HomeMy WebLinkAbout2025-029 CCH Condo Transfer 2025 & Supporting DocumentsCITY OF COLUMBIA HEIGHTS, MINNESOTA RESOLUTION NO.2025-29 RESOLUTION APPROVING CLOSING OF TRANSFER AGREEMENT WHICH RECITES TERMS FOR CONVEYANCE TO CITY OF CITY HALL COMPONENT AND PROVIDING AUTHORITY TO SIGN NECESSARY AND CUSTOMARY CLOSING DOCUMENTATION. BE IT RESOLVED by the City Council ("Council') of the City of Columbia Heights, Minnesota ("City") as follows: Section 1. Recitals. 1.01. The City and the Columbia Heights Economic Development Authority (the "Authority") have previously established the NE Business Center Tax Increment Financing District ("TIF District") within the Downtown Central Business District Redevelopment Project to promote the development and redevelopment of land which is underutilized within the City. 1.02. The City, the Authority, and BPOZ Columbia Heights, LLC ("Developer") have entered into a Purchase and Redevelopment Contract (the "Contract"), which provides for the conveyance by the City and the Authority of the City/Authority Parcels described in Exhibit A (the "Redevelopment Property") to the Developer, and the construction of improvements by the Developer of a multi -use facility comprising commercial space, a city hall, and multi -family housing (the "Minimum Improvements"). 1.03. The Contract recites the consideration to be received by the City for the City Parcels as cash and the Commercial Unit for use as a city hall. 1.04. The Contract provides that the Commercial Unit shall be conveyed by the Developer to the City after completion of the Minimum Improvements on the Redevelopment Property. 1.05, A Transfer Agreement between the City and Developer (the "Transfer Agreement") recites that upon completion and formation of the Commercial Unit (the "City Hall Component") in a Grey Shell Condition as described therein, the Developer shall convey this Commercial Unit to the City for no additional consideration. 1.06 That the City has previously authorized the prior City Manager, Kevin Hanson, to execute any and all necessary or customary closing documents and any documents referenced in such Transfer Agreement requiring execution by the City, and to carry out, on behalf of the City, its obligations under the Transfer Agreement and such documents as may have been signed by him are hereby ratified and remain valid documents and may be used in the closing and transfer of the Commercial Unit. 1.07 That the City also intends to enter into an Agreement Regarding Insurance as part of the closing and transfer of the Commercial Unit. Section 2. Transfer Agreement Closing Authorization. 2.01 The Transfer Agreement as presented to the Council has been and remains in all respects approved. 2.02 The Agreement Regarding Insurance as presented to the Council has been in all respects approved. 2.02. That Aaron Chirpich, as City Manager is hereby authorized to execute on behalf of the City any and all necessary or customary closing documents and any documents referenced in such Transfer Agreement requiring execution by the City, and to carry out, on behalf of the City, its obligations under the Transfer Agreement. 2.03. City staff and consultants are authorized to take any action necessary to carry out the intent of this resolution. Adopted by the City Council of the City of Columbia Heights this 24th day of February, 2025. Offered by: Buesgens Seconded by: Spriggs Roll Call: All Ayes ATTEST: Clerk 45725250 -2- Ma or EXHIBIT A TO RESOLUTION APPROVING TRANSFER AGREEMENT Tract A, REGISTERED LAND SURVEY NO. 250. Subject to the reservation to the State of Minnesota in trust for the taxing districts concerned of minerals and mineral rights therein. AND That part of Lot Twenty-three (23), Block One (1), Walton's Rearrangement of Lots Thirty- three (33), and Thirty-four (34), Block Six (6), Reservoir Hills lying Southwesterly and westerly of the following described line: Beginning at a point on the south line of said Block I, Walton's Rearrangement, said point being 18.00 feet west of the southeast corner of Lot 23 of said Block I, Walton's Rearrangement; thence northerly on a line 18.00 feet west of and parallel with said east line of Lot 23, a distance of 87.00 feet; thence on a straight line to a point on the north line of Lot 30 of said Block 6, Reservoir Hills, said point being 47.23 feet easterly of the northwest comer of said Lot 30 and there terminating according to the plat thereof on file and of record in the office of the Register of Deeds of and for Anoka County, Minnesota. Subject to the reservation to the State of Minnesota in trust for the taxing districts concerned of minerals and mineral rights therein. AND Tract B, REGISTERED LAND SURVEY NO. 250. Subject to the reservation to the State of Minnesota in trust for the taxing districts concerned of minerals and mineral rights therein. FAIJ Lot 19, Block 1, Walton's Rearrangement of Lots 33 and 34, Block 6, Reservoir Hills AND The east 18.00 feet of Lot 23, Block 1, Walton's Rearrangement of Lots 33 and 34, Block 6, Reservoir Hills, measured parallel with the east line of said Lot 23. Subject to the reservation to the State of Minnesota in trust for the taxing districts concerned of minerals and mineral rights therein. AND Lots 24, 25, and 26, Block 6, RESERVOIR HILLS, Anoka County, Minnesota. -3- Lots 20, 21, and 22, Block 1, WALTON'S REARRANGEMENT OF LOTS 33 AND 34. BLOCK 6, RESERVOIR HILLS, and all of the vacated alley adjacent to said Lots 20. 21, and 22, Anoka County, Minnesota. That part of Lot 27, Block 6, RESERVOIR HILLS which lies westerly of the northerly extension of the east line of Lot 23, Block 1, , WALTON'S REARRANGEMENT OF LOTS 33 AND 34, BLOCK 6, RESERVOIR HILLS and lying easterly of the following described line: Beginning at a point on the South line of said Block 1, WALTON'S REARRANGEMENT OF LOTS 33 AND 34, BLOCK 6, RESERVOIR HILLS, said point being 18.00 feet west from the Southeast comer of Lot 23 of said Block 1, WALTON'S REARRANGEMENT OF LOTS 33 AND 34, BLOCK 6, RESERVOIR. HILLS; thence northerly on a line 18.00 feet west of and parallel with the east line of said Lot 23, to the north line of said Block 6, RESERVOIR HILLS. Lot 32, Block 6, RESERVOIR HILLS, Anoka County, Minnesota. Lots 25 through 283 Block 1, WALTON'S REARRANGEMENT OF LOTS 33 AND 34, BLOCK 6, RESERVOIR HILLS, Anoka County, Minnesota. The vacated alley adjacent to Lots 25 through 28, Block I, WALTON'S REARRANGEMENT OF LOTS 33 AND 34, BLOCK 6, RESERVOIR HILLS, Anoka County, Minnesota. Those parts of Lots 28 through 31, Block 6, RESERVOIR HILLS; Lot 24, Block 1, WALTON'S REARRANGEMENT OF LOTS 33 AND 34,, BLOCK 6, RESERVOIR HILLS; and of the vacated alley adjacent to Lot 24., Block 1, WALTON'S REARRANGEMENT OF LOTS 33 AND 34, BLOCK 6, RESERVOIR HILLS; lying Southwesterly and Westerly of the following described line: Beginning at a point on the South line of Block 1, WALTON'S REARRANGEMENT OF LOTS 33 AND 34, BLOCK 6, RESERVOIR HILLS, said point being 18.00 feet West of the Southeast corner of Lot 23, of said Block 1, WALTON'S REARRANGEMENT OF I..,OTS 33 AND 34, BLOCK 6, RESERVOIR HILLS; thence Northerly on a line 18.00 feet West of and parallel with the East line of said Lot 23, a distance of 87.00 feet; thence on a straight line to a point on the North line of Lot 3 )0 of said Block 6, RESERVOIR HILLS, said point being 47.23 feet Easterly of the Northwest corner of said Lot 30 and there terminating. Parcel 2: Those parts of Lots 27 through 31, Block 6, RESERVOIR HILLS and those parts of Lots 23 and 24, Block 1, WALTON'S REARRANGEMENT OF LOTS 33 AND 34, BLOCK 6, RESERVOIR HILLS and of the vacated alley abutting Block 1, "WALTON'S REARRANGEMENT OF LOTS 33 AND 34, BLOCK 6, RESERVOIR HILLS", as dedicated in said plat, lying within the following described tract: Commencing at a point on the South line of said Block, 1, WALTON'S REARRANGEMENT OF LOTS 33 AND 34, BLOCK 6, RESERVOIR HILLS distant 18.00 feet West of the 9EAE Southeast comer of Lot 23, said Block 1, WALTON'S REARRANGEMENT OF LOTS 33 AND 34, BLOCK 6, RESERVOIR HILLS, thence Northerly on a line 18.00 feet West of and parallel with the East line of said Lot 23, a distance of 87.00 feet, to the actual point of beginning of the tract to be described; thence continuing Northerly on the extension of said parallel line to the North line of Block 6, RESERVOIR HILLS; thence Westerly along said North line of Block 6, to a point being 47.23 feet Easterly of the Northwest corner of Lot 30,, Block 6, RESERVOIR HILLS; thence Southeasterly, to the point of beginning; Excepting therefroni Tract A. REGISTERED LAND SURVEY NO, 250,, Anoka County, Minnesota. - 5 - AGREEMENT REGARDING INSURANCE THIS AGREEMENT, is made as of February 24, 2025 by and between BPOZ Columbia Heights, LLC, a Delaware limited liability company (hereinafter referred to as `BPOZ" or "Multifamily Owner"), and the City of Columbia Heights, a municipality under the laws of Minnesota (hereinafter referred to as the "City" or "Commercial Owner"). WHEREAS, Common Interest Community No. 342, Heights Condominium, a condominium located in Anoka County, Minnesota (the "CIC"), was created pursuant to that certain Declaration, dated October 25, 2023 and recorded December 15, 2023, in the Office of the Anoka County Registrar of Titles as Document No. 614447.002, and is governed by the Minnesota Common Interest Ownership Act, Minnesota Statutes Chapter 515B (the "Act"); WHEREAS, Heights Condominium Owners Association, a nonprofit corporation under the laws of Minnesota ("Association"), was created to operate the CIC; WHEREAS, the City is the fee owner of Unit 1 (the "Commercial Unit"), and BPOZ is the fee owner of Unit 2 (the "Multifamily Unit') in the CIC, and such units constitute all of the units in the CIC; WHEREAS, neither the Commercial Unit nor the Multifamily Unit may be used for "residential use" as that term is defined by the Act; WHEREAS, the parties desire to memorialize their temporary agreement regarding insurance coverage to be maintained by the Association so long as BPOZ, or an entity owned or controlled by it, or which owns or controls it, remains the owner of the Multifamily Unit and so long as the insurance coverages specified herein are in fact timely procured and evidence of such insurance procurement is provided. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the undersigned hereby agree as follows: If the Board, acting on behalf of the Association, determines in its discretion, that doing so is expedient, economically advantageous, and reasonably available, the Board may elect, in satisfaction of its obligations under Section 7.1.1 of the Declaration, to insure the Property under a master policy of property insurance that also covers additional properties, provided that the Association identifies itself, the Multifamily Owner and the Commercial Owner as named insureds or additional named insureds and such master policy of property insurance otherwise complies with the requirements of Section 7.5 of the Declaration. Such master policy of property insurance shall otherwise satisfy the requirements of said Section 7.1.1, except that it may exclude ceiling or wall finishing materials, cabinetry, finished millwork, finished flooring, electrical, heating, ventilating, and air conditioning equipment and plumbing fixtures, built-in appliances, light fixtures and other improvements and betterments (collectively "Internal Betterments"), all within or to the extent serving only the Commercial Unit, regardless of when installed, the interior of the Commercial Unit being either self -insured or insured separately by the Commercial Owner. The costs of the Internal Betterments coverage procured regarding the Multifamily Unit shall be assessed exclusively against the Multifamily Owner and the Multifamily Unit pursuant to Section 7.2 of the Declaration. Regardless of being identified as an additional named insured on the master policy, neither owner shall make nor settle a claim for damage to the Common Elements, Limited Common Elements or the Units under such master policy, all such claims to be made solely by the Association; provided, however, the Multifamily Owner may make and settle claims directly to the extent related solely to the Interior Betterments of the Multifamily Unit. Without limiting the Association's discretion, the Association need not approve any claim for cosmetic damage to the Commercial Unit, except that cosmetic damage caused by the fault, intentional act or negligence of the Multifamily Owner or agents of the CIC/Association is not expressly excluded. 3. If the Association determines, in its discretion, that doing so is expedient, economically advantageous, and reasonably available, the Association may elect, in its discretion and in satisfaction of its obligations under Section 7.1.2 of the Declaration, to maintain its commercial general liability insurance under a master policy of liability insurance that also covers owners of additional properties and otherwise complies with the requirements of Section 7.5 of the Declaration. The Association shall be the named insured and the Commercial Owner and the Multifamily Owner, their partners and members, as their interests may appear, shall be included as additional insureds for claims and liabilities arising in connection with the ownership existence, use or management of the Common Elements. Notwithstanding the foregoing, the Multifamily Owner may also be named as an additional named insured, subject to assessment of such costs related to the same, if any, to the Multifamily Owner and Multifamily Unit pursuant to Section 7.2 of the Declaration. 4. The costs of insurance shall be allocated among the parties as set forth in the Declaration, including the rights and obligations of Section 7.2 of the Declaration. 5. In the event that the Commercial Owner intends to transfer title to the Commercial Unit, or an interest therein, Commercial Owner agrees to notify the Multifamily Owner of such intent and to notify the potential purchaser or transferee of this Agreement. Any notice given pursuant to the right of first offer specified in Section 4.26 of the Declaration shall serve as proper notice to the Multifamily Owner hereunder. 6. This Agreement shall be binding upon and inure to the benefit of the parties' respective successors, and assigns, but shall nevertheless terminate upon transfer of title of the Multifamily Unit to an independent third party purchaser which does not own or control BPOZ and which BPOZ does not own or control. 7. This Agreement contains the entire understanding between the parties with respect to the subject matter hereof, allowing a temporary contractual deviation from the express terms of the Declaration, superseding, to the extent specified herein, the Declaration, all negotiations, prior discussions and preliminary agreements. This Agreement may not be changed orally but only by an agreement in writing signed by the party against whom enforcement of any waiver, change, modification, extension or discharge is sought. 8. This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same document. 9. This Agreement may not be recorded in the public real estate records of Anoka County, Minnesota, without the prior written consent of the Multifamily Owner. 10. If any provision of this Agreement is held to be unenforceable or void, such provision shall be deemed to be severable and shall in no way affect the validity of the remaining terms of this Agreement. 11. Multifamily Owner hereby indemnifies and holds Commercial Owner, and any existing or future member of the board elected, or appointed, by Commercial Owner, harmless from any and all claims, costs, expenses, lawsuits, damages, and reasonable attorneys' fees that may arise directly from this Agreement and any deviation therein from the terms of the Declaration or Act governing property or commercial general liability insurance to be maintained by the Association. Specifically, without limiting the foregoing, Multifamily Owner shall indemnify Commercial Owner from any and all claims that may arise from any existing or future lender of the Multifamily Unit, or from any future purchaser of the Multifamily Unit, or any part thereof, related to this Agreement and any deviation from the terms of the Declaration or Act specified herein. This indemnification and hold harmless provision shall survive termination or cancellation of this Agreement. [Signature page follows] IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above written. BPOZ Columbia Heights, LLC Its STATE OF MINNESOTA COUNTY OF City of Columbia Heights By 4r"e'VW Its ';I� The foregoing instrument was acknowledged before me this day of , 2025, by , the of BPOZ Columbia Heights, LLC, a Minnesota limited liability company, for and on behalf of the company. Notary Public STATE OF MINNESOTA COUNTY OF ANOKA The foregoing instrument was acknowledged before me this 24th day of February, 2025, by Aaron Chirpich, the City Manager, of the City of Columbia Heights, a municipality under the laws of the State of Minnesota, for and on behalf of said city. otar4Public THIS INSTRUMENT WAS DRAFTED BY: Winthrop & Weinstine, P.A. MGM^^^ t 225 South Sixth Street, Suite 3500 SARA EUSASM P Minneapolis, Minnesota 55402-4629 NotivY Public-Minnose 30831671v4 MyCammlalon EzpWlJW• 31, 15056.15 [RESERVED FOR RECORDING DATAI AGREEMENT REDUCING STATUTE OF LIMITATIONS HEIGHTS CONDOMINIUM A Condominium Common Interest Community Number 342 This Agreement is made by and between BPOZ COLUMBIA HEIGHTS, LLC, a Delaware limited liability company, as "Transferor", and the CITY OF COLUMBIA HEIGHTS, a Minnesota municipal corporation, as "Transferee" as of the 2 day of ,,ty , 2025. In consideration for certain land in Anoka County, Minnesota, conveyed by Transferee and the Columbia Heights Economic Development Authority to Transferor pursuant to the Purchase and Redevelopment Contract, dated September 28, 2020, Transferor, among other things, formed upon said land Common Interest Community No. 342, a Condominium, Heights Condominium (the "CIC") and, pursuant to a City Hall Transfer Agreement between the parties hereto, dated as of October 27, 2020 (the "Transfer Agreement'), contemporaneously herewith reconveyed to Transferee a unit in the CIC legally described as follows (the "Unit'): See Exhibit A attached hereto and hereby made a part hereof. The CIC is subject to the Minnesota Common Interest Ownership Act codified in Minnesota Statutes Chapter 515B ("MCIOA"). MCIOA §§ 51513.4-112 and 51513.4-113, copies of which are attached hereto as Exhibit B and hereby made a part hereof, impose certain statutory warranties which, under MCIOA § 51513.4- 114, are capable of being waived, modified and/or excluded in transactions involving units restricted to nonresidential uses. NOW, THEREFORE, the parties hereto hereby acknowledge and agree as follows: (1) This Agreement constitutes part of the basis of the bargain for which Transferor has contemporaneously conveyed title to the Unit to Transferee. (2) The CIC, and the Units within the CIC, are restricted by the Declaration for Common Interest Community Number 342, Heights Condominium, recorded in the Office of the Registrar of Titles in and for Anoka County, Minnesota as Document No. T614447.002_ to nonresidential uses. Specifically, no part of the CIC may be used for "residential use" as defined by Minnesota Statutes § 515B.1-103(30). (3) Transferor agrees to be bound by the MCIOA Warranties, but only if and to the extent that Transferee commences a legal action for breach of the MCIOA Warranties within one (1) year after the date the cause of action accrues pursuant to MCIOA § 51513.4-1152(c), and any statute of limitations on asserting a claim under the MCIOA Warranties is hereby reduced from six (6) years to one (1) year after such cause of action accrues. Thereafter, the MCIOA Warranties shall have no further force or effect. (4) As of the date hereof, Transferee has leased and/or occupied the Unit for more than one (1) year. (5) Any challenge to the foregoing reduction of the statute of limitation by Transferee shall be conclusively deemed a complete waiver of and void all MCIOA Warranties. (6) This Agreement is subject to any further reduction in the statute of limitations as set forth in Section 23 of the Transfer Agreement. (7) This Agreement and the Transfer Agreement constitute the complete agreement between the parties as to the subject matter hereof and supersede any and all other oral or written agreements, negotiations, understandings and representations between the parties as to the same. There are no verbal or written side agreements that change this Agreement. (8) This Agreement has been made under the laws of the State of Minnesota, and such laws will control its interpretation and effect. (9) This Agreement shall survive the closing of the transfer of the Unit from Transferor to Transferee transaction, shall not merge with the deed given to Transferee, and shall run with the land and be binding on the parties, their successors and assigns. Transferee consents to the recordation of this Agreement with the Registrar of Titles in and for Anoka County, Minnesota. 20374878v9 15056.15 [The balance of this page is intentionally left blank.] lA TRANSFEREE: CITY OF COLUMBIA HEIGHTS li And by: Its: City MaLger STATE OF MINNESOTA TRANSFEROR: BPOZ COLUMBIA HEIGHTS, LLC By: Its: ) ss. COUNTY OFA,,�,, ) rr The foregoing instrument was acknowledged before me this --i day of , 2025, by GlmAA-,o(,L a„t, the Mayor of the City of Columbia Hei hts, Minnesota, a Minnesota municipM corporation, for and on behalf of the municipality. -Notary Public My Commission Expires: 31 `Yo3a 7LSARIA EUSABETH ION STATE OF MINNESOTA l ry PubNc-Minnesotal *siw Expires Jan. 31, 203P t ss. COUNTY OF A—r i,, ) The foregoing instrument was acknowledged before me this 2-4 day of - , 2025, by � the City Manager of the City of Columbia Heights, Minnesota, a Minnesota municipal corporation, for and on behalf of the municipality. ary Public My Commission Expires: �a..,ti 31r 2D3a GFNOqr� ARA RISABETH ION Publl Innesota My Omission Expihs Jan. 31. 2030 1 Signature Page to Agreement Reducing Statute of Limitations STATE OF MINNESOTA ) ss. COUNTY OF ) The foregoing instrument was acknowledged before me this day of , 2025, by Robert C. Lux, the President of BPOZ Columbia Heights, LLC, a Delaware limited liability company, on behalf of the company. Notary Public My Commission Expires: THIS INSTRUMENT WAS DRAFTED BY: Winthrop & Weinstine, P.A. 225 South Sixth Street, Suite 3500 Minneapolis, Minnesota 55402-4629 (612)604-6400 Signature Page to Agreement Reducing Statute of Limitations EXHIBIT A Legal Description of Unit Unit 1, Common Interest Community No. 342, Heights Condominium, Anoka County, Minnesota, together with all hereditiments and appurtenances. Exhibit A EXHIBIT B NICIOA Warranties 51513.4-112 EXPRESS WARRANTIES. (a) Express warranties made by a declarant or an affiliate of a declarant to a purchaser of a unit, if reasonably relied upon by the purchaser, are created as follows: (1) Any affirmation of fact or promise which relates to the unit; use of the unit; rights appurtenant to the unit; improvements to the common interest community that would directly benefit the purchaser or the unit; or the right to use or have the benefit of facilities which are not a part of the common interest community, creates an express warranty that the unit and related rights and uses will conform to the affirmation or promise. (2) Any model or description of the physical characteristics of a unit or the common interest community, including plans and specifications of or for a unit or other improvements located in the common interest community, creates an express warranty that the unit and the common interest community will conform to the model or description. A notice prominently displayed on a model or included in a description shall prevent a purchaser from reasonably relying upon the model or description to the extent of the disclaimer set forth in the notice. (3) Any description of the quantity or extent of the real estate comprising the common interest community, including plats or surveys, creates an express warranty that the common interest community will conform to the description, subject to customary tolerances. (b) Neither the form of the word "warranty" or "guaranty," nor a specific intention to make a warranty, are necessary to create an express warranty of quality, but a statement purporting to be merely an opinion or commendation of the real estate or its value does not create a warranty. (c) Any conveyance of a unit transfers to the purchaser all express warranties. 51513.4-113 IMPLIED WARRANTIES. (a) A declarant warrants to a purchaser that a unit will be in at least as good condition at the earlier of the time of the conveyance or delivery of possession as it was at the time of contracting, reasonable wear and tear excepted. (b) A declarant warrants to a purchaser that: (1) a unit and the common elements in the common interest community are suitable for the ordinary uses of real estate of its type; and (2) any improvements subject to use rights by the purchaser, made or contracted for by the declarant, or made by any person in contemplation of the creation of the common interest community, will be (i) free from defective materials and (ii) constructed in accordance with applicable law, according to sound engineering and construction standards, and in a workmanlike manner. (c) In addition, a declarant warrants to a purchaser of a unit which under the declaration is available for residential use that the residential use will not violate applicable law at the earlier of the time of conveyance or delivery of possession. (d) Warranties imposed by this section may be excluded or modified only as specified in section 51513.4-114 Exhibit B-1 (e) For purposes of this section, improvements made or contracted for by an affiliate of a declarant are made or contracted for by the declarant. (f) Any conveyance of a unit transfers to the purchaser all implied warranties. (g) This section does not in any manner abrogate the provisions of chapter 327A relating to statutory warranties for housing, or affect any other cause of action under a statute or the common law. (h) A development party shall not have liability under this section for loss or damage caused by the failure of the association or a unit owner to comply with obligations imposed by section 51513.3-107, unless the loss or damage is caused by failure to comply with section 51513.3-107 while the declarant controlled the board. Exhibit B-2