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AGENDA REPORT
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| | | | | | | | DATE:
| February 18, 2020
| TO:
| Mayor and City Council
| FROM:
| Stefan T. Chatwin, City Manager
| | SUBJECT: | Resolution 2020-27 of the City Council of the City of Fairfield Authorizing Execution of a Purchase and Sale Agreement with Hospitality Management and APRR Management, LLC for the Transfer of Two Individual Lots Totaling ±2.43 Acres of Land, Commonly Referred to as 3365 North Texas Street, Fairfield, CA |
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| | | | | | | | | RECOMMENDED ACTION | | Adopt resolution. |
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| | | | | | | | | STATEMENT OF ISSUE | Staff recommends City Council approval of the Purchase and Sale Agreement (the “PSA”) by and between the City of Fairfield (the “City”), Hospitality Management, and APRR Managements, LLC (collectively the “Buyer”) for the sale of two undeveloped lots, Assessor Parcel Numbers 0167-110-220 and 140, totaling ±2.43 (the “Property”) located at 3365 N Texas Street, Fairfield, CA.
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| | | | | | | | | DISCUSSION | The City is the owner of two parcels known as APNs 0167-110-140 and 220 totaling approximately 2.43 acres located at 3365 North Texas Street. The City has been actively marketing the Property for a potential hotel and/or sit-down restaurant use to enhance the area.
The Buyer has significant experience developing high quality hotel and restaurant projects in Northern California that include brands such as Hampton Inn & Suites, Courtyard by Marriott, Fairfield Inn, and many others. The PSA includes an exhibit defining categories and examples of hotels and restaurant types that the City will accept as tenants for the site. In addition, the PSA prohibits any drive through food or beverage use on the site and the City retains final control over the selection of tenants who will occupy the project.
The PSA provides that the Buyer must have acquired the adjacent property owned by Robert W. Anderson Trusts (“Trusts”) known as APN 0167-110-040 before the Close of Escrow.
Staff negotiated a Purchase and Sale Agreement (the “PSA”), which includes the following terms:
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Purchase Price:
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$14.00 per square foot ($1,481,900) plus reimbursement to City and the Trusts for on-site and off-site improvements (totaling $365,777.67)
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Deposit:
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$25,000 paid at the time of execution of the PSA
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Close of Escrow:
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180 Days after execution of the PSA |
The PSA also provides that the Property is to be sold “as-is” and that all planning entitlements must be obtained within 180 days from the execution of the PSA.
In addition, the close of escrow for this transaction will trigger payment of $99,862 plus 3% interest per annum (approximately $11,984) to the City under a Promissory Note executed by North Texas Solano, LLC in 2012 to secure payment for off-site improvements benefitting the existing Chevron Station.
The project is Categorically Exempt from the requirements of the California Environmental Quality Act pursuant to CEQA Guidelines, Section15332 (Infill Projects).
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| | | | | | | | | FINANCIAL IMPACT | The net amount the City will receive from this sale transaction is approximately $1,781,464 and is comprised of as follows:
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• Total Purchase Price
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$ 1,481,900
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| • Total Reimbursement of onsite/offsite improvements (1) |
$ 199,702 |
| • Reimbursement of Trust onsite improvements (2) |
$ 166,075 |
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Total (3)
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$ 1,847,677
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Additional proceeds/payments triggered by sale:
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• Repayment of Funds owed under Promissory Note
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$ 99,862
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| • Reimbursement of Trust onsite improvements transferred to Trust |
$ (166,075)
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Net Proceeds From Sale
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$ 1,781,464
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Per Reciprocal Easement Agreement Buyer will reimburse the City and Trust for cost of existing on-site and off-site improvements (Traffic light, common area drive aisle, common area entrances, utilities, etc.). The agreement was approved by Council on April 8, 2010 by Resolution No. 2010-63.
- This represents the amount owed to the Trust for on-site improvements being reimbursed by the Buyer. To be paid in escrow and City will transfer funds to Trust.
- The TOTAL of approximately $1,847,677 represents the amount owed to the City in escrow.
The net sale proceeds from this transaction will be deposited in the Intergovernmental Loan Fund (551-99-203) and used for future economic development projects and City real estate related transactions.
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| | | | | | | | | CITY COUNCIL WORKPLAN | Community Safety
| Community Infrastructure | Quality of Life | | Financial and Operational Sustainability | Economic Development | Travis Air Force Base |
| City Council Goal this item supports:
Economic Development |
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| | | | | | | | | Project: | #5A.5, Property Sales
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| | | | | | | | | PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION | Notice of surplus lands was sent to public agencies.
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| | | | | | | | | ALTERNATIVE ACTION | | The City Council could choose to modify the terms of the PSA or not enter into the PSA. However, not approving the PSA would require pursuing other economic development opportunities for the Property. |
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| | | | | | | | | STAFF CONTACT | Jorge Barrera, Senior Economic Development Project Manager
707-428-7039
jbarrera@fairfield.ca.gov
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| | | | | | | | | COORDINATED WITH | City Attorney's Office
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| REVIEWERS: | | Reviewer | Action | Date | | Answerer | Approved | 1/29/2020 - 6:53 PM | | Feinstein, David | Rejected | 1/31/2020 - 5:03 PM | | Garcia, Cindy | Approved | 1/31/2020 - 3:19 PM | | Answerer | Approved | 2/3/2020 - 3:08 PM | | Feinstein, David | Approved | 2/3/2020 - 7:48 PM | | Answerer | Approved | 2/4/2020 - 5:03 PM | | Alexander, Amber | Approved | 2/11/2020 - 1:45 PM |
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