HomeMy WebLinkAboutCRA-R-05-0007 COVER MEMOCRA Board of Directors Meeting
January 31, 2005
Item #9
SOUTHEAST OVERTOWN/PARK WEST
AND OMNI
COMMUNITY REDEVELOPMENT AGENCIES
INTER -OFFICE MEMORANDUM
Chairman Johnny L. Winton
and Members of the CRA Board
Date: January 21, 2005 File: 04-01437
Subject: Recommendation to Approve the
Sale of CRA Property to Bayview
Towers Associates, LLC.
From: Frank K. Rollason References:
Executive Director
Enclosures:
RECOMMENDATION:
It is recommended that the Board of Directors for the Southeast Overtown/Park West CRA approve and adopt
the attached Resolution authorizing the Executive Director to sell to Bayview Towers Associates, LLC
("Bayview") all right, titles and interest in fee simple title to the property as described and the CRA's interest, as
the laniard, under the terms and provisions of that certain lease agreement (the "lease") by and between the
City of Miami and Park West LTD., ("Park") dated June 15, 1988 for 1) the payment of a purchase price of
$500,000, 2) Bayview expending not less than $300,000 to improve the 9th Street Pedestrian Mall between NW
1at Avenue and North Miami Avenue as approved by the Executive Director, 3) Bayview paying to the CRA 7%
of the gross purchase price received by Bayview from the sale of individual condominium units comprising a
portion of the property provided not less than $2,100,000 is paid to the CRA within 2 years of closing, 4)
Bayview to pay all unpaid rent due as of the date of closing, and 5) the reimbursement to the CRA of all costs
and expenses incurred by the CRA in connection with the transaction including, without limitation, appraisal fees
and attorneys' fees and costs that are incurred by the CRA in connection with the transaction, not to exceed
$50,000.
JUSTIFICATION:
In February of 2003, the SEOPW CRA was approached by Bayview Towers Associates, LLC, to see if the CRA
would be interested in negotiating an agreement whereby the land on which their buildings occupy could be
conveyed in fee simple title instead of continuing the existing lease (the CRA receives $3,112.00 +1-, annually,
for another 84 years = $261,408.00 +1-). On November 14, 2004, the SEOPW Board adopted Resolution No.
CRA-R-04-0021 (copy of marked agenda attached) instructing the Executive Director to advertise this parcel per
the requirements of Florida Statutes Chapter 163.380; the parcel was so advertised with no responses (see
attached "No Proposals Received" sheet from the Office of the City Clerk). A new appraisal was ordered with
the result that the value of the land, subject to the lease, is between $75,166.00 and $563,168.00. These
numbers were helpful in negotiating a deal keeping in mind there is more value to the existing tenant (Bayview)
in purchasing the fee than there is to another third party who would buy the land subject to the lease, receive the
cash flow for approximately 84 years and then own the property in fee simple. Negotiations took place, with the
assistance of City Staff, resulting in the proposal being recommended for your approval as outlined in the
attached Resolution. The upside potential of this proposal is a minimum additional $3.7 million above the
closing payment of $500,000 if the building goes condo once all units are sold using Bayview's projections; if
not, the CRA receives its $2.1 million above the $500,000 closing payment within 24 months of closing. It is
quite possible that sale prices will exceed what has been calculated and the CRA would reap the benefits of the
increased amount at the 7% rate. Attached, you will also find a history of the negotiation process which began
in February of 2003 and culminated an January 12, 2005 resulting in this offer being presented with a
recommendation for your approval.
FINANCIAL IMPACT: No adverse financial impact to the CRA.
FKRieh