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Economic Development Authority (EDA) Meeting Date: 05/05/2016 Submitted For: Patrick Brama, Administrative Services By: Patrick Brama, Administrative Services 4. 2. Title: Aeon Purchase Agreement [PORTIONS OF CASE MAY BE CLOSED TO THE PUBLIC] Purpose/Background: PURPOSE Consider attached offer to purchase City -owned land (Purchase Agreement, PA). Provide a recommendation to the City Council. OVERVIEW Attached to this case is a purchase agreement from Aeon, a Twin Cities housing developer. Aeon is interested in purchasing 3.38 acres of City -owned land located within The COR, on the northeast corner of Ramsey Parkway and Center Street (just north of The Draw). Aeon is proposing a 40-60 unit, 3-story, income restricted, apartment complex. In many ways, this proposed project will be structured much like the Common Bond project currently under construction in The COR. Aeon plans to fund their $12.4M project by utilizing low income housing tax credits (LIHTC), Metropolitan Council grants, Anoka County Homes Funds, and owner equity. At this point, Aeon is not requesting any funding from the City of Ramsey, nor are they asking for a discount on land. Although Aeon is a non-profit organization, they will be paying property taxes on this project. With limited information available, staff currently estimates property taxes for this project will range from $40K-60K annually. After discussing the project with staff, Aeon is aware of the high architectural standards/ expectations for projects located within The COR, and has indicated no concerns with delivering a quality project (similar to Common Bond). Aeon has indicated they will own and operate this project. As proposed by Aeon, the 3.38 parcel will be developed in phases. Phase 1 is described above. Phase 2 will occur when market demand is present, and will likely mirror Phase 1. BACKGROUND City Purchase of O UTLOT A The City of Ramsey purchased The COR (formerly Ramsey Town Center) in 2009 for $6.8M, consisting of 119.26 acres of developable property. As part of the purchase, the City pulled back assessments on all City -owned property, totaling $5.9M. The total cost of the land purchase, including the assessments is $12.7M, which breaks down to $2.44 per square foot. The City purchased The COR with an intent to resurrect the development project and preserve the community's original vision and master plan. The subject property is a 3.38 acre portion of the larger 119.26 acre purchase. Site Information The subject property is roughly 3.38 acres in size and is zoned COR 4(C) Neighborhood District (Residential). The COR Master Plan contemplates an apartment complex for this parcel. This site is located in the north central portion end of The COR, and is rectangular in shape. Property Listing The City has officially listed this property with a broker (listing #52). The City has established an official asking price for this property ($2.08 psf, $90,725 per acre, $450,000). Aeon is not offering to purchase the entire listing (4.96 acres), they are offering to purchase 3.38 acres; which can be prorated to ($306,653). Staff believes this parcel