Agenda - Council Work Session - 10/11/2016

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C. Wait to see what happens with PACT Charter School —if PACT ended up buying a portion of the former Legacy Christian Academy property owned by Hageman Holdings. PACT Charter only needs a portion of the former Legacy Christian Academy site (about half). If the PACT Charter purchase took place, the City could pick up about 40 acres of the remaining land for the business park. UPDATE: PACT Charter School has indicated they have made a site selection for their new school campus —that being the Legacy Christian Academy site. For a number of reasons, they are unable to make that decision final, and enter into a formal purchase agreement, until at least fall of 2017. Likely, closing would occur sometime in 2018. This is the best -case scenario for PACT from a timing perspective. As a result, counting on this action to occur is speculative at this point. Hageman Holdings has indicated they currently don't have a specific timeline RE their school site. They are willing to wait for their vision to come to fruition. D. If developers are not interested, and PACT Charter doesn't get their deal done, staff should bring back a future discussion about potentially considering a City purchase. Staff is concerned the upfront cost -benefit of a city purchase of the Pearson property is diminishing, considering the purchase price is now nearly double what was originally contemplated. • In order for the City to purchase the Pearson property now, we would need to come up with $1,465,501 (about $30,000 per acre or$0.75 psf). Originally, the City discussed a price of roughly $800,000 (about $18,000 per acre or $0.41 psf). • In order to get arterial infrastructure completed, the City estimated a $31,000 cost per acre (about $.075 psf or $1,393, 000 for the Pearson 48 acres). • Therefore, if the city were to purchase the Person property now (48 acres), and install arterial infrastructure, we'd be looking at an investment of about $2,858,000, $63,600 per acre, or $1.46 psf. That price does not include holding costs, time -value of money, internal site infrastructure, etc. • We believe the asking price for industrial land is roughly $2.00-$2.50 psf. However, it is very common for the City to sell property at the low end of the market, or even with a subsidy (i.e. $1.00-$1.75 psf). • The EDA has about $2.1M available (between the County EDA/HRA, EDA fund, and EDA RLF). We would need to pull dollars from other sources in order to make this project work. NOTE: this is a departure from the original discussion — which assumed the EDA would have enough dollars to cover. Page 4 of 6