Agenda - Economic Development Authority - 07/13/2017

Home

Economic Development Authority (EDA) Meeting Date: 07/13/2017 Submitted For: Patrick Brama, Administrative Services By: Patrick Brama, Administrative Services 4. 3. Title: CBRE Real Estate Listing Contract, Amendment #2, 1-Year Extension w/Month-to-Month Termination Option Purpose/Background: PURPOSE The purpose of this case is to approve the attached 1-year contract extension with CBRE with a month -to -month termination clause. Notification: NA Observations/Alternatives: NA Funding Source: NA Recommendation: STAFF Staff is generally supportive of this approach and the attached contract extension. • This short-term CBRE contract will provide enough time for the City to decide what their next long-term contract will be/ with who. This contract is flexible, in favor of the City, as a month -to -month cancelation provision is included. • This contract amendment requires CBRE to supply the City with their "protected" list now. This will allow the city control/ ability to effectively monitor said list (rather than waiting until final cancelation). • This contract amendment shows a "reduced" list of properties. Staff not only removed sold properties, but also removed properties CBRE is unlikely to either bring a prospect to the city (i.e. the prospect will come organically) or the commission payment would outweigh the benefit of selling. • Staff would note, that a 6-month "carryover" clause exists within the original CBRE listing agreement. This means, after cancelation, all deals CBRE has previously worked on, are eligible for commission payments for another 6-month period. NOTE: this compares to the 18 month carryover clause that the City previously had with with Landform. • Staff believes activity from CBRE (i.e. prospects being brought to the city) has increased over the past six months. Staff believes this is for two reasons: (a) the larger real estate industry is doing really well, and (b) Ramsey is establishing strong momentum in the real estate industry --which helps attract additional interest (we've had lots of sales, big infrastructure investments, we have several projects are in the hopper, and we've seen significant residential growth). • Staff is currently working with CBRE on a serious prospect looking at a 175-unit, high -quality, senior independent living, market rate, apartment complex in The COR. • CBRE has indicated once the McDonald's land dispute is settled, they will be able to quickly attract prospects to said site(s).