Agenda - Economic Development Authority - 01/11/2024

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Economic Development Authority (EDA) Meeting Date: 01/11/2024 Primary Strategic Plan Initiative: { (d)Aud_pd8(d) (a,} 4. 1. Title: Consider Approval of Purchase Agreement for Lot 1, Block 1, Rivers Bend Plaza 2nd Addition; Case of MW Properties LLC (Complete Auto) Purpose/Background: The purpose of this case is to consider an EDA recommendation to the City Council to sell Lot 1, Block 1, Rivers Bend Plaza 2nd Addition (approximately 1.01 acres) to MW Properties LLC dba Complete Auto (the "Developer") to construct a minimum 9,500 SF Auto Repair Shop. The auto repair shop will not include auto body or auto restoration, which can tend to be a bit unsightly. This property, formerly an Amoco Station, was acquired by the City in 2005 for $230,000, which included a Car Wash. The two buildings were demolished in 2005 and the property has been on the market ever since and has had very little interest by developers based on the property restrictions/conditions. When the City acquired the property, it was subject to deed restrictions prohibiting residential development, installation of groundwater wells, basements, construction of quick service / take out restaurant. Soil excavation restrictions and the requirement for a vapor barrier over the newly constructed building is required. A copy of the Quit Claim Deed and those restrictions are attached to this case showing the challenges of the property. Based on these restrictions and limitations, the market value is lower than the purchase price by the City. Based on the lot restrictions, lack of full access to Hwy 47 and potential added construction costs for the buyer, the offer of $100,000 ($2.27/SF) seems reasonable. The price for the property is above the high -end of the approved deal range ($2.00 / SF). Staff appreciates the willingness of the Developer to take on these challenges. For reference on this developer, MW Properties LLC also purchased the distressed retail center at 6013 167th Lane NW in 2021. MW Properties invested $800,000 into the property/building to approve functionality and curb appeal. His sister operates the daycare at that location and they have about 100 children they serve. This past investment along with the future investment shows the commitment to quality in the City of Ramsey. Notification: None required Time Frame/Observations/Alternatives: This site has remained vacant since the demolition in 2005. Development of this difficult site (property conditions/restrictions.access) would complete the commercial corner and also preserve the land needed for the future trail from 142nd to Xkimo St NW by Holiday. Staff also believes that this project will bring a needed service to this area of the City to serve residents. The property is zoned as B-2 (Community Business) which allows this use with approval of a Conditional Use Permit. The Planning Commission will review these items during the site plan approval process. It should be noted that the property is platted, but there is an additional small remnant sliver of land at the northeast corner that is privately owned that the developer has an agreement to acquire as part of this project. Staff is supportive of the attached Purchase Agreement and Right of Re -Entry Agreement being considered by the EDA and City Council. The sale of this property will bring this property back onto the tax rolls. Staff has estimated the tax -assessed value to be approximately 1.6M when completed, which results in approximately $42,000 in annual total property taxes, $11,000 being collected by the City. Expected job creation on the site is estimated to be 7-8 employees with wages ranging from $50,000 - $125,000. This is a solid project