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Home My WebLink About5J - Main & Hastings Prop. Quit Claim Deed 16200 Eagle Creek Avenue S.E. Prior Lake, MN 55372-1714 MEETING DATE: AGENDA #: PREPARED BY: AGENDA ITEM: DISCUSSION: CITY COUNCIL AGENDA REPORT June 26, 2006 5J Kelly Meyer, Asst. to the City Manager Consider Approval of a Resolution Authorizing the Mayor and City Manager to Execute a Quit Claim Deed Releasing the City's Interest in the Main Avenue and Hastings Property (Rock Creek). Introduction The City owned a 49' x 145' parcel at the intersection of Main Avenue and Hastings in downtown Prior Lake. In early 2005 in order to continue the City's downtown redevelopment efforts, the City requested proposals from bidders interested in purchasing this site in order to construct a commercial building consistent with the City's 2030 Vision and Strategic Plan. On June 6, 2005, the City Council awarded the project to Rock Creek Designers and Builders represented by Dan Schaefer whose proposal most closely conformed to the requirements of the RFP, planned for a 3-story building consistent with the design guidelines for downtown, and offered a purchase price of $200,000 for the parcel. In February 2006, the City Council authorized the Mayor and City Manager to enter into a purchase agreement and close on the sale of the property. In April 2006, the project began construction. Current Circumstances The terms of the contract documents (Agreement for the Purchase of City- Owned Property, Development Agreement, Purchase Agreement) for the sale of property included that the deed conveying title have a rescission clause that would allow the City to recover the property in the event the Developer failed to construct the building, or abandoned the project prior to significant completion. With the rescission clause, the City would have the opportunity to rescind the sale and ownership would revert back to the City. The trigger in the Development Agreement for releasing the City's interest as a result of the rescission provision was for the developer to complete significant foundation work on the building with a minimum of a $100,000 investment. The construction project began in April of this year. Currently, the project is well underway, has surpassed the $100,000 investment benchmark, and the developer is requesting that the City release its interest. Conclusion The staff believes the conditions in the contract documents for the release of the City's interest has been met. www.cityofpriorlake.com I :\CO U NC I L \AG N RPTS\2006\Rock Crpflbf&i98~.iIPl~42:mle,srcRC%2. 447.4245 ISSUES: There are no significant issues. This item is housekeeping in nature, and is driven by the City's obligations in the Development Agreement and other contract documents for the sale of the property. FINANCIAL IMPACT: There is no financial impact of this action. Under the terms of the agreements, the extension payments held by the City on this project are not released until the certificate of occupancy is issued. ALTERNATIVES: 1. Motion and Second to Adopt Resolution 06-xxx as part of the Consent Agenda Authorizing the Mayor and City Manager to Execute a Quit Claim Releasing the City's Interest in the Conveyance Document for the Property at Main Avenue and Hastings. 2. Remove this item from the Consent Agenda for further discussion. RECOMMENDED MOTION: Alternative 1. Reviewed by: 1:\COUNCIL\AGNRPTS\2006\Rock Creek Quit Claim Deed Release DOC 16200 Eagle Creek Avenue S.E. Prior Lake, MN 55372-1714 RESOLUTION 06-xx A RESOLUTION AUTHORIZING THE MAYOR AND CITY MANAGER TO EXECUTE A QUIT CLAIM DEED RELEASING THE CITY'S INTEREST IN THE MAIN AVENUE AND HASTINGS PROPERTY FOR ROCK CREEK. Motion By: Second By: WHEREAS, the 2030 Vision and Strategic Plan provides that continued redevelopment of the Downtown Prior Lake area is important to the citizens of Prior Lake; and WHEREAS, Rock Creek Designers & Builders, LLC has purchased the property subject to a rescission provision, in order to construct a 3-story retail/office building, and WHEREAS, the contract documents for this transaction provide that the City will release its interest in the property once an investment of $100,000 has been made in the building project; and WHEREAS, Rock Creek Designers & Builders has completed all of the foundation work and the construction of one external wall and is requesting that the City execute a quit claim deed releasing its interest in the property, and WHEREAS, the City Council has determined that with respect to this issue, the contract obligations of Rock Creek Designers & Builders, LLC have been met. NOW THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF PRIOR LAKE, MINNESOTA as follows: 1. The recitals set forth above are incorporated herein. 2. The Mayor and City Manager are authorized to execute a Quit Claim deed releasing the City's interest in the property located at 16180 Hastings Avenue, Prior Lake, Minnesota. PASSED AND ADOPTED THIS 26TH DAY OF JUNE, 2006. YES NO Hauaen Haugen Dornbush Dornbush Erickson Erickson LeMair LeMalr Millar Millar Frank Boyles, City Manager I :\COUNC I L \RESOLUTI\ADM I NRESi2006\Rock Creek ~ityofpriorlake.com Phone 952.447.4230 / Fax 952.447.4245 (Reservedfor Recording Data) QUIT CLAIM DEED STATE DEED TAX DUE HEREON: $ 1.65 Dated: June 5. 2006. FOR VALUABLE CONSIDERATION, THE CITY OF PRIOR LAKE, a municipal corporation person, Grantor, hereby conveys and quitclaims to ROCK CREEK DESIGNERS & BUILDERS, LLC, a Minnesota limited liability corporation, Grantee, real property in SCOTT County, Minnesota, described as follows: Lot 8, except the Northerly One (1) foot of said Lot 8, Block Three (3), Village of Prior Lake, Scott County, Minnesota. PID #25-001021-0 PID #25-001-021-1 together with all hereditaments and appurtenances belonging thereto, subject to the following exceptions: None. This Quit Claim Deed releases the interest of the City of Prior Lake reserved in that certain Warranty Deed dated February 21,2006, filed February 28, 2006, as Document #A731212 in the office of the Scott County Recorder. THE GRANTOR CERTIFIES THAT THE GRANTOR DOES NOT KNOW OF ANY WELLS ON THE DESCRIBED REAL PROPERTY. The consideration for this transfer is less than $500.00. By: Jack Haugen, Mayor By: Frank Boyles, City Manager 102236 Quit Claim Deed Rock Creek Designers & Builders, LLC Page 20f2 STATE OF MINNESOTA ) )ss. COUNTY OF ) The foregoing instrument was acknowledged before me this day of , 2006, by Jack G. Haugen and Frank Boyles, respectively the Mayor and City Manager of the City of Prior Lake, a Minnesota municipal corporation, by and through the authority granted by its City Council. Notary Public Tax Statements for the real property described in this instrument should be sent to: Rock Creek Designer's & Builders LLC Attn: Dan Schaefer 16180 Hastings Avenue Prior Lake, MN 55372 THIS INSTRUMENT WAS DRAFTED BY: City of Prior Lake 4646 Dakota Street Prior Lake, MN 55372 Admin: kgm File No. 100.063 102236