Title
An Ordinance approving the Second Amendment to Real Estate Sale Agreement between the City of Lee’s Summit, Missouri, and Archview Properties, LLC, for the sale of city property at 15 and 25 NW Tudor Road.
(First read by Council on March 14, 2023. Passed by unanimous vote.)
Body
Issue/Request:
A request by Archview to extend the approvals period a second time from March 30, 2023 to June 28, 2023. The resulting closing date would be approximately July 7, 2023.
Key Issues:
Extension of the Approvals Period for an Agreement to sell City surplus property from March 30, 2023 to June 28, 2023.
Proposed City Council Motion:
I move for adoption of an Ordinance Approving the Second Amendment to Real Estate Sale Agreement Between the City of Lee’s Summit, Missouri, and Archview Properties, LLC, for the Sale of City Property at 15 and 25 NW Tudor Road.
Background:
The City holds fee simple title to property located at 15 and 25 NW Tudor Road (the “Property”), which was originally purchased as part of a larger parcel for the purpose of constructing and operating a police and municipal court facility. The Police and Court Facility continues to be operated on the north side of Tudor Road. The Property located on the south side of Tudor Road is no longer needed by the City and therefore can be sold as surplus property pursuant to the general authority as set forth in Section 2.1 of the City Charter and as authorized by Article 6, Section 19(a) of the Missouri Constitution.
The City Council passed Ordinance No. 9337 on February 22, 2022, which approved a Real Estate Sale Agreement between the City and Archview Properties, LLC (“Archview”), for the sale of the Property, which was executed by the parties on February 23, 2022 (the “Agreement”). The Agreement includes two 30-business-day extension periods which may be exercised at the option of Archview upon the payment of additional Earnest Money, as defined in the Agreement.
A timeline of the relevant dates associated with the Agreement is:
February 22, 2022 - Ordinance No. 9337, Contract approved
February 23, 2022 - Agreement executed
July 12, 2022 - Ordinance No. 9461 approved First Amendment to Agreement
July 13, 2022 - First Amendment executed
September 21, 2022 - Original expiration date of the approvals period, superseded by First Amendment
December 22, 2022 - Archview delivered first notice of extension of approvals period to February 15, 2023
February 14, 2023 - Archivew delivered second notice of extension of approvals period to March 30, 2023
March 30, 2023 - Current expiration date of the approvals period
Archview will be present at the Council meeting to explain the basis of the requested extension.
Impact/Analysis:
The City will sell the Property for fair market value pursuant to the Real Estate Sale Agreement. The sales price will be maintained as a closed record, as allowed by Section 610.021(2) of the Revised Statutes of Missouri, until the transaction closes. This is to maintain the sales price as a closed record in the event that the transaction set forth in the Agreement fails to close and the City seeks to sell the property to another buyer at a later date. Disclosure of the current sales price might adversely affect the sales price to a different buyer, in the event the pending transaction under the Agreement that is authorized by this Ordinance fails to close.
The Second Amendment would extend the approvals period for 90 calendar days to June 28, 2023. The Agreement provides that the closing will take place on the date that is selected by the Purchaser which date shall be no later than ten (10) days after the end of the approvals period. Therefore, under this Second Amendment and assuming no further extensions and assuming Archview elects to complete the purchase, the closing would occur by approximately Friday, July 7, 2023.
Timeline:
The Agreement sets forth time periods for due diligence and seeking governmental approvals by the Buyer, and would close by the date stated above.
Presenter
David Bushek, Chief Counsel of Economic Development & Planning
Recommendation
Recommendation: Staff recommends approval of the ordinance in accordance with the prior directions of the City Council.