25A - AGMT - SALE 2129 N MAIN ST

Home Browse Search

Purchase and Sale Agreement – 2129 North Main Street May 2, 2017 Page 2 The next step in the process is to enter into a Purchase and Sale Agreement with Net Development Co. (Exhibit 2) to develop the hotel. The appraised value for the parcel is $2,075,000 which Net Development Co. has agreed to. The purchase and sale agreement has been drafted to ensure a high quality hotel is developed in a timely manner. Tourism remains an important industry sector that Santa Ana needs to continue to invest resources into. The proposed hotel's proximity to the 1 -5 freeway, the Bowers Museum, MainPlace Mall, and the Discovery Science Cube make it a premium location to enhance the future growth of these city amenities and the tourism industry in Santa Ana. The development of a hotel at this location will also add a public benefit through the increase of Hotel Visitor Taxes (HVT). This increase will help fund local services such as infrastructure — improvements, new public parks, environmental preservation, and increases in public. safety_for-_- - _ _ residents of Santa Ana. STRATEGIC PLAN ALIGNMENT Approval of this item supports the City's efforts to meet Goal #3 Economic Development, Objective #5, (Leverage private investment that results in tax base expansion and job creation citywide), Strategy A (Identify and market underutilized properties [city and non -city owned] for new development that will create new jobs and expand the City's tax base). FISCAL IMPACT The purchase price of the City -owned property located at 2129 North Main Street is $2,075,000. Pursuant to the Execution of the Purchase and Sales Agreement, Net Development Co. will pay the City a total amount of $1,985,000 which will be deposited into account no. 01102002 - 57071. In addition, the "good faith" deposit amount of $90,000 currently in account no. 01101001 -21671 which Net Development Co. paid to the City when the Exclusive Negotiation Agreement (ENA) was executed, will be reclassified and recorded into account no. 01102002 - 57071. The Sale and Purchase of said property will be completed and funds will be reclassified and recorded upon the close of the extended escrow which requires all entitlements to be completed and the date which the Grant Deed conveying title to the Property to Net Development is recorded. This project will require an Environmental Review process which may take up to 18 months. Therefore Net Development anticipates the extended escrow to close no later than fiscal year 2018/19. 25A -2