HomeMy WebLinkAbout010708 Approval of 1st Amend Acq-License Agmts 2101 E. Edinger AveREQUEST FOR
AGENCY ACTION
AGENCY BOARD MEETING DATE:
JANUARY 7, 2008
TITLE:
APPROVAL OF FIRST AMENDMENT TO
ACQUISITION & LICENSE AGREEMENTS
FOR PROPERTY LOCATED AT 2101 E.
EDINGER AVENUE
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RECOMMENDED ACTION
AGENCY SECRETARY USE ONLY:
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APPROVED &:/ 691V", U)
CONTINUED TO
FILE NUMBER
Direct the Agency General Counsel to prepare and authorize the Executive
Director to execute an Amendment to the Acquisition Agreement, Mutual
Release and Joint Escrow Instructions and related Right of Entry and
License Agreement with DWWRBB, Inc. (Honda Santa Ana) and Vinci
Investment Co., Inc.
DISCUSSION
In January 2006, the Agency acquired a 40 +/- year lease of approximately
1.9 acres of property located at 2101 E. Edinger Avenue for the purpose
of facilitating an expansion of the Santa Ana Auto Mall. Vinci
Investment Co., Inc., the prior owner of the adjacent Honda Santa Ana
dealership, had acquired the leasehold and business interests. Pursuant
to the terms of the Acquisition Agreement, the property was then licensed
back to Vinci Investment Co., Inc. for up to two years. During this time
frame, Vinci was to undertake certain interim improvements to the 2101 E.
Edinger property and both parties were to discuss pursuing full
redevelopment of the subject site along with the existing Honda
dealership. On December 18, 2006, the Agency approved a partial
assignment of the agreement to DWWRBB, Inc., with the exception of the
license, which was retained by Vinci. David Wilson, the owner of a
number of Orange County auto dealerships including Toyota of Orange and
Lexus of Newport Beach, is the majority shareholder of DWWRBB.
Due to a number of circumstances such as delays in completing the
reconstruction of Edinger Avenue adjacent to the dealership, complexities
in the transfer of the dealership and a general downturn in the auto
sales industry, DWWRBB has not been able to complete the interim
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As Recommended
As Amended
❑
Ordinance on 1s' Reading
❑
Ordinance on 2nd Reading
❑
Implementing Resolution
❑
Set Public Hearing For
CONTINUED TO
FILE NUMBER
Direct the Agency General Counsel to prepare and authorize the Executive
Director to execute an Amendment to the Acquisition Agreement, Mutual
Release and Joint Escrow Instructions and related Right of Entry and
License Agreement with DWWRBB, Inc. (Honda Santa Ana) and Vinci
Investment Co., Inc.
DISCUSSION
In January 2006, the Agency acquired a 40 +/- year lease of approximately
1.9 acres of property located at 2101 E. Edinger Avenue for the purpose
of facilitating an expansion of the Santa Ana Auto Mall. Vinci
Investment Co., Inc., the prior owner of the adjacent Honda Santa Ana
dealership, had acquired the leasehold and business interests. Pursuant
to the terms of the Acquisition Agreement, the property was then licensed
back to Vinci Investment Co., Inc. for up to two years. During this time
frame, Vinci was to undertake certain interim improvements to the 2101 E.
Edinger property and both parties were to discuss pursuing full
redevelopment of the subject site along with the existing Honda
dealership. On December 18, 2006, the Agency approved a partial
assignment of the agreement to DWWRBB, Inc., with the exception of the
license, which was retained by Vinci. David Wilson, the owner of a
number of Orange County auto dealerships including Toyota of Orange and
Lexus of Newport Beach, is the majority shareholder of DWWRBB.
Due to a number of circumstances such as delays in completing the
reconstruction of Edinger Avenue adjacent to the dealership, complexities
in the transfer of the dealership and a general downturn in the auto
sales industry, DWWRBB has not been able to complete the interim
3 -1
Approval of First Amendment to Acquisition
& License Agreements for Property Located
at 2101 E. Edinger Avenue
January 7, 2008
Page 2
improvements. Additionally, complexities in dealing with the owner of
the 2101 E. Edinger property has prevented the Agency and DWWRBB from
having productive negotiations on acquisition of the fee interest in the
property.
DWWRBB and Vinci are requesting amendments to the Acquisition and License
Agreements to provide for an additional two years to complete the
improvements and negotiations on the redevelopment agreement including
negotiations with the fee owner. The amendment will extend the applicable
obligations in the agreements for up to two years until late January
2010. Any lease payments the Agency makes during this time period will
be reinvested in the project and /or be applied to any potential future
Agency obligations negotiated with respect to full site
redevelopment /lease assignment.
ENVIRONMENTAL IMPACT
In accordance with the California Environmental Quality Act, the proposed
request is not considered a project; therefore, no further action is
required.
FISCAL IMPACT
Funds for this agreement in the amount of $373,455 for the lease payments
to the fee owner are available in the South Main Tax Allocation Bond
Series 2003 A Fund account (account #552 -936- 6291).
Nancy T. Edwards
Assista Director
Community Development Agency
SGH /VU /SG /mlr
APPROVED AS TO FUNDS AND ACCOUNTS:
bF�rancisco Gutierrez �yf
xecutive Director
Finance and Management Services Agency
H: \ACTION ITEMS \CRA \2008 CRA \Honda Amendment to Agreements 1- 7- 08V2.DOC
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