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Agenda Item 4.

Oversight Board Successor Agency Special Meeting

Meeting Date:	03/31/2017
FROM:	David Crabtree

Subject:

Sale of Successor Agency Owned Property Located at 323 N. Brea Blvd.

RECOMMENDATION

Adopt resolution authorizing the sale of real property to the recommended buyer.

BACKGROUND

With the elimination of redevelopment in California in 2012, successor agencies to the former redevelopment agencies were directed by the State to prepare a Long Range Property Management Plan (LRPMP) to govern the disposition and use of the former Agency's non-housing properties. Brea's LRPMP, approved by the State Department of Finance (DOF) in December 2015, included selling three undeveloped lots in the Downtown Brea area. Via a Request for Proposal process brokers Lee and Associates Commercial Real Estate Services, Inc. were recommended to and approved by the Successor Agency to assist staff in selling the three properties.

Lee and Associates used comparative sales in Brea and nearby cities to establish a market value asking price. All those who had previously inquired about the availability of former redevelopment properties were notified that the properties were now available for sale. Purchase offers were received over a two month period and multiple cash offers were received for each of the three properties. The purchase offers were evaluated by staff with assistance from the brokers on criteria that included offer amount as well as the potential buyer's intended use for the property, zoning requirements, neighborhood compatibility and long term value of the property.

The Successor Agency and Oversight Board approved the Purchase and Sale agreements for the two other properties owned by the Successor Agency. Escrow has closed on the property located at 340 North Orange Avenue and escrow is anticipated to close April 7 on the property located at 112 West Bracken Street

The Purchase and Sale agreement has been signed by the buyer of the Brea Boulevard property and the Successor Agency has authorized the sale contingent upon the Oversight Board's approval. The Board is now asked to adopt a resolution approving the execution of that agreement.

The following chart notes the recommended purchase offer and lists the other offers received.

323 N. Brea Blvd. 19,044 SF \| Mixed Use I Zone
Asking Price: $800,000 ($42.00/SF)	Recommended Offer: Better Blocks LLC (Medical Office) - $950,000 ($49.88/SF) Other Offers: Pacific National Development - $950,000 Stone Chen - $900,000 Richmore Realty - $809,370 AVA Properties - $800,000 Woo Sung Lim - $800,000

The recommended buyer's intended use of the property is to build and occupy a dental office on the property.

If the Oversight Board adopts the resolution authorizing the sale of the Brea Boulevard property, the next step will be to open escrow.

FISCAL IMPACT

The sale proceeds from this property minus the broker commission, title report and escrow expenses will be remitted to the County Auditor-Controller for distribution to the taxing entities including the City of Brea. The City's share on this property is approximately $133,000. Additionally, as the property is improved and the value increases, the annual property tax generated will increase and thus benefit all of the taxing entities.

The Oversight Board is asked to adopt a resolution to authorize the sale of property at 323 North Brea Boulevard. This property was acquired by the former redevelopment agency for redevelopment purposes in the Downtown Brea area. Current State legislation requires that it be sold per the terms approved in the Long Range Property Management Plan and that the sales proceeds be distributed to the various taxing entities, including the City of Brea.

SIGNATURE BLOCK

Respectfully Submitted by: David Crabtree, Community Development Director
Prepared by: Kathie DeRobbio, Economic Development Manager
Concurrence: David Crabtree, Community Development Director

Attachments
Resolution OB 2017-09
Purchase and Sale Agreement
Resolution SA 2017-03