Item 4: Termination of Option on Roberts Building

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EURA UGENE RBAN ENEWAL GENCY AIS GENDA TEM UMMARY Action: Termination of Purchase Option on Roberts (Taco Time) Property Meeting Date: July 14, 2008 Agenda Item Number: 4 Department: Planning and Development Staff Contact: Denny Braud www.eugene-or.gov Contact Telephone Number: 682-5536 ISSUE STATEMENT On September 15, 2006, the Urban Renewal Agency (URA) signed a purchase option agreement on the Roberts (Taco Time) building located on the northwest corner of Broadway and Willamette Street. The URA board is asked to consider a request from the property owner to terminate the purchase option agreement so that independent redevelopment of the property can occur. BACKGROUND Beginning in 2006, the URA signed purchase option agreements on several properties within the West Broadway redevelopment area. The URA subsequently provided direction to exercise purchase options on the Centre Court property, Washburne Building, and the Diamond Parking property. The URA directed the Director to not exercise the purchase of the Roberts property at that time. The URA also provided direction to solicit offers from parties interested in an assignment of the West Broadway purchase option agreements, including this one, not being exercised by the URA. Notice of the bidding process was provided to the public, and no bids were received on any of the purchase options, including the Roberts property. On June 24, 2008, the City Manager received a request from Jack Roberts (property owner partner) for the URA to terminate the purchase option agreement to allow for the pursuit of re-leasing of space or redevelopment of the property. (This letter is Attachment A.) The property owner has indicated a willingness to pay $500 for the early termination of the agreement. (The URA paid $3,000 for the initial 12-month option and $2,000 for a 12-month extension, which expires on September 15, 2008.) The $500 payment roughly represents a prorated amount of option money paid by the URA, based on the remaining term of the agreement. The presence of the URA’s purchase option limits the property owner’s ability to enter into long-term leases or pursue a sale of the property and may be seen as an encumbrance to the potential and continued redevelopment of a portion of our downtown. Several West Broadway purchase option agreements have already expired; those include the Scan Design property, Josh Keim’s property, Diva to Shawmed half- block, and Betty Snowden’s property. The purchase options on other properties, including Lazar’s, John Henry’s, and Jack Louie are scheduled to expire over the next few months. Z:\CMO\2008 Council Agendas\M080714\S0807144.doc