Item 2C: Approval of Exchange of Real Property Interests on Franklin Boulevard

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ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Approval of Exchange of Real Property Interests on Franklin Boulevard Meeting Date: September 25, 2006 Agenda Item Number: 2C Department: Public Works Staff Contact: Mark Schoening www.eugene-or.gov Contact Telephone Number: 682-5243 ISSUE STATEMENT The City Council is requested to approve an exchange of an approximately .29-acre, City-owned property fronting on Franklin Boulevard for an approximately .56-acre exclusive easement across a portion of the adjacent property owned by Tedron Properties (site of the new Holiday Inn Express) which contains a segment of the Millrace. Tedron Properties to pay the City an additional $143,300 at the time of closing of escrow. BACKGROUND The City property proposed for exchange is mostly at-grade with Franklin Boulevard and has been vested in City ownership since 1926. The City also owns a larger tract of land at the lower elevation near the Willamette River and the Millrace which will be retained in City ownership. A map is attached to illustrate the proposed areas of exchange. This segment of Franklin Boulevard is under Oregon Department of Transportation (ODOT) jurisdiction and is a limited access highway. As such, ODOT has stated it will not permit an access from Franklin to serve the City lot. Access would be required through the adjacent ownership, resulting in the highest and best use of the City property to be assembled with the adjacent property. A market value appraisal was completed by an independent appraisal firm which concluded a cash difference in value of $35,000. The appraisal of the city parcel was based on what someone other than the adjacent owner would be willing to pay for the property. As such, the appraised value of the city parcel was substantially discounted because the access to Franklin Boulevard is restricted by ODOT. However, the adjacent owners acknowledged the additional value of the City parcel when assembled with their property. The reduced market value of the Tedron property because of the existing Millrace was also recognized by all parties. As such, the City and the property owners agreed upon the proposed cash difference of $143,300 to be paid to the City by Tedron Properties. Public Works staff has further reviewed the proposed exchange of property rights with Planning and Development staff with regard to desired development plans in the area, the Walnut Street mixed-use study, and future plans for extending the pedestrian/bicycle corridor in this area. The exchange was considered desirable in respect to these reasons and further desirable for the City to obtain possession and control of the Millrace and its connectivity to the existing City-owned park land immediately to the east, and adjacent to the river. L:\CMO\2006 Council Agendas\M060925\S0609252C.doc