HomeMy WebLinkAboutItem 6: Disposition of Surplus Property
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UGENE ITY OUNCIL
AIS
GENDA TEM UMMARY
Work Session: Disposition of Surplus Property
Meeting Date: May 28, 2013 Agenda Item Number: 6
Department: Planning & Development Staff Contacts: Mike Sullivan
www.eugene-or.gov Staff Contact Telephone: 541-682-5448
ISSUE STATEMENT
The council is being asked to approve the sale of the quarter-block surface parking lot located at
8 Avenue and High Street to the Shedd Institute for the Arts.
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BACKGROUND
Section 2.872 of the Eugene Code provides that a proposal for the sale of property that is
acceptable to the City Manager shall be presented to the council for its action. The Shedd
Institute for the Arts approached the City with an offer to purchase the quarter-block (25,600
square feet) surface parking lot located on the southwest corner of 8 Avenue and High Street,
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directly behind the Shedd Institute for the Arts (see Attachment A map). The proposed
purchase price is the appraised value of $800,000 paid in cash at closing. A detailed outline of
the proposed terms is included in Attachment B.
The property, zoned C-2/TD, is currently used as a City-owned and -operated surface parking lot.
The property was appraised by Duncan & Brown in May 2012 which indicated a fair market value
of $800,000 ($32.50/square feet). The value conclusion was based on a highest and best use
assumption that the current use would be continued on an interim basis until a financially feasible
commercial use can occur.
The Shedd Institute for the Arts is interested in acquiring the property for the purpose of
growing the existing music school and performance space. Their existing music school serves
approximately 500 students per week. Their expansion plans envision additional classroom
space, a new 350-400 seat music theater, and potentially a retail music store. They have
indicated that a fundraising campaign for the expansion project would begin immediately
following the acquisition of the property, and that the start date for construction of the project
would be contingent on the success of the fundraising efforts.
The arts are a key part of the revitalization of downtown Eugene. The growing art and culture
district, which includes venues such as the Shedd Institute for the Arts, draws customers and
dollars to the city core year-round. The Americans for the Arts’ latest national economic impact
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study, Arts & Economic Prosperity IV, revealed that non-profit arts and culture organizations in
Eugene are a $45.6 million industry supporting the equivalent of 1,730 full-time jobs in Eugene,
and generating $2.4 million in local and state government revenue. Additionally, the City has been
working with its partners to establish a cultural district in downtown as an economic
development tool the will attract and nurture Eugene’s growing creative sector and support the
regional economic development branding efforts that are focused on creativity, innovation and
quality of life. An expanded Shedd Institute for the Arts will have many positive impacts related to
local economic prosperity, growing arts and culture in the community, and continuation of the
significant momentum that is currently underway Downtown.
RELATED CITY POLICIES
This item relates to the following goals for Eugene, including:
Council Goals
Accessible and Thriving Culture and Recreation: A community where arts and outdoors are
integral to our social and economic well-being and are available to all.
Eugene Downtown Plan
Reinforce the creative, distinctive culture of downtown as the arts and entertainment
center of the city.
Provide and promote development and community events that reinforce downtown’s role
as the cultural center for the city and region.
Build upon downtown’s role as the center for government, commerce, education, and
culture in the city and the region.
Downtown development shall support the urban qualities of density, vitality, livability and
diversity to create a downtown, urban environment.
Actively pursue public/private development opportunities to achieve the vision for an
active, vital, growing downtown.
Use downtown development tools and incentives to encourage development that provides
character and density downtown.
Regional Prosperity Economic Development Plan
Promote the region’s natural and cultural resources to enhance cultural tourism.
Building downtowns as places to live, work and play will support the retention and
expansion of the existing business community and be a significant asset to attract new
investment.
Envision Eugene Pillars
Promote compact urban development and efficient transportation options.
- Integrate new development and redevelopment in the downtown, in key transit corridors
and in core commercial areas.
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COUNCIL OPTIONS
1.Authorize the City Manager to enter into a purchase and sale agreement with the Shedd
Institute for the Arts for the disposition of the property consistent with the outline of terms
included in Attachment B.
2.Modify the outline of terms included in Attachment B, and authorize the City Manager to enter
into a purchase and sale agreement with the Shedd Institute for the Arts for the disposition of
the property.
3.Do not approve the disposition of the property at this time.
CITY MANAGER’S RECOMMENDATION
The City Manager recommends the disposition of the property to the Shedd Institute for the Arts
consistent with the outline of terms included in Attachment B.
SUGGESTED MOTION
Move to authorize the City Manager to enter into a purchase and sale agreement with the Shedd
Institute for the Arts for the disposition of the quarter-block property located at 8 Avenue and
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High Street consistent with the terms and conditions included in Attachment B.
ATTACHMENTS
A. Map – Surplus Property
B. Outline of Terms
FOR MORE INFORMATION
Staff Contact: Mike Sullivan
Telephone: 541-682-5448
Staff E-Mail: mike.c.sullivan@ci.eugene.or.us
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ATTACHMENT B
Preliminary Draft: Sale of Property
Shedd Institute for the Arts (Buyer) – City of Eugene (Seller)
The following is a preliminary outline of terms for the sale of the City-owned quarter block property
located immediately north of the Shedd Institute (Shedd). This outline of terms is for discussion
purposes only.
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Property: Land (approximately 25,600 sqft quarter block) located at the southwest corner of 8 Avenue
and High Street (Map No. 17-03-31-14 Tax lot No. 1300 and 1400).
Purchase Price: $800,000
Payment of Purchase Price: $800,000 cash shall be paid in full at closing.
Deposit: Upon City Council approval of the sale of the Property, Buyer shall deposit into escrow non-
refundable earnest money in the amount of 10% of the purchase price. Earnest Money will be credited
toward the Purchase Price at closing.
Purchase and Sale Agreement: Following City Council’s approval of the sale, Buyer and Seller shall
enter into a formal Purchase and Sale Agreement.
Due Diligence Period: Upon the execution of a Purchase and Sale Agreement, Buyer will have a period
of 60 days in which to review property information and conduct on site testing to determine the
condition of the property.
Environmental Condition: During the Due Diligence Period, Buyer will be able to perform
environmental investigation to satisfy itself of the environmental condition of the property. The
investigations must be scheduled with the Seller and the results provided to the Seller for review. Based
on the information provided in the environmental assessment, Buyer may either move forward with the
purchase of the site or rescind the offer to purchase the site.
Closing Date: The closing of the sale shall occur no later than 90 days after the completion of the Due
Diligence Period. The closing date can be extended an additional 30 day if Buyer demonstrates
sufficient progress is being made to close within the extension period.
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Easement: Buyer shall grant to Seller a 5-foot easement on the Property along the 8 Avenue street
frontage which will be retained indefinitely for future right-of-way improvements.
Additional Easement: On or before closing, Buyer shall grant to Seller a 5-foot easement on the Shedd
property (Tax Lot 1100) located across High Street east of the Property, which will be retained
indefinitely (even in the event of transfer of ownership) for future right-of-way improvements.
Parking. Prior to Closing, Buyer and Seller shall reach an agreement regarding the management of
parking as an interim use of the Property, with the intent to allow general public access to parking
supply not being fully utilized by Shedd operations.
Condition of Title: Seller shall deliver the Property to Buyer with clear title free of any and all
encumbrances and exceptions except those as may have been approved by Buyer in its sole discretion.
Seller, at Seller’s cost, shall provide Buyer with standard form of owner’s policy of title insurance in the
face amount of the Purchase Price insuring clear title in Buyer’s name subject only to approved
exceptions.
Condition of the Property at Closing: Buyer is purchasing the Property as is in its current condition.
Buyer’s expectations concerning the Property are to be based solely on the basis of Buyer’s own
inspection and investigation of the Property.
First Right of Refusal: Prior to Shedd’s development of the Property, Seller shall hold a first right of
refusal. In the event that Buyer receives an offer to purchase the Property at any time following the sale,
Seller shall have the right to purchase the property under the same terms and conditions as the offer, or
decline and allow the other buyer to move forward and complete the purchase.
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