11-A
TO: Honorable Mayor and Members of the City Council
ATTENTION: Jeffrey L. Stewart, City Manager
FROM: Jim DellaLonga, Director of Economic Development
SUBJECT: Consideration and Possible Action to conduct a public hearing to consider adopting Resolution No. 22-1 – A Resolution authorizing the City Manager to execute an Agreement for Disposition of Real Property No. 882.1, in a form approved by the City Attorney, between Urban Pacific Development Group, LLC and the City of Bellflower for the disposition of real property located at 9443 Artesia Boulevard.
DATE: January 13, 2022
EXECUTIVE SUMMARY
Since October 2020, the City negotiated the sale of the real property located at 9443 Artesia Boulevard (the “Property”) with Urban Pacific Development Group, LLC (“Purchaser”). Based upon assurances from the Purchaser regarding a potential future development at the Property, the City Manager recommends that the City sell the Property for a negotiated fair market price of $350,000 as supported by a valuation analysis by Harris & Associates, dated November 19, 2021.
RECOMMENDATION TO CITY COUNCIL
It is recommended that the City Council:
1) Open the public hearing; take documentary and testimonial evidence; and after considering the evidence, adopt Resolution No. 22 -1 authorizing the City Manager to execute Agreement for Disposition of Real Property AFN 882.1, in a form approved by the City Attorney; or
2) Alternatively, discuss and take other action related to this item.
CEQA
This matter is exempt from additional review under the California Environmental Quality Act (Public Resources Code §§ 21000, et seq., "CEQA") and the regulations promulgated thereunder (14 California Code of Regulations §§ 15000, et seq., the "CEQA Guidelines"), because it authorizes the sale of real property only; it can be seen with certainty that there is no possibility that this disposition, by itself, will cause a direct physical change in the environment and is therefore not considered a “project” pursuant to CEQA § 21065. Any future development on the Properties will require separate CEQA scrutiny.
Staff Report – Sale of City Property
January 13, 2022
FISCAL IMPACT
The City negotiated a purchase price of $350,000 to sell the Property to Purchaser. A valuation analysis performed by Harris & Associates indicates a fair market value $306,905. The City purchased the property from the Successor Agency in April 201 8 for $175,000.
DISCUSSION
In April 2018, the City purchased the vacant Property located at 9443 Artesia Boulevard from the Successor Agency to assist in the revitalization of the Artesia Boulevard corridor. The Property’s location on Artesia Boulevard, between two major north/south arterials, its proximity to the 91 freeway, and the new housing and commercial development at and west of the intersection of Bellflower Boulevard and Artesia Boulevard made this an important property to begin creating new development opportunities on Artesia Boulevard, west of Bellflower Boulevard. The Property has been vacant for nearly a decade.
The City contacted the Purchaser following a multi-year marketing effort to sell the property which came up empty. Purchaser, a developer who specializes in small, infill residential development, entered into an Exclusive Negotiation Agreement (AFN 882) with the City in October 2020 to purchase and potentially develop the Property in a manner that would enhance economic development and public welfare. The Purchaser and the City negotiated a purchase price of $350,000. The Purchaser intends to develop the site with a conceptual multi-family development. If such a project is eventually submitted by the Purchaser and entitled by the City Council, it would create economic opportunity, as defined by Government Code § 52200.2, by increasing property tax revenues by at least 15% at full implementation of a project when compared to the year prior to the Properties being acquired by the City.
Based on a valuation analysis prepared by Harris & Associates, dated November 19, 2021, the negotiated purchase price of $350,000 is above the estimated fair market value of the Property.
Pursuant to Government Code Section 52201 the City prepared the a ttached Summary Report that describes the following:
a) The cost of the agreement to the City;
b) The estimated value of the interest to be conveyed or leased determined at the highest and best uses permitted under the general plan or zoning;
c) If applicable, the estimated value of the interest to be conveyed or leased determined at the use with the conditions, covenants, and development costs required by the sale or lease (fair reuse value);
d) The purchase price or present value of the lease payments which the Purchaser will be required to make during the term of the Agreement;
Staff Report – Sale of City Property
January 13, 2022
DISCUSSION – Continued
e) If the sale price or total rental amount is less than the fair market value of the interest to be conveyed or leased, determined at the highest and best use, then the City shall provide, as part of the summary, an explanation of the reasons for the difference; and
f) An explanation of why the sale or lease of the property will assist in the creation of economic opportunity (as defined by Government Code Section 52200.2), with reference to all supporting facts and material relied upon in making this decision.
ATTACHMENTS
Summary Report .......................................................................................................... 3 Resolution No. 22-1...................................................................................................... 6 Agreement for Acquisition of Real Properties AFN 882.1 ............................................. 8
Summary Report Government Code Section 52200 – Purchase and Sale Agreement – 9443 Artesia Boulevard 1
SUMMARY REPORT PURSUANT TO
GOVERNMENT CODE § 52201
REGARDING AN
AGREEMENT FOR DISPOSITION OF REAL PROPERTY
BY AND BETWEEN THE
CITY OF BELLFLOWER AND
URBAN PACIFIC GROUP, LLC
The following Summary Report was prepared pursuant to Government Code § 52201. This report sets forth certain details of the proposed Agreement for the DISPOSITION of Real Property (“Agreement”) between the City of Bellflower (“City”) and Urban Pacific Development Group, LLC (“Purchaser”).
The City of Bellflower owns approximately 10,991 square feet of land located at 9443 Artesia Boulevard, referred to as the “Property.” The Agreement causes the City to sell the Property.
The following Summary Report is based upon information required by the Government Code.
It is organized into the following six sections:
I. Salient Points of the Agreement: This section summarizes the major responsibilities agreed to by the City and the Purchaser.
II. Cost of the Agreement to the City: This section details the total cost to the City associated with implementing the Agreement.
III. Estimated Value of the Interests to be Conveyed Determined at the Highest and Best Uses Permitted Under the General Plan or Zoning: This section estimates the value of the interests to be conveyed determined at the highest and best use permitted for the Property and the requirements imposed by the General Plan or Bellflower Municipal Code.
IV. Estimated Reuse Value of the Interests to be Conveyed: If applicable, this section summarizes the valuation estimate for the Property based on the required scope of development and other conditions and covenants required by the Agreement.
V. Consideration Received and Comparison with the Established Value: This section describes the compensation to be received by the City and explains any difference between the compensation to be received and the established highest and best use value of the Property.
VI. Creation of Economic Opportunity: This section describes the existing condition of the Property and explains how the Agreement will assist in the creation of economic opportunity.
This report and the Agreement are to be made available for public inspection before approval of the Agreement and not later than the time of publication of the first required notice of the public hearing pursuant to Government Code § 52201.
Summary Report Government Code Section 52200 – Purchase and Sale Agreement – 9443 Artesia Boulevard 2
I. SALIENT POINTS OF THE AGREEMENT
A. Project Description
The Project is the City’s sale of one parcel totaling 10,991 square feet of land to Purchaser. It is anticipated that the Purchaser will submit an application for developing a potential multifamily development at a future date. All square footage amounts and development details are approximate and may be adjusted based on the specific types of use and design constraints, subject to approval by both parties.
B. Seller Responsibilities Under the Agreement
The Agreement requires the City to accept the following responsibilities:
1. The City agrees to sell the Property on an “as is” basis.
2. The City agrees to pay the costs associated with an ALTA Owner’s Coverage Policy of Title Insurance showing title to the Property vested in Buyer.
C. Purchaser Responsibilities Under the Agreement
1. The Purchaser will purchase the Property for $350,000.
2. The Purchaser will pay all usual escrow, title and recording fees, charges and costs.
3. The Purchaser has the right of access to the Property for the purpose of making necessary or appropriate inspections, including geological, soils and/or environmental assessments.
4. The Purchaser must, at its sole cost and expense, secure any and all land use and other entitlements, and approvals which the City may require for the construction and operation of the Purchaser Improvements, and any other entitlements, permits or approvals required by any other governmental agency.
5. The Purchaser will construct all on-site landscape and hardscape improvements as set forth in any plans approved by the City.
6. The Purchaser is responsible for installing utility facilities and hookups to public utility lines. All utility service must be installed underground or concealed within buildings and any mechanical, electrical, fire sprinkler or plumbing equipment that may be at ground level must be aesthetically screened except where not permitted by the Bellflower Municipal Code.
II. COST OF THE AGREEMENT TO THE CITY
The cost incurred by the City to implement the Agreement is a de minimus amount of administrative time and an ALTA Owner’s Coverage Policy of Title Insurance.
Summary Report Government Code Section 52200 – Purchase and Sale Agreement – 9443 Artesia Boulevard 3
III. ESTIMATED VALUE OF THE INTEREST TO BE CONVEYED OR LEASED
DETERMINED AT THE HIGHEST AND BEST USES PERMITTED UNDER THE
GENERAL PLAN OR ZONING
Government Code § 52201 requires the City to identify the value of the interests being conveyed at the highest use allowed by the City’s General Plan or Property’s zoning. The City and Purchaser have negotiated a sales price of $350,000 for the Property.
IV. ESTIMATED REUSE VALUE OF THE INTERESTS TO BE CONVEYED
A reuse value evaluation is not included in this summary because no extraordinary conditions, covenants and/or development costs are required by the Agreement.
V. CONSIDERATION RECEIVED AND COMPARISON WITH THE ESTABLISHED VALUE
The Agreement causes the City to sell the Property to Purchaser at a negotiated price of $350,000. In a valuation analysis dated November 19, 2021, Harris & Associates determined the Fair Market Value of the City Property to be $306,905. The negotiated sale price for the City Property of $350,000 exceeds that fair market value. The consideration to be received is equal to or greater than the established fair market value.
III. ECONOMIC OPPORTUNITY
The Property is currently a vacant lot owned by the City of Bellflower. As a publicly owned vacant parcel, it is not generating any state or local taxes, and is not creating or retaining any jobs. It is currently not on the property tax rolls. The Purchaser intends to develop the site with a conceptual multi-family development. If such a project is eventually entitled by the City Council, it would create economic opportunity, as defined by Government Code § 52200.2, by (among other things) increasing property tax revenues to all property tax collecting entities by at least 15% at full implementation of a project when compared to the year before the Property being sold by the City.
CITY OF BELLFLOWER
RESOLUTION NO. 22-1
A RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE
AN AGREEMENT FOR DISPOSITION OF REAL PROPERTY NO. 882.1,
IN A FORM APPROVED BY THE CITY ATTORNEY, BETWEEN URBAN
PACIFIC DEVELOPMENT GROUP, LLC AND THE CITY OF
BELLFLOWER FOR THE DISPOSITION OF REAL PROPERTY
LOCATED AT 9443 ARTEISA BOULEVARD
THE CITY COUNCIL DOES RESOLVE AS FOLLOWS:
SECTION 1. Recitals. The City Council finds and declares as follows:
A. It is in the public interest to promote and maintain economic development and housing within the City;
B. In April 2018, the City purchased real property located at 9443 Artesia Boulevard (the “Property”) in order to ensure continued economic development activity in the Artesia Boulevard corridor;
C. The Property is part of the City’s Artesia Boulevard corridor and its development is crucial for the economic revitalization of the corridor;
D. At the moment, the Property on Artesia Boulevard is vacant and can constitute an aesthetic reminder of the Great Recession. Improving the Property through private investment is a critical component of the City’s overall plan for citywide economic development;
E. The City Council’s efforts in fulfilling the community’s expectations for a revitalized Artesia Boulevard corridor is demonstrated in a number of actions including, without limitation, the approval of the West Artesia Specific Plan; the Bellflower Boulevard Widening Project, which improved the intersection of Bellflower Boulevard and Artesia Boulevard; the Bellflower Business Assistance Program; and the adoption of a zoning designation that incorporates various standards for aesthetics and the development of existing and new businesses;
F. Following a multi-year marketing effort, the City selected Urban Pacific Development Group, LLC (“Purchaser”), as an entity to potentially develop the Property in a manner that would enhance economic development and public welfare. The Purchaser intends to develop the site with a conceptual multi-family development.
G. Following a valuation analysis performed by Harris & Associates, on November 19, 2021, the Property was identified as having a fair market value of $306,905; the negotiated sale price for the Property is $350,000, is above the estimated fair market value of the Property.
City of Bellflower
Resolution No. 22-1
H. For the reasons set forth above, the City finds it is in the public interest to adopt this Resolution and desires to enter into Agreement for Disposition of Real Property AFN 882.1 with the Purchaser.
SECTION 2. Findings. In accordance with Government Code § 52200.2 and 52201, the City Council finds as follows:
A. If the Purchaser’s conceptual development is eventually submitted by the Purchaser and entitled by the City Council, it would create economic opportunity, as defined by Government Code § 52200.2, by increasing property tax revenues by at least 15% at full implementation of a project when compared to the year before the Property being disposed by the City.
SECTION 3. CEQA. This matter is exempt from additional review under the California Environmental Quality Act (Public Resources Code §§ 21000, et seq., "CEQA") and the regulations promulgated thereunder (14 California Code of Regulations §§ 15000, et seq., the "CEQA Guidelines"), because it authorizes the sale of real property only; it can be seen with certainty that there is no possibility that this disposition, by itself, will cause a direct physical change in the environment and is therefore not considered a “project” pursuant to CEQA § 21065. Any future development on the Properties will require separate CEQA scrutiny.
SECTION 4. Authorizations. The City Council authorizes the City Manager to execute Agreement for Disposition of Real Property AFN 882.1, Amendments, and ancillary documents, in a form approved by the City Attorney as set forth in this Resolution.
SECTION 5. Electronic Signatures. This resolution may be executed with electronic signatures in accordance with Government Code § 16.5. Such electronic signatures will be treated in all respects as having the same effect as an original signature.
SECTION 6. The Mayor, or presiding officer, is hereby authorized to affix his signature to this Resolution signifying its adoption by the City Council of the City of Bellflower, and the City Clerk, or her duly appointed deputy, is directed to attest thereto.
SECTION 7. This Resolution will become effective immediately upon adoption and will remain effective unless repealed or superseded.
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City of Bellflower
Resolution No. 22-1
PASSED, APPROVED, AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF BELLFLOWER THIS 13TH DAY OF JANUARY 2022.
________________________________
Ray Dunton, Mayor
ATTEST:
________________________________
Mayra Ochiqui, City Clerk
APPROVED AS TO FORM:
________________________________
Karl H. Berger, City Attorney
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PARCEL NO.: 7161-001-900
TITLE REPORT NO.:
ESCROW NO.:
AGREEMENT FILE NO.: 882.1
AGREEMENT FOR ACQUISITION OF REAL PROPERTY
(WITH ESCROW INSTRUCTIONS)
THIS AGREEMENT is entered into this 13th day of January, 2022 by and between the City of Bellflower, a municipal corporation and general law city (“Seller”), and Urban Pacific Development Group, LLC, a California limited liability company (“Buyer”), for acquisition by Buyer of certain real property identified below. The Parties agree as follows:
1. AGREEMENT TO SELL AND PURCHASE. Seller agrees to sell to Buyer, and Buyer agrees to purchase from Seller, upon the terms and for the consideration set forth in this Agreement, all that certain real property (“Property”) situated in the City of Bellflower, County of Los Angeles, State of California, and legally described as follows:
See Legal Description attached as Exhibit A, and incorporated by reference.
2. DEPOSIT AND PURCHASE PRICE. The total purchase price, payable in cash through escrow, is the sum of $350,000 (the “Purchase Price”). Within five business days of the execution of this Agreement, Buyer will deposit $5,000 (the “Deposit”) into escrow. The Deposit will be applied against the Purchase Price for the Property at the Close of Escrow.
The Deposit will be refundable to Buyer until the end of the Due Diligence Period (defined below). Escrow Holder will place the Deposit in an interest-bearing account. Interest earned in said account will be credited to Buyer and be paid to Seller and applied to the Purchase Price at the Close of Escrow.
3. CONVEYANCE OF TITLE. Seller agrees to convey fee simple title to the Property by quitclaim deed, attached as Exhibit B, to Buyer. Seller provided Buyer with a current preliminary title report with respect to the Property.
4. TITLE INSURANCE POLICY. Escrow Agent must, concurrently with the Close of Escrow, provide Buyer with a CLTA Standard Coverage Policy of Title Insurance in the amount of $350,000 issued by First American Title showing title to the Property vested in Buyer, subject only to the permitted exceptions set forth on attached Exhibit C, which is incorporated by reference, together with such general provisions of the title policy as are customary. Buyer may obtain an ALTA Policy of title insurance, including any appropriate binders or endorsements, provided that Buyer must pay any increase in premium charged as a result of upgrading from a CLTA standard coverage of policy of title insurance to an ALTA standard coverage of policy of title insurance.
5. ESCROW. Within five business days after execution of this Agreement, Buyer agrees to open an escrow with the following: First American Title, 4380 La Jolla Village Drive #200, San Diego, CA 92122, Attn: Sheri Keene (“Escrow Agent”). This Agreement constitutes the joint escrow instructions of Buyer and Seller, and Escrow Agent to whom these instructions
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are delivered is hereby empowered to act under this Agreement. The Parties agree to do all acts necessary to close this escrow in the shortest possible time.
5.1 . Seller executed a quitclaim deed to Buyer, for deposit into escrow concurrently with this Agreement. As soon as possible after opening of escrow, Seller will deposit the executed deed with Escrow Agent on Buyer’s behalf. Buyer agrees to deposit the purchase price upon Closing Date.
5.2 Buyer must deliver to Escrow Agent at least 24 hours before the Close of Escrow, the Purchase Price and Buyer’s share of any closing costs. All funds delivered by Buyer must be in immediately available funds.
5.3 Buyer and Seller agree to execute and deliver to Escrow Agent any additional documents or instruments as may be necessary to complete this Agreement, provided that such documents or instruments do not materially alter the terms and conditions of this Agreement.
5.4 Insurance policies for fire or casualty are not to be transferred, and Seller will cancel its own policies after Close of Escrow.
5.5 All funds received in this escrow will be deposited with other escrow funds in a general escrow trust account(s) and may be transferred to any other such escrow trust account in any State or National Bank doing business in the State of California. All disbursements must be made by check or wire transfer from such account.
6. ESCROW AGENT IS AUTHORIZED TO, AND MUST:
6.1 Charge Seller and Buyer for any escrow fees, charges and costs payable under Paragraph 8 of this Agreement;
6.2 Disburse funds and deliver the quitclaim deed when conditions of this escrow are fulfilled by Buyer and Seller.
6.3 The term “Close of Escrow,” if and where written in these instructions, means the date necessary instruments of conveyance are recorded in the office of the County Recorder of Los Angeles County. Recordation of instruments delivered through this escrow is authorized if necessary or proper in the issuance of said policy of title insurance.
6.4 All time limits within which any matter herein specified is to be performed may be extended by mutual agreement of the parties hereto. Any amendment of, or supplement to, any instructions must be in writing.
7. TIME IS OF THE ESSENCE IN THESE INSTRUCTIONS AND ESCROW IS TO CLOSE AS SOON AS POSSIBLE. Escrow will close on the Property not later than 60 days following expiration of the Due Diligence Period. Buyer and Seller will notify Escrow Agent in writing as to the actual date of expiration of the Due Diligence Period. Escrow cannot close until Buyer delivers to Escrow Agent a certified copy of a resolution and/or ordinance adopted by the City Council of Bellflower and authorizing the sale of the Property to Buyer and its assigns.
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8. DUE DILIGENCE PERIOD AND BUYER’S CONDITIONS PRECEDENT TO PERFORMANCE. The Due Diligence Period will commence five business days of the execution of this agreement and expire 270 days thereafter (“Due Diligence Period”).
During the Due Diligence Period, Buyer may, at its sole cost and expense, perform physical inspections and other due diligence pertaining to the Property, and decide, in Buyer’s sole discretion (for any reason or for no reason), whether the Property is in all respects satisfactory to Buyer. Such due diligence may include, without limitation, Buyer’s receipt of any and all approvals required under California law to accept the Property from the Seller, review of title and review and approval of the physical condition of the Property including, without limitation, at the Buyer’s discretion, the physical characteristics of the Property. If Buyer is not satisfied, in its sole and absolute discretion, with the Property, Buyer may terminate this Agreement by written notice to Seller and Escrow Agent delivered on or before 5:00 p.m., California time, on the date the Due Diligence Period expires. Buyer’s failure to timely deliver written notice of termination in accordance with the immediately preceding sentence is deemed Buyer’s election to terminate this Agreement.
To the extent in Seller’s possession or reasonably available to Seller, Seller will deliver to Buyer, for its review copies of any and all special or conditional use permits or applications, Reciprocal Access Agreements, Restrictions and Development Agreements, surveys, site plans, subdivision maps, lot splits, plats of the property, and engineering drawings, inspection reports, geotechnical soil condition reports, environmental analyses and reports, drainage reports, any existing leases or other agreements encumbering the Property, any entitlement information, studies and permits, title policies, access and utility easements, traffic studies, zoning reports, and any other documents within Seller’s possession or reasonable control which pertain to the Property (collectively, the “Due Diligence Information”). The Due Diligence Information will be delivered upon request to Buyer within upon the date the Due Diligence Period commences. Seller represents and warrants that upon information and belief, the Due Diligence Information to be so provided constitutes all of the Due Diligence Information.
9. ESCROW FEES CHARGES AND COSTS. Seller will pay the premium for a CLTA standard coverage title insurance policy. Buyer will pay all City and County transfer taxes, any additional premium for ALTA extended coverage and endorsements, and all Escrow Agent recordation fees. Any and all other closing costs will be divided equally between Buyer and Seller. In the event that Buyer obtains financing of any sort, Buyer is responsible for all title, escrow, and recording charges in connection with such financing. Any real property taxes will be prorated as of the Closing Date.
10. RENTALS AND OCCUPANCY BY SELLER. If applicable, Seller agrees to execute a complete, current and correct statement of rentals on a form furnished to Seller and deliver same to Buyer within fifteen days hereof with copies of any written leases and rental agreements attached. All security deposits must be credited to Buyer through escrow and all rents will be pro-rated as of the Close of Escrow on the basis of a thirty-day month consistent with that statement, subject to approval of Buyer. Seller hereby warrants that the rental statement referred to includes the terms of all rental agreements, tenancies and leases (written, unwritten, recorded or unrecorded). Seller also warrants that, to Seller’s actual knowledge, there are no undisclosed tenancies, whether by oral or written leases on all or any portion of the Property, and Seller further agrees to hold Buyer harmless and reimburse
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Buyer for any and all of its losses and expenses occasioned by reason of any such undisclosed tenancies.
11. TESTING, INSPECTION, ENTRY ON PREMISES, AND RESPONSIBILITY FOR CONDITION OF PREMISES.
11.1 Seller grants to Buyer, and its authorized agents, permission to enter upon the Property at all reasonable times before Close of Escrow for the purpose of making all inspections and investigations as Buyer deems reasonable to determine the physical condition of the Property. Buyer will indemnify, and hold harmless Seller, from and against any and all claims, liabilities, liens, damages, losses, causes of action, and obligations and expenses (including reasonable attorneys’ fees) incurred as a result of, or arising in connection with physical damage to the Property and/or bodily injury arising out of any tests, inspections, and studies performed by Buyer, its agents, representatives, employees or contractors (collectively, the “Buyer Parties”). The obligation set forth in this paragraph will survive the Closing and any termination of this Agreement and constitute a continuing obligation of Buyer and its successors and assigns.
11.2 As used in this Agreement, the term “hazardous materials” means all flammable, explosive, noxious, toxic, or otherwise dangerous materials, wastes, products, or substances, the handling, use, discharge, or release of which is regulated or the contamination by which is prohibited by any federal, state, or local statute, ordinance, rule, or regulation, including, but not limited to, those substances defined as “hazardous substances,” “hazardous materials,” or “toxic substances” in the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq.; The Hazardous Materials Transportation Act, 49 U.S.C.
Section 1801, et seq.; The Resource Conservation & Recovery Act, 42 U.S.C. Section 6901, et seq.; and also including those substances defined as “hazardous waste” in Section 25117 of the California Health and Safety Code or as “hazardous substances” in Section 25316 of the California Health and Safety Code; and those chemicals to which reference is made in the Safe Drinking Water and Toxic Enforcement Act of 1986, Section 25249.5, et seq. of the California Health and Safety Code.
12. DESTRUCTION OF IMPROVEMENTS.
12.1 The risk of damages to or loss of improvements due to fire or other cause is Seller’s until title passes to Buyer at Close of Escrow. In the event of any insured damage to or destruction of any portion of the Property, Buyer at its option either (i) may terminate this Agreement, in which case the Deposit must be returned to Buyer and neither party will have any further rights or obligations hereunder, or (ii) may consummate the purchase evidenced by this Agreement. In the event that Buyer elects to consummate the purchase pursuant to clause (ii) above, Buyer will receive a credit at Closing in an amount equal to all insurance proceeds collected by Seller before the Closing, and all rights to all other insurance proceeds arising out of such damage or destruction or proceedings and not collected before the Closing, will , subject to the terms of the Lease, be assigned by Seller to Buyer as of the Closing and Seller will execute such reasonable instruments as Buyer may request to evidence such assignment.
12.2 Seller agrees to maintain any existing fire and/or casualty insurance on the property in force until Close of Escrow.
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13. COUNTERPARTS. This Agreement may be executed in counterparts, each of which so executed shall irrespective of the date of its execution and delivery be deemed an original, and all such counterparts together constitute one and the same instrument.
14. REPRESENTATIONS AND WARRANTIES.
14.1 Mutual Representations and Warranties. Each of the parties represents and warrants to the other as follows:
14.1.1 Authority. Such party is duly organized, validly existing and in good standing under the laws of the state of its formation. Such party has the legal right, power and authority to enter into and perform its obligations under, and to consummate the transactions contemplated by this Agreement.
14.1.2 Binding Agreement. This Agreement is, and all documents to be executed by such party pursuant to this Agreement will be, binding on such party and enforceable against such party in accordance with their respective terms (subject to bankruptcy, insolvency and other laws affecting the enforcement of creditor’s rights generally and to principles of public policy).
14.1.3 Bankruptcy. There are no bankruptcy, insolvency or similar actions or proceedings pending or threatened by or against such party.
14.2 Seller’s Representations and Warranties.
14.2.1 Authority. Seller warrants that it is authorized to sell the Property.
14.2.2 Hazardous Materials. Upon information and belief, Seller is not aware of any toxic or hazardous waste or materials, including asbestos, petroleum products, or any other hazardous waste as defined in Section 11.2 “Hazardous Materials” with respect to the Property.
14.2.3 No Leases. To Seller’s actual knowledge, there are no oral or written leases, options to purchase, or rights of first refusal with respect to the Property.
14.2.4 Litigation. Upon information and belief, there are no legal proceedings threatened or in existence, which would in any way impair the ability of Seller to sell the Property to Buyer, or that would materially impact Buyer’s ability to acquire and develop the Property.
14.2.5 Marketable Title. Seller has marketable title to the Property, and is not aware of any encumbrances or defects in title, other than as are set forth in the title report.
14.2.6 Compliance with Laws. Upon information and belief, the Property is not in violation of any laws, ordinances, statutes, or regulations.
14.2.7 Costs and Expenses. Seller is responsible for paying all costs and expenses arising out of Seller’s ownership of the Property before the Closing Date.
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15. LIQUIDATED DAMAGES. If Buyer breaches its obligation to purchase the Property in accordance with the terms of this Agreement and Close of Escrow fails to occur by reason of such breach, then Seller’s sole remedy for such breach is to receive and retain the Deposit. The parties acknowledge and agree that it would be impracticable or extremely difficult to fix the actual damages that Seller would incur as a result of the breach by Buyer of its obligation to purchase the Property. The parties agree that $5,000.00 is a reasonable estimate of Seller’s damages, and the Deposit constitutes liquidated damages in accordance with Civil Code Sections 1671, 1676 and 1677. Seller waives all other remedies for such breach.
The sum of $5,000.00 only constitutes liquidated damages for Buyer’s breach of its obligation to purchase the Property pursuant to this Agreement and does not limit or impair Buyer’s obligations which, by the terms of this Agreement, expressly survive termination of this Agreement.
16. SELLER’S DEFAULT. If Seller breaches its obligation to sell the Property to Buyer in accordance with the terms of this Agreement and Escrow fails to close by reason of such breach, then Buyer may assert any claims in law or in equity.
17. ESCROW CANCELLATION. If this Agreement is terminated, the parties will promptly execute any escrow cancellation or other instructions necessary to cancel Escrow.
18. CLOSING STATEMENT. Seller hereby authorizes and instructs Escrow Agent to release a copy of Seller’s closing statement to Buyer; purpose being to ascertain if any reimbursements are due Seller.
19. TAX REPORTING AND WITHHOLDING--NON-FOREIGN STATUS.
19.1 The Foreign Investment in Real Property Tax Act of 1980, as amended by the Tax Reform Act of 1984, places special requirements for tax reporting and withholding on the parties to a real estate transaction where the transferor (Seller) is a non-resident alien or non-domestic corporation or partnership, or is a domestic corporation or partnership controlled by a non-resident or non-resident corporation or partnership.
19.2 Seller advises Buyer that Seller is NOT a “foreign person” for the purposes of Section 1445 (as may be amended) of the Internal Revenue Code of 1954, as amended, and any regulations promulgated thereunder, and that, in accordance with the provisions of Section 1445, Seller must execute an affidavit under penalty of perjury setting forth Seller’s name, address, federal tax identification number, and certifying that Seller is not a “foreign person” in accordance with the provisions of the Internal Revenue Code.
19.3 It is specifically understood and agreed by Seller that closing of this escrow is subject to, and contingent upon, deposit into escrow, or notification to Escrow Agent by Buyer, of receipt of said Affidavit.
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20. NOTICES. All notices or other communications required or provided to be sent by either party or Escrow Agent will be in writing and sent by facsimile, electronic mail, U.S. mail or any nationally known overnight delivery service, or by courier, or in person. All notices are deemed to have been given upon personal delivery if sent by overnight delivery se rvice, courier or personally delivered. All notices must be addressed to the party at the address below:
If to Seller: Jeff Stewart, City Manager
16600 Civic Center Drive
Bellflower, CA 90706
E-Mail: [email protected]
If to Buyer: Urban Pacific Development Group, LLC
Attn: Scott Choppin
5318 E. 2nd Street, Suite 644
Long Beach, CA 90803
E-Mail: [email protected]
With a Copy to:
Karl H. Berger, City Attorney
Hensley Law Group
2600 W. Olive Avenue, Suite 500
Burbank, CA 91505
[email protected]
21. AS-IS. Buyer acknowledges and agrees that, except as provided herein, it is purchasing the Property in its present "AS-IS, WHERE IS, WITH ALL FAULTS," condition and with all defects and neither Seller nor any employee or agent of Seller has made or will make, eit her expressly or impliedly, any representations, guaranties, promises, statements, assurances or warranties of any kind (other than as expressly set forth in this Agreement) concerning any of the following matters (collectively referred to herein as the "Property Conditions"): (a) the suitability or condition of the Property for any purpose or its fitness for any particular use, (b) the profitability and/or feasibility of owning, developing, operating and/or improving the Property, (c) the physical condition of the Property, including, without limitation, the presence of wetlands and the presence of current or former presence or absence of environmental hazards or hazardous materials, asbestos, radon gas, underground storage tanks, electromagnetic fields, or other substances or conditions which may affect the Property or its current or future uses, habitability, value or desirability, (d) the rentals, income, costs or expenses thereof, (e) the condition of title, (f) the compliance by the Property with all environmental and similar laws governing or relating to environmental hazards or hazardous materials, asbestos, radon gas, underground storage tanks, electromagnetic fields, or other substances or conditions which may affect the Property or its current or future uses, habitability, value or desirability, including without limitation, the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended, 42 U.S.C.A. sections 9601 et. seq., (g) utility availability or use restrictions, (h) geologic/seismic conditions, soil and terrain stability, or drainage, (i) sewer, septic, and well systems and components, (j) other neighborhood or Property conditions, including, schools,
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proximity and adequacy of law enforcement and fire protection, crime statistics, noise or odor from any sources, landfills, proposed future developments, or other conditions or influences which may be significant to certain cultures or religions, or (k) any other past, present or future matter relating to the Property which may affect the Property or its current or future use, habitability, value or desirability.
22. NO THIRD PARTY BENEFICIARY. This Agreement and every provision herein is for the exclusive benefit of Seller and Buyer and not for the benefit of any other party. There will be no incidental or other beneficiaries of any of Seller’s or Buyers’ obligations under this Agreement.
23. MISCELLANEOUS TERMS. The terms, conditions, covenants and agreements set forth herein apply to and bind the heirs, executors, administrators, assigns and successors of the parties hereto.
23.1 This Agreement contains the entire agreement between the parties, and neither party relies upon any warranty or representation not contained in this Agreement.
23.2 This Agreement has been made in and will be construed in accordance with the laws of the State of California and exclusive venue for any action involving this Agreement will be in Los Angeles County.
23.3 In accordance with City Council action taken on January 13, 2022, the City Manager is authorized to execute this Agreement on behalf of the City of Bellflower.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day and year first set forth hereinabove.
BUYER:
URBAN PACIFIC DEVELOPMENT GROUP,
LLC
By ___________________________________
Scott Choppin, Manager
APPROVED AS TO FORM:
By ________________________________
Karl H. Berger, City Attorney
SELLER:
CITY OF BELLFLOWER
By __________________________________
Jeffrey L. Stewart, City Manager
Attachments: Exhibit A – Legal Description
Exhibit B – Quitclaim Deed
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Exhibit A
Legal Description of Property
ALL THAT CERTAIN REAL PROPERTY SITUATED IN THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:
THE WEST 86.2 FEET OF THE SOUTH 150 FEET OF LOT 104 OF BE3LLFLOWER
ACRES, IN THE CITY OF BELLFLOWER, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 16, PAGE 136, OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
EXCEPT THEREFROM THE SOUTHERLY 20 FEET AS GRANTED TO THE STATE OF CALIFORNIA, BY DEED RECORDED JUNE 7, 1951, AS INSTRUMENT NO. 3337, IN BOOK 36482, PAGE 137, OF OFFICIAL RECORDS.
APN: 7161-001-900
Street Address: 9443 Artesia Blvd.
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Exhibit B
Quitclaim Deed
ASSESSOR PARCEL NOS. 7161-001-900
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
Urban Pacific Group, LLC
Attn: Scott Choppin
5318 E. 2nd Street, Ste 644
Long Beach, CA 90803
FREE RECORDING REQUESTED PURSUANT TO GOV. CODE §§ 6103 AND 27383 SPACE ABOVE THIS LINE FOR RECORDER’S USE
QUITCLAIM DEED
The undersigned grantor(s) declare(s):
Documentary transfer tax is $
() computed on full value of property conveyed, or
( ) computed on full value less value of liens and encumbrances remaining at time of sale.
( ) Unincorporated area: (x) City of Bellflower
For valuable consideration, the receipt of which is hereby acknowledged, CITY OF BELLFLOWER, (“BELLFLOWER”), a public entity (“GRANTOR”) hereby grants to Urban Pacific Group, LLC, a California limited liability company, herein called “Grantee,” the following described real property in the County of Bellflower, County of Los Angeles, State of California:
SEE ATTACHMENT “A” ATTACHED HERETO
Executed this ____ day of _____________, 2022
Signature of Grantor
Jeffrey L. Stewart, City Manager
Approved as to form:
Karl H. Berger, City Attorney
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EXHIBIT “A” TO QUITCLAIM DEED
LEGAL DESCRIPTION OF THE PROPERTY
ALL THAT CERTAIN REAL PROPERTY SITUATED IN THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:
THE WEST 86.2 FEET OF THE SOUTH 150 FEET OF LOT 104 OF BE3LLFLOWER
ACRES, IN THE CITY OF BELLFLOWER, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 16, PAGE 136, OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
EXCEPT THEREFROM THE SOUTHERLY 20 FEET AS GRANTED TO THE STATE OF CALIFORNIA, BY DEED RECORDED JUNE 7, 1951, AS INSTRUMENT NO. 3337, IN BOOK 36482, PAGE 137, OF OFFICIAL RECORDS.
APN: 7161-001-900
Street Address: 9443 Artesia Blvd.
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ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
State of California
County of _____________________
On _______________ before me, ____________________________________________, a notary public, personally appeared ____________________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing is true and correct.
Witness my hand and official seal.
Signature ________________________________ (Seal)