Cotati City Council
Agenda Staff Report
Item type: CONSENT CALENDAR (ACTION)
To: City Council/Successor Agency to the Former Cotati Community Redevelopment Agency
Subject: Resolution Approving a Disposition and Development Agreement Between David McDonald and Brion Wise of B Wise Inc, and the City of Cotati/Cotati Community Redevelopment Successor Agency Regarding Real Property Commonly Known as 950 E. Cotati Avenue (APN 144-320-026) and Authorizing the Executive Director to Execute all Documents Necessary to Complete the Sale.
Date: June 28, 2022
Written by: Angela Courter, Director of Administrative Services Recommendation
It is recommended that the City Council, acting on behalf of the City of Cotati and the Successor Agency, adopt a Resolution approving the Disposition and Development Agreement Between David McDonald and Brion Wise of B Wise Inc and the City of Cotati and Cotati Community Redevelopment Successor Agency Regarding real at 950 E. Cotati Avenue (APN 144-320-026) and authorize the City Manager/Executive Director to execute all documents necessary to complete the sale.
Background
The Cotati Successor Agency is required to sell a 0.42-acre parcel located on E. Cotati Avenue (See Attachment 1) as part of the dissolution of the former Cotati Community Development Commission. The parcel is adjacent to the Cotati SMART Station and is part of the Santero Way Specific Plan which allows mixed use residential and commercial development.
The property was listed for sale based on equivalent properties zoned for mixed use development, as identified in the City of Cotati Long Range Property Management Plan (LRPMP) for an estimated price of between $287,000 and $350,000. This price is supported by the appraisal completed for the LRPMP, which is dated December 2015.
After procuring the services of a local real estate broker, the property was listed for sale and received no offers or bids. A second real estate broker was selected, and the property re-listed in August 2020. A final offer to purchase the property for $350,000 was submitted to the City of Cotati, for a proposed mixed-use development. On June 1, 2021, a Surplus Land Act, notification was sent out for the required 60-day notification period to allow affordable housing developers to make an offer on the property. No such offers were received.
On June 17, 2022, the Consolidated Oversight Board adopted their resolution to approve the contract for the sale of the property.
Analysis/Discussion
The City of Cotati/Successor Agency directed staff to move forward with negotiations with the offering party, and the City/Agency received Oversight Board approval to sell the property for three hundred fifty thousand dollars ($350,000) on June 17, 2022, as previously mentioned.
This offer is within the appraised value and within the estimated range of value of two hundred fourteen thousand nine hundred and sixty-six dollars and three hundred fifty-nine thousand one hundred and thirty dollars ($214,966 - $359,130) per the Long-Range Property Management Plan.
The agreement requires development of the property with the mixed-use project inclusive of a minimum of six multi-family housing units and a similar amount of commercial square footage in keeping with the direction and requirements of the Cotati LRPMP. The offering party is a general contractor as provided information regarding their participation in several successful development projects. The final purchase agreement requires the buyer provide a down payment deposit and obtain all necessary City entitlements and CEQA approvals prior to the property being transferred upon demonstration of a viable construction financing plans. Given the limited number and schedule of Oversight Board meetings, and the complexity of development financing and entitlement approval timing, staff brought the conceptual purchase agreement and there were no significant comments at that time outside of the requirement of the sales price to meet or exceed the valuation. One item of note is that the agreement includes dual Exhibit B sections which describe the easement requirements.
At the request of the Rancho Adobe Fire Protection District (RAFPD), the City has recorded a 20- foot emergency evacuation easement across the eastern boundary of the property. Supplementing this 20-foot evacuation easement (also at the request of the RAFPD), the City also recorded a 5- foot “no build” easement adjacent to the evacuation easement. This supplemental easement is intended to ensure adequate access and circulation remain in place as the property develops. Both easements are labeled Exhibit B to the sales agreement given that they function together and total a 25-foot easement limiting development across the property.
Staff recommends the City Council, acting on behalf of the City of Cotati and Successor Agency, and consistent with the Consolidated Oversight Board, authorizes the City to transfer the property to allow the development of the site with a mixed-use project in keeping with the direction of the LRPMP, for a sales price of $350,000. The proposed mixed-use project would be consistent with the Santero Way Specific Plan however, the site is a challenge to develop given the constrains of the adjacent SMART parking lot, existing City infrastructure and access easements and municipal site ownership as well as the requirement for Site Plan and Architectural Review by the Planning Commission and potentially the City Council before any project could move forward to construction.
Financial Considerations
The sale of the property would provide funds for each of the taxing agencies based on their share of property tax. The development of the commercial piece of the property, in line with the long- range property management plan, would serve to potentially increase the future sales tax revenues.
Currently, there is no known significant expenditure of resources other than staff time.
Environmental Issues
This action is exempt from the California Environmental Quality Act (CEQA) because it is not a project which has a potential for resulting in either a direct physical change in the environment, or a foreseeable indirect physical change in the environment, pursuant to CEQA Guideline section 15378.
Attachments:
Cotati Long Range Property Management Plan (LRPMP) (PDF) Cotati Consolidated Oversight Board Resolution 2022-12 (PDF)