Agenda Report
Fullerton City Council
MEETING DATE: November 7, 2023
TO: CITY COUNCIL / SUCCESSOR AGENCY
SUBMITTED BY: sunayana thomas, director of community and economic development PREPARED BY: sunayana thomas, director of community and economic development SUBJECT: Assignment of The PINES AT SUNRISE VILLAGE from Sunrise Village owner, llc to Lennar HOmes of California, LLC
SUMMARY
City Council consideration of acknowledging the assignment of the Development Agreement between the City and Sunrise Village Owner, LLC (Sunrise Village) and of assigning the Improvement and Reimbursement Agreement between the City of Fullerton Community Facilities District No. 3 (The Pines at Sunrise Village) (CFD No. 3) to Lennar Homes of California, LLC (Lennar).
RECOMMENDATION
Consent to Assignment and Assumption of Development Agreement between Sunrise Village Owner, LLC and Lennar Homes of California, LLC and authorize City Manager, or designee, to execute said consent, in a form approved by the City Attorney.
Approve City of Fullerton Community Facilities District No. 3 Assignment and Assumption Agreement and authorize City Manager, or designee, to execute the agreement, in a form approved by the City Attorney.
CITY MANAGER REMARKS
The City Manager recommends approval of Assignment and Assumption of Development Agreement between Sunrise Village Owner, LLC and Lennar Homes of California.
PRIORITY POLICY STATEMENT
This item matches the following Priority Policy Statements:
Fiscal and Organizational Stability
Infrastructure and City Assets.
FISCAL IMPACT
No direct budgetary fiscal impact. Lennar’s acquisition of the residential parcels (Lots 1 and 2 only) from Sunrise Village Owners, LLC transfers obligations of the Development Agreement and the Improvement and Reimbursement Agreement to Lennar. Lennar will undertake the obligations to make the agreed upon public improvements with the assignments.
DISCUSSION
The City entered into a Development Agreement with Sunrise Village Owner, LLC for The Pines at Sunrise Village in January 2023. Sunrise Village Owner, LLC seeks to sell the residential parcels (Lots 1 and 2) to Lennar which requires the City to approve / acknowledge assignment of the Development Agreement to Lennar.
City approval of the City Acknowledgement of Assignment and Assumption of Development Agreement indicates that the City agrees and confirms that the following has occurred:
Lennar has provided substitute security equivalent to security provided by Sunrise Village to the City to secure performance of Sunrise Village’s obligations regarding the Property under the Development Agreement.
Lennar has either provided security satisfactory to the City to the unsecured obligations with regards to the Property under the Development Agreement or has otherwise demonstrated to the City’s satisfaction that Lennar has the financial resources or commitments available to perform the Assumed Rights and Obligations at the time in the manner required under the Development Agreement and Development Regulations.
Sunrise Village will have satisfied the conditions to the release of the transferring Developer (Lennar) set forth in Article 11 of the Development Agreement upon actual transfer of ownership and Sunrise Village shall be released from their obligations under the Development Agreement solely with respect to the Property under the Development Agreement The City authorized formation of CFD No. 3 in August 2023 and finalized with ordinance adoption on September 19, 2023. City Council also approved the Improvement and Reimbursement Agreement which required Sunrise Village Owner, LLC to undertake certain public benefit improvements. City, on behalf of the City of Fullerton Community Facilities District No. 3 (The Pines at Sunrise Village), approval of the Assignment and Assumption Agreement acknowledges that Lennar will acquire only the residential parcels (Lots 1 and 2) which will be subject to any special taxes resulting from debit issuance to finance the agreed upon improvements to Sunrise Village Owner, LLC.
Attachments:
Attachment 1 – Acknowledgement of Assignment and Assumption of Development Agreement between Sunrise Village Owner, LLC and Lennar Homes of California, LLC Attachment 2 – Assignment and Assumption Agreement for City of Fullerton Community Facilities District No. 3 between Sunrise Village Owner, LLC and Lennar Homes of California, LLC cc: City Manager Eric J. Levitt
Assignment of The Pines at Sunrise Village to Lennar Homes of California, LLC November 7, 2023 - Page 2