Title
Development Agreement with Metrowest Development, LLC for Sale and Development of 814 N. 5th Ave. (Ordinance S-47691)
Description
Request to authorize the City Manager, or his designee, to enter into a development agreement and other agreements as necessary, with Metrowest Development, LLC, or its City-approved designee, for the sale and development of a City-owned property located at 814 N. 5th Ave. in downtown Phoenix. Further request to authorize the City Treasurer to accept funds related to this item. The sale of the property will generate one-time revenue of $345,000 in sales proceeds to the City.
Report
Summary
The Developer submitted its proposal in response to the City's Request for Proposals (RFP) for the disposition and redevelopment of an approximately 7,000-square-foot, City-owned vacant lot located at 814 N. 5th Ave. in downtown Phoenix (Site). The Site was previously developed with a small multi-family building, which was purchased with U.S. Department of Housing and Urban Development Community Development Block Grant (CDBG) funds by the Neighborhood Services Department (NSD) in the early 2000s to facilitate revitalization through blight elimination in the Roosevelt Neighborhood. In November 2005, the structure suffered severe fire damage and was subsequently demolished.
The Developer proposes to relocate and rehabilitate the historic home known as the Seargeant-Oldaker House to the Site. The Seargeant-Oldaker House is currently located at 649 N. 3rd Ave. If relocation of the historic home is unsuccessful, the Developer will build a home on the Site that is consistent with the character of the area. The Developer has agreed to purchase the Site for $345,000, which is the appraised value and the minimum purchase price listed in the RFP.
This project will preserve a threatened historic building, resolving a significant community concern. In addition, an unproductive vacant lot in the Historic Roosevelt Neighborhood will be activated and an opportunity for new downtown residents will be created, which are both outcomes supported by the City Council-adopted Downtown Strategic Plan. Furthermore, this project will put a vacant City property back into private and taxable use. The City will only transfer title of the Site when permits to relocate and renovate the home are paid for and approved. The City intends to enter into an agreement to allow the Developer to complete some utility work and site preparation prior to the closing of the transaction.
Procurement Information
The City received two proposals for the North Fifth Avenue Parcel Sale and Redevelopment Request for Proposals (RFP-CED20-NFA), which was issued on Sept. 29, 2020. The proposals were evaluated by a panel comprised of representatives from the development community and City staff from the Community and Economic Development, Planning and Development, and Neighborhood Services departments. On Jan. 8, 2021, the panel recommended the City begin negotiations with Metrowest Development, LLC, the top-ranked proposer.
Financial Impact
The sale of the Site will generate a one-time $345,000 sales proceed to the City, and will put the 0.16-acre property back into private ownership, which will generate net new property tax revenues. The proceeds will be returned to the CDBG program managed by NSD. There is no impact to the General Fund.
Public Outreach
Staff presented this proposal to the Downtown Voices Coalition on April 10, 2021, the Roosevelt Action Association on April 20, 2021, and the City's Central City Village Planning Committee on April 12, 2021.
Concurrence/Previous Council Action
This item was recommended for approval by the Land Use and Livability Subcommittee at the May 19, 2021 meeting by a vote of 3-0. However, the legislative file incorrectly stated that the purchase price of the Site was $350,000 instead of the correct amount of $345,000. The price has been corrected for this requested action.
Location
814 N. 5th Ave.
Council District: 7
Department
Responsible Department
This item is submitted by Deputy City Managers Gina Montes and Ginger Spencer, and the Neighborhood Services and Community and Economic Development departments.