HomeMy WebLinkAboutCAO-10-032 - Land Sale - 83 Elmsdale Dr
REPORT
REPORT TO: Council
DATE OF MEETING:
SUBMITTED BY:
PREPARED BY:
WARD(S) INVOLVED:
DATE OF REPORT:
REPORT NO.:
September 7, 2010
Hans Gross, Director Asset Management
Rob Morgan, Capital Investment Advisor X2734
4
August 30, 2010
CAO-10-032
SUBJECT: 83 ELMSDALE DRIVE - LANDSALE
RECOMMENDATION:
"That the Mayor and Clerk be authorized to execute an Agreement of Purchase and Sale
with Craft Acquisitions Corporation for their acquisition of the City's parcel of land
located at 83 Elmsdale Drive, having an area of approximately 4.88 hectares (12.05
acres), legally described as Part 1 on Plan 58R-16784 at a total purchase price of
$7,800,000.00; said agreement to be to the satisfaction of the City Solicitor; and further
That the Mayor and Clerk be authorized to execute all documentation required to
complete the transaction, said documentation to be satisfactory to the City Solicitor."
BACKGROUND:
The City of Kitchener has owned the facility at 83 Elmsdale Dr. since the 1950s and used it
since the late 1960s for municipal and public utilities purposes. Situated at the intersection of
Ottawa Street and Elmsdale Drive, and adjacent to commercial, institutional and park sites, it is
approximately 12-acres in size consisting of two buildings and a storage yard.
A new home for the services delivered from the Elmsdale Operations Centre is currently under
construction on Goodrich Drive, namely the Consolidated Maintenance Facility (CMF). When
the CMF is completed next year, the city will vacate the Elmsdale property rendering it surplus
to the City's needs. In anticipation of the consolidation of the City's operations, Council declared
the subject property surplus and directed staff to begin the disposition process on April 6, 2009.
The property was marketed utilizing a sealed bid process through the City's Real Estate Service
Provider, Coldwell Banker Commercial Peter Benninger Realty. The submission deadline for the
sealed bids was June 25, 2010.
A selection committee was established consisting of members of City staff as well as a member
of the Economic Development Advisory Committee.
The selection committee consisted of the following people:
Rob Morgan, Economic Development
Hans Gross, Finance
Terry Boutillier, Economic Development
Alain Pinard, Planning
Brian Bennett, Economic Development Advisory Committee
Through this process, a purchaser was selected based on the following criteria
• Bidders development vision of the property, including but not limited to the density of
development, potential employment densities, assessment growth and adherence to the
City's urban design principles.
• Ability of the bidder to complete the transaction.
• The number and nature of the conditions identified.
• Financial considerations
The City prepared the form of Agreement of Purchase and Sale (APS), for prospective bidders
to use with the understanding that bidders could mark up the agreement with their desired
changes for the City to review. The APS was structured as a conditional offer allowing the
Purchaser the opportunity to complete their due diligence including initiating and completing, at
their own expense, any zone change and Official Plan amendment with respect to the
Purchaser's desired use of the property.
REPORT:
Through the sealed bid process two submissions were considered with the Craft offer being the
highest at $7,800,000.00. Craft acquisitions also had the strongest development vision for the
12.05 acre property. Their proposal consists of a multi-phased mixed use development
consisting of residential units, live/work space and retail.
The second offer was for less money and consisted of a commercial plaza with an anticipated
mixture of retail, personal service and restaurant uses.
From a financial standpoint both offers are strong however, Craft Acquisitions development
vision for this property more fully meets the development interests of the City.
PUBLIC PROCESS
Within the terms of the agreement the purchaser is obligated to have commenced a Zone
Change and Official Plan Amendment within 60 days of the City accepting the offer to purchase.
The proposal will be required to go through the statutory public meeting requirements as
set out in the Planning Act, thereby giving the public an opportunity to provide input and
participate in the development approval process.
FINANCIAL IMPLICATIONS:
It is anticipated that the revenue from this land sale less the real estate fees will go to off set the
costs of the Consolidated Maintenance Facility.
Land sale Revenue - $7,800,000
Less 4% Real Estate Commission -* $312,000
*Includes 2% commission for the City's agent for complete RFP and negotiation services and
2% for the purchaser's agent.
Total Revenue - $7,488,000
CONCLUSION:
The Craft Acquisition proposal meets all of the criteria outlined in the Terms of Reference. The
company has the ability to complete the transaction and implement the proposal if approved
through the public zone change and official plan process. They have a demonstrated record of
success within the community and as such the selection committee supports the Craft
Acquisition bid proposal.
ACKNOWLEDGED BY: Rod Regier, Executive Director, Economic Development