HomeMy WebLinkAboutCAO-07-001 - Offers to Purchase - Lot 8A - Grand River West Business Park~~.
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Chief Administratar`s
Office
Report To: Finance and Corporate Services
Date of Meeting: January 8, 2007
Submitted By: Rod Regier, Executive Director, Ecnomic Development
Prepared By: Kathy Weiss, Director Economic Development
Ward(s) Involved: Ward 1
Date of Report: December 21, 2006
Report No.: CAO-07-001
Subject: OFFERS TO PURCHASE -LOT 8A IN GRAND RIVER WEST
BUSINESS PARK
RECOMMENDATION:
That Council accept the conditional Offer to Purchase from MacNaughten, Hermsen, Britton,
Clarkson Planning Limited in Trust, for part of Part 12 on Registered Reference Plan 58R14324,
being an irregular shaped parcel of land in the Grand River West Business Park, having an area
of approximately 2.56 acres, at a price of $200,000 an acre, for a total purchase price of
$512,000 being identified as lot 8A on Schedule A attached with detail of the proposal on
Appendix B attached;
and
That the Mayor and Clerk be hereby authorized to execute any other necessary documentation
required by the City Solicitor to complete the sale transaction.
BACKGROUND:
Lot 8A was created by the severance of the former Lot 8 in the Grand River West Business
Park. This is an irregular-shaped 2.56 acre parcel, located on Bingeman Centre Drive and is
the last remaining unsold lot. It is zoned is B-3 which allows light industrial and commercial
establishments including designated office uses.
The City accepted a previous offer in 2006 from a company separate from the ones named in
this report which did not solidify since the prospective purchasers did not satisfy the conditions
of the offer by the specified date.
REPORT:
The City has received three Offers to Purchase for Lot 8A in the Grand River West Business
Park. (See Appendices A, B, and C attached). Two companies, Woodhouse Contractors and
MacNaughton, Hermsen, Britton Clarkson Planning Limited (MHBC) are Kitchener businesses
looking to expand and Knapp Fasteners from Waterloo are expanding and looking to relocate.
Staff have reviewed all three offers and based on the analysis below, determined that MHBC is
the desired candidate based on higher net bid and particularly as it aligns with our bio/pharma
cluster strategy.
Company Name Curent # Future # Net Revenue Use Current Status
Employees Employees of Sale
In Kitchener In
Kitchener
Knapp Fasteners 15 TBD $484,224 Distributes industrial New company to Kitchener
Incorporated fasteners for
automotive ,aerospace Currently located in
and general Waterloo, looking to expand
manufacturing
industries
MacNaughton, 25 40 $512,000 10,000 sq feet Local company looking to
Hermsen, Britton, Engineering, Planning expand and offer
Clarkson Planning Firm opportunities to help support
Incorporated 10,000 sq. feet R&D the bio/pharma cluster
and Laboratory firms
Woodhouse 80 110 $496,640 Provide insurance Local company looking to
Contracting restoration work, expand
commercial contacting
and environmental
services
Covenants require the purchaser to construct a minimum of 20,000 square feet. The
prospective purchaser proposes to design and build a building in a campus like setting (see
appendix 2i, that will support their needs of 10,000 sq. ft. as well as attract
research/development and laboratory firms that support the City of Kitcheners economic
development strategy for the biotech/pharma cluster. All of which are supported in the zoning
by-law.
The intent of MHBC is to also work with the City of Kitchener in developing an adaptive re-use
opportunity of their current facility that also supports the biotech/pharma cluster as part of the
inventory of sites that will accommodate the needs of that particular cluster.
The offer is conditional upon the purchaser satisfying himself that site plan approval and a
building permit are available as well as environmental clearances and soil bearing capacity
requirements are sufficient to construct the building they are proposing. If these conditions are
not waived prior to or on the conditions date specified in the agreement, February 15, 2007, the
agreement becomes null and void. The proposed closing date is on or before March 28, 2007.
The property is subject to site plan control through which a Section 41 Development Agreement
will be entered into with the purchaser. Elevation drawings will be reviewed and approved as a
condition of site plan approval along with the standard conditions of approval. The purchaser will
be responsible for the cost and the closing of redundant services, a condition in this regard will
be included in the Section 41 Development Agreement.
All three companies have expressed a strong desire to locate within the City of Kitchener in the
prestigious Grand River West Business Park. The subject lands have an asking price of
$195,000 an acre. MHBC and Woodhouse Contracting are offering $200,000 an acre. Realtor
fees are not applicable on the MHBC offer, as the purchaser did not use a private realtor in
submitting the offer.
The City Solicitor has reviewed the Offer to Purchase.
FINANCIAL IMPLICATIONS:
2.56 acres @ $200,000/acre = $512,000, paid to the City of Kitchener
COMMUNICATIONS:
N/A
Rod Regier, Executive Director Kathy Weiss, Director
Economic Development Business Development
Valerie Bradford
Business Development Officer
Appendix "A"
The City has received an offer to purchase the last remaining lot in the Grand River
West Business Park from Knapp Fasteners Incorporated in trust for a Company to be
incorporated with limited liability.
Knapp Fasteners is a family-owned company which distributes industrial fasteners for
use in the automotive, aerospace and general manufacturing industries across North
America. The company was incorporated in 1987, and is currently located in the City of
Waterloo. The owners, Mr. and Mrs. James Knapp are residents of Kitchener. Due to
their company's ongoing growth and success, they have outgrown their current 10,000
square foot facility, and wish to erect a new facility of approximately 25,000 square foot,
with plans to eventually expand to approximately 45,000 square feet in the future.
Knapp Fasteners has seen the need to relocate to larger premises for some time,
however, was waiting to be able to construct a high quality facility in an appropriate
location within a fully serviced business park, with all amenities. They are impressed
with the quality of buildings currently located within the Grand River West Business Park
and its convenient location to many of their customers.
Knapp Fasteners currently employs fifteen full time employees, with plans for additional
hiring as growth continues.
The closing date for the transaction is March 15, 2007.
The City Solicitor has reviewed the Offer to Purchase.
FINANCIAL IMPLICATIONS:
2.56 acres ~ $195,000.00/acre = $499,200.00 paid to the City of Kitchener.
City pays 3% commission, $14,976.00 to the registered agent.
Net to City of Kitchener = $484,224.00
Appendix "B"
The City has received an offer to purchase for the last remaining lot in the Grand River
West Business Park from MacNaughton, Hermsen, Britton and Clarkson Planning
Limited (MHBC) in trust in order to expand their business. A letter in support of their
offer detailing their intentions for the property, is attached to this appendix.
MHBC is currently located at 171 Victoria Street North in Kitchener and they have four
other locations throughout Ontario employing a total of 100 people whereby they
provide general and specialized planning services to all government levels and the
private sector in Ontario, specializing in cities and towns. They also provide urban
design, aggregate resource planning and resource management.
They currently employ 25 people in the Kitchener location, however their intent is to
expand their services to include landscape and construction resulting in an increase of
15 employees.
Building covenants require a minimum building size of 20,000 sq. ft. The purchaser
proposes to build a building in a campus like setting (see attached) that will support their
needs of 10,000 sq. ft. as well as attract research/development and laboratory firms that
support the City of Kitcheners economic development strategy for the biotech/pharma
cluster. All of which are supported in the zoning by-law.
The intent of MHBC is to also work with the City of Kitchener in developing an adaptive
re-use opportunity of their current facility that also supports the biotech/pharma cluster
as part of the inventory of sites that will accommodate the needs of that particular
cluster.
The subject lands have an asking price of $195,000 an acre, however MHBC is offering
$200,000 an acre based on their desire to relocate within the City of Kitchener in the
prestigious Grand River West Business Park with a closing date of March 28, 2007.
The City Solicitor has reviewed the offer to purchase.
FINANCIAL IMPLICATIONS:
2.56 acres ~ $200,000/acre = $512,000, paid to the City of Kitchener. There are no
realtor commissions to be paid.
REVISED -Jan. 6/07
Appendix "C"
The City has received an offer to purchase the last remaining lot in the Grand River
West Business Park from Woodhouse Contracting Ltd.
Woodhouse Contracting Ltd. was established in 1968, they currently have 8 locations in
South Western Ontario and their Head office is located at 207 Madison Ave. in
Kitchener. Woodhouse provides 24 hour insurance restoration services, commercial
contracting and environmental restoration. Due to the continued growth and success of
their business, they have outgrown their location on Madison Ave, and wish to relocate
their Head Office to a central upscale site within the City of Kitchener.
Woodhouse Contracting Ltd. is proposing to initially construct an upscale industrial
building of 25,000 square feet, with energy efficient features. This structure will
accommodate their Head Office and local operational requirements. At present, they
employ 180 people. Approximately 80 people will be employed at this new site initially,
and it is anticipated that a further 20 - 30 employees could be added over the next five
years.
Woodhouse Contracting has reviewed various options to relocate their Head Office
within Kitchener. This location is appropriate, being a fully serviced business park, it is
central, which is paramount for their business, and allows them to build an upscale
facility for their Head Office Location.
A letter of intention from the President of Woodhouse Investments Inc. is attached
hereto.
The closing date for the transaction is April 2, 2007.
The City Solicitor has reviewed the Offer to Purchase.
FINANCIAL IMPLICATIONS:
2.56 ACRES $200,000.00/ACRE _ $512,000.00 Paid to the City of Kitchener.
City pays 3% commission, $15,360.00 to the registered agent.
Net to City of Kitchener = $496,640.00
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