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INFORMATIONAL MEMO <br /> Page 3 <br /> Leuqar LLC has reviewed the proposals and indicated a willingness to sell to any of the <br /> applicants; however, Leuqar has not signed a letter of intent (LOI) with any of them at this time. <br /> Pulte offered Lequar$6.5 million, which is the highest offer Leuqar received. That price is <br /> acceptable to Leuqar but they understand the City received its highest offer from Alliance and it <br /> does not make sense to enter into a LOI if the City is not interested. <br /> All of the proposals meet the criteria for at least half of the residential units to be rented or sold <br /> at market rates since none of them are proposing any rent or income restrictions. <br /> All of the applicants have the financial capacity and experience to finance projects of this scale <br /> and type. <br /> All of the applicants are experienced developers with proven ability to design and construct <br /> projects of this scale and type. Alliance is currently constructing multi-family residential in <br /> Tukwila (on Baker Boulevard) and has built many quality multi-family residential developments <br /> in the Seattle area and so would rank as best for experience in our local market with this type of <br /> project. This would be a larger project than Momentum has built in Washington State but is <br /> smaller than what they've built in China. Pulte is a large, national residential builder. They <br /> have not built condo flats in the Seattle region but are planning a project that will include condo <br /> flats in Bothell. Elsewhere in the U.S. they have built projects similar to what they've proposed <br /> for the Longacres parcel. <br /> Price Considerations <br /> Because all of the proposals are good and the applicants are qualified, staff would typically <br /> recommend the City enter into negotiations with Alliance since they offered the highest price. <br /> However, since Pulte offered the highest price to Leuqar, it is unlikely that Leuqar would choose <br /> to sell to Alliance. Both Alliance and Pulte would only complete the purchase of the City's <br /> property if they can also purchase Leuqar's property. <br /> All of the offers exceed the City's minimum price (based on the fair market value per the <br /> appraisal) of$1,560,000. However, the City may want to insist on receiving the price that <br /> Alliance offered. In addition, staff feels that the City should at least receive a fair price relative <br /> to the price that Leuqar would receive based on each parcel's appraised value relative to the <br /> appraised value of the total site. The City's appraisal also included a fair market value estimate <br /> of Leuqar's parcel if developed on its own, and both parcels if developed together. Staff feels <br /> the City should receive at least $2,174,314. That number is based on 25% of$8,530,000 (the <br /> value if developed together). The 25% is based on the City's percentage of the fair market <br /> value if both parcels were developed separately. See table below. <br /> Comparison of Values <br /> Appraised Value Proportional Value <br /> If Developed Separately If Developed Together <br /> City Parcel $1,560,000 25% $2,174,314 25% <br /> Leuqar Parcel $4,560,000 . 75% $6,355,686 75% <br /> Total $6,120,000 100% $8,530,000 100% <br /> 15 <br />