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HomeMy WebLinkAboutReg 2003-06-02 Item 5A - Purchase - Xtra Car Property at 14120 Tukwila International Boulevard (Tukwila Village Phase I)CAS Number: 03-075 Agenda Item Title: I Original Sponsor: I Timeline: Sponsor's Summary: Recommendations: Sponsor Committee: Administration: Cost Impact (if known): Fund Source (if known) Meeting Date Meeting Date 1 06/02/03 o3 —O75 I Mthmn COUNCIL AGENDA SYNOPSIS Meeting Date I Prepared by 06/02/03 RAB Purchase and Sale Agreement for Xtra Car Property Council Admin.x As has been discussed with Council in Executive Session, there are two parcels remaining to be purchased for the development of Tukwila Village Phase I. Staff is requesting Council authorization for the Mayor to sign a Purchase and Sale Agreement for one of those properties, located at 14120 Tukwila International Authorize Mayor to sign agreement $6 302 Fund C 2 no Initials--- Mayor's review) Council review mil% tee ITEM INFORMATION Original Agenda Date: June 2, 2003 RECORD OF COUNCIL ACTION Action APPENDICES Attachments ITEM No. MEMORANDUM To: City Council FROM: Mayor Mullet DATE: May 28, 2003 SUBJECT: Real Estate Purchase and Sale Agreement Attached for your review is the Purchase and Sale Agreement for the property at 14120 Tukwila International Boulevard South. This is one of two remaining parcels needed for development of Tukwila Village Phase I. The City Attorney has reviewed this agreement. It allows us to move forward on the purchase, provides the ability to test the site during our due diligence period, and allows us an out if we find any hazardous substances on the site. It also provides that the current property owner has until the time of closing to free the property of any leases. I am requesting Council authority to sign this agreement. Please let me know if you have questions. This Agreement is made and entered into this day of 2003, by and between The City of Tukwila, and /or "Assigns (hereinafter referred to as "Purchaser") and the Ben Carol Land Development, Inc. (hereinafter referred to as "Seller 1. Property and Exhibits Seller hereby agrees to sell to Purchaser, and Purchaser hereby agrees to purchase from Seller, certain real property situated in King County, State of Washington, together with any easements and rights appurtenant thereto and improvements, hereinafter referred to as the "Property The closing of this sale shall also include any plans, engineering drawings and calculations, permits, and any other development information pertinent to the Property described herein as a part of the closing of the sale that are in Seller's possession. All such items shall be included in the purchase price described in Section 2 of this Agreement. The Property is legally described on Exhibit A attached hereto and by this reference incorporated herein. It is commonly described as 14120 Pacific Highway South and known as the Xtra Car Park and Fly lot, and recorded under auditor's tax lot number 152304 -9123. 2. Purchase Price and Terms 3. Earnest Money 4. Title Insurance REAL ESTATE PURCHASE AND SALE AGREEMENT The purchase price for the Property shall be Six Hundred Ninety Thousand Dollars and No /100 ($690,000.00). The purchase price shall be paid as follows: Purchaser shall pay Six Hundred Ninety Thousand Dollars and No /100 ($690,000.00) cash, inclusive of Earnest Money deposit, at Closing. Within two (2) days after full execution of this Agreement by both parties, Purchaser will execute and deliver to the "Closing Agent" designated in Section 5 below an Earnest Money Promissory Note (in the form of Exhibit B attached hereto) in the amount of Twenty Five Thousand Dollars and No /100 ($25,000) as Earnest Money deposit. Said note shall be converted to cash after completion of the feasibility study and removal of contingencies as described in sections 6 and 7 below. At closing, Seller shall furnish and Purchaser shall pay for an A.L.T.A. "extended" owner's policy of title insurance issued by Transnation Title Insurance, 1200 Sixth Avenue, Seattle, WA 98101, containing no exceptions except the "Permitted Exceptions," which are: (i) a lien to secure payment of real estate taxes with respect to the Property not yet delinquent; (ii) matters affecting title to the Property created by or with the written consent of Purchaser; (iii) those exceptions which are approved by Purchaser or are deemed approved pursuant to this Section 4; and (iv) rights reserved in federal patents or state deeds, building or use restrictions general to the district, existing easements, and building or zoning regulations. Within five (5) days of the date of last Purchase and Sale Agreement Page 2 signature to this Agreement, Seller shall deliver to Purchaser a preliminary commitment for title ordered from Transnation Title Insurance, 1200 Sixth Avenue, Seattle, WA 98101, together with clear, complete and legible copies of the instruments, if any, evidencing the special exceptions contained in Schedule B of the Commitment (the "Commitment Purchaser shall have ten (10) days to review the title condition and approve the same or to report to Seller by written notice (a "Disapproval Notice any deficiencies not acceptable to Purchaser. If Purchaser does not notify Seller, in writing as provided herein of its satisfaction or dissatisfaction with title, this Agreement shall terminate and Buyer shall receive a refund of the earnest money. Seller shall pay the additional premium for an Extended Owner's Policy, and the cost of any survey required by the title insurer. Seller shall determine within five (5) days from Seller's receipt of a Disapproval Notice from Purchaser whether Seller will arrange for the elimination or amelioration of the disapproved exceptions at or prior to Closing. If Seller is unable or unwilling to arrange for the elimination of all disapproved exceptions, Seller shall, prior to the end of such 5- day period, give written notice thereof to Purchaser "Inability Notice specifying which disapproved exceptions Seller is unable or unwilling to eliminate. Notwithstanding any other provision of this Section 4, the condition of title shall not include, and Seller shall remove at or before Closing, and shall cause the Property to be delivered free and clear of, any lien encumbering the Property that secures the payment of money, such as mechanic's and materialman's liens and the liens of deeds of trust and mortgages (except such as have arisen through the acts or omissions of Purchaser). If Seller has not timely given an Inability Notice, Seller shall be obligated to eliminate from title at or prior to Closing all title exceptions disapproved by Purchaser. If Seller shall give an Inability Notice to Purchaser, Purchaser shall have the right by giving written notice delivered to Seller and Escrow Holder within two (2) business days from Purchaser's receipt of the Inability Notice either: (i) to waive its prior disapproval, in which event said disapproved exceptions shall be deemed approved by Purchaser without deduction from or offset to the Purchase Price; or (ii) to terminate this Agreement, in which event the Earnest Money shall be returned to Purchaser, and thereafter this Agreement and all rights and obligations of the parties hereunder shall terminate. If Purchaser shall have failed to make a timely election, Purchaser shall be deemed to have elected to terminate this Agreement. 5. Escrow After complete execution of this Agreement, including, but not limited to time set forth in paragraph 7 below, the Closing Agent, Transnation Title Insurance, 1200 Sixth Avenue, Seattle, WA 98101, will be instructed to assemble the appropriate documentation and to close the sale of the Property. In connection with the Closing, the Closing Agent will be instructed to pro -rate real property and personal property taxes, water, and other utilities for the current year to the date of closing. Purchaser and Seller shall each pay one -half of the Closing Agent's escrow fees. Seller shall be solely responsible for the cost of real estate excise tax provided for in RCW 82.45, and all costs associated with owner's policy of title insurance. Seller and Purchaser shall pay their individual costs associated with legal counsel and other costs incidental to this transaction. Seller shall pay recording fees to release any and all encumbrances. Purchase and Sale Agreement Page 3 6. Seller's Representations and Warranties Except as specifically set forth in this Agreement, Seller makes no warranty, guaranty or representation of any kind or manner concerning the Property, its fitness for use, or its condition, and the Property shall be conveyed in "as -is" condition, except as provided otherwise below, on the date of closing. Property condition shall be construed to mean the physical condition of the Property and not the condition of the title to the Property. It is the intent of both parties, Seller and Purchaser, that the Property conveyed on the date of closing will be conveyed free of any occupants or tenants and the site /building(s) shall be vacant. Seller represents and warrants to Buyer that, to the best of Seller's knowledge, each of the following is true as of the date hereof and shall be true as of closing: (a) No hazardous substances have been deposited on or released from the Property by Seller; (b) The Property is in compliance with applicable laws; (c) There are no claims, actions, suits or governmental investigations or proceedings existing, or threatened against or involving Seller or the Property; (d) No party other than Seller is entitled to occupy or use the Property; and (e) There are no oral or written agreements of Seller which will prevent timely and full performance of all of its material obligations under this Agreement. 7. Removal of Leasehold Interest(s) Seller shall have until the date of closing to resolve any leasehold interests in the property. If Seller is not able to provide evidence that all leasehold interests in the property have been resolved, Seller acknowledges that Purchaser may, at its discretion, proceed forward with Condemnation Proceeding described in Section 14. 8. Inspection of Property Within ten (10) days after full execution of this Agreement by both parties, Seller shall provide to Purchaser any and all copies of documents relating to the Property, including but not limited to, copies of all rental agreements on the Property, copies of all documents related to any structures, and copies of all environmental studies or reports conducted or prepared related to the Property. Beginning on the later of the date that the Purchaser receives the documents listed above in this paragraph or the date of full execution of this Agreement by both parties, Purchaser shall have ninety (90) days to undertake such feasibility study and inspection of the Property as Purchaser deems necessary (the "Study Period (i) The feasibility study and inspection of the Property at Purchaser's discretion may include, but not be limited to obtaining City Council approval, acceptable financing, zoning and land use issues, a study of the physical condition of the Property, soils and engineering tests, including an environmental audit for purposes of determining the presence of hazardous substances, which environmental audit may include either a "phase 1" or "phase 2" study and such other studies and reports as Purchaser deems reasonable, with all such tests and studies to be conducted at Purchaser's sole expense. (ii) In order for Purchaser to conduct this feasibility study and inspection, Purchaser, utilizing such advisors as Purchaser elects, shall have reasonable access to the Purchase and Sale Agreement Page 4 Property at all reasonable times, but as a condition of this right of entry, shall give Seller and /or its agents, and Seller's Tenant, reasonable notice before entry, and the opportunity to accompany Purchaser prior to entering the Property. Seller's approval of Purchaser's reasonable entry shall not be unreasonably withheld. (iii) Purchaser shall promptly repair any damages to the Property resulting from such studies, inspections, or tests. (iv) As a condition of Purchaser's right of entry, Purchaser hereby agrees to defend, save, and indemnify Seller harmless from all liability and expense, including reasonable attorney's fees and all court costs and expenses, in connection with any and all claims, suits, and actions against Seller, its agents, or employees by any person or entity as a result of or on account of actual or alleged injuries or damages (including monies owed) to any persons, entities, and /or property received or sustained, or alleged to have been received or sustained, in any way arising out of, in connection with, or as a result of the acts or omission of Purchaser, its agents or employees, in exercising its right under this right of entry granted herein. (v) In connection with Purchaser's inspection, Purchaser acknowledges that it shall examine and inspect all matters with respect to bonds, taxes, permissible uses, zoning, covenants, LID's, and governmental assessments, conditions and restrictions, and all other matters bearing upon the value of the Property in Purchaser's judgment and for Purchaser's purposes, and Purchaser shall rely on its own inspection of such items and not representations of Seller, Seller's agents, or employees. (vi) For purposes hereof, "hazardous substances" shall mean any substance, waste or material which now or hereafter is designated as a "hazardous substance" under the Revised Code of Washington Chapter 70.105 D, et seq.), any substances so defined or designated under the Comprehensive Environmental Response, Compensation and Liability Act (42 USC 6901, et. seq.), or their implementing regulations. (vii) As used in this Agreement, "other property" means any real or personal property that becomes contaminated with hazardous substances as a result of construction, operations, or other activities on or the contamination of the Property subject to this Agreement. (viii) In the event the Purchaser does not notify Seller in writing on or before the last day of the Study Period that it is satisfied with its inspection and feasibility study of the Property, this Agreement shall terminate, and the Purchaser's Earnest Money Promissory Note of Twenty Five Thousand Dollars ($25,000) shall be cancelled and returned, and Purchaser's right to acquire the Property shall terminate. (ix) In the event the Purchaser is not satisfied with the inspection because hazardous substances are present on the property and so notifies the Seller; this Agreement shall terminate, and Purchaser's Earnest Money Promissory Note of Twenty Five Thousand Dollars ($25,000) shall be cancelled and returned, and Purchaser's right to acquire the Property shall terminate. In such an event the parties agree to engage in good faith efforts to renegotiate this Agreement to address the presence of hazardous substances Purchase and Sale Agreement Page 5 on the property. (x) If Purchaser notifies Seller as provided in this Agreement, that it is satisfied with the findings of the feasibility and inspection study of the Property, the Earnest Money Promissory Note of Twenty Five Thousand Dollars ($25,000) shall be converted to cash by Purchaser, deposited with the Closing Agent within two days after the later of Purchaser's approval of title, as provided for in Section 4, or Purchaser's removal of its feasibility /inspection, and applicable to the purchase price. In such event, the earnest money shall be non refundable except (i) in the case of damage to the Property before the closing which would adversely affect Purchaser's ability to perform its intended use(s), (ii) in the event of a breach of warranty by the Seller of any material covenant or duty described herein, or (iii) as otherwise specifically provided in this Agreement, in which event the earnest money of Twenty Five Thousand Dollars ($25,000) will be refunded to Purchaser by the closing agent. 9. Property Access and Information Upon mutual acceptance of this Agreement, Seller agrees to make the Property accessible at reasonable times to Purchaser and or its Agents for its feasibility study as described in paragraph 7 herein. 10. Liens Seller hereby agrees to defend, indemnify, and save Purchaser harmless from any and all liens, including court costs, expenses and reasonable attorney's fees associated therewith, which may attach to the Property by reason of any work performed by Seller, its agents, contractors, or employees. This indemnification shall survive the closing of this transaction. 11. Seller's Cooperation Seller shall cooperate and make such reasonable effort as Seller in its discretion deems necessary to aid in Purchaser's efforts to obtain all necessary governmental decisions, permits, and approvals necessary for Purchaser's intended use and /or development of the Property. In no event shall Seller be required to pay any costs or expenses associated with Purchaser's efforts in securing the same, and Purchaser shall hold Seller harmless there from, including any court costs, expenses and reasonable attorney's fees. This indemnification shall survive the closing of this transaction. 12. Conveyance of Title Upon closing, Seller shall deliver to Purchaser a Statutory Warranty Deed subject only to the Permitted Exceptions. Purchaser shall deliver all payment due at closing by wire transfer or other source of immediately available funds, together with other instruments and documents required by this Agreement. Purchaser shall be entitled to possession upon closing. Closing shall be construed to mean the day that all documents required by this Agreement are recorded and funds are available for disbursement to Seller. 13. Date of Closing Purchase and Sale Agreement Page 6 Subject to Purchaser's removal of contingencies, the sale shall be closed in the offices of Closing Agent on a mutually acceptable date on or before 5:00 p.m. Pacific Time. Closing shall be no more than 60 days, after the expiration or earlier termination of the Study Period. 14. Condemnation Purchaser, being a governmental entity, possesses the ability to condemn the Property. Purchaser and Seller acknowledge this Agreement shall be executed under the threat of condemnation, and that Seller is eligible for all the benefits accorded the possessor of a condemned property, including the waiving of excise tax, and additional time to seek an exchange property. 15. Assignment Purchaser shall have the full and unrestricted right to assign its interest in this Agreement to any person, people, corporation, partnership, Limited Liability Company or any other entity able to vest in title. Assignment under this Agreement shall be construed to mean a full release of interest and liability of the Purchaser named above in this Agreement at the time of Closing if such Assignee has assumed all of Purchaser's obligations hereunder, and Purchaser has fully satisfied all such obligations up to the Closing Date. Pending Closing, Purchaser shall remain fully liable for the performance of all of Purchaser's obligations hereunder. 16. Successors and Assigns Except as provided in paragraph 13 of this Agreement hereinabove, this Agreement shall inure to the benefit of and be binding upon heirs, successors, and assigns of the parties. 17. Default Time is of the essence of this Agreement. If Purchaser fails, without legal excuse, to complete the purchase of the Property, the earnest money shall be forfeited to Seller as the sole and exclusive remedy available to Seller for such failure, except that Seller may recover damages from Purchaser for a breach by Purchaser of indemnities set forth in this Agreement which survive Closing. If Seller shall fail to perform any covenant of Seller contained herein, Purchaser shall have the right to terminate this Agreement and receive a full refund of its earnest money, or, at its option, seek to specifically enforce this Agreement. Purchaser's rights are cumulative and nothing in this Agreement shall prevent Purchaser from seeking other remedies, including damages, as may be available to it at law or in equity. 18. Oral Agreements and Representations There are no verbal or other agreements, including but not limited to, any representations or warranties, which modify or affect this Agreement. Purchase and Sale Agreement Page 7 19. Counterparts This Agreement may be executed in counterparts, which together shall be construed to be one integrated document. 20. Notices All notices, demands, consents, approvals and other communications which are required or desired to be given by either party to the other hereunder shall be in writing and shall be either hand delivered or sent by United States mail, return receipt required, postage pre -paid, addressed to the appropriate party at its address set forth below or at such other address as such party shall have last designated by notice to the other. Notices, demands, consents, approvals and other communications shall be deemed given (i) when hand delivered or delivery is refused, (ii) three business days after being deposited with the United States Postal Service, or (iii) upon actual delivery or refusal of delivery by Federal Express or other similar overnight courier. To Seller: To Purchaser: 21. Non merger Ben Carol Land Development, Inc. C/o Harriett Butters P.O. Box 98924, Seattle, WA 98198 With copies to: City of Tukwila C/o Mr. Steven M. Mullet, Mayor 6200 Southcenter Boulevard Tukwila, WA 98188 With copies to: All covenants, warranties, and hold harmless and indemnification provisions set forth herein shall not merge in but shall survive the closing of the transaction contemplated hereunder. 22. Negotiations and Construction This Agreement and each other terms and provisions hereof are deemed to have been explicitly negotiated between the parties, and the language in all parts of this Agreement shall, in all cases, be construed according to fair meaning and not strictly for or against either party. 23. Brokers Purchase and Sale Agreement Page 8 Purchaser and Seller each represent and warrant to the other that no brokers were involved in the transaction contemplated by this Agreement other than Trammell Crow Company, who represents the Purchaser. Buyer agrees to pay Broker a commission in accordance with a separate agreement. Each party agrees to indemnify, defend, protect and hold the other party harmless from and against any and all liability, loss, cost, damage or expense, including reasonable attorneys' fees and costs, which the other party may sustain or incur by reason of any claim for a broker's fee, finder's fee, commission or other similar compensation in connection herewith other than as set forth above. 24. Time Time is of the essence in this Agreement. 25. 1031 or 1033 Exchange Each party agrees to cooperate with the other and /or the other's principals in effectuating a like -kind exchange under Section 1031 or 1033 of the Internal Revenue Code. Each party shall execute such documents as may be necessary or appropriate to assist with a contemporaneous or deferred exchange arrangement requested by the other on the conditions that the non requesting party shall have no liability whatsoever in connection with such exchange, the non requesting party will not be required to incur any expense in connection therewith and that the requesting party indemnifies and holds the non requesting party harmless from any such liability or expense, including all of the non requesting party's costs and attorney fees related thereto. 26. Entire Agreement This Agreement together with its Exhibits constitutes the entire agreement among the parties with respect to the subject matter hereof and supersedes all prior agreements, oral or written, express or implied, and all negotiations or discussions of the parties, whether oral or written, and there are no warranties, representations or agreements among the parties in connection with the subject matter hereof except as set forth herein. This Agreement is intended to be legally binding on all parties to it. Parties are hereby advised to seek independent legal, tax and other necessary counsel before signing below. 27. Computation of Time Unless otherwise specified in this Agreement, any period of time in this Agreement shall begin the day after the event starting the period and shall expire at 5:00 p.m. Pacific Time, or Pacific Daylight Time, as appropriate, of the last calendar day of the specified time, unless the last day is a Saturday, Sunday or legal holiday, in which case the specified time shall expire on the next day that is not a Saturday, Sunday or legal holiday. Any specified period of five (5) days or Tess shall not include Saturdays, Sundays or legal holidays. 28. Attorneys' Fees Purchase and Sale Agreement Page 9 In the event of any litigation or arbitration between Purchaser and Seller concerning the transaction provided for in this Agreement, the substantially prevailing party shall be entitled to recover from the other party reasonable attorneys' fees and costs, in an amount to be determined by the court or arbitrator(s), which amount shall be included in any judgment or award rendered in the matter. 29. Exclusive Dealing While this Agreement remains in effect, Seller covenants not to solicit or accept offers for, or enter into negotiations with any other person or entity relative to, the sale or exchange of the Property. 30. City Council Approval This entire Agreement is conditioned upon the Purchaser receiving approval from the City Council for the City of Tukwila, Washington. City Council approval is necessary to move forward with the contemplated purchase. In the event that the Purchaser cannot gain City Council approval, the Agreement shall terminate without further obligation to either party. PURCHASER: City of Tukwila Steven M. Mullet, Mayor SELLER: Ben Carol Land Development, Inc. Date Date Purchase and Sale Agreement Page 10 Exhibit A Legal Description This Exhibit A shall attach that certain Purchase and Sale Agreement for real property located in King County, State of Washington, by and between the City of Tukwila and /or "Assigns ("Purchaser") and Ben Carol Land Development, Inc., a Washington corporation "Seller The Property is legally described as follows: STR 152304 TAXLOT 123 POR OF SE 'A OF SW DAF -BEG AT PT ON E LN OF SUBD 812.6 FT N OF SE COR TH W 425.5 FT TH S 01 -27 -30 W 200 FT TH SWLY TO PT ON ELY MGN OF PAC HWY 5 WH PT IS 2503 FT SLY MEAS ALG SD HWY FR PT W OF POB TH NLY ALG SD ELY MGN OF HWY 250,5 FT THE 123 FTM/LTOPOB *(Buyer and Seller authorize Agent or Closing Agent to insert and /or to correct, over their signatures, the legal description of the Property.) Purchase and Sale Agreement Page 11 This Exhibit B shall attach that certain Purchase and Sale Agreement (the "Agreement for real property located in King County, State of Washington, by and between the City of Tukwila and /or "Assigns (hereinafter referred to as "Purchaser") and Ben Carol Land Development, Inc., a Washington corporation (hereinafter referred to as "Seller $25,000 Exhibit B Earnest Money Promissory Note For Value Received, the City of Tukwila and /or "Assigns" agrees to pay the Ben Carol Land Development, Inc., a Washington corporation, or order, at Transnation Title Insurance, 1200 Sixth Avenue, Seattle, WA 98101, the sum of Twenty Five Thousand Dollars ($25,000) with interest at the rate of zero percent (0 per annum from the date hereof, payable as follows: Within two days after the later of Purchaser's approval of title, as provided for in Section 4, and Purchaser's completion or removal of its feasibility /inspection study stated in Section 7 of the Agreement by and between the parties named above. This note shall bear interest at the rate of twelve percent (12 per annum, but not exceed the statutory limits after maturity, or after failure to pay any installment as above specified, and if this note shall be placed in the hands of an attomey for collection, or if suit shall be brought to collect any of the principal or interest of this note, the above referenced Maker promises to pay a reasonable attorney's fee in accordance with the same. City of Tukwila Steven M. Mullet, Mayor Date