HomeMy WebLinkAboutReg 2021-01-04 Item 6B - Agreement - Purchase and Sale Agreement with Tukwila Community Coalition, LLC for parcel at 3747 S. 146th StreetCOUNCIL AGENDA SYNOPSIS
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ITEM No.
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Meeting Date
Prepared by
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Council revieav
1/4/21
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ITEM INFORMATION
STAFF SPONSOR: B. MILES
ORIGINAL AGENDA DATE: 1/4/20
AGENDA ITEM TITLE Authorizing the Mayor to enter into a purchase and sale agreement for 3747 S. 146th
Street, commonly referred to at the "Traveler's Choice Motel" property.
CATEGORY ❑ Discussion
Mtg Date
0 Motion
Mtg Date 1/4/21
❑ Resolution
Mtg Date
❑ Ordinance
Mtg Date
❑ Bid Award
Mtg Date
❑ Pub& Hearing
Mtg Date
❑ Other
Mtg Date
SPONSOR ❑ Council
0 Mayor ❑ Admin Svcs ❑ DCD ❑ Finance ❑ Fire ❑ P&R ❑ Police ❑ PIV
SPONSOR'S Authorize the Mayor to execute a purchase and sale agreement to sell approximately .60
SUMMARY acres generally located at 3747 South 146th Street to the Tukwila Community Coalition,
LLC for fair market value based on a third party appraisal and upon terms reasonable to the
Mayor and City Attorney.
REVIEWED BY ❑ Trans&Infrastructure ❑ CommunitySvs/Safety ❑ Finance Com ❑ Planning/Economic Dev.
❑ LTAC ❑ Arts Comm. ❑ Parks Comm. ❑ Planning Comm.
DATE: N/A COMMITTEE CHAIR: N/A
RECOMMENDATIONS:
SPONSOR/ADMIN. Mayor's Office
Comm' °IEE N/A, straight to full City Council.
COST IMPACT / FUND SOURCE
EXPENDITURE REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED
$N/A $N/A $N/A
Fund Source: N/A
Comments: N/A
MTG. DATE
RECORD OF COUNCIL ACTION
1/4/21
MTG. DATE
ATTACHMENTS
1/4/21
Informational Memoradum, dated December 29, 2020.
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OGDEN MURPHY WALLACE, PLLC
901 FIFTH AVENUE, SUITE 3500
SEATTLE, WA 95164-2008
MEMORANDUM
DATE: December 29, 2020
TO: Tukwila City Council
FROM: Kari Sand, City Attorney
CC: Allan Ekberg, Mayor
David Cline, City Administrator
Derek Speck, Economic Development Administrator
Brandon Miles, Business Relations Manager
T 206.447.7000
F 206.447.0215
OMWLAW.COM
RE: Traveler's Choice Property at 3747 S. 146th Street (Parcel No. 0040000-0911)
Proposed Purchase and Sale Agreement with the Tukwila Community Coalition
I. Background
a. Traveler's Choice Property
The City owns a vacant lot that formerly was the Traveler's Choice motel located at 3747 S. 146th Street
(Parcel No. 0040000-0911) ("the Property"). It was one of three motel properties seized by the federal
government after an extensive undercover operation into criminal activities on the Property. The City
purchased it in 2014 to prevent crime from recurring and completed demolition of the structure in 2016.
On March 5, 2018, the Tukwila City Council passed Resolution No. 1927 (attached hereto), which declared
the Property surplus to the City's needs, approved an alternative sale process as authorized by TMC
2.64.030(4), set the minimum sale price at fair market value as determined by a certified appraiser, and
established four criteria for consideration when evaluating the prospective purchaser. In addition to price,
the four criteria to be considered include: (1) how well the buyer's intended use fits the City' s vision for
Tukwila International Boulevard, (2) whether the property would be developed in conjunction with the
adjacent parcel on Tukwila International Boulevard, (3) whether the buyer's intended use would support
small businesses or dislocated businesses, and (4) buyer/developer experience.
b. Tukwila Community Coalition
In 2018, the City began assembling land for the Justice Center project on Tukwila International Boulevard.
The acquisition of the Justice Center property resulted in approximately 16 small businesses being
relocated. In June of 2018, the City Council authorized City Administration to enter into settlement
agreements with several small local businesses dislocated by the City's Justice Center project. These
settlement agreements authorized cash payments, rent reductions, permit fee waivers from the City, and
the opportunity to purchase City -owned property to provide a single location where the businesses could
relocate permanently. In follow-up to the settlement agreements, several of the businesses approached
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the City as the Tukwila Community Coalition and requested the opportunity to negotiate in good faith to
purchase the Traveler's Choice property. These businesses were:
1. AZ Trading Co. Ltd.
2. Tawakal Mini Market, Corp.
3. Bayview Motor Club, LLC
4. Muna Grocery and Import LLC
5. Salama for Hajj and Umrah, Inc.
6. Foos Barqadle dba Foos Beauty Salon
7. Have a Nice Day Jewelry and Phone Card Plus, Inc.
In October of 2019, City Administration and the seven Tukwila Community Coalition members listed above
finalized a letter of intent for the sale of the Property. Letters of intent are commonly used in commercial
land transactions and while not binding, help to secure the main deal points before a formal purchase and
sale agreement ("PSA") is negotiated. In December of 2020, the City received additional documentation
indicating that the businesses identified above are still part of the coalition and are ready to move forward
with the final PSA. The following outlines the key, broad deal points that are set forth in the proposed PSA
between the City and the coalition.
II. Overview of Key PSA Terms
a. Purchaser is the Tukwila Community Coalition, LLC ("TCC") for a Purchase Price of $665,000,
which is fair market value as determined by an appraisal completed by ABS Valuation on
December 4, 2019. Purchase price is payable in cash at closing.
b. Purchaser has 120 -days (4 months) to complete Feasibility (inspection and due diligence)
Contingency and Financing Contingency periods.
c. Property is sold "as -is" with no warranties.
d. Conveyance of the Property will be by bargain and sale deed.
e. Purchaser may not assign the PSA to a third -party without the Seller's consent.
III. Requested Approval of the TCC PSA
Approval of the proposed TCC PSA is recommended, as it satisfies the settlement agreements negotiated
between June and October of 2018; the TCC's purchase price of $665,000.00 constitutes fair market value
as supported by a certified appraiser; and this proposed sale will support a new, permanent location for
these small businesses dislocated by the Justice Center and gives them an opportunity to succeed locally.
Based on the foregoing reasons, City Administration recommends and requests approval of the proposed
TCC.
IV. Recommended Motion
Authorize the Mayor to execute a purchase and sale agreement to sell approximately .60 acres generally
located at 3747 South 146th Street to the Tukwila Community Coalition, LLC for fair market value based
on a third party appraisal and upon terms reasonable to the Mayor and City Attorney.
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