HomeMy WebLinkAboutSuccessor Reso 02-2018City of South San Francisco P.O. Box 711 (City Hall,
400 Grand Avenue)
South San Francisco, CA
Successor Agency
Resolution: RES 02 -2018
File Number: 18 -700 Enactment Number: RES 02 -2018
RESOLUTION APPROVING THE FIRST AMENDMENT TO THE
PURCHASE AND SALE AGREEMENT BETWEEN THE SOUTH
SAN FRANCISCO SUCCESSOR AGENCY AND SSF MILLER
CYPRESS PHASE 2, LLC AMENDING THE SUPPLEMENTAL
PURCHASE PRICE FOR 216 MILLER AVENUE (APN 012 - 314 -220)
TO A FIXED AMOUNT OF $1,118,538.
WHEREAS, on June 29, 2011, the Legislature of the State of California ( "State ") adopted Assembly Bill
xl 26 ( "AB 26 "), which amended provisions of the State's Community Redevelopment Law (Health and
Safety Code sections 33000 et seq.) ( "Dissolution Law "), pursuant to which the former Redevelopment
Agency of the City of South San Francisco ( "City ") was dissolved on February 1, 2012; and
WHEREAS, the City elected to become the Successor Agency to the Redevelopment Agency of the City
of South San Francisco ( "Successor Agency "); and
WHEREAS, pursuant to Health and Safety Code Section 34191.5(c)(2)(C), property shall not be
transferred to a successor agency, city, county or city and county, unless a Long Range Property
Management Plan ( "LRPMP ") has been approved by the Oversight Board and the California Department
of Finance ( "DOF "); and
WHEREAS, in accordance with the Dissolution Law, the Successor Agency prepared a LRPMP, which
was approved by a resolution of the Oversight Board for the Successor Agency to the Redevelopment
Agency of the City of South San Francisco ( "Oversight Board ") on May 21, 2015, and was approved by
the DOF on October 1, 2015; and
WHEREAS, consistent with the Dissolution Law and the LRPMP, certain real properties located in the
City of South San Francisco, that were previously owned by the former Redevelopment Agency, were
transferred to the Successor Agency ( "Agency Properties "); and
WHEREAS, on October 18, 2016, the City entered into an Amended and Restated Master Agreement for
Taxing Entity Compensation ( "Compensation Agreement ") with the various local agencies who receive
shares of property tax revenues from the former redevelopment project area ( "Taxing Entities "), which
provides that upon approval by the Oversight Board of the sale price, and consistent with the LRPMP,
the proceeds from the sale of any of the Agency Properties will be distributed to the Taxing Entities in
accordance with their proportionate contributions to the Real Property Tax Trust Fund for the former
Redevelopment Agency; and
City of South San Francisco Page 1
File Number. 18 -700
Enactment Number: RES 02 -2018
WHEREAS, consistent with the LRPMP and the Oversight Board resolution, the Successor Agency and
City executed and recorded grant deeds transferring the Agency Properties to the City; and
WHEREAS, the Successor Agency was the owner of certain real property located in the City of South
San Francisco ( "City "), California, known as County Assessor' s Parcel Number 012 - 317 -110 ( "401
Airport Boulevard ") and 012 - 317 -100 ( "411 Airport Boulevard ") (collectively "Parcel A "), 012- 317 -090
( "421 Airport Boulevard "), 012 -314- 100 ( "405 Cypress Avenue ") (collectively "Parcel B ")
012- 314 -220 ( "216 Miller Avenue" or "Parcel C "), 012 - 318 -080 ( "315 Airport Boulevard" or "Parcel
D ") and collectively referred to as the "Properties "; and,
WHEREAS, on February 10, 2016, the Agency adopted Resolution number 03 -2016 approving the
Purchase and Sale Agreement ( "PSA ") with Miller Cypress SSF, LLC ( "Developer ") for the acquisition
and development of the Properties; and
WHEREAS, the PSA was executed and became effective on February 23, 2016; and
WHEREAS, the Properties were conveyed to the Developer on December 12, 2016; and
WHEREAS, on February 10, 2016, entitlements were approved by the City Council for 260 market rate
rental apartments on two assembled sites, Parcel A and D, a parking lot on Parcel B, and 12 townhomes
on Parcel C; and
WHEREAS, the Developer purchased six sites, comprising Parcel A, B, C and D, from the Successor
Agency /City of South San Francisco ( "City ") for $4,000,000; and
WHEREAS, pursuant to the terms of the PSA, Parcel C was transferred to Developer, but was not
included in the $4,000,000 sale price; and
WHEREAS, Developer has indicated it is pursuing the Land Assembly Option, as contemplated in the
PSA; and
WHEREAS, the appraisal, dated July 3, 2018, valued Parcel C at $3,700,000 as part of a larger
development; and
WHEREAS, due to increases in construction costs, the cost to assemble neighboring properties for the
development, and slow growth in rental revenues Developer has informed the Successor Agency that it is
unable to pay the appraised value and has requested and amendment to the PSA to set a fixed
supplemental purchase price of $1,118,538 for Parcel C; and
WHEREAS, upon issuance of a building permit for Phase 2 of the Cadence project, the taxing entities
will receive sale proceeds consistent with the Compensation Agreement; and
WHEREAS, pursuant to the terms of the Compensation Agreement, the Oversight Board must approve
the final sale price.
City of South San Francisco Page 2
File Number. 18 -700
Enactment Number. RES 02 -2018
NOW, THEREFORE, BE IT RESOLVED that the South San Francisco Successor Agency does hereby
resolve as follows:
The foregoing recitals are true and correct and made a part of this Resolution.
The proposed actions in this Resolution are consistent with the Long Range Property Management Plan.
Subject to approval by the Oversight Board, the First Amendment to the Purchase and Sale Agreement,
amending the supplemental purchase price for 216 Miller Avenue (APN 012 -314 -220) to a fixed amount
of $1,118,538, a draft of which is attached hereto as Exhibit A and incorporated herein, is hereby
approved.
The Executive Director, or his designee, is authorized to execute the First Amendment to the Purchase
and Sale Agreement, a draft of which is attached hereto as Exhibit A and incorporated herein, subject to
minor amendments that do not materially increase the Successor Agency's obligations.
The Executive Direction or authorized to execute any necessary documents related to the First
Amendment to the Purchase and Sale Agreement.
The Executive Director, or his designee, is authorized take any and all other actions necessary to
implement this intent of this Resolution, subject to approval as to form by Agency Counsel.
At a meeting of the Joint Special Meeting City Council and Successor Agency on 8/8/2018, a motion was
made by Mark Addiego, seconded by Pradeep Gupta, that this Resolution be approved. The motion passed.
Yes: 5 Addiego, Normandy, Matsumoto, Gupta, and Garbarino
Ai
City of South San Francisco Page 3
FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
This First Amendment to the Purchase and Sale Agreement and Joint Escrow
Instructions (this "First Amendment ") is made effective as of ,
2018 ( "Effective Date ") by and between the South San Francisco Successor Agency, a
public agency ( "Seller" or "Agency ") and SSF Miller Cypress Phase 2, LLC(`Buyer "),
successor -in- interest to Miller Cypress SSF, LLC, which is the date this Agreement was
approved by the South San Francisco Oversight Board ( "Oversight Board "). Seller and
Buyer are each individually referred to herein as a "Party" and, collectively, as the
"Parties."
RECITALS
A. WHEREAS, Seller and Miller Cypress SSF, LLC entered into that certain
Purchase and Sale Agreement dated August 23, 2016 (the "Agreement ") with respect to
that certain real property located at known as County Assessor's Parcel Numbers 012-
317 -110 (401 Airport Boulevard)( "Parcel A.1 "), 012 - 317 -100 (411 Airport Boulevard)
( "Parcel A.2 "), 012- 317 -090 (421 Airport Boulevard) ( "Parcel A.3" ), 012 - 318 -030 (315
Airport Boulevard) ( "Parcel D "), 012 - 314 -100 (405 Cypress Avenue) "(Parcel B "), and
012 - 314 -220 (216 Miller Avenue parking lot) ( "Parcel C "). Parcel A.1, Parcel A.2 and
Parcel A.3 are collectively, "Parcel A." Parcel A, Parcel B, Parcel C, and Parcel D are
collectively the "Property."
B. WHEREAS, the Agreement was approved by the Oversight Board by
Resolution 4 -2016 which also authorized the transfer of the property to the City of South
San Francisco ( "City ") for subsequent conveyance to Miller Cypress SSF, LLC pursuant
to the terms of the Agreement.
C. WHEREAS, Miller Cypress SSF, LLC subsequently assigned its interest
and obligations under the Agreement and the related development agreement to Miller
Cypress PRI, LLC.
D. WHEREAS, at a joint meeting of the City Council and the Agency held on
November 30, 2016, the City Council and the Agency approved, by motion, a
Memorandum of Understanding between the City and the Agency whereby the Agency
agreed to convey the Property to the City as part of the Close of Escrow as set forth in
Section 5 of the Agreement and the City agreed that it would subsequently convey the
Property to SSF Miller Cypress PRI, LLC pursuant to the terms and at the times set forth
in the Agreement as part of the Close of Escrow.
E. WHEREAS, the Agency and City entered into a grant deed to convey the
Property to the City as part of the Close of Escrow as set forth in Section 5 of the
Agreement solely for the purpose of allowing the City to thereafter convey the applicable
Property to SSF Miller Cypress PRI, LLC pursuant to the terms and at the times set forth
in the Agreement.
FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT —
401 AIRPORT BLVD, 411 AIRPORT BLVD, 421 AIRPORT BLVD, 315 AIRPORT BLVD, 405 CYPRESS AVE AND 216
MILLER AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA
F. WHEREAS, SSF Miller Cypress PRI LLC changed its name to BIT SSF
Miller Cypress, LLC.
G. WHEREAS, BIT SSF Miller Cypress, LLC subsequently assigned its
interest and obligations under the Agreement and the related development agreement to
Buyer for the portion of the Property known as Parcel C (also known as 216 Miller
Avenue).
H. WHEREAS, pursuant to the grant deed between the Successor Agency
and the City, the Parties agree that the City conveyed the property in accordance with the
above - described Memorandum of Understanding and did not assume any obligations or
liabilities of the Agency as set forth in the Agreement and that such obligations and
liabilities remain the obligations and liabilities of the Agency.
I. WHEREAS, Buyer has notified the City and the Agency of its intent to
pursue the Land Assembly Option, as defined in Section 5.6 of the Agreement.
J. Seller and Buyer now desire to amend certain provisions of the
Agreement, as set forth herein.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and incorporating all of the above as
though set forth in full herein and in consideration of all the recitals, conditions and
agreements contained herein, the parties agree to amend the Agreement as follows:
1. Section 2.3 of the Agreement is hereby deleted in its entirety and replaced
with the following:
2.3 Supplemental Purchase Price for Parcel C. If the Buyer constructs
Parcel C (whether as (i) a 12 -unit town home development consistent with the
Project Approvals ( "12 Unit Project ") or (ii) as part of a revised development
under the potential Land Assembly Option defined in Section 5.6 "Cadence
Phase 2 Project" )), Buyer shall nay Seller a fixed Supplemental Purchase Price
of One Million One Hundred Eighteen Thousand Five Hundred Thirty -Eight
Dollars ($1.118.538) (the "Supplemental Purchase Price" ). which amount shall
be paid in full at the issuance of the first building permit for the Cadence Phase 2
the addifienal land 1value payable to the Seller- fer- Pafeel G shall be One
Project.
Ad:ll: DR lays will be deto,.mi ne either- by (X) ., residual land value " sal
, e (Y) en a eempar-isen sales based appfai
botl, of...l ieh will be prepared by ., eei4ified appraiser- mutually seleeted by tl.o
Seller- and Buyef within sixty(60) days of the date Beyer- provides wr-44efl fie
of either- its ifAent to par-sue Nhe Revised -R-AfeVed C, its ifl4eflt to
12 Unit Pr-qjeet ("Supplemental Pur-ehase PFiee"). in the evem that the paFties
Page 2 of 4
FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT —
401 AIRPORT BLVD, 411 AIRPORT BLVD, 421 AIRPORT BLVD, 315 AIRPORT BLVD, 405 CYPRESS AVE AND 216
MILLER AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA
Ele not agree ^CO , the cell shall id +'f J three ,+'f ed
KpYr- a'rJC. -rte
with e"er-ienee .,YY..., „b Y....Y
strike ene appraiser- and the femaining appraiser- shall be fetained te eenduet-t�
appraisal. el The sts of the .,1 shall be sh e d equally between th Sell
and J Buyef shall pay Supplemefltal uieaa
«l:e mY YY K1JK
of„ ninety (90) days f+ „le+: of the 1 of the firs
+
J /
building peffnit by the €ere,rTC—. -This provision shall not apply if Buyer
re- conveys Parcel C to Seller pursuant to Section 5.6(e)(v).
2. General Provisions. Each party hereto has received independent legal
advice from its attorneys with respect to the advisability of executing this First Amendment
and the meaning of the provisions hereof. The provisions of this First Amendment shall
be construed as to the fair meaning and not for or against any party based upon any
attribution of such party as the sole source of the language in question. Except as expressly
amended pursuant to this First Amendment, the terms and provisions of the Agreement
shall remain unmodified and shall continue in full force and effect, and Buyer and Seller
hereby ratify and affirm all their respective rights and obligations under the Agreement.
Any capitalized terms not defined herein shall have the meaning ascribed to them in the
Agreement. In the event of any conflict between this First Amendment and the Agreement,
this First Amendment shall govern. The terms and provisions of this First Amendment,
together with the Agreement, shall constitute all of the terms and provisions to which Buyer
and Seller have agreed with respect to the transaction governed hereby, and there are no
other terms and provisions, oral or written, that apply to the Agreement and /or the Property
other than as set forth in the Agreement as modified by this First Amendment. The
provisions of this First Amendment shall apply to, be binding upon, and inure to the benefit
of the parties hereto and to their respective successors and assigns. This First Amendment
may be executed in multiple counterparts, all of which shall constitute an original, and all
of which together shall constitute a single instrument. Counterparts of this First
Amendment executed and delivered by facsimile, email or other means of electronic
delivery shall constitute originals for all purposes.
IN WITNESS WHEREOF, the parties have executed this First Amendment as
of the Effective Date.
SIGNATURES ON FOLLOWING PAGES.
Page 3 of 4
FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT —
401 AIRPORT BLVD, 411 AIRPORT BLVD, 421 AIRPORT BLVD, 315 AIRPORT BLVD, 405 CYPRESS AVE AND 216
MILLER AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA
SELLER
SOUTH SAN FRANCISCO SUCCESSOR AGENCY
By:
Mike Futrell
Executive Director
ATTEST:
By:
Agency Clerk
APPROVED AS TO FORM:
By:
Jason Rosenberg
Agency Counsel
BUYER:
SSF MILLER CYPRESS PHASE 2, LLC
a Delaware limited liability company
By: SRGNC MF Miller Cypress Phase 2, LLC,
a Delaware limited liability company
Sole Member
By: SRGNC MF, LLC
a Delaware limited liability company
Sole Member
By:
Mark R. Kroll
President
Page 4 of 4