FROM:
Administrative Services
SUBJECT:
Title
Approve the Sale of Real Property by the Successor Agency to the City of Fontana
End
RECOMMENDATION:
Recommendation
Approve the Purchase of Real Property Identified as APN 0228-301-51 - Located at Citrus And South Highland Avenues - by The City of Fontana and Authorizing the City Manager To Negotiate and Execute a Purchase and Sale Agreement with the Successor Agency to the Fontana Redevelopment Agency
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COUNCIL GOALS:
• To operate in a businesslike manner
• To promote economic development by pursuing business development, retention, expansion and attraction
DISCUSSION:
In 2008, prior to the dissolution of redevelopment agencies, the former Fontana Redevelopment Agency purchased from the State of California, Department of Transportation, certain real property then identified as parcel DD 015496-01-01 comprised of eight parcels, (also known as Lots 21-31 of Tract No. 3348, Highland Haven M.B. 47/14-16), now identified with APN 0228-301-51 (the “Property”), with a common location west of Citrus Avenue and north of South Highland Avenue. The
Director’s Deed for the Property was recorded with the San Bernardino County Recorder’s Office in the Official Records of the County of San Bernardino. It was recently discovered that it was recorded mistakenly in the name of the City of Fontana and not the Fontana Redevelopment Agency.
In 2018 and 2019, the City, under the belief that it owned the Property, conducted a formal Request for Qualifications and Request for Proposal process to facilitate development of the parcels, which included the Property. Following this process in the same year, the City entered into an Exclusive Negotiating Agreement (“ENA”) with the selected party, the Ladhar Group. Per the terms of the ENA, the parties would negotiate and execute an agreement for the purchase, acquisition and development of the City owned properties. On January 26, 2021, the City approved the Purchase, Sale and Development Agreement (“PSDA”) between the City and Citrus Development LLC (formerly the Ladhar Group) for the commercial and retail development of the City owned properties located on the North West Corner of Citrus Avenue and South Highland Avenue. Recently, the mistake in how the title owner for this Property was recorded by the San Bernardino County Recorder’s Office was discovered.
Notwithstanding the mistake that occurred in 2008 when the Director’s Deed was recorded, the former Fontana Redevelopment Agency is the property owner and thus technically it is now owned by the Successor Agency by operation of law when the redevelopment agencies were dissolved in 2012.
The City has submitted an offer to purchase the Property identified with APN 0228-301-51 for $623,505 from the Successor Agency. This Property is part of a larger (commercial zoned) development area located near the corner of South Highland and Citrus Avenue. The City is acquiring this Property to ensure its inclusion as part of the larger commercial development.
Following consideration by the Successor Agency and the Countywide Oversight Board, the recommended property sale “offer” will be submitted to the State Department of Finance for its review and consideration. The Department of Finance may elect to approve or deny the submitted offer. Based upon the time-frames established for DOF’s review and consideration of the recommended offer, it is anticipated that the escrow would close on this Property in late Spring of 2024.
Adoption of this item and the approval of the attached Purchase and Sale Agreement with the Successor Agency will facilitate the sale and disposition of the Property.
FISCAL IMPACT:
The fiscal impact associated with the approval of this item is an increase in expenditures and decrease in unappropriated fund balance of $623,505 in Fund 101 and is not included in the 2023-24 current budget. Necessary budget adjustments will be included in the Third Quarter Budget Report.
MOTION:
Approve staff recommendation