FROM:
Development Services
SUBJECT:
Title
Purchase and Sale Agreement-16565 Orange Way
End
RECOMMENDATION:
Recommendation
1. Approve a Purchase & Sale Agreement for the purchase of buildings and associated land located at 16565 Orange Way, Fontana CA 92335 specifically described as APN 0191-251-25 in the amount of $2,800,000 plus escrow costs and related acquisition fees.
2. Authorize the purchase of that certain Real Property with APN 0191-251-25 compromised of approximately 0.68-acre parcel with a 16,000 square foot building (“Property”) from Fontana Orange, LLC, a California Limited Liability Company.
3. Authorize the City Manager to enter into the Purchase and Sale Agreement and/or any other documents necessary or appropriate to facilitate said purchase on behalf of the City of Fontana.
End
COUNCIL GOALS:
• Practice sound fiscal management by living within our means while investing in the future.
• Invest in the City’s infrastructure (streets, sewers, parks, etc.) by maintaining and improving the city's existing infrastructure.
• Invest in the City’s infrastructure (streets, sewers, parks, etc.) by providing for the development of new infrastructure.
DISCUSSION:
The City of Fontana continues to experience significant population growth and is now the most populous city in San Bernardino County. This growth has led to a corresponding increase in public infrastructure and demands on public services, supplies, equipment, and materials. To illustrate the scale of current maintenance responsibilities, Public Works staff currently manage over 220 traffic signals, 52 public parks, 470 miles of sewer lines, 640 centerline miles of roadway, and more than 28 public buildings-including the recently completed downtown parking structure.
The Public Works North Yard, located at 16440 Orange Way, serves as the city’s hazardous waste intake as well as equipment and material storage supply for public works operations. In addition to storage contained in the north yard, various city departments rent space from various storage facilities located throughout the city. To facilitate prompt repairs and service the demands of the businesses and residents of the city, additional storage capacity is needed.
The North Yard is not capable of supporting the storage needs of the city and it is economically inefficient to expand the city’s use of privately owned storage facilities. Staff proposes acquisition of this property to resolve the ongoing growing demands of the city. Increased storage capacity will allow for more economic acquisitions of items needed for routine and specialized maintenance, including traffic signal poles, utility cabinets, park benches, light poles and other essential materials required for the daily upkeep of city assets.
The City and the Seller have negotiated a Purchase Agreement with the following proposed deal-points:
• The City of Fontana would acquire the property for the price of $2,800,000.
• The City of Fontana and Seller Fontana Orange, LLC will equally split any/all escrow fees as appropriate.
• The City will have 60 days from the opening of escrow to complete its due diligence on the subject property to confirm the suitability and condition of the property for the city’s intended use.
• The City will have a sixty-day financing period to complete all wire-transfers and documents necessary for the close of escrow after approval of the feasibility review.
Approval of the Purchase Agreement and acquisition of the subject property is a crucial step in the City’s efforts to efficiently maintain the city’s growing list of assets and facilities.
FISCAL IMPACT:
The fiscal impact associated with the approval of this item is estimated to be $3,500,000 (including escrow costs, acquisition fees, and site improvements). The necessary budget adjustments will be included in the FY 25-26 First Quarter Budget Report Fund 601 and 632.
MOTION:
Approve staff recommendation.