FROM:
Development Services
SUBJECT:
Title
Second Amendment to Option and Purchase and Sale Agreement for City owned property
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RECOMMENDATION:
Recommendation
1. Approve the Second Amendment to the Option and Purchase and Sale Agreement with SA Golden Investments, Inc., for city owned land located at the northwest corner of Arrow Boulevard and Sierra Avenue consisting of approximately 21,600 square feet, more specifically described as APNs 0191-163-26, 0191-163-17, and 0191-163-16
2. Authorize the City Manager to enter into any documents necessary or appropriate to effectuate said approvals and/or agreement, including any related financing or subordination documents required to effectuate the close of escrow and development of the property.
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COUNCIL GOALS:
• Promote economic development by pursuing business attraction, retention, and expansion.
• Provide a diverse range of housing types and levels of affordability while addressing homelessness in the community by promoting diverse range of housing projects and levels of affordability.
DISCUSSION:
The City of Fontana has undertaken an expansive and comprehensive revitalization of Downtown Fontana. The City of Fontana owns three parcels (Assessor’s Parcel Numbers 0191-163-16, 0191-163-17, and 0191-163-26) on the northwest corner of Arrow Boulevard and Sierra Avenue encompassing approximately 21,600 square feet. The City entered into an Option and Purchase and Sale Agreement and Joint Escrow Instructions with SA Golden Investments, Inc., dated February 22, 2024. The Agreement was amended via the First Amendment, which defined certain responsibilities of the parties and confirmed specific closing and post-closing conditions.
This Second amendment provides the Buyer with the financial flexibility needed to ensure a successful development. By providing an option to defer the payment of the purchase price, the Buyer will be able to focus 100% of their financial resources on construction and finishing costs.
Approval of the Second Amendment will facilitate timely completion of the project and further support the ongoing revitalization of Downtown Fontana.
FISCAL IMPACT:
Purchase agreement reflects a purchase price of $650,000. Actual revenue will not be realized until the building is occupied, with an anticipated payment schedule beginning 36 months from close of escrow, with final payoff 5 years later. Upon receipt of closing proceeds, net revenue will be deposited into Fund 601 - Capital Reinvestment.
MOTION:
Approve staff recommendation.