HomeMy WebLinkAboutR & S Properties LLC-11/25/2013Please return Chis copyto:
CIty Clerk & Finance Dept.
715 Mulberry St.
Waterloo, IA 50703
Prepared by Noel Anderson
715 Mulberry Street Waterloo, Iowa 50703
(319) 291.4366
DEVELOPMENT AGREEMENT
This Development Agreement (the "Agreement") is made and entered into this
„Z" --day of A%v(41 , by and between R & S Commercial, LLC (the
"Company") and R & S Rental Properties, LLC (the "Company Affiliate"), and the City of
Waterloo, Iowa (the "City").
WHEREAS, City considers economic development within the City a benefit to
the community and is willing for the total good and welfare of the community to provide
financial incentives so as to encourage that goal, and
WHEREAS, Company is willing and able to purchase real property and to
develop a commercial building on property legally described as set forth on Exhibit "A"
attached hereto (the "Property"), located in the Amended Rath Urban Renewal and
Redevelopment Plan Area.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
contained, Company and City agree as follows:
1. Sale of Property; Improvements. Within six (6) months from the date of
this Agreement, on a date to be determined hereafter by the mutual consent of the
parties (the "Closing"), the City shall convey the Property to Company for the sum of
$1.00. After conveyance, Company shall construct a commercial building consisting of
approximately 5,200 square feet and related improvements (the "Improvements") on the
Property. The Improvements are to be constructed in accordance with all applicable
City, State, and Federal building codes and be in compliance with all applicable City
ordinances and other applicable law. It is contemplated that the Improvements should
have an estimated total project cost of $300,000. The Property, the Improvements, and
all site preparation and development -related work to make the Property usable for
Company's purposes as contemplated by this Agreement are collectively referred to as
the "Project".
In addition, at any time within six (6) months after the Closing, City shall
convey to Company Affiliate, upon request by Company Affiliate, the real property
described on Exhibit "B" (the "Infill Lot"). Subject to the terms of this Agreement and
applicable City policy regulating the moving of buildings, Company Affiliate will move
the house and garage at 1025 Sycamore Street (the "Sycamore Buildings") to the Infill
Lot at the sole expense of Company Affiliate.
2. Purchase of Company Property. Company and/or Company Affiliate
are the owners of real property located in Block 18, Original Plat on the East Side of the
Cedar River, Waterloo, Iowa, consisting of assessor parcels 8913-25-137-010, 8913-
25-137-011, 8913-25-137-012, and 8913-25-137-013 (collectively, the "Company
Property"), legally described as set forth in Exhibit "C attached hereto. On a date to be
mutually agreed by the parties, the City will purchase the Company Property from
Company and Company Affiliate for the sum of $169,000, which has been determined
by a certified real estate appraiser. At closing on the sale and purchase transaction,
Company and Company Affiliate will enter into leases of their respective portions of the
Company Property so that they can continue their current activities until completion of
the Project and relocation of the Sycamore Buildings. Prior to the end of the lease
term, Company and Company Affiliate may exercise salvage rights upon said property,
subject to making any buildings upon Company Property secure against intrusion by
others.
2.1 Deferred Exchange. Company and/or Company Affiliate acknowledge
that it is their intention to create an IRS Code Section 2031 tax-deferred exchange of
their respective properties and that each of their rights and obligations under this
Agreement pertaining to disposition of their respective properties may be assigned to
Black Hawk Exchange, Inc. to facilitate such exchange. City agrees to provide
reasonable cooperation to Company and/or Company Affiliate in a manner necessary
to initiate said exchange at no additional cost or liability to City. The parties
acknowledge that any assignment of rights or obligations made by Company or
Company Affiliate will not include an assignment of rights or responsibilities with respect
to construction of the Improvements or arising under the Minimum Assessment
Agreement referenced in Section 4 below.
3. Construction; Reversion. The parties agree that Company's
commitment to construct the Improvements in timely fashion constitutes a material
inducement for the City to convey the Property to Company and that without said
commitment City will not convey the Property. Company must obtain a building permit
and begin construction within four (4) months from the date of Closing. If, after the
expiration of four (4) months from the date of Closing, Company has not begun in good
faith the construction of the building described above upon the Property, the title to the
Property will revert to City. If construction has not begun at the end of said four-month
period, but the development of the Project is still imminent, the City Council may, but
shall not be required to, grant an extension of time for the construction of the
Improvements. If development has commenced within the twenty-four (24) month
period and is stopped and/or delayed as a result of an act of God, war, civil
disturbance, court order, labor dispute, fire, or other cause beyond the reasonable
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control of Company, the requirement that construction is to be completed within twenty-
four (24) months shall be tolled for a period of time equal to the period of such
stoppage or delay, and thereafter if construction is not completed within the allowed
period of extension the title to the Property shall revert to the City. In the event that title
to the Property shall revert to the City pursuant to the provisions of this Section,
Company agrees that it shall, at its own expense, promptly execute all documents or
take such other actions as the City may reasonably request to effectuate said reversion,
and Company further agrees that it shall indemnify and hold harmless the City with
respect to any demand, claim, or cause of action by, or on behalf of, Company or any
third party regarding any damage, or injury made, suffered, or incurred as a result of, or
in connection with this Agreement, the Improvements, or any legal work, plans,
drawings, soil borings, partial construction work, or other activities undertaken by third
parties at Company's request or direction. The provisions of this Section 3 shall survive
the closing of City's sale of the Property to Company and shall not be merged into the
deed. The same timelines shall apply to relocation of the Sycamore Buildings to the
Infill Lot, commencing at substantial completion of the Improvements.
4. Minimum Assessment Agreement. Company acknowledges and agrees
that it will pay when due all taxes and assessments, general or special, and all other
charges whatsoever levied upon or assessed or placed against the Property. Company
further agrees that prior to the date set forth in Section 2 of Exhibit "D" it will not cause
a reduction in the taxable valuation for the Property, which shall be fixed for
assessment purposes, below the amount of $252,510 ("Minimum Actual Value"),
through:
(i) willful destruction of the Property, the Improvements, or any part of
either;
(ii) a request to the assessor of Black Hawk County; or
(iii) any proceedings, whether administrative, legal, or equitable, with
any administrative body or court within the City, Black Hawk County,
the State of Iowa, or the federal government.
Company agrees to sign said attached Exhibit "D" at the closing.
5. Other Development Incentives and Commitments. Because the
Property is located in a designated Consolidated Urban Revitalization Area (CURA), the
Property is eligible for tax exemption consistent with and to the extent provided for in
Iowa law, provided that Company meets all requirements to qualify for such exemption.
6. Deeds; Easement. (a) The City shall convey or cause to be conveyed
fee simple title to the Property and the Infill Lot by special warranty deed, free and clear
of all encumbrances except: (a) easements, conditions, and restrictions of record which
do not, in Company's opinion, interfere with Company's proposed use; (b) current and
future real property taxes and assessments subject to the agreements made herein; (c)
general utility and right-of-way easements serving the Property; and (d) restrictions
imposed by the City zoning ordinances and other applicable law.
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(b) Company and/or Company Affiliate shall convey or cause to be
conveyed fee simple title to the Company Property by warranty deed, free and clear of
all encumbrances except: (a) easements, conditions, and restrictions of record which do
not, in Company's opinion, interfere with Company's proposed use; (b) current and
future real property taxes and assessments subject to the agreements made herein; (c)
general utility and right-of-way easements serving the Property; and (d) restrictions
imposed by the City zoning ordinances and other applicable law.
(c) Company acknowledges and agrees that an existing gas line on
the Property will be relocated in connection with the Project to a position generally in
accordance with preliminary drawings. Company agrees to cooperate with City upon
request to execute any documents necessary or advisable for the grant or reservation
of a permanent easement with respect to the location of the gas line and its
construction, repair, inspection, reconstruction, etc., together with reasonable rights of
access thereto.
7. Abstracting. No Tess than fourteen (14) days prior to the anticipated date
of conveyance of its respective property, a party shall, at its own expense, deliver to the
other party an updated abstract of title. If title is unmarketable or subject to matters not
acceptable to the recipient, the conveying party shall remedy or remove such
objectionable matters in timely fashion following written notice of such objections from
the other party.
8. Representations and Warranties of City. City hereby represents and
warrants as follows:
A. City is not prohibited from consummating the transactions
contemplated in this Agreement by any law, regulation, agreement, instrument,
restriction, order or judgment.
9. Representations and Warranties of Company and Company Affiliate.
Company and Company Affiliate each hereby represents and warrants for itself as
follows:
A. It is not prohibited from consummating the transactions
contemplated in this Agreement by any law, regulation, agreement, instrument,
restriction, order or judgment.
B. It is duly organized, validly existing, and in good standing under the
laws of the state of its organization and is duly qualified and in good standing
under the laws of the State of Iowa.
C. It has full right, title, and authority to execute and perform this
Agreement and to consummate all of the transactions contemplated herein, and
each person who executes and delivers this Agreement and all documents to be
delivered to City hereunder is and shall be authorized to do so on its behalf.
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10. No Joint Venture. Nothing in this Agreement shall, or shall be deemed
or construed to, create or constitute any joint venture, partnership, agency,
employment, or any other relationship between the City and Company or Company
Affiliate nor to create any liability for one party with respect to the liabilities or
obligations of the other party or any other person.
11. Notices. Any notice under this Agreement shall be in writing and shall be
delivered in person, by overnight delivery service, by United States registered or
certified mail, postage prepaid, or by facsimile (with an additional copy delivered by one
of the foregoing means), and addressed:
(a) if to City, at 715 Mulberry Street, Waterloo, Iowa 50703, facsimile
number 319-291-4571, Attention: Mayor, with copies to the City Attorney and
City Planner.
(b) if to Company or Company Affiliate, to SJ Construction Inc., at
1027 Sycamore Street, Waterloo, Iowa 50703, Attention: Steven J.
Santomauro.
Delivery of notice shall be deemed to occur (i) on the date of delivery when delivered in
person, (ii) one (1) business day following deposit for overnight delivery to an overnight
delivery service which guarantees next day delivery, (iii) three (3) business days
following the date of deposit if mailed by United States registered or certified mail,
postage prepaid, or (iv) when transmitted by facsimile so long as the sender obtains
written electronic confirmation from the sending facsimile machine that such
transmission was successful.
12. Amendment, Modification, and Waiver. No amendment, modification,
or waiver of any condition, provision, or term of this Agreement shall be valid or of any
effect unless made in writing, signed by the party or parties to be bound or by its duly
authorized representative, and specifying with particularity the extent and nature of the
amendment, modification, or waiver. Any waiver by any party of any default by another
party shall not affect or impair any rights arising from any subsequent default.
13. Severability. Each provision, section, sentence, clause, phrase, and
word of this Agreement is intended to be severable. If any portion of this Agreement
shall be deemed invalid or unenforceable, whether in whole or in part, the offending
provision or part thereof shall be deemed severed from this Agreement and the
remaining provisions of this Agreement shall not be affected thereby and shall continue
in full force and effect. If, for any reason, a court finds that any portion of this
Agreement is invalid or unenforceable as written, but that by limiting such provision or
portion thereof it would become valid and enforceable, then such provision or portion
thereof shall be deemed to be written, and shall be construed and enforced, as so
limited.
14. Captions. All captions, headings, or titles in the paragraphs or sections
of this Agreement are inserted only as a matter of convenience and/or reference, and
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they shall in no way be construed as limiting, extending, or describing either the scope
or intent of this Agreement or of any provisions hereof.
15. Binding Effect. This Agreement shall be binding and shall inure to the
benefit of the parties and their respective successors, assigns, and legal
representatives.
16. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which, taken
together, shall constitute one and the same instrument.
17. Entire Agreement. This Agreement, together with the Minimum
Assessment Agreement attached hereto as Exhibit "D", constitutes the entire
agreement of the parties and supersedes all prior or contemporaneous negotiations,
discussions, understandings, or agreements, whether oral or written, with respect to the
subject matter hereof.
18. Time of Essence. Time is of the essence of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Development
Agreement as of the date first written above.
R & S COMMERCIAL, LLC and
R & S RENTAL PROPERTIES,
By:
Steven J. S;gjt•mauro, Manager
CITY OF WATERLOO, IOWA
By:
Attest:
Ernest G. Clark, Mayor
uzy Sch'res, City Clerk
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EXHIBIT "A"
Legal Description of the City Property
MORNING SIDE ADDITION LOT 22, 23, 24, AND 25, BLOCK 1, CITY OF WATERLOO, BLACK HAWK
COUNTY, IOWA.
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Exhibit "B"
Legal description of Infill Lot
ORIGINAL PLAT WATERLOO EAST, LOT 6, BLOCK 23, CITY OF WATERLOO, BLACK HAWK
COUNTY, IOWA.
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Exhibit "C"
Legal description of Company Property
ORIGINAL PLAT WATERLOO EAST, LOTS 8 AND 9, BLOCK 18, CITY OF WATERLOO, BLACK HAWK
COUNTY, IOWA.
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EXHIBIT "D"
MINIMUM ASSESSMENT AGREEMENT
THIS MINIMUM ASSESSMENT AGREEMENT (the "Agreement"), dated as of
this /4' day of a Veiltiatii, 100 by and among the CITY OF WATERLOO,
IOWA, ("City"), R & S Commercial, LLC ("Developer"), and the COUNTY ASSESSOR
of the City of Waterloo, Iowa ("Assessor").
WITNESSETH:
WHEREAS, on or before the date hereof the City and Developer have entered
into a Development Agreement (the "Agreement") regarding certain real property
located in the City; and
WHEREAS, it is contemplated that pursuant to said Agreement, the Developer
will undertake the development of an area ("Project") within the City and within the
"Downtown" Renewal and Redevelopment Plan area.
WHEREAS, pursuant to Iowa Code section 403.6, as amended, the City and the
Developer desire to establish a minimum actual value for the land and building thereon
pursuant to the Agreement and applicable only to the development, which shall be
effective upon substantial completion of the development and from then until this
Agreement is terminated pursuant to the terms herein and which is intended to reflect
the minimum actual value of the land and building as to the development only; and
WHEREAS, the City and the Assessor have reviewed the preliminary plans and
specifications for the improvements which it is contemplated will be erected as a part of
the development;
NOW, THEREFORE, the parties to this Minimum Assessment Agreement, in
consideration of the promises, covenants and agreements made by each other, do
hereby agree as follows:
1. Upon substantial completion of renovations by the Developer on the
property described in Exhibit "A" attached hereto, the minimum actual taxable value
which shall be fixed for assessment purposes for the land and improvements to be
constructed thereon by the Developer as a part of the development shall not be Tess
than $252,510 ("Minimum Actual Value") until termination of this Agreement. The
parties hereto agree the construction of the improvements will be substantially
completed on or before December 31, 2015.
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2. The Minimum Actual Value herein established shall be of no further force
and effect and this Minimum Assessment Agreement shall terminate on December 31,
2019. Nothing herein shall be deemed to waive the Developer's rights under Iowa
Code section 403.6, as amended, to contest that portion of any actual value
assignment made by the Assessor in excess of the Minimum Actual Value established
herein. In no event, however, shall the Developer seek or cause the reduction of the
actual value assigned below the Minimum Actual Value established herein during the
term of this Agreement.
The City shall not unreasonably withhold its consent to permit the Developer to
contest its taxable valuations in full, commencing with the assessment of January 1,
2020.
3. This Agreement shall be promptly recorded by the City with the Recorder
of Black Hawk County, Iowa. The City paying all costs of recording.
4. Neither the preambles nor provisions of this Agreement are intended to, or
shall be construed as, modifying the terms of the Development Agreement.
5. This Minimum Assessment Agreement shall inure to the benefit of and be
binding upon the successors and assigns of the parties, including but not limited to
future owners of the Project property.
CITY OF W ERLOO, IOWA
B
rnest G. Clark, Mayor
Attest:
Suzy Scha res, City Clerk
STATE OF IOWA )
) ss.
COUNTY OF BLACK HAWK )
R & S COMMERCIAL, LLC
By:
Steven J. Samauro, Manager
On this tv day of Jou/ 2° /tit , before me a Notary Public in
and for the State of Iowa, personally appeared Ernest G. Clark and Suzy Schares, to
me personally known, who being duly sworn, did say that they are the Mayor and City
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Clerk, respectively of the City of Waterloo, Iowa, a Municipal corporation, created and
existing under the laws of the State of Iowa, and that the seal affixed to the foregoing
instrument is the seal of said municipal corporation, and that said instrument was
signed and sealed on behalf of said municipal corporation by authority and resolution of
its City Council, and said Mayor and City Clerk acknowledged said instrument to be the
free act and deed of said municipal corporation by it and by them voluntarily executed.
STATE OF IOWA )
) ss.
COUNTY OF BLACK HAWK )
D.
DeAnne Kobliska
COMMISSION NO. 763995
MY COMMISSION EXPIRES
--
Subscribed and sworn to before me on L'4 A. 209, , by Steven J.
Santomauro as Manager of R & S Commercial, LLC.
/211 S
Notary Public
,0`1" BARBARA J. MOSTEK
COMMISSION NO. 720408
a MY COMMISSION EXPIRES
January 15, 2015
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CERTIFICATION OF ASSESSOR
The undersigned, having reviewed the plans and specifications for the
improvements to be constructed and the market value assigned to the land upon which
the improvements are to be constructed for the development, and being of the opinion
that the minimum market value contained in the foregoing Minimum Assessment
Agreement appears reasonable, hereby certifies as follows: The undersigned Assessor,
being legally responsible for the assessment of the property subject to the
development, upon completion of improvements to be made on it and in accordance
with the Minimum Assessment Agreement, certifies that the actual value assigned to
such land, building and equipment upon completion of the development shall not be
less than Two Hundred Fifty -Two Thousand Five Hundred Ten Dollars ($252,510.00).
STATE OF IOWA
) ss.
COUNTY OF BLACK HAWK )
sor for Black Hawk County, Iowa
Date
Subscribed and sworn to before me on
% f este."14 o /' , Assessor for Black H
DEBORAH L. BOECKMANN
MY COMMISSION NO. 195788
. o MY COMMI$SIO.N EXPIRES
lei ® c p/%/ , by
k County, Iowa.
Notary Public
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