Legislative Update: The ordinance was approved by a 5-0 vote of the City Commission on July 20, 2022.

Issue Statement: On August 2, 2021, the City of Oakland Park released the Request for Qualifications, RFQ# 091421 Downtown Properties Redevelopment Project Phase One – Development Firm Pre-Qualification Solicitation.  As a result, twelve responses were received, and the City Commission adopted resolution R-2021-150, which approved a shortlist of the top five ranked firms on November 3, 2021.  On November 15, 2021, the City released the Request for Proposals, RFP #011322 Downtown Properties Redevelopment Project Phase Two- Development Proposals, and invited the five firms to submit comprehensive development proposals.   On January 13, 2022, the City received proposals from three (3) of the five (5) pre-qualified firms. 

On March 2, 2022, the City Commission approved Resolution R-2022-028, which (1) Approved the selection committee ranking of the three proposals in response to RFP #011322 Downtown Properties Redevelopment Project Phase Two - Development Proposals; and (2) Authorized City staff to begin negotiations on the necessary agreements with the top-ranked proposer,  Kaufman Lynn and the Falcone Group, a joint submittal.   Furthermore, in accordance with R-2022-028, if negotiations were not favorably concluded within a 90-day period, the City Manager was authorized to cease negotiations with the top-ranker proposer and begin negotiations with the next most highly-ranked proposer.

Recommended Action:   The City Commission conduct a public hearing and thereafter adopt the ordinance on second reading, authorizing the City Manager to enter into a Purchase and Sale Agreement in the amount of $11,206,580.00 with Horizon of Oakland Park, LLC for the sale of the Oakland Park Downtown Properties.

Background

Since the initial award and authorization to negotiate, the City team and representatives from Kaufman Lynn Falcone Group (the “Developer”) have met regularly to negotiate the terms of the public private partnership for the development of the Downtown Properties.  The City and the Developer have successfully negotiated business terms for the two enabling documents that will support the development of this project: the Purchase and Sale Agreement and the Development Agreement. Kaufman Lynn and the Falcone Group have created a new business entity to deliver the project, Horizon of Oakland Park, LLC. 

This agenda item concerns the first of the two key documents the Purchase and Sale Agreement (PSA), which is attached for City Commission review. The Development Agreement will be brought forward for City Commission review and approval along with the Second Reading of the PSA.

The action that is being presented for City Commission consideration is the approval on first reading of an ordinance to authorize the Purchase and Sale Agreement for the City of Oakland Park Downtown Properties which is comprised of six (6) individual sites totaling more than 4 acres and located on the east side of Northeast 12th Avenue, between Northeast 36^th Street and Northeast 38^th Street. This document will set forth the detailed process and conditions under which the Downtown Properties would be sold, and ownership transferred to Horizon of Oakland Park LLC, which is a joint venture between Kaufman Lynn Construction and the Falcone Group, for the express purpose of development of the Downtown Properties. The Purchase and Sale Agreement provides for the disposition of City property and as such, an Ordinance is required per City code.

The proposed ordinance requires two readings, with a public hearing on second reading. If approved, the ordinance would authorize the City to enter into the Purchase and Sale Agreement for the Downtown Properties for the express purpose of its development as defined in the Development Agreement. The agreement seeks to transfer the property under a very specific set of conditions and responsible timeframe to ensure the success of the development.  The Development Agreement will be brought to Commission at the second reading of this ordinance and will contain the essential terms and conditions as outlined in the staff presentation to Commission.    

The following summarizes the Project and Purchase and Sale Agreement:

Development Program

The Project: Consists of the following components: North Building, South Building, Residential Building, Public Recreational Spaces, Public Parking, Woonerf, Train Station, and Open Spaces.

The Site Plans:  The Purchase and Sale Agreement and the Development Agreement contemplate the potential scenarios for the development of the project with or without the acquisition of the private parcels (A and B) and future timing of the Train Station. See attached map of Parcel A and B.  It should be noted that all proposed site plans retain Greenleaf Park amenities, the "historic" tree, woonerf, public parking and train platform. 

Primary Site Plan:

* Exceeds City Code required Ground Open Space = 20%

**Exceeds City Code required Rooftop Open Space = 5%

Alternative Site Plan A-1: without Parcel A

* Exceeds City Code required Ground Open Space = 20%

**Exceeds City Code required Rooftop Open Space = 5%

Alternative Site Plan A-2: without Parcel A

* Exceeds City Code required Ground Open Space = 20%

**Exceeds City Code required Rooftop Open Space = 5%

Summary of Provisions

1. Definitions: Establishes a clear understanding of the terms and conditions within the contract.

2. Purchase Price and Deposits: Sets the purchase price for the property at $11,206,508.00 and sets forth earnest money deposit requirements.

3. Inspections: Provides that the Developer will be allowed a 120-day inspection period for the property; this section also includes provisions that govern access, responsibilities, and deadlines.

4. Development Review Application, City Development Approval, City Commission Approval and Site Plan Approval:  Sets forth the process and timelines associated with the development of the Downtown Properties.

5. Sellers Representation, Warranties, and Covenants: These provisions establish clarity regarding the City’s knowledge of the site conditions and clarifies that the site is being sold "as is" while providing for site access and indemnification.

6. Sellers Closing Documents: These provisions establish closing cost obligations between the parties.

7. Purchasers Deliverables: Sets forth the deliverables to be provided by the Purchaser to the City at time of closing.

8. Real Estate Commissions: Clarifies that there are no real estate commissions to be paid by either party in this transaction.

9. Default: Provides that the Purchaser shall be in default should they fail to file the Development Review application prior to the required date or close the acquisition of the Property before the Closing Date.  The City shall be in default should it not perform any required obligations or fail to close the sale of the Property before the Closing Date.

10. Timeline for City Development Approval, City Commission Approval, and Permits: Indicates that the Purchaser shall exercise due diligence in obtaining Government approvals and coordinating with the City to resolve entitlement issues.  Permits shall be obtained by the Purchaser through reasonable efforts within 12 months and close on the Property within 60 calendar days of obtaining Governmental Approvals, Permits for the Project and a Construction Loan Commitment.

11. Evidence of Title:  Outlines that the City and the Purchaser shall work to provide proper title to the Property and jointly work to cure any title objections and survey inaccuracies.

12. Risk of Loss; Condemnation:  Options provided to the Purchaser should the City be advised of pending or threatened condemnation of the Property arising from fire or other casualty prior to closing.

13. Transfer of Title Subject to:  Provisions under which the Title will be accepted regarding utility easements.

14. Adjustments at Closing:  Sets forth basis for which closing credits and/or prorations will be calculated.

15. Closing Date and Place:  Specifies the closing date and location.

16. Termination:  Outlines the provision for the City to terminate the agreement.

17. Closing Cost:  Establishes responsibility for closing costs and legal fees.

18. Purchasers Warranties:  Provides the authority for the Purchaser to execute the agreement with the City.

19. Option to Repurchase all of the Property:  Outlines the City’s ability to repurchase the Property under certain circumstances.

20. Enforceability:  Provides for unenforceable circumstance as provided by a Court as to any provision of the Agreement and the resolution of same.

21. Conditions Precedent to Closing and Contingencies:  Provides for the City’s, Purchaser’s and joint considerations that must be satisfied prior to closing.

 22.– 38. Notice/ Heading/ Effective Date/ Governing Law and Venue/ Entire Agreement/ No Oral Change/ Successors/ Counterparts/ Radon Gas/ Attorney’s Fees/ Cooperation and Status Updates/ Escrow/ Time is of the Essence, Force Majeure/ No Third-Party Beneficiaries/ Survival/ Waiver of Jury Trial/ Closing Agent Escrow Agreement:  Provisions 22 thru 38 provide the legal notices, official notifications, and requirements, etc. relating to the execution of the Agreement.

Additional City Actions:

• Purchase and Sale Agreement on Second Reading (Public Hearing)
• Development Agreement
• Neighborhood Participation Meeting
• Development Review Committee – Site Plan Approval
• Planning and Zoning Board – Bonus Provisions
• City Commission Approval - Bonus Provisions
• Project Specific Documents for City Commission Approval (Future Approval)          
• Woonerf Long Term Maintenance Agreement
• Parking Maintenance Agreement
• Construction Agreement with Developer (Greenleaf Park & Pump Station Relocation)
• Train Station Delivery Agreement
• Other Approvals:
• Rezoning of 1300 NE 38 Street (former Omega Church Site) – site of the future Greenleaf Park

The sale price of the Downtown Properties is $11,206,580.00.  The sales appraised exceeds the highest appraised value by $1,451,580.00.  The Purchase and Sale Agreement requires three deposits prior to closing, totaling $1,200,000.  A payment of $450,000 is required upon execution of the PSA, another $450,000 is required upon final Governmental Approval, and $300,000 due when the City vacates the property.  In addition to the direct sale price, the City will also be receiving capital contributions from the developer, including the development of the former Omega Church site into a new Greenleaf Park, the creation of the Woonerf, and train station platform construction obligations.  These contributions are further outlined in the Development Agreement.

The sale of the land to Horizon of Oakland Park, LLC and the development of the site will also expand the property tax base of the City. As shown in the attached document, the estimated ad valorem impact of the project is forecast to be excess of $24 million over a twenty-year period.

The City Commission conduct a public hearing and thereafter adopt the ordinance on second reading, authorizing the City Manager to enter into a Purchase and Sale Agreement in the amount of $11,206,580.00 with Horizon of Oakland Park, LLC for the sale of the Oakland Park Downtown Properties.