6. Acquisition of lot east of Hanus site CITYOF
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1 i CHANHASSEN
1
Voior4,,,, , 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317
(612) 937-1900 • FAX (612) 937-5739
1
MEMORANDUM
1 TO: Housing and Redevelopment Authority
1 '1
FROM: Don Ashworth, Executive Director P
DATE: September 14, 1990
1 SUBJ: Consider Acquisition of the Lot Lying East of the Hanus
Site
IIMr. Johnson verbally presented this item at one of our last Housing
and Redevelopment Authority meetings. The proposal is one of
1 having the Housing and Redevelopment Authority acquire the current
vacant parcels lying east of the Hanus property and lying west of
the Red-E-Mix property (see map) . Mr. Johnson would be willing to
sell such to the Housing and Redevelopment Authority for the same
1 price paid by him plus holding costs. The proposal currently
includes Tracts 1, 3 and 4. Although I can understand the
developer's desire to see Tract 1 being a part of the acquisition,
II believe that such could create financing problems for the
developer if the Frank Kurvers property is developed and/or the
Hanus property renovated. Specifically, with our acquisition it
1 would become questionable as to whether legal street access existed
to either of these two parcels. In support of the acquisition of
Tracts 3 and 4 is the recognition that a potential purchase of
these sites by a third party could develop potential suits against
I the city/Hanus requiring the city to issue building permits to
parcels previously subdivided and having proper zoning. An
additional argument favoring the acquisition is the recognition
1 that options regarding Apple Valley may very well require our
acquisition of all or a part of Tract 4 and/or require some form of
access to this parcel via West 78th Street and/or Dakota Avenue/TH
I 101. None of these options are in fact realistic and all are cost
prohibitive. A reverse condemnation suit for Tracts 3 and/or 4
could result in damage payments significantly higher than those
proposed under the acquisition offer. Finally, acquisition of
1 Tracts 3 and 4 would provide monies to the developer to cash out
current liens by Hanus. These liens have stopped Mr. Johnson from
cleaning up the site to the extent desired by both himself and the
1 city and to eliminate certain land uses which have not been
compatible with the overall redevelopment efforts on the property.
I would recommend that should the HRA authorize acquisitions of
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Housing and Redevelopment Authority
September 14, 1990
Page 2
Tracts 3 and 4 and that be conditioned upon a portion of the money
being dedicated to removing existing title problems associated with
Tract 2, i.e. requiring removal of Hanus contingencies against said
Tract 2. The final argument favoring the acquisition of Tracts 3
and 4 is the fact that the $2.30 per sq. ft. offer from the
developer is reasonable and will be to the city's advantage as
condemnation proceeds for the Taco and Apple Valley properties.
1
RECOMMENDATION
It is recommended that the Housing and Redevelopment Authority
authorize the Executive Director to draft a purchase agreement for
Tracts 3 and 4 at a rate of $2.30 per sq. ft. and to include in
such purchase conditions which would ensure that redevelopment of
Tract 2 lies with Mr. Johnson and is not impaired by the previous
owner, Mr. Hanus.
•
1
1
1
1
LOTUS REALTY SERVICES
545 WEST 78th STREET, P.O. BOX 100
CHANHASSEN, MINNESOTA 55317
(612) 934-4538
September 13, 1990
•
TO: Chanhassen HRA
' FROM: Brad Johnson, Lotus Realty
SUBJ: Purchase of Hanus land
Lotus Realty would like to propose that the HRA purchase the
' Hanus land which Lotus currently has under contract for
$230,000, or approximately $2.30 per square foot.
The Hanus property consists of Tracts 1, 3 and 4 on the copy of
' the attached survey. The total land area is approximately 100,000
' square feet. Of that amount, 65,0000 square feet are buildable,
after the acquisition of Apple Valley Concrete. The balance
(Tract 1) could be used for the future parking needs of the site.
The land could be held by the HRA for redevelopment along with the
Apple Valley and Taco sites. The purchase price reflects Lotus's
' acquisition and holding costs to date.
' Thank you for consideration of this matter.
I
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