STAFF REPORT

MEETING

DATE: June 21, 2016

TO: City Council

FROM: Cathy Capriola, Interim City Manager

Scott Ward, Director of Hamilton Base Reuse

SUBJECT: HAMILTON SENIOR TRIANGLE – AMENDMENT TO EXTEND

CLOSING PERIOD OF AGREEMENT OF PURCHASE AND SALE

REQUEST

Consider authorizing the Interim City Manager to execute an Amendment to Purchase and Sale

Agreement with Urban Community Partners extending the Close of Escrow in the Agreement of

Purchase and Sale for the Hamilton Senior Triangle, APN 157-860-03.

RECOMMENDATION

Authorize the Interim City Manager to execute the Amendment to Purchase and Sale Agreement

with Urban Community Partners.

BACKGROUND

On July 30, 2014, the City entered into a Purchase and Sale Agreement (“PSA”) with Urban

Community Partners, LLC (“UCP”) for approximately 1.5 acres of land (APN 157-860-03) and

for a parking and access easement on adjacent City-owned parcel (APN 157-860-04)

(“Property”). As contemplated in the PSA, UCP has since assigned the agreement to Hamilton

Cottages LLC (“HCLLC”), a sole purpose entity that includes both UCP and its investor and co-

developer, Ryder Homes of California, Inc. The PSA requires HCLLC close on the Property by

July 30, 2016. HCLLC requests an extension of the closing date, as described in its attached

letter of June 1, 2016.

CONSIDERATIONS

1) Closing: Under the current PSA, Close of Escrow must occur by the earlier of i) thirty days

after final, non-appealable, resolution of any administrative action or lawsuit over the

issuance of any City Approvals or other Government Approvals, or ii) two years after

execution of the Agreement (July 30, 2016).

2) Price: The purchase price for the property is $450,000.1

1 The PSA specifies that the purchase price shall be $450,000, but that that price shall be increased by $25,000 for

each unit above 14 that is ultimately approved by the City Council. At the present time, HCLLC has applied for

approvals for a 16 unit project, which, if approved, would yield a $500,000 purchase price.

922 Machin Avenue Novato, CA 94945

415/ 899-8900 FAX 415/ 899-8213

www.novato.org

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3) Process: HCLLC has been diligently pursuing entitlements for a “pocket neighborhood”

consisting of 16 seniors- restricted (55 years old and up) residential dwellings on the site,

as contemplated in the PSA. The Novato Design Review Board approved the proposal

unanimously with “Strong Endorsement” on March 16, 2016. A California Environmental

Quality Act (“CEQA”) review of the project has been completed and is currently under

public review, which will be complete in mid-July. After the CEQA document is finalized,

the project will go to the Planning Commission for its recommendation and then will come

before the City Council for final decision.

4) Need: HCLLC describes an extension of the closing date as being made necessary and

warranted due to the unique complexities of the site, including its difficult geometry, the

unique nature of the project, the need to apply for several concurrent approvals and by the

discovery of previously unknown site utilities which required an adjustment to the original

design.

5) Proposed Amendment: The proposed amendment to the PSA would:

a. Extend the Close of Escrow to the earlier of (i) 30 days after the last City Approval

or Government Approval applicable to the Project become final and non-appealable

or for which the last applicable statute of limitations has expired without lawsuit or

legal challenge having been filed within that statute of limitations; or (ii) January

22, 2017.

b. Require HCLLC to immediately pay to the City an additional, non-refundable

deposit of $25,000. If escrow closes, deposit will be applied to the purchase price.

ATTACHMENTS

1. Amendment to Agreement of Purchase and Sale

2. Letter from Hamilton Cottages, LLC dated June 1, 2016

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June 22, 2016

Aaron Roden

Director of Acquisitions and Planning

Ryder Homes of California, Inc.

1425 Treat Boulevard

Walnut Creek, CA 94597

Subject: Extension of Purchase and Sale Agreement Closing Date for Hamilton

Senior Triangle Parcel

Dear Mr. Roden,

This agreement (“Agreement”) is made as of June 22, 2016 by and between: The

City of Novato (“Seller”) and Hamilton Cottages, LLC (“Buyer”).

WHEREAS the Seller and Buyer’s assignor, Urban Community Partners, LLC

(“UCP”), entered into a certain Agreement of Purchase and Sale (“PSA”) on the

30th day of July, 2014.

WHEREAS, UCP assigned its rights in and to the PSA to the Buyer, which

assignment the Seller consented to.

WHEREAS the parties agree to extend the date of the Close of Escrow set forth

in the Agreement of Purchase and Sale under the terms and conditions provided

herein.

A. NOW, THEREFORE, the parties hereby agree that the PSA shall be

amended as follows:

1. Contemporaneously with its execution of this Agreement, Buyer shall pay

directly to Seller twenty five thousand dollars ($25,000.00) which said amount

shall be nonrefundable under all circumstances and irrespective whether escrow

closes under the PSA, but in the event that escrow closes in accordance with the

PSA, said amount shall be credited toward the Purchase Price.

2. The last sentence in Section 3.02 of the PSA shall be amended to read as

follows:

a. Notwithstanding anything to the contrary stated herein, the outside

Closing Date shall be the date that is the earlier of (i) 30 days after

the last City Approval or Government Approval applicable to the

Project becomes final and non-appealable or for which the last

applicable statute of limitations has expired without lawsuit or

legal challenge having been brought within that statute of

limitations; or (ii) January 22, 2017.

922 Machin Avenue Novato, CA 94945 415/899-8900 FAX 415/899-8213 www.novato.org Mayor Pat Eklund Mayor Pro Tem Denise Athas Councilmembers Pam Drew Josh Fryday Eric Lucan Interim City Manager Cathy Capriola

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B. The parties further agree that:

1. Unless the context would indicate a different meaning, all capitalized

terms in this Agreement shall have the same meaning that is assigned to those

terms in the PSA.

2. Those portions of the PSA not modified by this Agreement shall remain

in full force and effect, and the PSA, as amended hereby, shall remain in full force

and effect.

If the above meets with your entire satisfaction, please execute where indicated

below and return the original of this letter Agreement to the undersigned,

accompanied by a cashier’s check in the amount of $25,000, made payable to the

City of Novato.

Sincerely,

Cathy Capriola

Interim City Manager, City of Novato

The above terms and conditions are agreed to.

Hamilton Cottages, LLC,

By: _______________________________

Name:_____________________________ Title:_________________________

Dated:_____________________________

cc: Scott Ward, Director of Hamilton Base Reuse, City of Novato

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