City Council

11. PURCHASE AND SALE AGREEMENT WITH MARINERS CHURCH FOR APPROXIMATELY 3 ACRES OF DISPOSITION AREA 8 AT TUSTIN LEGACY Request for authorization to approve a Purchase and Sale Agreement between Mariners Church and the City for the sale of approximately 3.324 acres of City-owned property located within a portion of Disposition Area 8 at Tustin Legacy. The property is generally bounded by Warner Avenue, future Veterans Way, and future John Johnson Way. The purpose of the Purchase and Sale Agreement is to implement the Reuse Plan for Marine Corps Air Station Tustin and the Specific Plan for Tustin Legacy through the development and maintenance of property. Recommendation: 1. Approve and authorize the City Manager to execute the Purchase and Sale Agreement between Mariners Church and the City in the form attached hereto subject to any non-substantive modifications as may be recommended by the City's special real estate counsel or the City Attorney; and 2. Authorize the City Manager to take all actions and to approve and execute all other agreements, attachments and documents necessary or appropriate to complete the transaction. Fiscal Impact: The purchase price for the property is $4,000,000. In addition to the purchase price, Mariners Church will pay to the City a Project Fair Share Contribution of $1,640,217.83 to fund backbone infrastructure improvements at Tustin Legacy. The Project Fair Share Contribution will be payable at closing or may be deferred until the earlier of 12 months after closing or when permits are pulled for construction, and if deferred, will accrue interest at the Wall Street Journal Prime Rate. Within three (3) days of the effective date of the Purchase and Sale Agreement, Mariners Church will also submit a $100,000.00 deposit into escrow, which will be applicable to the purchase price at the close of escrow. Each party will also be responsible for paying customary escrow and closing costs. Further, the City will not be required to pay any real estate commissions for the broker representing Mariners Church. The Property will be annexed into a future Zone 4 of the City Community Facilities District 2018-01, which has been established to cover service costs at Tustin Legacy (such as police and fire; recreation program services; maintenance of parks, streets, sidewalks and drainage facilities). The Rate and Method of Apportionment specific to this transaction will require City Council consideration and approval prior to the close of escrow. The negotiated rate will be $0.50 per square foot of permitted building square footage. The rate will escalate annually based on a maximum annual escalation of 2%.