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CITY COUNCIL AGENDA ITEM NO. 5

Meeting Date: October 9, 2007

Subject/Title: Approve the selection of Rodda Electric, Inc., as the successful candidate to purchase 385 Carrol Court at Sunset Industrial Complex based on Council-approved sales strategy criteria ranking

Prepared by: Gina Rozenski, Redevelopment Manager

Submitted by: Howard Sword, Community Development Director

RECOMMENDATION
Approve the selection of Rodda Electric, Inc., as the successful candidate to purchase 385 Carrol Court at Sunset Industrial Complex based on Council-approved sales strategy criteria ranking.

PREVIOUS ACTION

 City Council authorized the purchase of approximately 40 acres of property located at the northeast corner the Tresch and Sunset Roads.

 City Council authorized various consultant contracts to master-plan and prepare environmental documents for approximately 132 acres of City-owned land northeast of Tresch and Sunset Roads to include a 49.2 acre Wastewater Treatment Plant, 2.7 acre Solid Waste Plant, 37.7 Sports Park, 13.3 acre Corporation Yard and a 28.4 acre Sunset Industrial Complex.

 On November 26, 2002 the City Council approved a sales strategy for property located at the Sunset Industrial Complex and adopted criteria for the selection of successful candidates to purchase the subject property. The sales strategy scoring was amended by the Council on April 25, 2006, by adding 2 points for businesses located in the Redevelopment Project Areas.

 From April 2004 to September 2007, fifteen escrows at Sunset Industrial Complex have closed.

 On June 12, 2007, the City Council approved the commission of updated appraisal for 385 Carrol Court at Sunset Industrial Complex and directed staff to undertake a fresh round of requests for purchase proposals as a method to select a buyer for 385 Carrol Court, based on the adopted sales strategy criteria.

BACKGROUND
The Sunset Industrial Complex was an economic development strategy envisioned by the City and Redevelopment Agency to voluntarily relocate members of the redevelopment project areas, our business community and surrounding areas to a more appropriate location zoned for light and medium industrial employers.

The qualifications and identities of the buyers are of particular concern to the City. For that reason, the City adopted a sales strategy ranking system to fairly and objectively select qualified buyers that meet the economic development objectives of Sunset Industrial Complex.

The escrow for 385 Carrol Court was canceled in June 2007 when Kendall Automotive, as part of Brentwood Sunset 2010, Inc., assumed the Purchase and Sale Agreement for 2010 Elkins Way. In June 2007, the City Council authorized staff to re-appraise 385 Carrol Court and, based on the appraised value, offer the sale of the parcel to interested buyers in accordance with the adopted sales strategy criteria.

The appraisal dated August 3, 2007, reflected a value of $10.00/square foot or $435,600 for the 1.0 acre parcel at 385 Carrol Court.

Early August 2007, staff prepared and mailed 51 sales offerings, and advertised the availability of the parcel twice in the local newspaper. Three purchase proposals were received, scored and ranked in accordance with the sales strategy criteria that considered business location, type, job generation and economic impacts. The evaluation of the three proposals is reflected in the following table.


Rank
Business 0-38
Possible Points
1 Rodda Electric, Inc. 32 points
2 WaterSavers Irrigation, Inc. 31 points
3 AJA Construction 21 points

The Land Use and Development Committee met on September 20, 2007, to review the rankings of the purchase proposals. The Committee recommends the selection of Rodda Electric, Inc., as the successful candidate. Rodda Electric is quickly outgrowing its existing leased space at Sunset Industrial Complex. The company currently has 38 employees, and anticipates 50 employees by next year, with an expectation of growing to 100 employees. Rodda Electric provided a pre-qualification letter from Bay Area Development Corporation for an SBA 504 loan, and has been named #300 of the “500 Fastest Growing Businesses in America” by Entrepreneur Magazine, August 2007. Mr. Rodda uses the local East Bay Works placement services for its 5-year apprenticeship electrician program, and proposes to build the Planning Commission-approved Vornhagen building which should result in a timely design review application submittal. Mr. Rodda agrees with the terms and conditions of the proposed purchase agreement. The purchase agreement for Mr. Rodda will be brought to the Council for approval at a later date, if selected.

The Committee recommends that the second candidate be offered the property in the event the first candidate does not complete the transaction, and so forth.

FISCAL IMPACT
There is no fiscal impact associated with the selection of the successful candidate to purchase 385 Carrol Court. The purchase agreement will be brought to the Council for approval at a later date.

 

City Administration
City of Brentwood City Council
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Brentwood, CA 94513
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