HomeMy WebLinkAboutItem 08 Discussion of an Unsolicited Offer from VMG to Purchase and Develop a Two-Story Commercial Building on City-Owned Property Located at 2 North Bluford ocoee
florida
AGENDA ITEM COVER SHEET
Meeting Date: May 4. 2021
Item # O 8
Reviewed By:
Contact Name: Craig Shadrix Department Director:
Contact Number: 407-905-3111 City Manager: Robert Fr nk
Subject: Discussion of an unsolicited offer from VMG to purchase and develop a two-story
commercial building on city-owned property located at 2 North Bluford
Background Summary:
During strategic planning exercises with the City Commission almost six years ago, the City
Commission harmoniously directed staff to pursue a plan to revitalize and redevelop the area
historically referred to as downtown. Since that time, the City adopted a downtown masterplan and
secured funding for the projects deemed crucial in the masterplan, all while lowering taxes. The
downtown masterplan projects are well underway, with City Hall, Oakland Avenue, and the Downtown
Master Stormwater Park in late stages marking the final efforts of completion.
With the final phases of the downtown revitalization effort underway, attention must be given to
economic development efforts to bring additional businesses and consumers to the downtown area.
As part of this effort, staff created a vision for the property at 2 North Bluford, including color
renderings (see attached), that is compatible and representative of good economic development of
downtown parcels—new construction. In 2019, VMG Construction, Inc., offered to build the City's
rendered plan in exchange for the property located at 2 North Bluford. The City's plan included a
commercial building that would include restaurant and office space, and would cost a developer
approximately $4 to 5 million to construct.
In February of 2020, VMG representatives reached out to the City and informed the City of their
intention to terminate the agreement with the City. In August of 2020, the City Commission awarded
the same offer to GPK Investments who agreed to design to the City's downtown guidelines and
construct an even more aggressive plan than the original utilizing adjacent properties not owned by
the City. Unfortunately, GPK recently informed the City in writing that they wished to terminate the
negotiations on the purchase, due to their inability to acquire additional adjacent properties.
On April 15, 2021, the City received an unsolicited Letter of Interest from VMG Construction to again
acquire the property and construct a building consistent with the City's original design (attached).
Rather than the City conveying the property following construction of the building, with this new offer
from VMG Construction, VMG Construction would purchase the property from the City for $389,000
and then construct the building. Based on City's acquisition costs for the property ($344,000 in
2017), the sale amounts for comparable properties and prior negotiations on the conveyance of the
property, City staff believes that the $389,000 offer meets or exceeds the fair market value of the
property. If approved, the City would negotiate a contract for sale with VMG.
1
Pursuant to Section C-8.B.(2) of the Charter, since the sale would exceed $100,000, prior to the sale
of the property to VMG, the negotiated contract will be brought back to the City Commission and
voted on following a public hearing preceded by publication and notice of such hearing.
Issue:
Should the City Commission authorize City staff to negotiate a contract consistent with this attached
letter of intent for sale of city-owned property located at 2 N. Bluford to VMG Construction for
construction of the building shown in the attached building illustrations?
Recommendations:
Staff recommends that the City Commission authorize City staff to proceed with the negotiation of an
agreement consistent with this attached letter of intent for sale of city-owned property located at 2 N.
Bluford to VMG Construction for construction of the building shown in the attached building
illustrations.
Attachments:
LOI from VMG Construction
Illustrations of proposed building
Financial Impact:
The property was purchased with utilities funding in 2017 for $344,350. Upon transfer of the title, the
City would need to reimburse the utilities fund. Adequate funds are available to make the
reimbursement.
Type of Item: (please mark with an is)
Public Hearing For Clerk's Dept Use:
Ordinance First Reading Consent Agenda
Ordinance Second Reading Public Hearing
Resolution Regular Agenda .
X Commission Approval
Discussion&Direction
Original Document/Contract Attached for Execution by City Clerk
Original Document/Contract Held by Department for Execution
Reviewed by City Attorney N/A
N/A
Reviewed by Finance Dept.
Reviewed by
N/A
Reviewed by N/A
2
VALIANT
REALTY :GROUP
VMG Construction, Inc
LOI for Purchase
2 N Bluford Ave., Ocoee LF 34761
April 15, 2021
VMG Construction Inc., and its affiliates were established in 2006 as a privately-held commercial
construction company based in Winter Garden,Florida. The company serves the Greater Orlando
Area as a high-quality commercial construction subcontractor that also provides environmental
services and industrial constructions. Over the years,the company also participated in theme park
attractions,recreational parks and public schools constructions. For more information,please visit
VMG's website at www.VMGconstructioninc10.com
This Letter of Intent(the "LOI") outlines the basic terms upon which VMG Construction, Inc., as
the buyer is hereby offering to purchase and develop the property defined by the attached
proposed conceptual plans.
Upon mutual execution of this LOI, a formal Contract between the buyer and seller shall be
drafted by the buyer incorporating the terms and conditions specified herein,plus any other
tejins and conditions that are mutually agreeable to the parties.
TERMS AND CONDITIONS
1. PROPERTY: 2 N Bluford Ave., Ocoee, Florida 34761.
Parcel ID: 17-22-28-6144-03-221
2. SELLER: City of Ocoee.
3. PURCHSER: VMG Construction Inc., A Florida Registered Company
4. TIME FOR ACCEPTANCE: The LOI must be signed by the seller on upon City
Commission Approval but not later than 30 days from April 20, 2021.
5. SALES PRICE: $389,000.00 AS-IS
Seller agrees to convey and transfer the property as a vacant parcel to Buyer, and Buyer
agrees to receive and accept from the Seller, all of the Seller's right,title and interest in
and to the Real Property subject to the terms, conditions and provisions acceptable to the
parties.
Page 2 of 4
VALIANT
:.RT E A LTY PR
DEVELOPER:
VMG Construction, Inc.
By: Date:
Print Name:
As its:
The undersigned Donor accepts the foregoing LOI as the basis for a proposed transaction.
DONOR:
Rob Frank, City of Ocoee
By: Date:
Print Name:
As its:
Page 3 of 4
VALIANT
REALTY GROUP
Exhibits
1. 2 N Bluford Letter of Understanding
2. Proposed Conceptual design
Page 4 of 4
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VALIANT
•R: E _ALTY G: R.O: UP
Thursday, April 15, 2021
Sent Via E-Mail: craig.shadrix@ci.ocoee.fl.us
Craig Shadrix
C/O Rob Frank
City of Ocoee
150 N Lakewood Ave.
Ocoee, FL 34761
RE: VMG Construction, Inc., to purchase - 2 N Bluford Ave., Ocoee FL 34761
Dear Mr. Frank:
I have enclosed with this letter an LOI in consideration of VMG Construction, Inc., to purchase
the property located at 2 North Bluford Ave., Ocoee, FL 34761. If you have any questions
concerning this LOI please contact me to discuss.
Otherwise, please send me your response to this LOI within three business days of receipt of this
letter.
I will contact you shortly after we receive your response, and we appreciate your prompt attention
to this matter.
Sincerely,
Lou Forges
Broker&Managing Partner
lou@valiantrealtygrp.com
407-592-7710
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