HomeMy WebLinkAboutEmergency Item - Crown Point Land Sale to Centex Homes
AGENDA ITEM COVER SHEET
Contact Name:
Contact Number:
Russell B. Wagner, AICP
(407) 905-3157
Meeting Date: October 2, 2007
Item # Ern~c'l r-f.ewa
Reviewed By:
Department Director:
City Manager:
Subject: Crown Point Land Sale to Centex Homes
Background Summary:
On Wednesday, September 26, 2007, Staff met with Centex Homes representatives to discuss the status of the
purchase agreement for the Crown Point Property. Since the Phase I closing date was originally set to expire
on September 28, 2007, Staff wanted to discuss the status of the current housing market with Centex to
determine whether they intended to still pursue development of the property. The attached memorandum from
Paul Rosenthal summarizes that discussion which indicated that Centex Homes absolutely wishes to proceed
with the project with some slight modifications related to timing and product mix. Based upon this information,
Staff believes that it is in the best interest of the City to grant a modest 90 day extension of time to permit
Centex Homes to tweak some of the project details and propose a game-plan going forward that would be
financially feasible to both parties.
Issue:
Should the Honorable Mayor and City Commissioners approve an extension to the Purchase Agreement with
Centex Homes?
Recommendations:
Staff respectfully recommends that the Mayor and City Commissioners approve the First Amendment to the
Centex Homes Agreement For Sale and Purchase and authorize the execution thereof by the Mayor and City
Clerk.
Attachments:
City Attorney Memorandum
First Amendment to Agreement For Sale and Purchase
Financial Impact:
None
Type of Item: (please mark with an "x')
Public Hearing
Ordinance First Reading
Ordinance Second Reading
Resolution
X Commission Approval
Discussion & Direction
For Clerk's Deot Use:
_ Consent Agenda
_ Public Hearing
_ Regular Agenda
~ Original Document/Contract Attached for Execution by City Clerk
_ Original Document/Contract Held by Department for Execution
Reviewed by City Attorney
Reviewed by Finance Dept.
Reviewed by 0
N/A
N/A
N/A
: FOLEY
FOLEY & LARDNER LLP
ATTORNEYS AT LAW
MEMORANDUM
CLIENT-MATTER NUMBER
020377-0781
TO:
The Honorable Mayor and City Commissioners of the City of Ocoee
FROM:
Paul E. Rosenthal, Esq., City Attorney
cc:
Rob Frank
Jamie Croteau
Russ Wagner
DATE:
September 27,2007
RE:
Crown Point Residential: Sale to Centex Homes / First Amendment to Purchase
Agreement
The City and Centex Homes previously entered into a Purchase Agreement dated
February 20, 2007 for the sale and purchase of the Crown Point PUD residential property owned
by the City. The Purchase Price under the Agreement is $12,500,000 and the Phase 1 Closing
Date is scheduled to be no later than September 28,2008. Centex has delivered $210,000 in
deposits to the City which are at risk and nonrefundable except in the event of a default by the
City. The Feasibility Period will expire on September 28,2007 at which time Centex is
obligated to deliver to the City a Third Deposit in the amount of $1 ,040,000.
On September 26, Jamie Croteau, Russ Wagner and I meet with representatives of
Centex Homes. They discussed the changed and changing market conditions for single family
homes in Central Florida and nationally. They advised that Centex was not in a position to
deliver to the City the Third Deposit, or any portion thereof, and that if the City required an
additional deposit at this time that Centex would need to terminate the contract. They also
advised that if they stayed in the deal that they would need to negotiate amendments to the
contract in order to fit it within Centex's current business model. An overview of these changes
was presented. Centex advised that they would maintain the neo-traditional approach, but would
need to rework the Conceptual Site Plan and housing product mix proposed for the project.
Centex also advised that they would need to work with us on the timing of the closings to better
match the recovery of the housing market.
City staff reacted favorably to the changes discussed by Centex and expressed a
willingness to work with them on a contract amendment to be presented to the City Commission
in January 2008. Centex indicated a willingness to devote resources to undertaking the work
which would be involved in a contract amendment. We mutually agreed that the details could be
worked out between the staffs for presentation to the City Commission at it's January 15, 2008
ORLA_595045.1
: FOLEY
FOLEY & LARDNER LLP
meeting. We advised Centex that while the City has some flexibility and could provide time
extensions while the real estate market recovered, we could not renegotiate the Purchase Price
since the contract was awarded through a competitive process.
Staff attempted to negotiate an additional deposit at this time, but was advised that
upper management was not providing any capital for new deals at this time and that they would
need to terminate if the City required an additional deposit at this time. Staff agreed to support
the 3 1'2 month extension with the caveat that we would not support any further extensions
without the payment of additional at risk deposits.
Attached hereto is a proposed First Amendment to the Purchase Agreement which
extends the Feasibility Period to January 18,2008.
RECOMMENDATION:
The City staff recommends that the City Commission approve the First
Amendment to the Purchase Agreement and authorize the execution thereof by the Mayor and
City Clerk.
Encl.
2
ORLA_595045.1
FIRST AMENDMENT TO AGREEMENT FOR SALE AND PURCHASE
This First Amendment (this "Amendment") is made and entered as of the 28th day of
September, 2007 by and between CITY OF OCOEE, FLORIDA (hereinafter referred to as
"Seller"), and CENTEX HOMES (hereinafter referred to as "Buyer").
PREMISES:
WHEREAS, Seller and Buyer have entered into that certain Agreement for Sale and
Purchase dated February 20, 2007 (the" Agreement"); and
WHEREAS, Buyer and Seller have agreed to amend certain terms and provisions of
the Agreement.
WIT N E SSE T H:
NOW, THEREFORE, for and in consideration of the sum of Ten Dollars ($10.00)
and other good and valuable considerations, the receipt and sufficiency of which are hereby
acknowledged, Buyer and Seller hereby agree as follows:
1. The above recitals are true and correct and are incorporated herein by reference.
2. All capitalized terms used herein shall be as defined in the Agreement unless
otherwise indicated or defined in this Amendment.
3. Paragraph 8(A) of the Agreement is hereby amended to extend the Feasibility
Period from September 28, 2007 to January 18, 2008, so that the first sentence of said
Paragraph 8(A) will read as follows: "Buyer shall have until 5:00 p.m. on January 18, 2008
(the "Feasibility Period") within which to investigate the physical and economic feasibility of
developing the Property for residential purposes in accordance with the Centex Conceptual
PIan. "
3. Except as amended hereby, the Agreement remains unchanged and in full force
and effect, and each of the parties hereto hereby ratifies and confirms the terms and conditions
of the Agreement. All references herein to the Agreement shall refer to the Agreement as
amended by this Amendment unless the text or context indicates otherwise. In the event of any
conflict between the Agreement and this Amendment it is agreed that this Amendment shall
contro1.
4. This Amendment shall become effective as of September 28, 2007
notwithstanding the date of actual execution by the parties hereto.
5. This Amendment may be executed in any number of counterparts, each of which
shall be deemed to be an original instrument, but all such counterparts shall constitute one and
ORLA_595030.1
the same instrument. Facsimile copies of this Amendment and any signatures thereon shall for
all purposes be considered as originals, provided that each of the parties hereto delivers an
executed counterpart original of this Amendment to the other party by overnight courier within
three (3) business days after the date of execution of the facsimile copy of this Amendment.
IN WITNESS WHEREOF, the Seller and Buyer have caused this Amendment to be
executed in their names by their proper officers, members, managers, agents or representatives
thereunto duly authorized as of the day and year first above written.
SELLER:
ATTEST:
CITY OF OCOEE, FLORIDA
By:
Beth Eikenberry, City Clerk
S. Scott Vandergrift, Mayor
(SEAL)
FOR USE AND RELIANCE ONLY BY
THE CITY OF OCOEE, FLORIDA;
APPROVED AS TO FORM AND
LEGALITY this day of
October 2007.
APPROVED BY THE OCOEE CITY
COMMISSION AT A MEETING
HELD ON October 2, 2007
UNDER AGENDA ITEM NO.
FOLEY & LARDNER LLP
By:
City Attorney
BUYER:
CENTEX HOMES, a Nevada general partnership
By: CENTEX REAL ESTATE
CORPORATION, a Nevada corporation,
Managing general partner
By:
Name:
Title:
ORLA_595030.1
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ORLA_595030.1
Date:
-3-