6.B.(5) Real Estate Purcahse and Site Work Agreement

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The 1 100 Corporation will be allowed to excavate sand from an adjacent lot which is where the City's expansion of the existin~~ retention pond will take place. Consh•uction of the new building is to begin no later than August 1, 2009 and qualify for a Cei-titicate of Completion within 12 months. Description of Project: • The 1100 Corporation or a successor real estate holding company will construct a 36,000 s.f. building in the Oliver Indush•ial Park that will be leased to Underground Pipe and Valve, Inc. The building will be a single level pre-engineered steel building with two sections; a basic shop area and an office section. The majority of the shop area, 23,197 square feet, will be heated and cooled with the remaining shop area unheated. The office area will consist of 7,270 square feet. There will be 14 private offices with reception, conference, workroom, break room, and resti-oom uses. An asphalt parking area will sui7•ound all four sides of the building with the area to the north capable of handling heavy truck parking. The entire site will be fenced. Decorative masonry pillars will be located on the south fence line. • The estimated cost of the new construction is just over $2,000,000. • Underground Pipe & Valve, Inc. has been in business since 1977. The company is a distributor of pipes, valves, and lift station equipment. Other product lines include; automatic meter reading systems, line stops, PVC water and sewer pipe, fire hydrants, water meters, manhole frames and covers, back flow preventers, couplings and grinders. The company has distribution centers in Fort Wayne, Kalamazoo and Schererville. It has fifty employees, 27 of whom work at the Prairie Avenue location. Staff Comments: The purchase price of $1,625,000 was negotiated and includes compensation for the approximately five acres of heavy duty paving, additional fencing with masonry pillars on the south side of the property and landscaping that the City required for the storage yard. In addition, they have agreed to not request tax abatement for the construction of the 36,000 square foot building. A map showing the current and new location of Underground Pipe & Valve is attached to this report. Funding Source: Funds ti•om the U.S. Department of Housing and Urban Development for the Studebaker/Oliver Development Project will be used for property acquisition and relocation. The Section 108 Loan has funds budgeted for this acquisition and relocation. Additional funds fi•om HUD's Economic Development Initiative grant will be used for site prep at the Oliver site. Staff Recommendation: The staff recommends approval of the Agreement. Underground Pipe & Valve is a strong, locally owned business. This Agreement allows them to relocate to a nearby location in order to continue to serve their customers and provide tax base and jobs to the City of South Bend. Purchase of the former foundry will complete the Commission's acquisition of former Studebaker buildings south of Sample Street. It will further the goals of City Plan by redeveloping a brownfield site and retaining an existing business within South Bend.