HomeMy WebLinkAbout5B1 Real Estate Option Agreement Heading for Home LLCS& T$ B
Department of
Community
1865
Investment
Redevelopment Commission Agenda Item
DATE: October 13, 2016
FROM: Brian Pawlowski, Interim Executive Director
SUBJECT: Real Estate Option Agreement (Heading for Home LLC)
This Real Estate Option Agreement (Agreement) is for the former Michiana Lock & Key
and Studebaker Museum properties, located in the 500 block of S. Lafayette & Main
streets. Both sites are vacant land.
The Agreement gives Heading for Home LLC an option to purchase these sites through
March 31, 2018. Two one year extensions may be granted, with a year one extension
payment of $5,000 and a year two extension of $10,000. If exercised, the option price
would be $1 and include a written explanation and, as applicable, a graphical depiction
for the planned use.
Staff requests approval of this Agreement.
INTERNAL USE ONLY: Project Code:
Total Amount new /change (inc /dec) in budget: ; broken down by:
Acct # various
Going to BPW for Contracting? Is this item ready to encumber now?
Existing PO# Inc /Dec $
227 W. JEFFERSON BLVD. SOUTH BEND, IN 46601 1 P: 574 - 235 -9371 1 FAX: 574- 235 -9021 1 SOUTHBENDIN.GOV
REAL ESTATE OPTION AGREEMENT
This Option Agreement (this "Option Agreement ") is made as of September 29, 2016
(the "Effective Date ") by and between the South Bend Redevelopment Commission, governing
body of the City of South Bend Department of Redevelopment (the "Commission "), and
Heading for Home LLC, a Delaware limited liability company with offices at 501 W. South St.,
South Bend, Indiana 46601 (the "Company ") (each a "Party" and collectively the "Parties ").
RECITALS
A. The Commission exists and operates pursuant to the Redevelopment of Cities and
Towns Act of 1953, as amended, being Ind. Code 36 -7 -14 (the "Act ").
B. In furtherance of its purposes under the Act, the Commission owns certain real
property located in South Bend, Indiana, and more particularly described and designated as
Parcels 1 through 7 in attached Exhibit A (collectively, the "Property ").
C. Pursuant to the Act, the Commission adopted Resolution Number 3286 on April
15, 2015, whereby the Commission established the minimum offering price of Thirty -One
Thousand Five Hundred Dollars ($31,500.00) for the portion of .the Property designated in
Exhibit A as Parcel 1.
D. Pursuant to the Act, on April 24, 2015, and May 1, 2015, the Commission
publicized its intent to sell Parcel 1 and invited bids for the purchase of Parcel 1 to be submitted
by May 14, 2015, at 9:00 a.m.
E. As of May 14, 2015, at 9:00 a.m., the Commission received no bids for Parcel 1,
and, therefore, the Commission, having satisfied the conditions stated in Section 22 of the Act,
now desires to grant to the Company an option to purchase Parcel 1 on the terms stated in this
Option Agreement.
F. Pursuant to the Act, the Commission adopted Resolution Number 3333 on March
24, 2016, whereby the Commission established the minimum offering price of Two Hundred
Eighty Thousand Dollars ($280,000.00) for the portion of the Property designated in Exhibit A
as Parcels 2 through 7, collectively.
G. Pursuant to the Act, on April 1, 2016, and April 8, 2016, the Commission
publicized its intent to sell Parcels 2 through 7 and invited bids for the purchase of Parcels 2
through 7 to be submitted by April 28, 2016, at 9:00 a.m.
H. As of April 28, 2016, at 9:00 a.m., the Commission received no bids for any of
Parcels 2 through 7, and, therefore, the Commission, having satisfied the conditions stated in
Section 22 of the Act, now desires to grant to the Company an option to purchase Parcels 2
through 7 on the terms stated in this Option Agreement.
1
I. Resolution Numbers 3286 and 3333 are collectively attached hereto as Exhibit B
and, taken together, establish the minimum offering price of Three Hundred Eleven Thousand
Five Hundred Dollars ($311,500.00) for the Property.
NOW, THEREFORE, in consideration of the sum of One Dollar ($1.00) and other
valuable consideration, the adequacy of which is hereby acknowledged, the Parties agree as
follows:
1. Exclusive Option to Purchase. The Commission hereby grants the Company an
exclusive option to purchase the Property, subject to the terms and conditions stated in this
Option Agreement (the "Option ").
2. Option Period. The Company must exercise the Option, if at all, on or after the
Effective Date of this Option Agreement and no later than March 31, 2018 (the "Option
Period "), provided, however, that the Option Period may be extended for no more than two (2)
additional terms of one (1) year each. If the Company desires to extend the Option Period
through and including March 31, 2019, the Company will deliver to the Commission by
February 1, 2018, (i) a payment in the amount of Five Thousand Dollars ($5,000.00) and (ii) a
written report concerning any development prospects or plans for the Property. If the Company
desires to extend the Option Period through and including March 31, 2020, the Company will
deliver to the Commission by February 1, 2019, (i) a payment in the amount of Ten Thousand
Dollars ($10,000.00) and (ii) a written report concerning any development prospects or plans for
the Property. Notwithstanding any provision herein to the contrary, this Option Agreement and
all rights hereunder will terminate immediately in the event of any conveyance, transfer, or
assignment that causes Andrew T. Berlin not to have a majority ownership interest in the minor
league baseball team currently known as the South Bend Cubs, which is a Class A Minor League
Franchise in the Midwest League of Professional Baseball Clubs, Inc., a member of the National
Association of Professional Baseball Leagues, Inc. (the "Team "). The preceding sentence shall
not apply to any conveyance, transfer, or assignment for bona fide estate planning purposes of
such majority ownership interest in the Team that does not cause Andrew T. Berlin to lose
management control of the Team.
3. Exercise of Option. The Company may exercise the Option by giving to the
Commission written notice (as provided in Section 12) of its intent to purchase the Property (the
"Notice of Intent "). The Notice of Intent will include a written explanation and, as applicable, a
graphical depiction of the Company's planned use of the Property after acquiring it from the
Commission.
4. Purchase Price. In the event the Company exercises the Option, the Commission
will sell the Property to the Company for the purchase price of One Dollar ($1.00) (the
"Purchase Price "), in accordance with the terms of the purchase agreement to be prepared as
described in Section 5 below.
5. Purchase Agreement and Closing. If the Company exercises the Option, the
Commission and the Company will promptly negotiate the terms of a purchase agreement for the
Property. The Commission and its counsel shall be responsible for preparing the initial draft of
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the purchase agreement, which will be in a form customary for transactions of similar scope and
significance to the Parties and will include customary representations, warranties, indemnities,
covenants, conditions of closing, and other customary matters. The Company will pay all
closing costs, recording fees, and title company charges arising out of the closing.
6. Interim License; Indemnity. The Commission hereby grants to the Company a
license to use the Property for the limited purpose of vehicular parking for the Team's guests
during all events at Four Winds Field, including, but not limited to, the Team's home games (the
"License "). Unless earlier revoked by the Commission, the License will terminate immediately
upon the termination of this Option Agreement or the closing described in Section 5, as the case
may be. The Company will indemnify, defend, and hold harmless the Commission and the City
of South Bend from and against any claims, liabilities, or losses of any kind suffered by the
Commission or the City of South Bend arising out of the Company's use of the Property under
the License herein granted.
7. Recording of Memorandum. The Parties agree to execute and record in the Office
of the Recorder of St. Joseph County, Indiana, a memorandum of this Option Agreement in the
form attached hereto as Exhibit C (the "Memorandum "). The Company will pay all recording
fees associated with the Memorandum.
8. Governing Law. This Option Agreement will be governed by and construed in
accordance with the laws of the State of Indiana.
9. Benefit of the Parties. This Option Agreement is made solely for the benefit of
the Parties, and no one else shall acquire or have any right under (or by virtue of) this Option
Agreement, except as expressly provided herein.
10. Binding Effect and Assignment. This Option Agreement shall be binding upon
and inure to the benefit of the Parties and their respective successors and assigns. The Company
may not assign this Option Agreement to any other party without the Commission's prior written
consent, except that the Commission's prior written consent will not be required in the event of a
conveyance, transfer, or assignment permitted in accordance with the last sentence of Section 2
above.
11. Amendment. This Option Agreement may be amended only by a written
instrument signed by authorized representatives of both Parties.
12. Notices. All notices and other communications required or permitted under this
Option Agreement will be in writing and will be furnished by hand delivery or by registered or
certified mail to the Parties at the addresses set forth below. Any such notice shall be duly given
upon the date it is delivered to the addresses shown below, addressed as follows:
Commission: South Bend Redevelopment Commission
1400 S. County -City Building
227 W. Jefferson Blvd.
South Bend, IN 46601
3
Attn: Executive Director of Community Investment
With a copy to: South Bend Legal Department
1200 S. County -City Building
227 W. Jefferson Blvd.
South Bend, IN 46601
Attn: Corporation Counsel
Company: Heading for Home LLC
501 W. South St.
South Bend, IN 46601
Attn: Joe Hart
With a copy to: Faegre Baker Daniels LLP
202 S. Michigan St., Suite 1400
South Bend, IN 46601
Attn: Anne E. Fischesser, Esq.
13. Severability. If any term, provision, covenant, or restriction contained in this
Option Agreement that is intended to be binding and enforceable is held by a court of competent
jurisdiction to be invalid, void, or unenforceable, the remainder of the terms, provisions,
covenants, and restrictions contained in this Option Agreement will remain in full force and
effect and will in no way be affected, impaired, or invalidated.
14. Entire Agreement; Recitals; Exhibits. This Option Agreement contains the entire
agreement between the Parties with respect to the subject matter hereof and supersedes all prior
or contemporaneous written or oral agreements or understandings of any kind between the
Parties with respect to the subject matter hereof. The exhibits attached hereto and the recitals set
forth above are incorporated into this Option Agreement by reference.
15. Authority. The undersigned persons executing and delivering this Option
Agreement on behalf of each of the Parties represent and certify that they are the duly authorized
officers of such respective Party and have been fully empowered to execute and deliver this
Option Agreement on behalf of such Party and that all necessary action to execute and deliver
this Option Agreement has been taken by such Party.
16. Counterparts; Facsimile Signatures. This Option Agreement may be executed in
any number of counterparts, each of which shall be deemed an original but all of which together
shall constitute one and the same instrument. Any electronic version of a manually executed
original shall be deemed a manually executed original.
[Signature page follows.]
11
IN WITNESS WHEREOF, the Parties have executed this Real Estate Option Agreement
to be effective as of the Effective Date stated above.
SOUTH BEND REDEVELOPMENT
COMMISSION
Marcia I. Jones, President
ATTEST:
Donald E. Inks, Secretary
4000.0000069 35206453.005
HEADING FOR HOME LLC
Andrew T. Berlin, Manager
Exhibit A
Description of Property
Parcel 1
Lot 4 of the plat of Coveleski Park Minor Subdivision recorded on February 11, 2015, as
Document No. 1503430 in the Office of the Recorder of St. Joseph County, Indiana. [Parcel Key
No. 018 - 3014 - 051503]
Parcel 2
Lots Numbered Fifty -five (55), Fifty -six (56) and Fifty -seven (57) as shown on the recorded Plat
of Samuel Martin's Addition to the Town, now City of South Bend, together with the West half
of the vacated alley lying East and adjacent and also the North half of the vacated alley lying
South and adjacent to said lots. [Parcel Key No. 018 - 3015- 056301]
Parcel 3
Lots Numbered Fifty -eight (58), Fifty -nine (59) and Sixty (60) as shown on the recorded Plat of
Samuel Martin's Addition to the Town, now City of South Bend, recorded in the Office of the
Recorder of St. Joseph County, Indiana, in Plat Book 3, Page 28, together with the West half of
the vacated alley lying East of and adjacent to said Lots and together with the South half of the
vacated alley lying North of and adjacent to said Lot Fifty -eight (58). [Parcel Key No. 018-
3015 -0563]
Parcel 4
Lots Numbered Forty -six (46), Forty -seven (47) and Forty -eight (48) as shown on the recorded
Plat of Samuel Martin's Addition to the Town, now City of South Bend, recorded in the Office
of the Recorder of St. Joseph County, Indiana, in Plat Book 3, page 28, together with the East
half of the vacated alley lying West of and adjacent to Lots Numbered Forty -six (46), Forty -
seven (47) and Forty -eight (48) and together with the South half of the vacated alley lying North
of and adjacent to said Lot Forty -six (46). [Parcel Key No. 018 - 3015 -0581]
Parcel 5
A lot or parcel of land 31 feet in width, taken off of and from the South side of Lot Numbered
Forty -five (45) as shown on the recorded Plat of Samuel Martin's Addition to the Town, now
City of South Bend, together with the East half of the vacated alley lying West and adjacent to
said lot and the North half of the vacated alley lying South and adjacent to said lot. [Parcel Key
No. 018- 3015 -05801
Parcel 6
Lot Numbered Forty -five (45) as shown on the recorded Plat of Samuel Martin's Addition to the
Town, now City of South Bend, excepting 3 feet in width North and South taken off of and from
the entire length of the North side, and also excepting 31 feet in width North and South taken off
of and from the entire length of the South side of said lot, together with the East half of the
vacated alley lying West and adjacent to said lot. [Parcel Key No. 018 - 3015 -0579]
A -1
Parcel 7
The South half of Lot Numbered Forty -four (44) and a parcel of land 3 feet in width, North and
South, taken off of and from the entire length of the North side of Lot Numbered 45, all as
shown on the recorded Plat of Samuel Martin's Addition to the Town, now City of South Bend,
together with the East half of the vacated alley lying West and adjacent to said lot. [Parcel Key
No. 018 - 3015 -0578]
WJ
Exhibit B
South Bend Redevelopment Commission Resolution Numbers 3286 and 3333
[See attached.]
RESOLUTION NO. 3286
RESOLUTION OF THE SOUTH BEND REDEVELOPMENT
COMMISSION APPROVING THE FAIR MARKET VALUE OF
PROPERTY IN THE RIVER WEST DEVELOPMENT AREA.
WHEREAS, the property identified at Exhibit "A" attached hereto and
incorporated herein has been appraised by two qualified, independent, professional real
estate appraisers and a written and signed copy of their appraisals is contained in the
Commission's files; and
WHEREAS, each such appraisal has been reviewed by a qualified
Redevelopment staff person and no corrections, revisions, or additions were requested
by such reviewer; and
WHEREAS, the reviewer has prepared a written report which indicates that the
appraisals are complete and consistent in the factual data contained therein, comply
with existing statutory and regulatory requirements and are acceptable for the
determination of fair market value.
NOW, THEREFORE, BE IT RESOLVED by the South Bend Redevelopment
Commission, governing body of the City of South Bend Department of Redevelopment,
that based upon such appraisals and the review thereof, the offering price of the
property described at Exhibit "A" is hereby established as stated therein and all
documentation related to such determination is contained in the Commission's files.
ADOPTED at a meeting of the South Bend Redevelopment Commission held on
April 15, 2015, at 1308 County -City Building, 227 West Jefferson Boulevard, South
Bend, Indiana 46601.
CITY OF SOUTH BEND
DEPARTMENT OF REDEVELOPMENT
`-� id A. Varner, Vice - President
ATnalcd T: /
�4
D E. Inks, Secretary,
EXHIBIT "A"
RESOLUTION NO. 3286
Property
Size
Minimum Offering
Price
proposed Use
Lot 4 of the Coveleski
Lot: I $31,500
Commercial projects
Park Minor Subdivision
that are permitted within
11,761 SF
the Central Business
District zoning
designation.
.27 Acres +/-
Strong emphasis will be
placed during the review
process on compatibility
with the goals and
objectives of the River
West Development
Area; Coveleski Park
Planning Area; and the
surrounding
neighborhood.
RESOLUTION NO. 3333
RESOLUTION OF THE SOUTH BEND REDEVELOPMENT
COMMISSION ESTABLISHING THE OFFERING PRICE OF
PROPERTY IN THE RIVER WEST DEVELOPMENT AREA
WHEREAS, the South Bend Redevelopment Commission (the "Commission "),
the governing body of the City of South Bend, Department of Redevelopment, exists
and operates pursuant to I.C. 36 -7 -14 (the "Act "); and
WHEREAS, the Commission may dispose of real property in accordance with
Section 22 of the Act; and
WHEREAS, the real property identified at Exhibit A attached hereto and
incorporated herein has been appraised by two qualified, independent, professional real
estate appraisers and a written and signed copy of their appraisals is contained in the
Commission's files; and
WHEREAS, each such appraisal has been reviewed by a qualified
Redevelopment staff person, and no corrections, revisions, or additions were requested
by such reviewer.
NOW, THEREFORE, BE IT RESOLVED by the Commission, pursuant to Section
22 of the Act, that based upon such appraisals, the offering price of the property
described at Exhibit A is hereby established as stated therein, which amount is not less
than the average of the two appraisals, and all documentation related to such
determination is contained in the Commission's files.
ADOPTED at a meeting of the South Bend Redevelopment Commission held on
March 24, 2016, at 1308 County -City Building, 227 West Jefferson Boulevard, South
Bend, Indiana 46601.
SOUTH BEND REDEVELOPMENT
COMMISSION
Marcia I. Jones, sident
AT ST:
D nald El . Inks, Secretary
EXHIBIT A
TO RESOLUTION NO. 3333
Property
Size
Minimum Offering
Price
proposed Use
500 Block S. Lafayette &
East Tract
East Tract
Commercial projects that
Main
1.23 acres
$127,50 0
are permitted within the
Central Business District
West Tract
West Tract
zoning designation.
1.62 acres
$130,00 0
Strong emphasis will be
placed during the review
Total
Total
process on compatibility
2.85 acres
$280,00 0
with the goals and
objectives of the River
West Development Area;
the planning efforts of the
Central Business District
and Coveleski Stadium
area; and the surrounding
neighborhood.
Exhibit C
Memorandum of Option Agreement
MEMORANDUM OF REAL ESTATE OPTION AGREEMENT
This Memorandum of Real Estate Option Agreement (this "Memorandum ") is entered
into as of September 29, 2016 (the "Effective Date "), by and between the South Bend
Redevelopment Commission, governing body of the City of South Bend Department of
Redevelopment (the "Commission "), and Heading for Home LLC, a Delaware limited liability
company with offices at 501 W. South St., South Bend, Indiana 46601 (the "Company ") (each a
"Party" and collectively the "Parties ").
WITNES SETH
A. The Commission owns certain real property located in South Bend, Indiana, and
more particularly described in attached Exhibit 1, (the "Property ").
B. As of the Effective Date hereof, the Commission and the Company have entered
into a Real Estate Option Agreement (the "Option Agreement ") whereby the Commission
granted the Company an exclusive option (the "Option ") to purchase the Property upon terms
and conditions more particularly stated in the Option Agreement.
C. The Parties desire to place their interests in the Property as a matter of record.
NOW, THEREFORE, the Parties state as follows:
1. The initial term of the Option will commence on the Effective Date and conclude
on March 31, 2018, unless earlier terminated pursuant to the terms of the Option Agreement.
The initial term of the Option may be extended by the Company for no more than two (2)
additional terms of one (1) year each.
2. This Memorandum may be executed in any number of counterparts, each such
counterpart, when so executed and delivered, shall be an original, but all such counterparts when
taken together shall constitute but one and the same Memorandum.
3. The recitals set forth above are hereby incorporated herein by reference.
[Signature pages follow.]
1
IN WITNESS WHEREOF, the Parties have executed this Memorandum of Real Estate
Option Agreement to be effective as of the Effective Date stated above.
SOUTH BEND
REDEVELOPMENT COMMISSION
Marcia I. Jones, President
ATTEST:
Donald E. Inks, Secretary
STATE OF INDIANA )
) SS:
ST. JOSEPH COUNTY )
Before me, the undersigned, a Notary Public, in and for said County and State, personally
appeared Marcia I. Jones and Donald E. Inks, known to me to be the President and Secretary,
respectively, of the South Bend Redevelopment Commission and acknowledged the execution of
the foregoing Memorandum of Real Estate Option Agreement.
IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed my official
seal on the day of , 2016.
My Commission Expires:
Notary Public
Residing in St. Joseph County, Indiana
2
HEADING FOR HOME LLC
Andrew T. Berlin, Manager
STATE OF INDIANA )
) SS:
ST. JOSEPH COUNTY )
Before me, the undersigned, a Notary Public, in and for said County and State, personally
appeared Andrew T. Berlin, known to me to be the Manager of Heading for Home LLC and
acknowledged the execution of the foregoing Memorandum of Real Estate Option Agreement.
IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed my official
seal on the day of 12016.
My Commission Expires:
Notary Public
Residing in St. Joseph County, Indiana
I affirm, under the penalties for perjury, that I have taken reasonable care to redact each Social Security number in this document, unless required
by law. Benjamin J. Dougherty.
This instrument was prepared by Benjamin J. Dougherty, Assistant City Attorney, 1200 S. County -City Building, 227 W. Jefferson Blvd., South
Bend, Indiana 46601.
Exhibit 1
Description of Property
Parcel 1
Lot 4 of the plat of Coveleski Park Minor Subdivision recorded on February 11, 2015, as
Document No. 1503430 in the Office of the Recorder of St. Joseph County, Indiana. [Parcel Key
No. 018 - 3014 - 051503]
Parcel 2
Lots Numbered Fifty -five (55), Fifty -six (56) and Fifty -seven (57) as shown on the recorded Plat
of Samuel Martin's Addition to the Town, now City of South Bend, together with the West half
of the vacated alley lying East and adjacent and also the North half of the vacated alley lying
South and adjacent to said lots. [Parcel Key No. 018 - 3015- 056301]
Parcel 3
Lots Numbered Fifty -eight (58), Fifty -nine (59) and Sixty (60) as shown on the recorded Plat of
Samuel Martin's Addition to the Town, now City of South Bend, recorded in the Office of the
Recorder of St. Joseph County, Indiana, in Plat Book 3, Page 28, together with the West half of
the vacated alley lying East of and adjacent to said Lots and together with the South half of the
vacated alley lying North of and adjacent to said Lot Fifty -eight (58). [Parcel Key No. 018-
3015 -0563]
Parcel 4
Lots Numbered Forty -six (46), Forty -seven (47) and Forty -eight (48) as shown on the recorded
Plat of Samuel Martin's Addition to the Town, now City of South Bend, recorded in the Office
of the Recorder of St. Joseph County, Indiana, in Plat Book 3, page 28, together with the East
half of the vacated alley lying West of and adjacent to Lots Numbered Forty -six (46), Forty -
seven (47) and Forty -eight (48) and together with the South half of the vacated alley lying North
of and adjacent to said Lot Forty -six (46). [Parcel Key No. 018 - 3015 -0581]
Parcel 5
A lot or parcel of land 31 feet in width, taken off of and from the South side of Lot Numbered
Forty -five (45) as shown on the recorded Plat of Samuel Martin's Addition to the Town, now
City of South Bend, together with the East half of the vacated alley lying West and adjacent to
said lot and the North half of the vacated alley lying South and adjacent to said lot. [Parcel Key
No. 018 - 3015 -0580]
Parcel 6
Lot Numbered Forty -five (45) as shown on the recorded Plat of Samuel Martin's Addition to the
Town, now City of South Bend, excepting 3 feet in width North and South taken off of and from
the entire length of the North side, and also excepting 31 feet in width North and South taken off
of and from the entire length of the South side of said lot, together with the East half of the
vacated alley lying West and adjacent to said lot. [Parcel Key No. 018- 3015 -0579]
1 of 2
Parcel 7
The South half of Lot Numbered Forty -four (44) and a parcel of land 3 feet in width, North and
South, taken off of and from the entire length of the North side of Lot Numbered 45, all as
shown on the recorded Plat of Samuel Martin's Addition to the Town, now City of South Bend,
together with the East half of the vacated alley lying West and adjacent to said lot. [Parcel Key
No. 018- 3015 -0578]
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