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5011TH Department of Community Investment less Memorandum June 26, 2013 TO: Redevelopment Commission FROM: David Relos, Economic Resources Qk SUBJECT: Administrative Settlement for 725 W. Indiana Ave. This staff report is for the administrative settlement that is needed for the acquisition of 725 W. Indiana Ave., also known as Barany Sheet Metal. This property is one of the remaining properties to be acquired between Scott and Kemble streets in the Ignition Park South Expansion Area. According to the Uniform Relocation Act, an administrative settlement is authorized when negotiations exceed the market value of the property and are necessary for its acquisition. On May 30, 2013 the Commission approved Resolution No. 3141, setting the offer price for this property at $51,500, which is the average appraised value of the real estate and improvements only. This property contains three parcels that equal 14,880 square feet, or almost 1/3 acre. On this property is an industrial building containing a total of 8,400 square feet of usable space. To relocate this business, another building that could accommodate it would need to be found, and that building brought up to current building and fire codes. In addition, actual moving costs would be incurred. Current industrial zoned buildings on the market are either too large, too small, or need a large amount of work to accommodate this type of business. One possible fit currently on the market is an 8,181 square foot building for $350,000. Actual moving costs would be an additional expense. After three years of ongoing efforts to acquire and relocate this business, the property owner has agreed to a lump sum payment of $300,000. The owners will then take it upon themselves to find a location and move their business, which they have stated will stay in South Bend. Staff believes the administrative settlement of $248,500 ($300,000 less the acquisition cost of $51,500) for this business is reasonable, in light of relocation costs that would have been incurred, and requests approval to allow the acquisition of this property. 22/ W. JEFFERSON BLVD. SOUTH BEND, IN 46601 1 P: 574- 235 -9371 1 FAX: 574 - 235 -9021 1 SOUTHBENDIN.GOV