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TO: Mayor Richard C. Irvin
FROM: Bill Wiet
DATE: November 21, 2017
SUBJECT:
To acquire, through assignment from Invest Aurora, the property at 7 S Broadway, and enter a lease agreement with a tenant. The current owner agrees to open an art gallery and workshop
PURPOSE:
The City of Aurora is the majority landowner on the block, and has in the past acquired properties in this area when the opportunity presents itself. However, other than for municipal purposes, it is the City's goal to lease these properties, which is the case here. This deal will allow the City of Aurora to gain ownership of an additional parcel on the block and also fill a vacant building with a viable business. The leasee has agreed to use the space as an art gallery & workshop.
BACKGROUND:
The City has planned to take the lead in the redevelopment of this block. While most of the City-owned properties are occupied, an effort is underway to lease or occupy the remaining properties. It is anticipated that the future redevelopment may be for municipal purposes, commercial, offices, open space, parking, or a combination thereof. In the meantime, it is in the best interest of the City to lease City-owned properties. The property in question is to be leased to the previous property owner, who has agreed to open an art gallery and workshop.
DISCUSSION:
Invest Aurora took the lead in the negotiations for the acquisition of this property and lease agreement. The term is five years with two five-year extensions. Rent is $10 per month plus $175 annually in lieu of SSA tax and the annual property tax. The City of Aurora will cover the cost of roof repairs, tuck-pointing, and HVAC repairs and provide $23,000 to the tenant for tenant improvements. The city will have the right to terminate the lease with one year's notice. Tenant will receive a relocation reimbursement if the lease is terminated within the first ten years. Reimbursement is $10,000 if the lease is terminated in the first year and reduces by $1,000 per year.
Funds are available in Account Number 215-1710-417.71-01 (Cost of Land)
IMPACT STATEMENT:
The City of Aurora will acquire another parcel in preparation of redevelopment of the block and fill a currently empty storefront with a viable business that is congruent with the Downtown Masterplan. .
RECOMMENDATIONS:
That the attached Real Estate Contract for the purchase of property located at 7 South Broadway be approved by assignment from Invest Aurora, as well as the building lease agreement.
cc: Alderman O’Connor, Chairman
Alderman Mesiacos
Alderman Bugg
Alderman Mervine, Alternate
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
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A Resolution Authorizing the Assignment of Commercial Sales Contract to Purchase Real Property Located at 7 South Broadway, Aurora, Illinois, and to Lease said Property to Existing Tenant.
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WHEREAS, the City of Aurora has a population of more than 25,000 persons and is, therefore, a home rule unit under subsection (a) of Section 6 of Article VII of the Illinois Constitution of 1970; and
WHEREAS, subject to said Section, a home rule unit may exercise any power and perform any function pertaining to its government and affairs for the protection of the public health, safety, morals, and welfare; and
WHEREAS, The City of Aurora is interested in acquiring, as assignee from Invest Aurora, and Gary Brown are interested in selling the property located at 7 South Broadway, consisting of parcel number 15-22-336-004 ; and
WHEREAS, it is in the best interests of the City of Aurora and its residents to complete the acquisition of the property described above; and
WHEREAS, the existing tenants located at 7 South Broadway are interested in leasing the property and paying rent therefore, all as set forth in the attached Building Lease document; and
WHEREAS, funding for the purchase will be available for the acquisition in Account Number 215-1710-417.71-01 (Cost of Land) for a total of One Hundred And Seven Thousand Dollars ($107,000.00).
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows: That the attached Commercial Real Estate Contract for the purchase of property located at 7 South Broadway be approved by assignment from Invest Aurora, and that Richard Veenstra, Corporation Counsel, or his designee are hereby authorized to act on the City's behalf to complete the purchase of this property.
BE IT FURTHER RESOLVED that the Building Lease Agreements attached hereto and incorporated herein as if fully set forth are hereby approved
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