HomeMy WebLinkAboutrda min 1984/02/07
MINUTES OF AN ADJOURNED REGULAR MEETING OF THE REDEVELOPMENT AGENCY
OF THE CITY OF CHULA VISTA, CALIFORNIA
Tuesday, February 7, 1984 Counci1 Chamber
9:30 p.m. (following Council meeting) Pub1ic Services Bui1ding
ROLL CALL
MEMBERS PRESENT Cha irman Cox; Members Scott, Ma1c01m, Moore,
McCand 1i s s
ST AFF PRESENT Executive Director Goss, Community Deve10pment
Director Desrochers, City Attorney Harron
ALSO PRESENT Michae1 Green, Attorney for Eye Physician's Group;
Jeff Phair, Broker for Peiri-Debbas Enterprises
ITEM NO. 1
APPROVAL OF AGREEMENT SUBJECT TO INSPECTION OF FINANCIAL CAPABILITY OF EYE
PHYSICIAN'S GROUP
Member Ma1c01m, because of a potentia1 conf] ict of interest, did not
participate on this item and 1eft the dais at this time.
Community Deve10pment Director Desrochers reported on financia1 statements of
the Eye Physician's Medica1 Group stating three of the four physicians show
net worth in high six figures and one in high five figures. The assets of
these gent1emen are varied inc1uding rea1 estate, stocks, bonds, property, and
partnership in their practice.
Jeff Phair, 5945 Steep1echase Road, Bonita, representing Pieri Debbas
Enterprises, deve10per of the new Corporate P1aza offices on Third Avenue read
an artic1e from the Star News with the heading "Medica1 Group to Look for
Restaurant Operator ."--;'Iie ãrtic 1 e was in reference to the development p 1 ans
for the City's 1.28 acre restaurant site on Bay Boulevard. Mr. Phair
indicated his client's concern regarding the newspaper article stating the
City Council had approved an agreement appointing a group of doctors to act as
developers. The asking price of $325,000 for the property is a fair market
value price; however, they have never seen a transaction where the seller paid
the buyer an option to buy the property. If one reads the article correctly,
the doctors group is willing to make a deposit for the right to find a
restaurant user for the site - but then the depos it is deducted from the
purchase pri ceo Mr. Phair stated it is a more common practice for the amount
of an option payment to reflect the increased value of the property during the
period of the option. Consequently, the buyer should be paying the City a
price which reflects the fair market value of the property at the end of the
option period. This parce1 is one of the key parce1s at the entrance to the
City of Chula Vista's future bayfront development and the concern is that this
parcel is developed correctly while at the same time resulting in a maximum
economic benefit to the City.
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Adjourned Regular Redevelopment
Agency Meeting - 2 - February 7, 1984
Mr. Phair submitted a formal letter of intent from Pieri Debbas Enterprises to
purch ase the subject property on the following terms and conditions: (1)
Purchase Price: They propose to pay the City of Chula Vista in cash $360,000
which reflects today's asking price of $325,000, a fair market value increased
at an appreciation rate of 11% for the coming year. (2) Option Payments: upon
mutua1 execution of a development agreement, they will pay the City of Chula
Vista $25,000 in cash for an option to purchase the property for a period of
six months. At the end of 6 months they wil1 pay the City an additional sum
of $25,000 in cash for one additional six month option. This amounts to
$50,000 cash option payments to the City. It will be paid in advance of each
option period and can be used by the City as it sees fit for the promotion of
the future bayfront development plan. (3) Commissions: There will be no
commission payable by the City of Chula Vista in this transaction which will
result in a savings to the City of approximate1y $20,000.
Mr. Phair added Pieri Debbas Enterprises have a vested interest in Chula Vista
with their recently completed $5 million Corporate Plaza professional office
building. They have a sincere interest in proceeding with the acquisition of
this bayfront parcel and look forward to accepting the terms and conditions of
a development agreement. Their financial statements, credit references and a
list of development experiments in their company is immediately avai1able for
review. Their check in the amount of $25,000 will be deposited in a trust
account and can be cashed immediate1y upon execution of a development
agreement between themselves and the City.
Commun ity Development Director Desrochers sa i d he had no knowl edge of the
1 etter unt i 1 this evening. He stated the City had made a commitment last
Thursday evening with the Medical Group. Mr. Phair was offered, as all
rea ltors were offered, a chance to provide brokerage services for the Agency
on this parcel, but not as a developer.
MSUC (Scott/McCandliss) to hold this item over for a report back next Tuesday
at the Redevelopment Agency meeting f0110wing the City Council meeting.
Agency Attorney Harron stated there have been no commitments made at this time
to do anyth ing - the City has the right to say "no" to the doctor's group.
There are no vested interests involved here and the City has a fu11 range of
options. The resolution (voted at the last Redevelopment Agency meeting) was
conditioned upon a satisfactory financial report. The City did not enter into
any commitment and whether the Agency is satisfied or not is an object i ve
decision on its part.
In response to Members' queries, Mr. Phair noted the past developments of this
enterprise in San Diego over the past ten years. In answer to Member Moore's
question, Mr. Phair stated, as a broker, he was aware the property was on the
market but understood from the request for proposals to the brokerage
community that the terms of the ava i1abi1 ity of the property would be
forthcoming; therefore, he did not feel the property had been marketed
properly. Nevertheless, they are now prepared to move quickly.
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Adjourned Regular Redevelopment
Ag ency Meet i ng - 3 - February 7, 1984
EXECUTIVE DIRECTOR'S REPORT
Executive Director Goss introduced the new Analyst, Martin Chase, who started
working this past week for the City. Mr. Chase was previously involved in
consulting work and stationed in the Bay area.
CHAIRMAN'S REPORT
a. Chairman Cox announced this is the third year in a row Chu1a Vista has
been named as "Tree City". An Arbor Day Ceremony is scheduled on March 8
at 1 p.m. in which a Flag wi11 be awarded to the City.
MEMBERS' COMMENTS
a. Member McCandliss commented as a representative of the Tree Committee,
she is proud to represent Chula Vista.
ADJOURNMENT at 9:50 p.m. to C10sed Session adjourning at 10:20 p.m. to th e
regularly scheduled Agency meeting of Thursday, February 16, 1984 at 4 p.m.
JENNIE M. FULASZ, CMC
City Clerk
f~d~.~~
PATRICIA A. GUARDACOSTA
Deputy City Clerk
WPG:0390C
PAG
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