CR 2003-035 Purchase agreement with supervalu
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CITY OF
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HOPKINS i
March 13, 2003 Council Report 2003-035
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Approve Purchase Agreement with SuperValu, Inc. - property required for road
right-of-way purposes
Proposed Action.
Staff recommends adoption of the following motion: Move that Council approve
the purchase aqreement between the City of Hopkins and SuperValu. Inc. for the
purchase of property necessary for Excelsior Boulevard. Phase II road riqht-of-
way purposes.
Overview.
In order to construct the Excelsior Boulevard, Phase II roadway improvements, it
is necessary to acquire property from SuperValu on both the north (north annex
site) and south (freezer warehouse site) sides of Excelsior Boulevard. These
property parcels are shown in the right of way plat that City Council approved on
February 4, 2003. In the first amendment to the North Annex Redevelopment
Agreement, SuperValu agreed to convey, at no cost to the city, the necessary
north annex property. Also in this amendment, SuperValu agreed to sell the,ir
property on the south side of Excelsior Boulevard at a cost of $71 ,500. The
proposed purchase agreement was prepared by the City Attorney and conveys
the property to the City in accordance with the conditions laid out in the first
amendment to the redevelopment agreement. .
Primary Issues to Consider.
. Is the $71,500 purchase price reason~ble?
The purchase price is based on the opinion of the city's contracted licensed
appraiser. The appraiser prepared a report that includes land value calculation
and a damages estimate.
Supportinq information.
. Proposed purchase agreement
. Right-of-way plat showing SuperValu parcels
. ~ort excerpts
Steven J. Stadler, Public Works Director
Financial Impact: $ 71.500 Budgeted: Y/N l Source: TIF 2-11 fund
Related Documents (CIP, ERP, etc.):
Notes:
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PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (this "Agreement") is made as of
, 2003, between SUPERV ALU, INC., a Delaware Corporation
("Seller") and The City of Hopkins, a municipal corporation under the laws of Minnesota
("Buyer").
RECITALS
A. On July 20, 1998, Seller entered into a Redevelopment Agreement ("Redevelopment
Agreement") with the Housing and Redevelopment Authority in and for the City of Hopkins,
Minnesota (the "Authority") relating to, among other things, the proposed redevelopment of
approximately 34.39 acres of real property owned by Seller and define,d in the Redevelopment
Agreement as the North Annex Property ("North Annex Property").
B. On , 200_, Seller and the Authority entered into a First Amendment
to the Redevelopment Agreement ("First Amendment"). In Section 3 of the First Amendment,
Seller agreed to convey certain property to the City as needed for the construction of a new
intersection at Milwaukee Street and Hennepin County Road 3 to facilitate the redevelopment of
the North Annex Property. Specifically, Section 3 of the First Amendment provides Seller has
agreed to convey, at no cost to the City, a portion of the North Annex Property for road right-of-
way purposes, which portion is hereinafter defined and referred to as the "North Annex Right-of-
Way Parcel." Sect~on 3 of the First Amendment also provides Seller has agreed to sell additional
land to the City for road right-of-way purposes located south of Hennepin County Road No.3,
which land is hereinafter defined and referred to as the "Additional Right-of-Way Parcel," for a
purchase price of $71 ,500.00. Seller and Buyer are entering into this Agreement to document the
terms and conditions under which Seller is to convey the North Annex Right-of-Way Parcel and
the Additional Right-of-Way Parcel to Buyer in accordance with the Redevelopment Agreement
and the First Amendment.
In consideration of the above Recitals and of the terms, covenants and conditions of this
Agreement, Seller and Buyer agree as follows:
1. Sale of Property and Conveyance of North Annex Rig:ht-of-Way Parcel. The
permanent right-of-way parcels and temporary easements to be conveyed to the City are
described as follows:
(a) Conveyance of North Annex Rig:ht-of-Wav Parcel. Seller agrees to convey to
Buyer, at no cost to Buyer, and Buyer agrees to accept such conveyance from
Seller, fee title to the North Annex Right-of-Way Parcel. As used in this
Agreement the, term "North Annex Right-of-Way Parcel" shall mean the
permanent right-of-way area described as Parcels 29A, 29B, 290, 29D, 29E, 29F,
29G, 29H, 34A, 348 and 34C in City of Hopkins Right-of-Way Plat No. 1
("Plat"), part of which Plat is attached hereto as Exhibit A.
(b) Sale of Additional Rig:ht-of-Way Parcel and Temporary Easements. Seller
agrees to sell to Buyer, and Buyer agrees to buy from Seller,Jhe following:
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(1) Fee title to the Additional Right-of-Way Parcel. As used in this
Agreement the term "Additional Right-of-Way Parcel" shall mean the
permanent roadway right-of-way area described as Parcels 30A and 30B
in the Plat.
(2) The temporary construction easements designated in the Plat as temporary
easements 29, 29C, 29D, 29F, 30A, 30B, 34A, 34B, 34C and 34D and
depicted in the attached Exhibit A ("Easements"). The Additional Right-
of- Way Parcel and the Easements are hereinafter collectively referred to as
the "Property." The Easements shall terminate upon final completion of
the reconstruction of Hennepin County Road 3 and the intersection of
Hennepin County Road 3 and Milwaukee Street, but in any event, no later
than December 31,2004.
2. . Purchase Price and Manner of Payment. The total purchase price ("Purchase
Price") to be paid by Buyer to Seller for the Property shall be $71,500.00, all of which shall be
due and payable in cash or by wire transfer on the Closing Date specified in Section 4 of this
Agreement.
3. Contine:encies for Buver's Benefit. The obligation of Buyer to close on the
transaction described in this Agreement is subject to and contingent upon each of the following
contingencies:
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(a)
Representations and Warranties. The representations and warranties of Seller
contained in this Agreement must be true in all material respects on the date of
this Agreement and on the Closing Date as if made on the Closing Date, provided
Seller may notify Buyer, in writing, of any matters occurring after the date of this
Agreement that cause the representations and warranties of Seller not to be true
and correct in any material respect as of the Closing Date.
(b) Title. Title shall have been found acceptable, or been made acceptable as of the
Closing Date, in accordance with the requirements and terms of Section 6 of this
Agreement.
(c) Performance of Seller's Obli2ations. Seller shall have performed all of the
obligations required to be performed by Seller under this Agreement, as and when
required by this Agreement.
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(d) Inspection and Testin2. Seller shall allow Buyer, and Buyer's engineers,
surveyors, consultants and employees, access to the North Annex Right-of-Way
Parcel and the' Property without charge and at all reasonable times and upon
reasonable notice to Seller for the purpose of Buyer's inspection and testing.
Buyer shall pay all costs and expenses of such inspection and testing, and shall
indemnify, defend and hold Seller and the North Annex Right-of-Way Parcel and
the Property harmless from all costs and liabilities arising out of or relating to the
Buyer's activities and the activities of Buyer's employees, agents and contractors.
Buyer shall further repair and restore any damage to the North Annex Right-of-
Way Parcel and the Property caused by or occurring during Buyer's inspection
and testing. Seller has delivered to Buyer, prior to the date of this Agreement,
copies of all environmental engineers' or consultants' reports pertaining to the
North Annex Right-of-Way Parcel which are in Seller's possession or in the
possession of Seller's agents. Within thirty (30) days of the date of this
Agreement, Seller shall deliver to Buyer copies of all environmental engineers' or
consultants' reports, if any, pertaining to the Property which are in Seller's
possession. In addition, Buyer may obtain a Phase I Environmental Assessment
of the North Annex Right-of-Way Parcel and the Property prepared by an
environmental engineer reasonably acceptable to Buyer. Buyer shall pay the cost
of obtaining any environmental assessments to be obtained by Buyer. Buyer shall
have determined, on or before the Closing Date, that the results of and matters
disclosed by Buyer's inspection and testing of the North Annex Right-of-Way
Parcel and the Property; including, but not limited to, geotechnical and
environmental assessments tests and inspections of the North Annex Right-of-
Way Parcel and the Property are acceptable and satisfactory to Buyer, in Buyer's
sole opinion.
If any of the above contingencies have not been satisfied on or before the date applicable to such
contingency stated above, then this Agreement may be terminated, at Buyer's option, by written
notice from Buyer to Seller delivered on or before the Closing Date. Upon such termination for
any of the reasons stated in this Section 3, this Agreement shall be cancelled and neither party
will have any further rights or obligations under this Agreement. Should Buyer fail to give
written notice of termination to Seller within the time periods provided above, Buyer shall be
deemed to have waived the contingency in question. All the contingencies set forth in this
Agreement are specifically stated and agreed to be for the sole and exclusive benefit of the Buyer
and the Buyer shall have the right to unilaterally waive any contingency by written notice to
Seller.
4. Closine:. The closing of the transaction described in this Agreement (the
"Closing") shall occur on April 30, 2003 (the Closing Date"). Buyer shall be entitled to advance
the Closing Date to a date earlier than April 30, 2003, upon ten (10) days' written notice to
Seller. The Closing shall take place at the offices of the Buyer's attorneys or at such other
location as shall be mutually agreed to. Seller agrees to deliver possession of the North Annex
Right-of-Way Parcel and the Property to Buyer on the Closing Date.
A. Seller's Closine: Documents. On the Closing Date, Seller shall execute and/or
deliver to Buyer the following (collectively, "Seller's Closing Documents"). Seller's Closing
Documents shall be duly executed and, where appropriate, be in recordable form.
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(1) Limited Warranty Deed. A Limited Warranty Deed ("Limited Warranty Deed")
conveying the North Annex Right-of-Way Parcel and the Additional Right-of-
Way Parcel to Buyer, free and clear of all encumbrances, except the Permitted
Encumbrances hereinafter defined.
(2) Quit Claim Deed. A Quit Claim Deed ("Quit Claim Deed") conveying the
Easements to Buyer, free and clear of all encumbrances that may prevent the use
of the Easements for their intended purpose.
(3) Seller's Affidavit. An Affidavit of Seller in customary form with respect to
judgments, bankruptcies, tax liens, mechanics liens, parties in possession,
unrecorded interests, encroachment or boundary line questions, and related
matters.
(4) FIRPT A Affidavit. A non-foreign affidavit, properly executed and containing
such information as is required by IRC Section 1445(b)(2) and its regulations.
(5) Well Certificate. In the event there are any wells on the North Annex Right-of-
Way Parcel or the Additional Right-of-Way Parcel within the meaning of Minn.
Stat. 1031, a Well Certificate as required by statute.
(6) Other Documents. Such other documents as described in this Agreement or
which shall be reasonably determined to be necessary to transfer the North Annex
Right-of-Way Parcel and the Property to Buyer in accordance with the ternls of
this Agreement or are required to carry out the intent of this Agreement.
(7) Possession. Possession of the North Annex Right-of-Way Parcel and the
Additional Right-of-Way Parcel free of possession by others, except as may be
provided otherwise in the Permitted Encumbrances.
B. Buver's Closine: Documents. On the Closing Date, Buyer will execute and/or
deliver to Seller the following (collectively, "Buyer's Closing Documents"):
(1) Purchase Price. Buyer shall pay the Purchase Price to Seller in the manner
required by Section 2 of this Agreement.
(2) Affidavit of Purchaser. An Affidavit of Purchaser in such form as shall
reasonably be required by the Title Company to issue the Title Policy as required
by Section 6 of this Agreement.
(3) Other Documents. Such other documents as shall reasonably be required to
carry out the intent of this Agreement.
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5. Prorations. Seller and Buyer agree to the following prorations and allocation of
costs regarding this Agreement:
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(a)
Real Estate Taxes and Special Assessments. Real estate taxes and installments
of special assessments payable therewith payable in 2002 and all prior years,
including any real estate taxes otherwise payable during any such year which may
have been deferred, will be paid by Seller. Installments of special assessments
due and payable in the year of closing shall be paid by Seller. Real estate taxes
due and payable in the year of closing with respect to the Additional Right-of-
Way Parcel shall be pro rated between Seller and Buyer as of the Closing Date,
based on the following allocation namely: the Additional Right-of-Way Parcel is
part of a larger tax parcel presently owned by Seller and assigned property
identification No. ("Existing Parcel"). Real estate taxes due
and payable in the year of closing for the Existing Parcel shall be allocated to the
Additional Right-of-Way Parcel based upon the percentage of the area of the
Existing Parcel that is included within the area of the Additional Right-of-Way
Parcel. The amount so allocated to Additional Right-of-Way Parcel shall be pro
rated between Buyer and Seller as of the Closing Date. Seller shall use
commercially reasonable efforts to cause such speCial assessments to be
transferred to or levied against the residue of the North Annex Property or the
Existing Parcel as the case may be; if it is not possible to cause such special
assessments to be transferred to or levied against the residue of the North Annex
Property or the Existing Parcel as the case may be, Seller shall pay, when they are
due and payable, all special assessments levied, pending or otherwise of record
against the North Annex Right-of-Way Parcel or the Property as of the closing
date. Seller shall pay all real estate taxes due and payable with respect to the
North Annex Property, including any allocable to the North Annex Right-of-Way
Parcel, that are due and payable in the year of closing. Real estate taxes due and
payable with respect to the North Annex Right-of-Way Parcel or the Additional
Right-of- Way Parcel, if any, in the years subsequent to the year of closing shall be
paid by Buyer.
(b) Recordin2 Costs. Seller will pay the State Deed Tax and the cost of recording all
documents necessary to place title in the condition required by this Agreement.
Buyer will pay the cost of recording all other documents, including the Limited
Warranty Deed, Quit Claim Deed and all costs of Closing other than those
specifically designated in this Agreement to be paid by Seller.
(c) Attornevs' Fees. Each of the parties will pay its own attorneys' fees, except that
a party defaulting under this Agreement or any closing document will pay the
reasonable attorneys' fees and Court costs incurred by the nondefaulting party to
enforce its rights regarding such default.
(d) Title Evidence and Closin2 Fees. Seller shall pay the cost of providing the Title
Evidence (as defined in Section 6 of this Agreement). Seller and Buyer shall each
pay one-half of the closing fee charged by the Title Company. Buyer will pay all
fees of the Title Company for issuance of the Title Policy.
6. Title Examination. Title examination will be conducted as follows:
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(a)
Title Evidence. Within twenty (20) business days after the date of this
Agreement, Seller shall deliver to Buyer a Commitment ("Title Commitment")
for an ALTA Form B Owners Policy of Title Insurance in the amount of the
Purchase Price issued by First American Title Insurance Company (the "Title
Company"). The Title Commitment shall cover the North Annex Right-of-Way
Parcel and the Property.
(b) Buver's Obiections. Within ten (10) business days after receiving the Title
Commitment, Buyer will make written objections ("Objections"), if any, to
marketability of title to the Property or the North Annex Right-of-Way Parcel.
Buyer's failure to make Objections within such time period will constitute waiver
of Objections. Any matter shown in the Title Commitment and not objected to by
Buyer shall be a "Permitted Encumbrance" hereunder. In addition, the interests in
the North Annex Property that have been approved by the Authority pursuant to
Section 3.3(g) of the Redevelopment Agreement shall be Permitted
Encumbrances that Buyer has agreed to accept title to the North Annex Right-of-
Way Parcel subject to. Seller will have thirty (30) days after receipt of notice of
the Objections to cure the Objections, during which period the closing will be
postponed as necessary, except that Seller will cause mortgages or other liens to
be satisfied or released at or prior to closing. Seller shall exercise commercially
reasonable efforts to cure Objections. At such time as the Objections have been
cured, the parties shall close the transaction described in this Agreement. If the
Objections are not cured within said thirty (30) days period, Buyer will have the
option to do one of the following:
i) Terminate this Agreement by giving written notice to Seller and receive a
refund of the Earnest Money. Upon such termination and refund of the
Earnest Money, neither party shall have any further liability under this
Agreement.
ii) Withhold from the Purchase Price an amount estimated by the Title
Company to be sufficient to cure any Objections encumbering the
Additional Right-of-Way Parcel and proceed to close, with the amount so
withheld to be deposited in escrow with the Title Company to be used to
correct Objections.
iii) Waive the Objections and proceed to close without any reduction in the
Purchase Price.
7. Operation Prior to Closing. During the period from the date of this Agreement
to the Closing Date, Seller shall execute no contracts, leases or other agreements regarding the
North Annex Right-of-Way Parcel or the Additional Right-of-Way Parcel that are not terminable
on or before the Closing Date.
8. Representations and Warranties bv Seller. Seller represents and warrants to
Buyer, as ofthe date of Seller's execution hereof, as follows:
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(a)
(b)
(c)
(d)
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(e)
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Authority. Seller has the requisite power and authority to enter into and perform
this Agreement and those Seller's Closing Documents to be signed by Seller; such
documents have been or shall be duly authorized by all necessary action on the
part of Seller and have been or shall be duly executed and delivered; such
execution, delivery and performance by Seller of said documents does not conflict
with or result in a violation of any contract, agreement, judgment, order or decree
of any Court or arbitrator to which Seller is a party; such documents are valid and
binding obligations of Seller, and are enforceable in accordance with their terms.
Title to Property. To the best of Seller's knowledge, without investigation,
Seller is the sole fee owner of the North Annex Right-of-Way Parcel and the
Property.
Leases. To the best of Seller's knowledge, without investigation, there are no
leases, tenancies or possessory rights of others affecting the North Annex Right-
of- W ay Parcel or the Property.
Contracts. Seller has not entered into any service or maintenance contract or
other contract affecting the North Annex Right-of-Way Parcel and the Property
which is not terminable on or before the Closing Date. Seller will terminate all
such contracts on or before the Closing Date.
Intentionally Deleted
(t)
Ri2hts of Others to Purchase Property. Seller has not entered into any other
contracts for the sale of the North Annex Right-of-Way Parcel or the Property, or
to the best of Seller's knowledge, granted any rights of first refusal or options to
purchase the North Annex Right-of-Way Parcel or the Property or any other rights
to others that might prevent the consummation of this Agreement, other than the
following: (i) the matters set forth in the Permitted Encumbrances; (ii) that
certain Option Agreement and Declaration of Restrictive Covenant between Seller
and the Authority dated October 13, 1998, as amended; and (iii) that certain
Public Trailway and Utility Easement and Agreement (the "Trail Easement")
dated January 1, 2000, between Seller and the Suburban Hennepin Regional Park
District, a political subdivision of the State of Minnesota (the "Park District"),
recorded on April 7, 2000 as Document No. 3270525. In addition, the Park
District and Seller are currently discussing amending the Trail Easement to
change the location of the Trail Easement to match the location on the North
Annex Property where the Park District actually constructed its trail.
(g) FIRPT A. Seller is not a "foreign person," "foreign partnership," "foreign trust"
or "foreign estate" as those terms are defined in Section 1445 of the Internal
Revenue Code.
(h) Proceedin2s. To Seller's actual knowledge, there is no action, litigation,
investigation, condemnation, eminent domain or proceeding of any kind pending
against the North Annex Right-of-Way Parcel or the Property. Seller shall deliver
to Buyer written notice of the commencement of any legal action by any
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governmental authority or third party affecting the North Annex Right-of-Way
Parcel or the Property.
(i)
Intentionally Deleted
The foregoing representations and warranties shall be deemed to have been remade as of the
Closing Date, provided that, during the period between the date of this Agreement and the
Closing Date Seller shall be entitled to notify Buyer in writing of exceptions to said warranties
and representations that have occurred or which Seller has discovered during such time period.
Except for the representations expressly set forth above in this Section, Buyer is not relying on
any representation or warranty of Seller or other person concerning the North Annex Right-of-
Way Parcel or the Property, including, without limitation, the condition of the North Annex
Right-of- Way Parcel or the Property or its fitness for any particular use or purpose, and with the
exception of Seller's representatiopsand warranties expressly stated in this Agreement, Buyer is
acquiring the North Annex Right-of-Way Parcel and the Property based upon its own
investigation and inquiry. Other than those warranties expressly stated in this Agreement, Buyer
hereby waives, and Seller hereby disclaims, all warranties of any type or kind whatsoever as to
the North Annex Right-of-Way Parcel and/or the Property, express or implied, including those
of fitness for a particular purpose, tenantability, habitability, and use. Buyer is acquiring the
North Annex Right-of-Way Parcel and the Property in their "AS IS, WHERE IS" physical
condition on the Closing Date and in an "AS IS, WHERE IS" state of repair on the Closing Date.
9. Name of Buildine:. (Intentionally deleted).
10. Damae:e. (intentionally deleted)
11. Condemnation. (intentionally deleted)
12. Broker's Commission. Seller and Buyer represent and warrant to each other that
they have dealt with no other brokers, finders or the like in connection with this transaction and
agree to indemnify each other and to hold each other harmless against all claims, damages, costs
or expenses of or for any such fees or commissions resulting from their actions or agreements
regarding the execution or performance of this Agreement, and will pay all. costs of defending
any action or lawsuit brought to recover any such fees or commissions incurred by the other
party, including reasonable attorneys' fees.
13. Assie:nment. Buyer may assign its rights under this Agreement prior to closing
only with Seller's prior written consent, which consent will not be unreasonably withheld. Buyer
may assign its rights under this Agreement contemporaneously with closing without Seller's
consent.
14. Survival. All of the terms of this Agreement will survive and be enforceable
after the Closing.
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15. Notices. Any notice, request or other communication required or provided to be
given under this Agreement shall be in writing and shall be deemed to be duly given when
delivered personally or when mailed by first class United States mail, postage prepaid, addressed
as follows:
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To Seller:
SUPERV ALU INC.
Attention: Legal Department
11840 Valley View Road
Eden Prairie, MN 55344
To Buyer:
City of Hopkins
Attention: James Kerrigan
1010 First Street South
Hopkins, MN 55343
With a Copy to be mailed
simultaneously to:
Jeremy S. Steiner
Miller, Steiner & Curtiss, P.A.
400 Wells Fargo Bank Building
1011 First Street South
Hopkins, MN 55343
or to such other address as either party, by notice given as herein provided, shall designate.
Personally delivered notices shall be effective as of the date of delivery. Mailed notice shall be
conclusively deemed to have been given three (3) days after the date of mailing.
.
16. Captions. The paragraph headings or captions appearing in this Agreement are
for convenience only, are not a part of this Agreement and are not to be considered in
interpreting this Agreement.
17. Entire Agreement: Modification. This written Agreement constitutes the
complete agreement between the parties and supersedes any prior oral or written agreements
between the parties related to the conveyance, purchase or sale of the North Annex Right-of-
Way Parcel or the Property, but does not supersede any provisions of the Redevelopment
Agreement or the First Amendment relating to any matter other than the conveyance, purchase
and sale of the North Annex Right-of-Way Parcel and the Property. There are no verbal
agreements that change this Agreement and no waiver or modification of any of its terms will be
effective unless in a writing executed by the parties. No waiver of a right in any instance shall
operate as a waiver of any other right, nor as a waiver of such right in a later or separate instance.
18. Binding Effect. This Agreement binds and benefits the parties and their
successors and assigns.
19. Controlling Law. This Agreement has been made under the laws of the State of
Minnesota, and such laws will control its interpretation.
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20. Remedies. If Buyer defaults in its obligation to close under this Agreement,
Seller shall have the right to terminate this Agreement by giving written notice to Buyer in
accordance with Minn. Stat. 559.21, and in such event, Seller shall be relieved of all obligations
set forth in Section 3 of the First Amendment regarding conveyance of the North Annex Right-
of- Way Parcel and the Property. Should either Buyer or Seller default in the performance of its
obligations hereunder, the other party shall have and may pursue all rights and remedies
available to it hereunder, at law or in equity, or otherwise, including, without limitation an action
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for damages or specific performance. In the event of any proceeding to enforce any of the terms,
covenants or provisions of this Agreement, the prevailing party in such proceeding shall also be
entitled to be awarded its reasonable attorneys' fees.
21. Counterparts. For the convenience of the parties, any number of counterparts of
this Agreement may be executed and each such executed counterpart shall be deemed an
original, but all such counterparts together shall constitute one and the same agreement.
22. Exhibits. All exhibits referred to in this Agreement are attached to and shall be
considered a part of this Agreement.
23. Severabilitv. Should anyone or more of the provISIOns contained in this
Agreement for any reason be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect the validity or enforceability of any other
provision of this Agreement, and this Agreement shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.
24. Subdivision Approval. Buyer shall be solely responsible for obtaining any
required governmental approvals for the subdivision of the North Annex Right-of-Way Parcel
and the Additional Right-of-Way Parcel from the larger parcels of real property presently owned
by Seller of which the North Annex Right-of-Way Parcel and the Additional Right-of-Way
Parcel are a part, all at Buyer's sole cost and expense.
. 25. Tax Prepayment or Temporary Easements. If it is necessary to prepay the real
estate taxes and installments of special assessments due and payable in the year of closing in
order to record the Limited Warranty Deed because the North Annex Right-of-Way Parcel
and/or the Additional Right-of-Way Parcel are being subdivided from a larger parcel, Seller, at
Seller's option, in its sole discretion, shall either prepay the real estate taxes due and payable in
the year of closing with respect to such larger parcels or grant Buyer a temporary easement for
road right-of-way purposes covering all of the North Annex Right-of-Way Parcel and the
Additional Right-of-Way Parcel, which temporary easement shall remain in effect until the
Limited Warranty Deed is recorded, and shall grant Buyer the exclusive right to use the North
Annex Right-of-Way Parcel and the Additional Right-of-Way Parcel for road right-of-way,
utility and related purposes. Such temporary easement shall be granted by Quit Claim Deed duly
executed by Seller and delivered at closing, in form and content reasonably acceptable to Seller
and Buyer.
26. Restoration of Seller's Property. After the Closing Date, and as part of the
Hennepin County Road 3/Milwaukee Street intersection reconstruction project to be completed
by the City and Hennepin County, Minnesota, the parking lot improvements and other
improvements presently located on the Additional Right-of-Way Parcel must be removed and the
contiguous parking lot improvements and other improvements located on the residue of Seller's
real property must be repaired or restored. Such repair or restoration work is described in
Exhibit B attached hereto and incorporated herein ("Restoration Work"). The Restoration Work
shall be completed by Seller, as promptly as possible in connection with the reconstruction of
Hennepin County Road 3 and Milwaukee Street, at Buyer's expense. Seller agrees to submit all
proposals for performance of the Restoration Work to Buyer prior to performance of the
Restoration, and Buyer shall not be obligated to reimburse Seller for the cost of the Restoration
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Work, unless such proposals and the cost of the Restoration Work have been approved in
advance by Buyer, in writing, such approval not to be unreasonably withheld or delayed.
27. Involuntary Conversion. Buyer represents that in the event Buyer had been
unsuccessful in negotiating the purchase of the Property, Buyer had decided to authorize the
commencement of eminent domain proceedings and proceed to exercise its powers of eminent
domain to acquire the Property. Accordingly, it is intended that this Agreement is in lieu of the
institution of formal eminent domain proceedings within the meaning of Section 1033 of the
United States Internal Revenue Code.
Seller and Buyer have executed this Agreement effective as of the date first written
above.
SELLER
SUPERV ALU INC.
By
Its
BUYER
CITY OF HOPKINS
By
Its
By
Its
.
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EXHIBIT A - Page 1
COPY OF RIGHT-OF-WAY PLAT
EXHIBIT B
DESCRIPTION OF RECONSTRUCTION WORK
Modifications to Be Made to Seller's Property South of Excelsior
Reconfigure parking lot layout, rebuild and pave disturbed parking areas including the
underground storage tank fill area, remove and replace parking lot fencing, abandon existing
water serve valve manhole and install new 8" water service pipe to pump house (install 1 0" water
service pipe with Seller paying the incremental cost increase) reimburse Seller for pump house
modifications per April 15, 2002 Olsen Fire Protection Incorporated description and price
quotes, ADT alarm system work (June '18, 2002 letter) and Wests ide Equipment overfill
protection work.
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DAVID D. SWENSON
REAL ESTATE APPRAISER
18135 39th AVE. N.
PLYMOUTH, MN 55446
(612) 478-2752
June 28, 2002
Mr. Matt Storm
Vice President
Evergreen Land Services Co.
6110 Blue Circle Drive
Minnetonka, MN 55343
RE: CSAH Highway 3
Hennepin County Project No. 9227
Parcel 30
Super Valu Stores, Inc.
Dear Mr. Storm:
Pursuant to your request, I have completed an appraisal of the damages sustained by the above
. referenced property attributable to the taking of permanent highway and temporary construction
easements. This acquisition is required for the proposed highway construction project referenced
above.
The estimate of value as stated in this report is predicated upon the definition of market value
contained herein. Implicit in the definition of market value is that payment is made in cash or its
equivalent financing.
It is my opinion that the damage sustained by the subject property attributable to the described
taking as of June 28, 2002 is as follows:
PERMANENT IDGHWAY EASEMENT:
TEMPORARY EASEMENT:
SEVERANCE DAMAGE:
TOTAL ESTIMATED DAMAGE:
ROUNDED:
$32t067
1,356
38~OOO
$71,423
$71,500
Reasonable care has been exercised in verifying the factual data set forth in the report and is
judged and assmned to be reliable. Such facts and information contained herein were obtained
from sources that are true to the best of my knowledge.
.
This appraisal has been completed in compliance with prevailing standards outlined in the
Uniform Standards for Professional Appraisal Practice. This assignment was not contingent upon
any direction regarding the final conclusion of value.
REAL ESTATE APPRAISER. CONSULTANT
Mr. Matt Stonn
Evergreen Land Services Company
June 28, 2002
Page 2
This appraisal is made subject to certain limiting conditions and assumptions as hereinafter
expressed. And, it is made in conformity with appropriate state laws, regulations, policies and
procedures applicable to the appraisal of right of way to be acquired for public purposes.
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The attached restrictedllimited appraisal report identifies and describes the real estate and
summarizes the valuation analyses and methods used in arriving at this conclusion.
DDS
Enclosures
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REAL ESTATE APPRAISER. CONSULTANT
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LAND VALUE ESTIMATE
The indicated value for the su?ject site is $3.00 per square foot.
In arriving at the market value of the subject site, I have relied entirely upon the sales of vacant
land. Sales are considered to best reflect the thinking of the " typical buyer in the marketplace.
This approach, which is referred to as the Direct Sales Comparison Approach, employs
dependable sales data available for properties that are truly competitive with the subject
property. I have investigated the terms and conditions of the comparable sale transactions. It
should be realized that there is a wide spectrum of buyer and user motivations and purposes in
the industrial real estate field. A comparison has been made on the basis of the subject property
having a Highest and Best Use if vacant for industrial development similar to that of the
comparable properties. In establishing a basis for value, the major characteristics of industrial
land that require analysis include:
1. Physical characteristics: size, shape, dimensi9ns, topography, drainage, etc.
2. Zoning and other public controls: use restrictions, structural restrictions, setback
requirements, height limitations, safety requirements and fire code requirements.
3. Location: access, transit, highway, visibility, utilities, fire and police protection,
capacities, comer influence and costs
4. Availability: price, financing terms.
Precise and specific factual information can be obtained concerning most of the
above factors. Some require further analysis. It is in tenns of this analysis that
standards of what is appropriate, and acceptable, must be developed. The following
sales are considered to provide the best indication of value for the subject land.
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COMPARABLE LAND SALES
LAND COMPARABLE #1
LOCATION: 7101 Sandburg Road
CITY: Golden Valley
BUYER: City of Golden Valley
SELLER: Honeywe1~ Inc.
PROXIMITY TO THE SUBJECT: 5Y2 miles
ZONING: Industrial
SIZE: 476,178 square feet
SITE DATA: Level
STREET SURF ACE: Bituminous
SALE PRICE: $900,000
DATE OF SALE: 6/99
SPECIAL ASSESSMENTS: None
FINANCING: $250,000 balloon payment 6/01
PRICE PER SQUARE FOOT: $1.89
LAND COMPARABLE # 4
LOCATION: 10901 Excelsior Blvd.
CITY: Hopkins
BUYER: StieIe and Bakken.LLC
SELLER: Venturian Corp.
PROXIMITY TO THE SUBJECT: 1 mile
ZONING: 1-1, Industrial
SIZE: 189,052 square feet
SITE DATA: Office building to be developed
STREET SURFACE: Bituminous
SALE PRICE: $450,000
DATE OF SALE: 12/97
SPECIAL ASSESSMENTS: None
FINANCING: Cash
PRICE PER SQUARE FOOT: $2.38
LAND COMPARABLE #2
LAND COMPARABLE #5
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LOCATION: Valley View Road
CITY: Eden Prairie
BUYER: CSM Properties
SELLER: Walter Carpenter
PROXIMITY TO THE SUBJECT: 4Y2 miles
ZONING: 1-2 (PUD)
SIZE: 612,894 square feet
SITE DATA: Hill on NW portion of site,
STREET SURFACE: Bituminous
SALE PRICE: $1,633,090
DATE OF SALE: 9/98
SPECIAL ASSESSMENTS: None
FJNANCJNG: Cash
PRICE PER SQUARE FOOT: $2.66
LOCATION: 6105 Golden Hills Drive
CITY: Golden Valley
BUYER: Duke Realty Limited Partnership
SELLER: Golden Valley HRA
PROXIMITY TO THE SUBJECT: 3Y2 miles
ZONING: LI, Limited Industrial
SIZE: 666,671 square feet
SITE DATA: Level, all uSable
STREET SURFACE: Bituminous
SALE PRICE: $2,361,389.85
DATE OF SALE: 10/98
SPECIAL ASSESSMENTS: None
FINANCING: Cash
PRICE PER SQUARE FOOT: $3.54
LAND COMPARABLE #3
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LOCATION: 320 Washington Ave. S..
CITY: Hopkins
BUYER: Hopkins HRA
SELLER: County of Hennepin
PROXIMITY TO TIm SUBJECT: ~ mile
ZONING: 1-2, General Industrial
SIZE: 1,792,494 square feet
SITE DATA Leve~ now site of large Super Valu WH
STREET SURFACE: Bituminous
SALE PRICE: $5,000,000
DATE OF SALE: 10/98
SPECIAL ASSESSMENTS: None
FINANCING: Cash
PRICE PER SQUARE FOOT: $2.79
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COMPARABLE LAND SALES MAP
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DAMAGE ESTIMATE
The range in sale prices of the comparable properties is from $1.89 to $3.54 per square foot. The
midpoint of this range is $2.72 per square foot, the median is $2.66 per square foot, and the
average is $2.65 per square foot.
After analyzing all of the data and recognizing the size, location, and utility of the site, it is
concluded that the subject site has a current market value of$3.00 per square foot.
The taking is a 10,689 square foot permanent highway easement and an adjacent 3,014 square
foot temporary construction easement. The temporary yasement begins on November 1,2002
and expires on November 1,2004, however, it is estimated that the temporary easement area will
only be used for a period of 1 yz years during the two year duration. The loss caused by the
temporary construction easement is estimated at 10% of ~ee value per year.
An estimated 38 parking spaces will be lost because of the land taken for road. The time that
these parking spaces are needed is during the shift change periods. This Super VaIu property
operates 3 shifts during a 24 hour day. The loss in value to the overall property because of loss of
parking is estimated at $1000 per space.
THE INDICATED VALUE OF THE TAKING IS:
PERMANENT IDGHW A Y EASEMENT:
10,689 square feet @ $3.00 per square foot =
$32,067
TEMPORARY EASEMENT:
3,014 square feet @ $3.00 per square foot x 10% x 1.5 years =
1,356
SEVERANCE DAMAGE
Loss of 38 parking spaces @ $1000 =
38.000
TOTAL ESTMATED DAMAGES:
ROUNDED:
$71,423
$71,500
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