July 22, 2014
Status:
Approve the reinstatement of Agreement of Sale and Purchase between The School Board of Broward County, Florida (SBBC) and JAG Development Company, LLC for the purchase of the site commonly referred to as Elementary D-1 School Site (No. 352.1).
Section 1013.28, Florida Statutes (FS) allows a school board to dispose of any land or real property that is by resolution of the board, determined to be unnecessary for educational purposes. On April 20, 2010, the School Board approved the surplus of the 12-acre gross Elementary D-1 School Site which is located at the southeast corner of Broward Boulevard and Hiatus Road in the City of Plantation. In the subsequent marketing of the property at the asking price of $7,239,000 (the then highest appraised value), the District received several inquiries on the property and in the fall of 2013, six (6) entities submitted Letters of Intent (LOI) to purchase the property. Of the submitted LOI's, JAG Development Company, LLC (JAG) offered the highest price of $9,750,000 to purchase the property. Subsequently on December 17, 2013, the SBBC and JAG entered into contract to enable the sale. At JAG's request, the Agreement was amended on March 4, 2014 to extend the inspection period on the property from sixty (60) days to ninety (90) days to allow JAG to complete its phase 1 environmental on the property. However on April 7, 2014, JAG terminated the Agreement for the following reasons: (1). That currently, the property does not have legal access from either Broward Boulevard or Hiatus Road, because the existing plat for the site indicates a Non-Vehicular Access Lines (NVAL) along the full length of the property on both thoroughfares; (2). Based on the phase 1 environmental report, JAG desired to conduct a phase 2 environmental, and as such wanted an additional sixty (60) day period to be codified in the Agreement to allow for the phase 2 environmental which would require additional testing of the soil on the property. In a memorandum dated May 30, 2014, the Board was informed about JAG's termination of the Agreement.
During the time the contract was terminated, staff utilized the opportunity to reappraise the property. Three appraisals were conducted, and the highest appraisal appraised the property at $7,239,000. Thereafter, the Negotiation Parameters Committee (NPC) was convened to review the appraisals, and upon their review, the NPC established the minimum asking price for the property at $7,239,000. Upon this action by the NPC, staff deliberated regarding the next steps for the property and at the end, decided to remarket the property. Thereafter, notice was sent to interested parties (including JAG) to submit LOI's by 5:00 p.m. on June 16, 2014. Thereafter, seven (7) entities (including JAG) submitted LOI's to the Facility Planning & Real Estate Department to purchase the property. Of the submitted LOI's, JAG offered the highest price of $10,360,000 as an upper purchase price contingent on it obtaining approval to build 296 mid-rise residential units, and $9,400,000 as a not lower than (NLT) purchase price. Furthermore, upon examination of the terms of the LOI's, staff felt the terms expressed in the LOI submitted by JAG, and additional conditions regarding modification/reinstatement of the Agreement were more beneficial to the District. Hence the recommendation to reinstate the terminated Agreement with JAG.
This Agreement has been reviewed and approved as to form and legal content by the Office of the General Counsel, and upon its approval by the School Board, due diligence processes towards purchase and closing on the property will continue.
There is a potential positive financial impact of $10,360,000 - $9,400,000 to the District; therefore, this item does not require a Collaboration Form from the Capital Budget Department.
Requested Action
Approve the reinstatement of Agreement of Sale and Purchase between The School Board of Broward County, Florida (SBBC) and JAG Development Company, LLC for the purchase of the site commonly referred to as Elementary D-1 School Site (No. 352.1).
Summary
Section 1013.28, Florida Statutes (FS) allows a school board to dispose of any land or real property that is by resolution of the board, determined to be unnecessary for educational purposes. On April 20, 2010, the School Board approved the surplus of the 12-acre gross Elementary D-1 School Site which is located at the southeast corner of Broward Boulevard and Hiatus Road in the City of Plantation. In the subsequent marketing of the property at the asking price of $7,239,000 (the then highest appraised value), the District received several inquiries on the property and in the fall of 2013, six (6) entities submitted Letters of Intent (LOI) to purchase the property. Of the submitted LOI's, JAG Development Company, LLC (JAG) offered the highest price of $9,750,000 to purchase the property. Subsequently on December 17, 2013, the SBBC and JAG entered into contract to enable the sale. At JAG's request, the Agreement was amended on March 4, 2014 to extend the inspection period on the property from sixty (60) days to ninety (90) days to allow JAG to complete its phase 1 environmental on the property. However on April 7, 2014, JAG terminated the Agreement for the following reasons: (1). That currently, the property does not have legal access from either Broward Boulevard or Hiatus Road, because the existing plat for the site indicates a Non-Vehicular Access Lines (NVAL) along the full length of the property on both thoroughfares; (2). Based on the phase 1 environmental report, JAG desired to conduct a phase 2 environmental, and as such wanted an additional sixty (60) day period to be codified in the Agreement to allow for the phase 2 environmental which would require additional testing of the soil on the property. In a memorandum dated May 30, 2014, the Board was informed about JAG?s termination of the Agreement.
During the time the contract was terminated, staff utilized the opportunity to reappraise the property. Three appraisals were conducted, and the highest appraisal appraised the property at $7,239,000. Thereafter, the Negotiation Parameters Committee (NPC) was convened to review the appraisals, and upon their review, the NPC established the minimum asking price for the property at $7,239,000. Upon this action by the NPC, staff deliberated regarding the next steps for the property and at the end, decided to remarket the property. Thereafter, notice was sent to interested parties (including JAG) to submit LOI's by 5:00 p.m. on June 16, 2014. Thereafter, seven (7) entities (including JAG) submitted LOI's to the Facility Planning & Real Estate Department to purchase the property. Of the submitted LOI's, JAG offered the highest price of $10,360,000 as an upper purchase price contingent on it obtaining approval to build 296 mid-rise residential units, and $9,400,000 as a not lower than (NLT) purchase price. Furthermore, upon examination of the terms of the LOI's, staff felt the terms expressed in the LOI submitted by JAG, and additional conditions regarding modification/reinstatement of the Agreement were more beneficial to the District. Hence the recommendation to reinstate the terminated Agreement with JAG.
This Agreement has been reviewed and approved as to form and legal content by the Office of the General Counsel, and upon its approval by the School Board, due diligence processes towards purchase and closing on the property will continue.
School Board Goals
| Goal 2: Continuous Improvement |
Financial Impact
There is a potential positive financial impact of $10,360,000 - $9,400,000 to the District; therefore, this item does not require a Collaboration Form from the Capital Budget Department.
Source of Additional Information
Chris Akagbosu 754-321-2162
Associated File Attachments
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Executive Summary (Files) | |
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Reinstated Agreement of Sale and Purchase (Files) | |
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Aerial Photo - Elementary D-1 School Site (Files) | |
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LL-3 Executed Agreement (Files) |