Reso 1997-101 to 105 - Laserfiche WebLink

Home

IV. VALUE OF THE INTEREST TO BE CONVEYED Reuse Value The reuse value for the Property is directly a function of the development economics for the specific development required to be constructed under the terms and conditions of the Agreement. The covenants and conditions of the Agreement require the near -term construction and operation of a. local resident -serving retail center, and a creekside plaza and creekwalk along the adjacent San Leandro Creek. additionally, the Developer is obligated to incur costs estimated at $1,000,000 for architectural and site upgrades of higher quality than would typically be found in a neighborhood shopping center and costs to attract key tenants, specifically the grocery story and a 4,500 sq.ft. fine dining restaurant. In the reuse appraisal report prepared by KMA, it is concluded that the fair reuse value, given the specific covenants and conditions of the Agreement, is a range of $1,500,000 to $1,900,000, subject to the terms and conditions of the DDA, specifically the actual development costs and rents. The k.MA reuse appraisal is attached to this report and incorporated herein by this reference. Estimated Value at Highest and Best Use KMA has also estimated the value of the interests conveyed to the Developer if sold by the Redevelopment Agency at its highest and best use allowed under the redevelopment plan. IQAA concludes that the value of the site, assuming that it is free and clear of all improvements and any other encumbrances, is approximately $3.0 million ($10/sq.ft. of net usable land area). While the reuse value being paid to the Agency is less than its fair market value of the site under the highest and best use, the Agency has determined that the high quality, local resident -serving retail development as provided in the DDA offers the best complementary uses for other land uses and activities in the area. In addition, the Developer must incorporate into the Project architectural and site upgrades of a higher quality than would typically be found in a neighborhood shopping center. Furthermore, the project must be developed in the near -term. Therefore, the project will further the overall goals of the Plaza 2 Redevelopment Project Area to revitalize the downtown commercial core and the Davis Street corridor in the vicinity of the subject site. 1910=001-001.doc 167 KEYSER MARSTON ASSOCIATES I N C. Page 9