HomeMy WebLinkAboutR12-Redevelopment Agency
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Redevelopment Agency . City of San Bernardino
300 North "D" SIIee~ Fourth Floor . San BentlIrdino, California 91A18
(714) 384-5081 FAX (714) 888-9413
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SIn.. H. Dukett
Execulive Director
JUNE 14, 1989
ARTHUR GREGORY OWNER PARTICIPATION AGREEMENT
PLATT BUILDING
Synopsis of Previous Commission/Council/Committee Action:
10-24-83 Resolution 4542 authorized Owner Participation Agreement (OPA) for
the rehabilitation of Platt Building.
01-06-86 Consideration of First Amendment continued to January 21, 1986.
01-21-86 Resolution No. 4843 authorized First Amendment to OPA.
06-06-88 Resolution No. 5118 authorized execution of a Second Amendment to
the OPA.
10-22-88 Committee authorized revision of the Second Amendment.
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Recommended Motion:
(COMMUNITY DEVELOPMENT COMMISSION)
That the Commission declare Arthur Gregory in default of the Owner
Participation Agreement dated January 25, 1983 (amended January 21,
1986) and authorize staff and counsel to pursue all remedies
available under said Agreement.
Supporting data attached: Yes
Ward:
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FUNDING REQUIREMENTS:
Project:
CCN (Platt Building)
Commission Notes:
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Item No.
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Agenda of:
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Redevelopment Agency
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STAFF REPORT
This is to recommend that Mr. Arthur Gregory be declared in default of the
Owner Participation Agreement (OPA) in effect and that the Agency be
authorized to pursue collection of $50,000 due under the liquidated damages
clause of the OPA.
BACKGROUND
On January 25, 1983, the Agency entered into an OPA with Arthur Gregory
(Owner) for the rehabilitation of the Platt BUilding, which required a minimum
construction value of $1,200,000.
The Agency's obligations included the acquisition and demolition of an
adjacent building (Ross ton Barber College) and construction of parking. This
parking would then be leased to the Owner for use by tenants of the Platt
Building. Due to delays in the construction of the new barber college on 5th
Street, the Agency was unable to proceed in a timely manner. This, in turn,
delayed the rehabilitation of the Platt Building and caused the necessity to
amend the agreement to provide a one-year extension.
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Since the execution of the OPA and First Amendment, the Owner has been unable
to secure tenants for the building and has not completed the exterior
rehabilitation. The Community Development Commission approved a Second
Amendment on June 6, 1988 providing additional time to complete the building
renovation. This Amendment was never executed by Owner. Several attempts
were made by staff to secure an executed Second Amendment and on September 9,
1988 Owner was informed that he was in technical default.
On October 5, 1988, Owner met with Agency staff, Ann Harris of Main Street and
Wayne Overstreet of Public Buildings. As a result of the meeting, the Owner
verbally committed to begin renovation, and requested a revised Second
Amendment which was later developed. The revised Second Amendment required
the Owner to deposit $50,000 with the Agency to insure completion. This
replaced the $50,000 liquidated damages provision in the OPA. The Owner did
not execute the revised Second Amendment and has not been responsive.
In light of the above, it is, therefore, recommended that Mr. Arthur Gregory
be declared in default of the OPA and that Agency staff and counsel be
authorized to pursue collection of $50,000 due under the liquidated damages
clause of the OPA.
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