Title
Mom's Kitchen Site Redevelopment (B)
This item involves accepting a referral from the Community Redevelopment Agency (CRA) to the City Commission to explore the acquisition of the property known as "Mom's Kitchen" and hear a presentation from Staff on the purchase of the property.
Explanation
Mom's Kitchen, an established restaurant dating back to the 1960's, is located at 1008 N.W. 5th Avenue in the Fifth Avenue/Pleasant Street (FAPS) redevelopment area (See Exhibit A). The owner closed the business and has engaged Rodney Long Real Estate of Gainesville, Florida as its agent and broker. Mr. Long has registered with the City's Clerk as a Lobbyist/Agent.
On December 15, 2008, the Community Redevelopment Agency referred the purchase of Mom's Kitchen to the City Commission for their review and consideration. A copy of the CRA's analysis and minutes are attached as Exhibit B. The CRA wishes to explore the acquisition of the property. The CRA has determined that the purchase of the property is important to the FAPS district and is supported by the FAPS Redevelopment Plan.
The CRA procured the services of a real estate appraisal firm to evaluate the Mom's Kitchen property. The firm's appraisal came in at $220,000. The owner's appraisal value of the property was $300,000. In addition, the CRA engaged services of a contractor who estimated the renovation cost at $279,500. The CRA determined that it had only $39,361 currently budgeted for acquisition options and that significant funding is necessary to purchase and renovate the building. Therefore, CRA is requesting the City further explore the acquisition of Mom's Kitchen.
City Staff conducted an analysis of the site which included the procurement of a third appraisal which came in at $165,000 as is, and $240,000 with renovations (See Exhibit G). The analysis included (1) Comparable sales in the area (2) City purchases of properties in the area including a map, and (3) Public benefit/value of the property.
Comparable Sales/ Tax Assess Values (TAV) (See Exhibit C) - The City Staff evaluated comparable sales in the area. Four (4) properties were identified, however only two (2) properties were similar in size. The Tax Assess Values (TAV) for the two properties ranged from $91,300 to $131,500. The TAV for Mom's Kitchen is $87,100. The purchase price ranged from $90,000 to $169,000, which is far below the appraisal value by the owner and CRA.
City Owned Parcels - Since 1972 the City has purchased a total of 4 properties in the area (mainly vacant land - See Exhibit C). The purchase price has ranged from $550 to $68,000 in the area. The CRA recently purchased a property in the area for $29,000.
Public Benefit/Values - The CRA has determined the purchase of the property is important to the redevelopment of FAPS District and the project supports the CRA Redevelopment Plan.
The subject site (Mom's Kitchen) is zoned for commercial utilization under the MU-1 zoning category (See Exhibit D). The property has a past history of being utilized as a neighborhood restaurant. However, the property could be used for other retail uses in the area. Uses within the immediate area are oriented toward commercial uses and the nearby Seminary Lane Apartment complex is in the process of being vacated in May 2009. The Seminary Lane property provided an opportunity for other development projects in the area. The building is of a size of similar structures within the area. The highest and best use of the property is commercial utilization under the MU-1 zoning.
The City also contacted other entities (Alachua County School Board, Alachua County Commission Administrative Staff, The Supervisor of Elections, and Alachua County Library Administration) to see if there was any level of unmet need in the area of the project. At this time, there were no real unmet needs in the area, but there were suggestions for the use of the property including as an African-American Cultural Center and a Youth Tutoring Center.
The City Commission must determine if the purchase of the property would be a public benefit/meet a public need and the project would aid in the redevelopment efforts in the area. Based on the City's current proposal, a total amount of $444,500 (purchase price 165,000 and $279,500 renovation cost) is needed for the project. This cost is based upon maintaining the existing building. If the City wishes only to utilize the land, the cost of purchasing and demolishing the building is approximately $173,550.
Neither of the two (2) proposals have been budgeted for FY09. If the City Commission wishes to purchase Mom's Kitchen, funding would have to come from the City's Reserves and/or the Capital Improvement Plan must be amended to delete/delay a project of equal value.
City Staff contacted the agent/owner with an offer to purchase the property at a cost of $165,000 subject to City Commission approval and identification of the funds for the project (See Exhibit E). City Staff received an acceptance letter from the agent/owner on February 11, 2009 (See Exhibit F).
Fiscal Note
The Mom's Kitchen project is not identified in the FY09 budget. If the City Commission wishes to participate in the purchase and renovation of the building, and/or the purchase and demolition of the building, the funding must come from the City's Reserve Fund and/or the Capital improvement Plan must be amended to delete/delay Capital Improvement Plan project(s) of equal value, and add the Mom's Kitchen project to the Capital Improvement Plan.
Recommendation
Recommendation A: The City Commission: 1) accept the referral from the Community Redevelopment Agency (CRA) to the City Commission to explore the acquisition of Mom's Kitchen; 2) hear a presentation from staff on the purchase of the property; 3) if the City Commission determines that there is a public benefit in purchasing Mom's Kitchen, authorize the City Manager or an authorized designee to finalize the purchase of Mom's kitchen and execute the purchase contract with the agent/owner and execute any necessary closing documents subject to approval from the City Attorney's Office as to form and legality of said documents; and 4) amend the FY09 City Capital Improvement Plan to add Mom's Kitchen to the plan and delete/delay other Capital Improvement Plan project(s) of equal value from the plan.
Recommendation B: The City Commission: 1) accept the referral from the Community Redevelopment Agency (CRA) to the City Commission to explore the acquisition of Mom's Kitchen; 2) hear a presentation from staff on the purchase of the property; 3) authorize the City Manager or an authorized designee to explore other resources to assist the CRA and the agent/owner in the redevelopment of the property in the FAPS Districts; and 4) request the agent/owner to re-list the property on local MLS for a period of six months.
Recommendation C: The City Commission does not accept the referral from the Community Redevelopment Agency (CRA) to explore the acquisition of Mom's Kitchen.