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Home My WebLink AboutLW11-138 - Original - Letter of Intent to Purchase Aukeen District Courthouse I j King County Real Estate Services Facilities Management Division Department of Executive Services 500 Fourth Avenue, Room 500 Seattle, WA 98104 Phone. (206) 205-5772 Email Steve Salyer@kingcounty.gov March 11,2011 i Mr. John M. Hodgson,Chief Administrative Officer City of Kent Office of the Mayor 220 Fourth Avenue South Kent,WA 98032 Re: Letter of Intent to Purchase Aukeen District Courthouse 1210 Central Avenue South Kent,WA Dear John: King County is pleased to present the following letter of intent to sell to the City of Kent the real property commonly known as the Aukeen District Courthouse This offer will outline the general terms and conditions pursuant to which King County("Seller")would be willing to sell to the City of Kent (`Buyer")the property more fully described below(the"Property"). Property: The property consists of two parcels,one approximately 57,060 square foot unimproved tax parcel abutting the Green River(Tax Account#346280-0206) and one approximately 125,885 square foot tax parcel improved with a courthouse/office building containing approximately 15,224 square feet of area. The improved parcel is benefited by a reciprocal parking easement between Buyer and Seller(King County recording#20030122002929) All property interests collectively consist of the"Property,"and are generally located at 1210 Central Avenue South,Kent,WA Purchase Price: The purchase price for the Property shall be Five Million Six Hundred Thousand Dollars($5,600,000.00)payable in cash at closing subject to applicable adjustments and prorations,as defined herein. Additional Consideration: A premium has been incorporated into the Purchase Price because sale to Buyer will force Seller to relocate its District Court facilities currently located on the Property,which then will require the Seller to relocate a portion of its Sheriff's office facilities Both of Seller's relocations will also involve attendant tenant improvements and moving expense,which will comprise additional costs to Page 1 of 4 i ji f Seller. As for Buyer,this sale will complete a significant property assemblage that will allow Buyer's municipal court to expand within the existing structure without having to construct a costly addition,and which will secure a combined criminal justice/public safety assemblage where the Buyer can maintain its jail and court facilities within direct proximity to each other,with sufficient property to allow for future expansion of both facilities. Earnest Money. No Earnest Money deposit shall be required from Buyer. Contingencies Due Diligence: Buyer shall be granted a due diligence period of ninety(90)days after full execution of a Purchase and Sale Agreement within which to inspect the property and conduct any engineering, environmental and/or economic feasibility studies. Seller will provide Buyer,as requested,copies of all designs,drawings,reports and studies in Seller's possession or control related to the Property,including without limitation any property surveys,environmental studies,soils studies, mechanical, structural, electrical,plumbing records,leases,contracts and warranties Buyer in its sole discretion may determine whether the Property is suitable for its needs. If Buyer fails to waive its contingencies in writing within such 90-day period,the Purchase and Sale Agreement shall be automatically terminated i Inspections. Seller shall allow Buyer and/or its designee to have full access to the Property to conduct its investigations Buyer agrees that all inspections will be conducted at reasonable times agreed upon in advance by Buyer and Seller and,at Seller's election, Seller may have a representative present at each inspection All such inspections shall be at Buyer's sole expense Upon completion of any such inspection, Buyer shall restore the Property to its condition prior to such inspection. Buyer shall indemnify,hold harmless and defend Seller from any loss,cause of action,or claim arising out of or resulting from Buyer's actions. Title and # Conveyance: Title to the property will be conveyed by bargain and sale deed free and clear of all encumbrances,liens,easements, liabilities and other charges except as approved in writing by Buyer Upon execution of a Purchase and Sale Agreement, Seller shall order a preliminary commitment for an owner's coverage policy of title insurance from the Title Company for delivery to Buyer and shall provide Buyer with any surveys of the Property in Seller's possession or control. Seller shall pay the cost of the premium for owner's standard coverage title insurance. Buyer,at Buyer's option,may obtain a current as-built survey of the land or an updated version of any existing survey,and may obtain extended coverage title insurance, all at Buyer's sole expense. Seller shall cooperate with Buyer as necessary to obtain such survey Condition of Property: Buyer understands and acknowledges that the Property is being sold in its current "AS IS"condition. Page 2 of 4 Closing: Closing will occur within thirty(30)days following approval of the Purchase and Sale Agreement by the King County Council and the move-out schedule for Seller's existing occupants utilizing the Premises. Closing Costs: Seller shall pay all conveyance or transfer taxes,the title insurance premium for the owner's standard coverage policy and one-half of the escrow fee.Buyer shall pay the cost of the premium for extended coverage title insurance, if any, recording costs and one-half of the escrow fee All other closing costs shall be paid in accordance with local custom Purchase and Sale Agreement: Within thirty(30)business days after mutual execution of this letter of intent, Seller shall prepare and deliver to Buyer a Purchase and Sale Agreement reflecting the terms of this letter The Purchase and Sale Agreement shall be fully negotiated by Buyer and Seller subject to approval by the King County Council and the Kent City Council,if required Brokerage: Buyer and Seller represent that neither party has worked with any broker,finder or intermediary in conjunction with this transaction and agree to indemnify each other against all claims for fees,commissions or other compensation claimed to be due any broker,finder or intermediary with whom the indemnifying party may have dealt in connection with this transaction Confidentiality: Seller represents that it has not entered into any agreement,option or right of first refusal with respect to the sale of the Property,other than the existing Lease with Buyer, as amended For a penod of forty five(45)days after the execution of this letter, Seller agrees that it will not negotiate for the sale of the property with any other prospective buyer.The parties shall maintain as confidential the terms of this non-binding letter of intent except as otherwise provided by law and except for disclosure to necessary third parties,such as title company,surveyor, attorneys,and other third parties actually involved in the negotiation and consummation of this transaction,who agree to hold the information as confidential. Non-Binding Buyer and Seller agree that the above information serves as an outline of the general terms and conditions of the proposed transaction and that this letter is not a contract or binding agreement. Completion of this transaction is subject to,and neither party shall be bound until,the full execution of a mutually acceptable Purchase and Sale Agreement and approval by ordinance of the King County Council This letter shall create absolutely no rights or obligations upon the parties hereto,whether by contract,implied covenant of good faith and fair dealing,tort or otherwise. This proposal shall be available for your acceptance until 5 00 PM Pacific Time on February 17,2011.If the City of Kent concurs that the terms set forth are satisfactory,please confirm your approval by signing and dating this letter in the space provided below and returning to the undersigned on or before the aforementioned date. We look forward to your favorable response to this offer and the opportunity to work together to consummate this transaction. Page 3 of 4 i i I Sincerely, KING COUNTY 51elm 44-1 Stephen L Salyer Real Estate Services ACKNOWLEDGED AND AGREED: BUYER: CITY of KENT By- Its: o Date- 3 / 7Xt/ cc: Kathy Brown Tim Barnes P\cvd\F11es\0pen Files\1482-Aukeen_Court_Purchase\Sale LOT-Aukeen.Goc I i i Page 4 of 4 �Krl-l3� REQUEST FOR MAYOR'S SIGNATURE y KtNT Please Fill In All Applicable Boxes W..N1.-T.N Routing Information (ALL REQUESTS MUST FIRST BE ROUTED THROUGH THE LAW DEPARTMENT) Originator: Tom Brubaker Phone (Originator): x5782 Date Sent: 3/17/11 Date Required: 3/21/11 Return Signed Document to: Cheryl Rolcik- CONTRACT TERMINATION DATE: n/a Wilcox VENDOR NAME: King County DATE OF COUNCIL APPROVAL: n/a Brief Explanation of Document: Letter of Intent to Purchase Aukeen District Courthouse All Contracts Must Be Routed Through The Law Department (This area to be completed by the Law Department) Received: r REvRVED Approval of Law Dept.: , 2A( (C\0 l L -- Law Dept. Comments: City of Kent 'y. Date Forwarded to Mayor: Shaded Areas To Be Completed By Administration Staff Received: p � Recommendations and Comments: CE WE Disposition: �� rw��-��l_/ . MAAR 17 2t}11 CITY OF KENT Date Returned: CITY CLERK