City taxpayer are made whole in the transaction as promised. This marks another step forward in the creation of the permanent UMR campus near Soldiers Field.
For the past several months I have been working with the University of Minnesota real estate department on the sale of 601 1st Avenue SW, 609 1st Avenue SW and 114 6th Street SW to the U of M for the future UMR campus and on the settlement of special assessments related to the reconstruction of 6th Street SW. We have wrapped all of the costs into a purchase agreement. Proceeds to the city will be paid through a deduction from the $14.0 million in sales tax funds allocated to UMR. A portion of the proceeds will reimburse the downtown abatement fund for the land acquisition and related costs. The remainder will be applied against the special assessments for the 6th Street reconstruction project.
The sale price of $1,366,939.70 allows the City to recoup all of the out of pocket costs we incurred for acquisition, abatement, demolition and other miscellaneous expenses. This total also includes $50,127.70 in street assessments for the parcel currently owned by UMR at Broadway and 6th and $57,968.80 in assessments associated with the former KTTC and Stillman properties (the U agreed to pay the specials even though they were not the owner at the time the improvements were made and are not legally responsible for special assessments). Removal of the former KTTC tower prior to closing was a condition of sale. Tower removal is underway. The cost of removal has also been folded into the purchase price.
This transaction requires approval by the Board of Regents and the approval of the Council. I will be preparing an RCA for approval of a purchase agreement for either the last Council meeting in December or the first meeting in January. We anticipate actual closing on the sale will occur in mid to late January 2014. If you have any questions on the transaction please call or send me an email. Doug