On December 3, 2019, the City received an unsolicited offer from Investel Garden Resorts LLC (Investel) to purchase four (4) residential properties located at 12233, 12235, 12237 and 12239 Choisser Road.  The proposed price and terms was presented at the December 10, 2019 City Council meeting.  Staff received direction to negotiate the final price and terms of the sale and prepare the Purchase and Sale Agreements for City Council consideration at the December 17, 2019 meeting.

The Choisser properties were originally acquired by the City of Garden Grove to support the development of the Site C project. Portions of the rear yards of each of the Choisser properties was conveyed to Investel as they were going to be impacted by the Site C development.  To facilitate implementation of the Site C project, Investel has expressed interest to acquire the remaining portions of the Choisser properties.

The City’s economic consultant, John Yonai with Tierra West Advisors has conducted an Opinion of Value and determined the fair market value of the Choisser properties to be $1.8 million.

The salient points of the Purchase and Sale Agreements are as follows:

·         An all cash purchase price in the amount of $1,800,000; 

·         The properties acquired by Investel shall be AS-IS with no warranties;

·         The current tenant leases will be transferred to Investel; and

·         Escrow closing to occur no later than December 31, 2019.

It is recommended that the City Council approve the Purchase and Sale Agreements.

It is recommended that the City Council:

•  Approve the Purchase and Sale Agreements and joint escrow instructions for the sale of 12233,12235, 12237 and 12239 Choisser Road; and 

•  Authorize the City Manager to execute the four Purchase and Sale Agreements and to approve any and all modifications that are deemed necessary, and to execute all other documents necessary to close the real property transfer.