Item 09 - Consideration of Sale Owned City Parcel at Eastland Shopping CenterAGENDA ITEM NO.9
AGENDA STAFF REPORT
City of West Covina I Office of the City Manager
DATE: August 20, 2019
TO: Mayor and City Council
FROM: David Carmany
Interim City Manager
SUBJECT: CONSIDERATION OF SALE OF CITY OWNED PARCEL AT EASTLAND SHOPPING
CENTER (APN NO: 8451-012-907)
RECOMMENDATION:
It is recommended that the City Council adopt the following resolution:
RESOLUTION NO.2019-62 - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST
COVINA, CALIFORNIA, APPROVING AND DIRECTING THE CITY MANAGER TO OPEN
ESCROW AND NEGOTIATE & EXECUTE A PURCHASE AND SALE AGREEMENT AND
RELATED DOCUMENTS NECESSARY TO COMPLETE THE SALE OF LAND TO BRE DDR BR
EASTLAND CA LLC (BLACKSTONE)
BACKGROUND:
The City of West Covina owns a 5.81-acre parcel (Parcel D) at the Eastland Shopping Center (Eastland Center).
Parcel D is comprised of surface parking stalls, lighting, curb and gutter, landscaping, ingress and egress (roads and
driveways) for the easterly section for Eastland Center (Attachment No. 1). Parcel D was acquired in 1986 from
May Centers for the sole purpose of providing a "free and non-exclusive public parking facility" to the general
public and patrons of the Eastland Shopping Center. Parcel D is subject to a Property Owner Participation,
Purchase and Redevelopment Agreement (OPA), a Public Parking Facilities Operation Agreement (Parking
Operation Agreement), Grant Deed, and Reciprocal Easement Agreement (REA).
The OPA was executed on July 27, 1977, and provided for redevelopment of the Eastland Center, conveyance of
Parcel D to the former West Covina Redevelopment Agency (Agency) (6.74-acres), and an agreement for the
Agency to use Parcel D for non-exclusive purpose to allow patrons of the retail store on the site to use any and all
parking facilities located on Parcel D without charge for a period of 50 years from the date of conveyance to the
Agency. The 50-year term ends 2027. Under the OPA, the property owner also maintains a first right (but not
obligation) to purchase the property at any time during the 50 years. Section 606 of the OPA also grants the
shopping center owner the right to acquire Parcel D, or any portion thereof, subject to a process for establishing the
value of Parcel D: `At any time after conveyance of Parcel D to the Agency and for a period offifty (50) years
commencing with such conveyance the Participant may from time to time submit to the Agency a request in writing
to purchase Parcel D, or any portion thereof... After said appraisals are completed, the Participant may purchase
parcel D or anyportion thereoffor the amount the Agency determines to be the fair market value of said Parcel or
portion thereof, but saidfair market value shall not exceed the estimated appraised value determined by the
arithmetic average of the two appraisals... "
The Parking Operation Agreement was executed on November 23, 1977, and provides for the Agency to contract
with the Eastland Center operator to manage, operate and maintain the parking facilities located on Parcel D at no
cost to the Agency. The Operator is obligated to pay for taxes, duties and fees levied on Parcel D and maintain it in
good repair at Operator's sole expense for a 50-year term (expiring November 23, 2027).
The Grand Deed of Parcel D was executed December 28, 1982, and covenants that "the Property shall be used
solelyfor use by the public as off-streetfree parking in accordance with the terms ofsuch Operating Agreement, for
fifty (50) years from the date of this Grant Deed, subject to Grantor's right to re purchase and develop it as
hereinabove provided [under the OPA]. "
A Reciprocal Easement Agreement (REA) was executed on September 21, 1988, and encompassed properties
owned by the developer, tenants and former redevelopment agency. The REA restated the Developer's reserved
rights under the Grant Deed, provides for ongoing covenants of reciprocal parking, and further provided for a five
to one parking ratio throughout the entire shopping center. Any parry may only make alterations to the parking
areas upon prior written consent of other parties, in their sole and absolute discretion. Any reduction in parking
ratio must be replaced by the parry proposing the reduction. The REA runs with the land and would survive in
perpetuity unless prematurely terminated with consent of the affected parties.
With the elimination of Redevelopment Agencies in 2012, the Successor Agency to the former Redevelopment
Agency obtained Department of Finance approval to transfer the two assets as "Government Purpose" to the City of
West Covina. On December 17, 2015, the City took ownership of the two parcels.
DISCUSSION:
On June 3, 2019, the Eastland Shopping Center owner, BRE DDR BR Eastland CA LLC (Blackstone) submitted an
offer to the City to purchase Parcel D from the City for $1 million dollars. The letter stated that it conducted an
appraisal which valued the property at $1,530,000 million. Blackstone justified the lower purchase price of
$1,000,000 due to investments Blackstone made and anticipates making in the Eastland Shopping Center.
Blackstone's offer was presented to the City Council at the June 18, 2019 Closed Session Meeting. The City
Council authorized staff to waive the OPA Section VI. F process required for Blackstone to purchase the City
parcel, rejected Blackstone's offer of $1,000,000, and instructed staff to obtain an independent appraisal. The City
Council directed staff to sell Parcel D at an amount not less than the value set by the City's appraisal report.
On June 24, 2019, staff hired Buss-Shelger Associates to conduct the appraisal of Parcel D. The appraisal, dated
July 1, 2019, was received by staff on Thursday, July 11, 2019, valuing Parcel D at $1,975,000 (excerpts
Attachment No. 2). On Monday, July 15, 2019, Blackstone submitted a revised offer at the City's full appraised
value of $1,975,000. Blackstone is very eager to move forward expeditiously with the purchase.
On July 16, 2019, the City Council directed staff to negotiate a Purchase and Sale Agreement and Joint Escrow
Instructions (PSA) with Blackstone for the sale of Parcel D at $1,975,000. Staff and the City Attorney have
negotiated with Blackstone the attached PSA (Attachment No. 3). The terms of the PSA include the following
terms:
1. Purchase Price: $1,975,000
2. Deposit: $10,000
3. Due Diligence Period: 30-day
4. Close of Escrow: 30 days from end of Due Diligence Period (possible one 30-day Extension)
As Parcel D is subject to various agreements that restrict the use of the property to free parking until 2027, and as
the OPA gives Blackstone the right to purchase Parcel D, staff is recommending approval of the PSA and authorize
the City Manager to execute the PSA.
LEGAL REVIEW:
The City Attorney's Office has reviewed the attached documents and approved them as to form.
OPTIONS:
The City Council has the following options:
1. Approve staffs recommendation; or
2. Provide alternative direction.
ENVIRONMENTAL REVIEW:
The City Council finds that the sale of the Eastland Center Parking Facilities (Parcel D) is exempt from review
under the California Environmental Quality Act pursuant to California Code of Regulations Section 15061 (b) (3) -
General rule of no potential for causing significant impact; as the sale of property does not allow any new uses or
activities, and no development approvals are granted by this purchase and sale of the property.
Prepared by: Paulina Morales, Economic Development and Housing Manager
Additional Approval: Thomas Duarte, City Attorney
Fiscal Impact
FISCAL IMPACT:
As the assets are City owned, any expenses associated with the sale of the City assets would be the responsibility
of the City. So far, the appraisal cost the City $4,500. Revenue from the sale proceeds, minus any closing costs,
would go into the City's General Fund.
Attachments
Attachment No. 1 - Eastland Shopping Center City Ownership Aerial
Attachment No. 2 - Buss-Shelger Associates Appraisal Dated July 1, 2019 (excerpts)
Attachment No. 3 - Purchase Agreement
Attachment No. 4 - Resolution 2019-62
CITY COUNCIL GOALS & OBJECTIVES: Achieve Fiscal Sustainabiltiy and Financial Stability
Engage in Proactive Economic Development
W
City Owned Property - Parcel D
4
� r
� � is S•t � ,�. � .. �.._,�. ,_ .-...
Ie
/ . ; tea, � r � ....._.. _ "`,e ,.. �I,� 1�, � fir• �• f , Q. „Q � , � � �-
� I s
^I.
-
��• 4l^." .:i".Nil' ♦• - w _ _ _ _.a a •. �.i-1'�., _..yY- :., ,�i
gaff. i
jpt
< .•� - 11C� 1�- ~ w "''��••�- 6 1, li♦
Ar
� 1
ATTACHMENT NO.2
BUSS-SHELGER ASSOCIATES
Real Estate Consultants
July 8, 2019
Community & Economic Development
City of West Covina
1444 West Garvey Avenue South
West Covina, California 91790
Attention: Ms. Paulina Morales
Economic Development & Housing Manager
Reference: Encumbered Market Valuation
Parking Lot — 5.81 acres
Eastland Center, West Covina
Our File No.: 5457-19
Ladies and Gentlemen:
970 W. 190th Street, Suite 350
Torrance, California 90502
Telephone: (213) 388-7272
(213) 270-1220
Facsimile: (213) 254-9032
E-Mail: bussshelger@pacbell.net
In response to your request, we have personally inspected and prepared an appraisal of 5.81-acre
parking lot located within the Eastland Center in West Covina. The purpose of this report is to
provide a fair market value for the property subject to a 50-year parking covenant in -place
restricting the use of the land. This valuation is subject to the extraordinary assumption that the
parking covenant will remain in effect for the 20 years remaining in the original term. Recognizing
these restrictions and assumptions, we have formed a fair market value opinion of the encumbered
fee simple interest in the property as of July 1, 2019.
ONE MILLION NINE HUNDRED SEVENTY-FIVE THOUSAND DOLLARS
($1,975,000)
Following is an appraisal report containing factual information, market data, and the analyses
which form the basis for the opinion rendered. This appraisal has been prepared in accordance
with the standards and reporting requirements of the Uniform Standards of Professional Appraisal
Practice as published by the Appraisal Foundation.
Respectfully submitted,
BUSS-SHELGER ASSOCIATES
",
620.,.dw 1, oumow
'�Z'
Ronald L. Buss, MAI
Lara Z. Buss, MAI
-1-
BUSS-SHELGER ASSOCIATES
GENERAL INFORMATION
INTRODUCTION
Buss-Shelger Associates has been asked to appraisal a portion of the parking lot located
within the Eastland Center in West Covina. The property is generally situated at the southwest
corner of East Workman Street and Barranca Avenue, just north of the Interstate 10 Freeway. The
5.81 acres of land is asphalt paved and contains both access corridors and parking spaces in support
of the larger commercial center. The holding is constrained to parking usage for another 20 years
which we have assumed will remain in effect for the duration of the covenant term. The land is
highly irregular in shape as highlighted on the following aerial photograph.
t . 1
oil
Err
OF
-
r-
0
ti—
_ _ - - 1 `_ ,:- „tea.:' •—
�_.- _
PURPOSE OF APPRAISAL
The purpose of this appraisal is to determine the fair market value of the fee simple
interest in the property subject to the parking covenant that has been in -place for the past 30 years.
- 1 -
BUSS-SHELGER ASSOCIATES
DATE OF VALUE
The opinions and matters expressed in this report are stated as of June 21, 2019, the date
the property has been inspected in the past month.
INTENDED USE OF APPRAISAL
This appraisal was prepared at the request of Ms. Paulina Morales, Economic
Development Manager for the City of West Covina, in connection with a potential sale of the asset.
PROPERTY RIGHTS APPRAISED
This appraisal addresses the fair market value of the fee simple interest in the parking
lot under consideration; the extraordinary assumption has been made that the parcel will remain
restricted to parking uses for the remaining 20 years of the parking covenant currently in -effect.
OWNERSHIP AND IDENTIFICATION
The property under analysis is owned by the City of West Covina and identified by the
following Los Angeles County Assessor's reference: Book 8451, Page 012, Parcel 907.
SCOPE OF APPRAISAL
To achieve the stated purpose, the appraisers have evaluated the subject properties and
surrounding area, plus collected, confirmed and analyzed pertinent market data necessary to form
the opinion of fair market value. The comparative approach to value has been utilized which
entails uncovering recent transfers of commercial land, parking lots and auto dealerships which
have nominal building improvements. The market information assembled have been compared to
the asset under analysis resulting in a current value conclusion. Based on the extraordinary
-2-
BUSS-SHELGER ASSOCIATES
assumption that the parking covenant will remain in effect for the full term of the parking covenant
(an additional 20 years), the current value of the land has been utilized to project a future value
which has been discounted to a present value.
An income analysis has not been undertaken as this land is would not likely be utilized
as a leased investment. A cost approach has not been considered due to the limited on -site
improvements, effectively paving and lighting. These two approaches to value are not a typical
way that market participants evaluate this type of asset.
Market Value(')
"The most probable price which a property should bring in a competitive and open
market under all conditions requisite to a fair sale, the buyer and seller each acting
prudently, knowledgeably and assuming that the price is not affected by undue
stimulus."
Fee Simple Estate (l)
"Absolute ownership unencumbered by any other interest or estate, subject only to the
limitations imposed by the governmental powers of taxation, eminent domain, police
power, and escheat."
"As Is" Value (l)
"The value of the property in its present condition and under market conditions prevalent
on the date of appraisal. No hypothetical conditions, assumptions, or qualifications
concerning the physical or legal aspects of the property are to be observed."
Footnote:
«ODictionary of Real Estate Appraisal, Appraisal Institute
The undersigned appraisers are competent to complete this appraisal and prepare this
report in accordance with the competency provision as stated within the Uniform Standards of
Professional Appraisal Practice (USPAP); qualifications are attached.
BIB
BUSS-SHELGER ASSOCIATES
8451 112 1 i ,, ,r' I aftm �
N i — �R
t WORKMAN • e e
FMW as 8 PM 188 -
�
e
PLAT MAP
88 «' 87PM
TlnNo cENoen -
s
BERNARDINO
I
1
7�7)
PM
RIE,B
s
•� - a Pc
Z o y
v Qm
iLl-
Ill Af-
- � IIIII Iilll
i� li'y •rl.
we.
M'r1
- 5 -
BUSS-SHELGER ASSOCIATES
LAND FEATURES
Location: Southwest corner of East Workman Street and Barranca
Avenue in West Covina
Assessor's Parcel: 8451-012-907
Size: Parcel contains 5.81 acres or 253,002 square feet,
Shape: Irregular shape as shown on the Plat Map.
Utilities: All available to the property
Topography: Level with Workman Street and slightly below grade of
Barranca Avenue
Zoning:
R-C — Regional Commercial zone which allows for
development of regional business centers which provide a
complete line of shop and store types, eating and
entertainment facilities, and business and financial services.
Flood Zone:
Subject has a Zone X designation which is an area of minimal
flood hazard and does not require flood insurance.
Soils:
We have not been given a title report on the property; based
on the existing improvements, it is assumed that the soil has
the load bearing capacity to support any improvements
allowed per zoning.
Title Matters:
The property is subject to a parking covenant for a 50-year
extending through January 31, 2039. There is roughly 20
years remaining on this term.
Site Improvements:
The property is asphalt -paved and improved with vehicular
transportation corridors within the Eastland Center.
Additionally, the land surrounding these passageways contain
surface parking spaces.
Surroundings:
The property is situated within a large regional center that is
adjacent to the Interstate 10 Freeway. Surrounding this
commercial core are residential neighborhoods.
Access:
There is street frontage on both Barranca Avenue and
Workman Street. Additionally, the westward extension of
Garvey Avenue provides access to the southern portion of the
property.
S'�
BUSS-SHELGER ASSOCIATES
HIGHEST AND BEST USE
Definition
"The reasonably probable and legal use of vacant land or an improved property, which
is physically possible, appropriately supported, financially feasible, and results in the
highest value."
Optimum Use
The subject property is a parking lot located along within a larger shopping center. The
land is restricted to parking usage for an additional 20 years. While the long-term reuse of the
property would likely be to create additional commercial space, the use restriction based on the
parking covenant will not allow that to occur for another 20 years. Based on its current utilization
and use restrictions, the property is being put to its optimum interim usage.
Workman Street Frontage
-7-
BUSS-SHELGER ASSOCIATES
UNENCUMBERED LAND VALUE ANALYSIS
OVERVIEW
For a comparative analysis of the asset in question, we have assembled sales of
commercial land parcels and parking lots in the subject's competitive Inland Empire marketplace.
Due to the limited number of transactions, we have also considered auto dealerships situated on
commercially zoned land with nominal building improvements. The data program includes
transactions involving two or more acres of land. The transactions have been listed in the
following table in chronological order by date of purchase. A Land Sales Map identifying the
location of each data point can be found on the following page.
Sales Summary
n�t� XT-
MARKET INFORMATION
Property
Address
Land Sq.Ft. Sale Price
Status Price/Sq.Ft.
Subject 2753 East Eastland Center 253,003 ---
--- Drive, West Covina Parking Lot ---
1 1164 Park View Drive,
6/18 Covina
2 4943-4949 Holt Boulevard,
10/18 Montclair
3 1530 W. Cameron Avenue,
11/18 West Covina
151,153 $4,175,000
Future Medical $28
148,540 $3,575,000
Future Industrial $24
301,683 $6,125,000
Future Residential $20
4
667 Auto Center Drive,
191,664
$4,650,000
12/18
Claremont
Auto Dealership
$24
5
10475 Central Avenue,
223,898
$6,050,000
5/19
Montclair
Auto Dealership
$27
6
528 S. Citrus Avenue,
91,389
$2,220,000
6/19
West Covina
Auto Dealership
$24
WE
BUSS-SHELGER ASSOCIATES
Land Sales Map
F
a� ada Duarte La F,h,
u E F BNd a
OF A pea OF,w.
OFF^
M Iowa, S A N B E
vil ,Da _ Ue aVerre
It I
_ Sale No. 4
A,udla ` Sale No. 6 Subject 667 Auto Center Dr
El 5 Citrus Ave 2753 E Eastland Center Dr Claremont, CA 91711 rpyy
s Ang West Covina, CA 91791 ress West Covina, CA 91791 - Hod Ceu on
° ianal Park Nod Pomo N A
'Ir W 5t 4th 41h 51
q D
West �'O t A A on elv onta o
Puehle
Valley E
Sale No. 3 Sale No. 1 Is m n ' Jun
vas ado 1530 W Cameron Ave 1164 5 Park View Dr Sale No. 2 Sale No. 5
Hetgms West Covina, CA 91790 Covina, CA 91724 4949 Holt Blvd 10475 Central Ave
Montclair, CA 91763 St Montclair, CA 91763
dusair TerdF4eAJe Ygallaa
HillD eQ Industry_ o aPUenle SaAN San d Riv side A 83
m Jose Is
--uFuectian. Marne,yvW A
-p-__--'- o Re ublic
`Rowland =, a Bar Y,
Dill end ghts ., -r on 4 e k10 H
Chino
NO Heights
wland a� *Airli
II
57
-- Los Serranose imboll Ave
Eel Rd_,
La Habra N eeDl'Hollow
Heights
............................................':..
P 1988-2012Miuosog Ca orationand10ritSSU" liers.FAllri hisreserved.
VALUE DETERMINATION
The properties in this study indicate a fairly narrow price pattern from $20 to $28 per
square foot. The auto dealerships are at the upper end of this price spectrum from $24 to $27 per
square foot due to the partially improved status of the existing property with paved parking and a
small showroom with a site coverage of less than 20%. These three data items (Nos. 4 thru 6) are
considered reasonably comparable to the subject due to the paved infrastructure and utilities in -
place for the subject parking lot.
111[I111
BUSS-SHELGER ASSOCIATES
The land sales, Data Nos. 1 thru 3, pertain to one vacant site and two redevelopment
projects. Data No. 1 was a vacant site proposed initially for a hotel; however, it was purchased by
Kaiser Permanente for either medical offices or a hospital. The higher price paid at $28 per square
foot is due to the fact that there were entitlements already approved for a hotel. Data No. 2
involved a small retail center with adjacent vacant land that was acquired for $24 per square foot to
redevelop into either industrial or a small business park. At the bottom end of the price spectrum,
Data No. 3 transferred for $20 per square foot; this site involved a small office building and
surrounding land which was acquired by a home builder. The need for rezoning and approvals for
residential is reflected in this lower price point.
Recognizing that the subject property is developed and used as a parking as well as
being situated within a major regional center, a price at the upper end of the spectrum is considered
reasonable. A value of $27 per square foot has been adopted for the subject holding without
consideration of the parking covenant.
253,003 square feet @$27/sq.ft.......................................................... $6,831,081
Rounded to ............................ $6,850,000
-11-
BUSS-SHELGER ASSOCIATES
LAND VALUE SUBJECT TO PARKING COVENANT
BACKGROUND
The previously determined unencumber land value has been utilized in the determining
the value of the property subject to the parking covenant. The current value has been indexed into
the future for the remaining 20 years of the covenant. The future value estimate has then been
discounted to a present worth. The parameters utilized for these calculations have been derived
from various indices found in the PricewaterhouseCoopers Real Estate Investor Survey (PwC
Survey) as of the 2°d Quarter 2019.
FUTURE VALUE CONSIDERATIONS
To index the current land value to the future, we have examined several indicators in the
PwC Survey.
Indicator
National Regional Mall Market:
Current
5 years ago
10-year forecast
National Net Lease Market:
Current
5 years ago
10-year forecast
Market Rent Change Expense Change
Range Average Range Average
(3.0%) - 4.0% 1.3% 2.0% - 5.0% 2.9%
1.0% - 5.0% 3.0% 0.0%- 3.0% 2.2%
0.0% - 5.0% 1.9% 2.0%- 4.0% 3.0%
0.0% - 3.0% 1.6% 0.0% - 3.0% 1.8%
0.0% - 3.0% 1.9% 0.0% - 3.0% 2.2%
1.0%-10.0% 2.8% 1.0%-10.0% 3.1%
The information regarding rental increases in the National Regional Mall Market
indicates a downward trend overtime the past five years with projections providing some hope of
an upturn. Unfortunately, expenses have been increasing at a higher percentage rate and are
forecast to continue to increase at a higher rate than rental rates. The overall value outlook for the
Regional Mall Market indicates decreases in value of these assets in the near term.
-12-
BUSS-SHELGER ASSOCIATES
Rental rates in the Net Lease Market, these include ground rents, have been relatively
stable over the past five years with a positive outlook in the future. However, the expenses for net
lease properties have been increasing at a rate greater than the rental rates are expected to continue
in the future. The overall values for these assets are projected to decrease in the near term similar
to the National Regional Mall Market.
As shown in the following table, the consumer price index has been increasing over the
past five years to a rate of 2.5% for 2018. The future of this rate is not known as quarterly
indicators vary greatly.
Consumer Price Index
2014
2015
2016
2017
2018
Average
1.66%
0.19%
1.63%
2.03%
2.50%
Given that expenses tend to be rising faster than rents in the markets considered, we
have indexed the property value of $6,850,000 by a conservative rate of 1.5%/year over the
remainder of the parking covenant timeline of 20 years.
PresentValue....................................................................................... $6,850,000
Future Value Factor — 20 years @ 1.5%/year..................................... x 1.346855
FutureValue........................................................................................ $9,225,957
Rounded to ................ $9,225,000
ENCUMBERED LAND VALUE
The projected future value of the land at the end of the parking covenant has been
discounted to a present value; the following indices have been utilized to understand current
discount rates.
-13-
BUSS-SIIELGER ASSOCIATES
Indicator
Range
Average
National Regional Mall Market:
5.0% - 10.0%
7.0%
National Net Lease Market
5.0% - 10.0%
7.5%
National Regional Mall Market Forecast — Class B IRR
6.5%- 10.0%
8.1 %
Discount rates from 7.0% to 8.1% are indicated on average for these categories of
assets. Given the unusual shape of the subject property, as well as the uncertainty of the status of
the larger mall in which it is located in 20 years, a discount rate of 8.0% has been applied to the
indexed future land value of $9,225,000.
FutureValue........................................................................................ $9,225,000
Discounted Present Value Factor — 20 years @ 8.0%......................... x 0.214548
Encumbered Land Value..................................................................... $1,979,205
Roundedto................ $1,975,000
-14-
BUSS-SliELGER ASSOCIATES
VALUATION
Based on the extraordinary assumption that the parking covenant will remain in -place
for the next 20 years, the following fair market value opinion of the 5.81-acre parking lot within
the Eastland Center has been formed as of July 1, 2019.
ONE MILLION NINE HUNDRED SEVENTY-FIVE THOUSAND DOLLARS
($1,975,000)
-15-
EXPERIENCE
BUSS-SHELGER ASSOCIATES
PROFESSIONAL QUALIFICATIONS
RONALD L. BUSS
Buss-Shelger Associates, Los Angeles, California (since 1984).
President. Provides consulting, investment, valuation, advisory,
brokerage and leasing services on all types of properties.
Landauer Associates, Inc., Los Angeles, California (1975-1984).
Senior Vice President. Real estate consulting services.
Shattuck Company, Los Angeles, California (1971-1975).
Real Estate Counselor and Consulting Appraiser.
State Board of Equalization, State of California (1963-1970).
PROFESSIONAL ACTIVITIES
Member: Urban Land Institute, 1998 - To date
Member: Lambda Alpha International, 1997 — To date
President — 2004
Member:
Land Economics Foundation, 2004 — To date
International President — 2004 — 2007
Member:
Appraisal Institute, 1976 - To date
Southern California Chapter President, 1987
Member:
Counselors of Real Estate, 1983 - 2004
Southern California Chapter President, 1988
National Vice President, 1996-1997
Member:
Assessment Practices Advisory Council,
Los Angeles County Assessor's Office, 1980-1986
Member:
Los Angeles Board of Realtors
Member:
California Real Estate Association
Member:
UCLA Center for Finance and Real Estate, 1993 - 1994
Member:
National Association of Realtors
Member:
American Industrial Real Estate Association
Advisor:
Operating Engineers Pension Trust, 1983 - 2006
Advisor:
Electrical Workers Pension Trust, 1994 - To date
Advisor:
Independent Directors, Irvine Apartment Communities
Investment
United States Securities & Exchange Commission
Advisor:
Registered 2000 - 2004
CERTIFICATION/EDUCATION
MAI designated and certified under The Appraisal Institute voluntary
program of continuing education for its designated members.
Certified as General Real Estate Appraiser in the State of California.
OREA Appraiser Certification No. AGO09146
Licensed State of California Real Estate Broker
Certificate in Real Estate — University of California Extension
Bachelor of Science — California Polytechnic College (1963)
SE9
ATTACHMENT NO.3
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (this "Agreement") is made as of the _ day of August, 2019
(the "Execution Date"), by and between the CITY OFWEST COVINA (a California municipal
corporation) ("Seller"), and BRE DDR BR EASTLAND CA LLC, a Delaware limited liability company
("Purchaser").
RECITALS:
A. Seller is the owner of certain real property situated in the City of West Covina, State of
California, with the tax parcel number 8451-012-907 and more particularly described on Exhibit A attached
hereto ("Parcel D").
B. The parties have agreed to the terms and conditions of the sale and purchase of the Property
at the price and upon the terms and conditions hereinafter set forth, and by these presents desire to confirm
the same in writing.
NOW, THEREFORE, for and in consideration of the premises and mutual covenants and
agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto do hereby incorporate the foregoing recitals herein and
further agree as follows:
follows:
1. Subject to and in accordance with the terms of this Agreement, "Property" is defined as
(a) fee simple title to Parcel D;
(b) all of Seller's right, title and interest in and to all improvements situated on Parcel D and
all fixtures and other property affixed thereto, if any (collectively, the "Improvements");
(c) all of Seller's right, title and interest in and to the rights and appurtenances to the extent
pertaining to Parcel D, including all water and mineral rights, rights under any reciprocal easement
agreements, access agreements or other recorded instruments benefiting Parcel D to the extent in effect
prior to Closing, any right, title or interest of Seller in and to easements, adjacent or contiguous tracts, strips,
gores, streets, alleys or rights -of -way, any reversionary rights to the extent attributable to Parcel D, any
condemnation awards made or to be made in lieu thereof, and any awards for damage to Parcel D by reason
of a change of grade of any highway, street, road or avenue (collectively, the "Appurtenances");
(d) all of Seller's right, title and interest in and to the following, to the extent that they exist,
are assignable and to the extent related to or arising out of the design, construction, ownership, use, leasing,
maintenance, management, service, supply or operation of Parcel D: (i) contracts or agreements such as
maintenance, service, construction, architect, engineering, supply or utility contracts, including all
amendments, modifications and supplements thereto (the "Contracts"), (ii) warranties, guaranties,
indemnities and claims, (iii) development rights, governmental approvals, licenses, permits, certificates of
occupancy or similar entitlements, (iv) plans, drawings, specifications, surveys, engineering reports,
environmental reports and audits, and governmental or regulatory compliance reports, and (v) any operating
NAI-1508450137v2
agreement, reciprocal easement agreement, utility agreement or other recorded or unrecorded agreement
affecting the Property.
(e) All of Seller's rights, title and interests in and to any covenants conditions and restrictions
to the extent impacting or affecting Parcel D, including, without limitation, the rights of "declarant",
"manager" or similar position under all declarations of covenants, operating covenants, condominium
documents, to the extent they exist and are held or controlled by Seller to the extent affecting Parcel D
(the "Contract Rights").
2. Purchase and Sale. Purchaser agrees to acquire the Property, and Seller agrees to sell the
Property, in "as is, where is" condition, pursuant to the terns and conditions set forth herein.
3. Purchase Price, Deposit.
3.1. Purchase Price. The purchase price for the Property is One Million Nine Hundred
Seventy Five Thousand and No/100 Dollars ($1,975,000.00) (the "Purchase Price"). The Purchase Price
shall be paid by Purchaser to Seller at Closing.
3.2 Deposit. Within three (3) business days after the Effective Date of this Agreement,
Buyer shall deliver to Escrow Agent a cash deposit of ten thousand and 00/100 ($10,000.00) (the
"Deposit"). Upon expiration of the Due Diligence Period, the Deposit shall be nonrefundable except as
otherwise expressly provided in this Agreement.
4. Seller's Representations and Warranties. hi order to induce Purchaser to enter into this
Agreement and to purchase the Property, Seller makes the following representations and warranties as of
the date hereof.
4.1 Seller's Authority: Property Documents. Seller is a validly existing entity
qualified to transact business in California. Seller and the persons executing this Agreement on behalf of
Seller have the full right, power and authority to enter into this Agreement, to cause Seller to sell the
Property to Purchaser and to otherwise perform Seller's obligations hereunder without the consent of any
other person, entity or Governmental Authority (as defined below). The sale of the Property shall not render
Seller insolvent; the sale of the Property pursuant to this Agreement shall not violate any law, ordinance,
judgment, decree or order to which it or the Property is subject or which affects the Property. Seller is not
a "foreign person" as that term is defined by Section 1445 of the Internal Revenue Code of 1986, as
amended (the "Code"). Seller is the owner of the Property.
4.2 Condemnation. There is no taking by power of eminent domain or condemnation
or threat thereof, whether for the permanent or temporary taking, of all or any portion of the Property.
4.3 Litigation. There is no pending or threatened order, actions, suits, complaints,
arbitration, protests, judgments, claims, litigation, proceedings, investigations, writ, award, ruling, charge,
injunction or decree of any court or governmental agency against or naming Seller or the Property or
otherwise affecting Seller, the Property, or any right or obligation benefitting or burdening the Property
following Closing, or which would cloud Purchaser's title to the Property or any portion thereof or Seller's
right to sell or Purchaser's right to purchase the Property or any portion thereof.
4.4 Absence of Bankruptcy. Seller has not commenced a voluntary case, nor has an
involuntary receivership proceeding been commenced against Seller, nor has Seller consented to the entry
of an order for relief against it in an involuntary case in bankruptcy, nor consented to the appointment of a
receiver for it or for any of its properties including the Property, nor has a court of competent jurisdiction
NAI-1508450137v2 2
entered an order or decree under any bankruptcy law that is for relief against Seller in an involuntary case
or that appoints a custodian for Seller or for all or any substantial part of the property of Seller.
4.5 Leases. There are no leases, ground leases, occupancy agreements, or rights of
possession affecting the Property.
4.6 Contracts. There are no written or oral Contracts or other agreements to which
Seller is a party or is bound and which relate to the Property or any portion thereof or any other contracts
or agreements which gives rise to a right to lien, attach or levy the Property or any portion thereof, or assert
a claim against Purchaser or be binding on the Property.
4.7 No Notice of Violation. Misc. (a) Seller has complied and is in compliance with
all applicable laws and no action, suit, proceeding, hearing, investigation, charge, complaint, claim,
demand, or notice has been filed or commenced against Seller alleging any failure to so comply, (b) Seller
has not received any written notice not previously cured from any governmental authority or quasi -
governmental authority having jurisdiction over the Property (each, a "Governmental Authority") that
the Property (or any part thereof) is subject to any fine, levy, penalty, special tax, or is in violation of any
law, ordinance, rule, order, regulation or requirement affecting the Property or any part thereof, including,
without limitation, those pertaining to zoning, land use, or environmental matters, (c) Seller has not received
any notice from any federal, city, county, state or other governmental authority of any order or directive
requiring any work of repair, maintenance or improvement be performed on the Property or relating to
defects in the Property or relating to noncompliance with any applicable laws or regulations, and (d) Seller
has not received any written notice of any special assessments to be or contemplated as being imposed
against the Property after the date hereof.
4.8 OFAC Compliance. Seller is in compliance with the requirements of Executive
Order No. 133224, 66 Fed. Reg. 49079 (Sept. 25, 2001) (the "Order") and other similar requirements
contained in the rules and regulations of the Office of Foreign Assets Control, Department of the Treasury
("OFAC") and in any enabling legislation or other Executive Orders or regulations in respect thereof (the
Order and such other rules, regulations, legislation, or orders are collectively called the "Orders"). Seller
is not: (1) listed on the Specially Designated Nationals and Blocked Persons List maintained by OFAC
pursuant to the Order and/or on any other list of terrorists or terrorist organizations maintained pursuant to
any of the rules and regulations of OFAC or pursuant to any other applicable Orders (such fists are
collectively referred to as the "Lists"); (2) a person or entity who has been determined by competent
authority to be subject to the prohibitions contained in the Orders; or (3) owned or controlled by, or acts for
or on behalf of, any person or entity on the Lists or any other person or entity that has been determined by
competent authority to be subject to the prohibitions contained in the Orders.
5. Purchaser's Representations and Warranties. In order to induce Seller to enter into this
Agreement, Purchaser makes the following representations and warranties as of the date hereof.
5.1 Purchaser Authority. Purchaser is a validly existing entity and is authorized to
transact business in California. Each of Purchaser and the persons executing this Agreement on behalf of
Purchaser has the full right, power and authority to enter into this Agreement, to purchase the Property from
Seller and to perform its obligations hereunder without the consent of any other person, entity or
Governmental Authority. The execution and delivery by Purchaser of, and the performance and compliance
by Purchaser with, the terms of this Agreement do not violate any term, condition or provision of (i)
Purchaser's organizational or governing documents, (ii) any judgment, order, injunction, decree, regulation
or ruling, of any court or other Governmental Authority to which Purchaser is subject, or (iii) any material
agreement or contract to which Purchaser is a party or is bound. Purchaser is not a "foreign person" as that
term is defined by the Code.
NAI-1508450137v2 3
5.2 Legal Proceedings. There are no judgments, liens, claims, litigation, legal or
administrative proceedings that have concluded, are pending or, to Purchaser's knowledge, are threatened
against or affecting Purchaser which have limited or impaired or could reasonably be expected to limit or
impair Purchaser's consummation of the transactions contemplated in this Agreement.
5.3 Absence of Bankruptcy. Purchaser has not commenced a voluntary case, nor has
an involuntary receivership proceeding been commenced against Purchaser, nor has Purchaser consented
to the entry of an order for relief against it in an involuntary case in bankruptcy, nor consented to the
appointment of a receiver for it or for all or a substantial part of its property, nor has a court of competent
jurisdiction entered an order or decree under any bankruptcy law that is for relief against Purchaser in an
involuntary case or that appoints a custodian for Purchaser or for all or any substantial part of the property
of Purchaser.
5.4 OFAC Compliance. Purchaser is in compliance with the requirements of the
Orders and other similar requirements contained in the rules and regulations of the OFAC and Purchaser is
not (1) listed on the Lists; (2) a person or entity who has been determined by competent authority to be
subject to the prohibitions contained in the Orders; or (3)owned or controlled by, or acts for or on behalf
of, any person or entity on the Lists or any other person or entity that has been determined by competent
authority to be subject to the prohibitions contained in the Orders.
6. Survival of Representations and Warranties. The representations and warranties of
Seller as set forth in Section 4 and in any document or certificate delivered to Purchaser pursuant to this
Agreement shall survive Closing for one (1) year.
7. Due Diligence Period; Title.
7.1 Due Diligence Period. During the period commencing on the Effective Date and
expiring at 5:00 PM (Pacific Time) on [September _, 2019'] (the "Due Diligence Period"), Seller shall
permit Purchaser and Purchaser's representatives to enter the Property at any time for the purpose of
conducting inspections and investigations reasonably required by Purchaser in order to determine the
suitability of the Property for Purchaser's purposes (collectively, the "Inspections"). From and after the
expiration of the Due Diligence Period, Buyer shall continue to have the right to perform Inspections in
accordance with this Agreement. If the results of the Inspections are not acceptable to Purchaser, Purchaser,
in its sole discretion, may terminate this Agreement by written notice given to Seller prior to the expiration
of the Due Diligence Period, in which event the Escrow Agent shall return the Deposit to Purchaser. If
Purchaser fails to terminate this Agreement prior to the expiration of the Due Diligence Period, Purchaser
shall be deemed to have terminated this Agreement.
7.2 Title. At Closing, title to the Property shall be conveyed to Purchaser in fee simple,
by grant deed, subject to (collectively, the "Permitted Exceptions") (i) all documents of record, (ii) all
matters that would be disclosed by a current ALTA survey of Parcel D, (iii) all zoning, land use and other
laws of general applicability, and (iv) any lien or encumbrance or other matter of title created by Purchaser
or any party claiming by, through or under Purchaser.
7.3 Standard Exceptions and Monetary Obiections. Seller shall, at Seller's cost and
expense: (a) cure any so-called general exceptions in Schedule B, Section 2 of the Title Commitment to the
extent the same may be removed by an owner's affidavit from Seller in form approved by Seller and the
Title Company (the "Seller's Affidavit") (other than those which will be cured by delivery of a current
' Insert date that is 30 days from Effective Date
NAI-1508450137v2
ALTA survey of the Property to the Title Company (as defined below)); and (b) cure those monetary
encumbrances to title (herein referred to as "Monetary Objections"), as follows:
(i) All mortgages or deeds of trust affecting the Property;
(ii) All past due real estate taxes and assessments, business improvement
district taxes, vault fees, fines, penalties and other governmental assessments of any kind constituting (or
which may constitute) a lien against the Property that are due and payable on or before the Closing Date, if
any:
(iii) All mechanics' and materialmen's liens arising out of work performed or
materials supplied to the Property, but expressly excluding any lien arising from Purchaser's activities;
(iv) All judgments against Seller which have attached to and become a lien
against the Property; and
(v) All liens or encumbrances against the Property arising by reason of an act
or omission of Seller which can be discharged by the payment of a sum certain.
7.4 Cure of Monetary Objections. Seller shall cure all Monetary Objections at
Closing.
8. Conditions Precedent to Closing.
8.1 Conditions Precedent to Purchaser's Obligation to Close. It shall be a condition
precedent to Purchaser's obligation to consummate the Closing hereunder that each and every one of the
following conditions shall have been satisfied (or waived in writing by Purchaser) on the Closing Date:
8.1.1 Representations and Warranties. Each of Seller's representations and
warranties contained herein shall be true and correct in all material respects on the date hereof.
8.1.2 Title Insurance. Title to the Property will be good and marketable,
insurable at customary rates and good of record and in fact, free and clear of all liens, encumbrances,
easements, leases, conditions and other matters affecting title, recorded or unrecorded, other than the
Permitted Exceptions, which condition shall be evidenced if the Title Company will commit to issue and
deliver to Purchaser (or its designee) an owner's policy of title insurance (the "Title Policy") subject only
to the Permitted Exceptions, in the amount of the Purchase Price, and insuring Purchaser (or its designee)
as the insured thereunder, in accordance with the title commitment issued by the Title Company to
Purchaser (the "Title Commitment"), a copy of which was previously provided to Seller, provided that
(A) Purchaser (or its designee) has complied with the requirements to be complied with by Purchaser under
Section 1 of Schedule B of the Title Commitment, and (B) Purchaser (or its designee) has paid to the Title
Company the title insurance premium required to be paid in connection with issuance of the Title Policy.
8.1.4 Seller's Covenants. The covenants of Seller set forth in this Agreement
shall have been fulfilled by Seller in all material respects.
8.2 Condition Precedent to Seller's Obligation to Close. It shall be a condition
precedent to Seller's obligation to consummate the Closing hereunder that each and every one of the
following conditions shall have been satisfied (or waived in writing by Seller) on the Closing Date as
indicated below:
NAI-1508450137v2
8.2.1 Representations and Warranties of Purchaser. Each of Purchaser's
representations and warranties contained herein shall be true and correct in all material respects on the date
hereof.
8.2.2 Purchaser's Covenants. The covenants of Purchaser set forth in this
Agreement shall have been fulfilled by Purchaser in all material respects.
9. Closing. The purchase and sale contemplated herein shall be consummated at a closing
("Closing") which shall take place on the date that is thirty (30) days following the expiration of the Due
Diligence Period (such date, the "Closing Date"); provided that Purchaser may (i) accelerate the Closing
Date to a date no earlier than five (5) days after written notice from Purchaser of such acceleration; or (ii)
extend the Closing Date by up to 30 days by providing written notice to Seller no later than three (3) days
prior to the then -scheduled Closing Date. The Closing shall take place on the Closing Date at the offices
of Lexington National Land Services LLC (as agent for First American Title Insurance Company) (the
"Title Company"), located at 39 West 37th Street, Fl. 12A, New York, New York 10018, Attention: Fanny
Trataros, Telephone: (646) 237-0825 (the "Escrow Agent"), and shall be conducted through a customary
escrow of deliveries for Closing by the parties.
10. Seller's Deliveries. At Closing, Seller shall execute, as appropriate, and deliver, or cause
the following to be delivered to Purchaser or the Escrow Agent, as customary:
10.1 Deed. A grant deed ("Deed") in the form attached hereto as Exhibit C.
10.2 Seller's Affidavit. The Seller's Affidavit to the Title Company.
10.3 FIRPTA Affidavit. An affidavit certifying that Seller is not a "foreign person" as
that term is defined by Section 1445 of the Code, in the form prescribed by the regulations promulgated
under the Code.
10.3 California Form 593-C. A California Form 593-C, in form sufficient to relieve
Buyer of any withholding obligation.
10.4 Closin¢ Statement. One (1) executed original of the closing statement (the
"Closing Statement") as prepared by the Escrow Agent and approved by the parties reflecting the Purchase
Price, prorations and adjustments as described in Section 13 below).
10.5 Other Documents. All other items or documents as are required by this
Agreement or the Title Company to be delivered by Seller at Closing, consistent with the obligations of
Seller hereunder, including, without limitation, all requisite recordation and transfer tax forms.
11. Purchaser's Deliveries. At Closing, Purchaser shall execute, as appropriate, and deliver,
or cause the following to be delivered to Seller or the Escrow Agent as customary:
11.1 Purchase Price. Payment of the Purchase Price (less the Deposit) by bank wire
transfer to the Escrow Agent.
11.2 Closing Statement. One (1) executed original of the Closing Statement.
11.3 Other Documents. All other items or documents as are required by this
Agreement or the Title Company to be delivered by Purchaser at Closing, consistent with the obligations
of Purchaser hereunder, including, without limitation, all requisite recordation and transfer tax forms.
NAI-1508450137v2
12. Release of Closing Escrow. Upon receipt of Seller's and Purchaser's deliveries as
described in Sections 10 and 11 above, and the satisfaction or waiver of the conditions to Closing by the
parties, Escrow Agent shall (A) disburse all cash proceeds due and payable to Seller as indicated on the
Closing Statement in accordance with Seller's wiring instructions attached hereto as Exhibit D, and
disburse any other Closing proceeds as indicated on the Closing Statement, and (E) record the Deed.
13. Closing Charges. Seller shall pay all costs of removing any Monetary Objections and all
of the cost of any transfer taxes and similar taxes attributable to, pertaining to, or otherwise due and payable
in connection with, the sale of the Property and the delivery of the Deed, and one half of any fees, settlement
and escrow charges of the Escrow Agent. Purchaser shall pay the cost of recording the Deed, all title
examination costs (including costs of the Title Commitment), premiums due in connection with the Title
Policy, and one half of any fees, settlement and escrow charges of the Escrow Agent. Purchaser and Seller
each shall pay its own legal fees related to the preparation of this Agreement and all documents required to
settle the transaction contemplated hereby. All other Closing costs shall be allocated according to custom
for land sale transactions in the County of Los Angeles.
14. Brokerage Commission. Seller and Purchaser represent and warrant to each other that
they have dealt with no brokers or finders in connection with the sale of the Property. Seller and Purchaser
represent and warrant to each other that no brokerage fee or real estate commission is or shall be due or
owing in connection with this transaction, and Seller and Purchaser hereby indemnify and hold the other
harmless from any and all loss, costs or damage (including, without limitation, reasonable attorneys' fees
and expenses) arising out of any claims of any broker or agent so claiming based on action or alleged action
of the indemnifying party.
15. Miscellaneous Provisions.
15.1 Completeness and Modification. This Agreement and all exhibits hereto,
constitute the entire agreement between the parties hereto with respect to the transactions contemplated
herein, and it supersedes all prior discussions, understandings or agreements between the parties. This
Agreement shall not be modified or amended except by an instrument or writing signed by and on behalf
of the parties. There are no oral agreements between the parties.
15.2 Additional Documents. Purchaser and Seller shall, at any time after the Closing,
duly execute and deliver to each other any additional documents and instruments, and shall take or cause
to be taken such further actions (including the making of filings), which are reasonably necessary in
connection with the consummation of the purchase and sale contemplated herein.
15.3 Severability. If fulfillment of any provision of this Agreement, or performance of
any transaction related hereto, at the time such fulfillment or performance shall be due, shall involve
transcending the limit of validity prescribed by law, then the obligation to be fulfilled or performed shall
be reduced to the limit of such validity; and if any clause or provision contained in this Agreement operates
or would prospectively operate to invalidate this Agreement in whole or in part, then such clause or
provision only shall be held ineffective, as though not herein contained, and the remainder of this
Agreement shall remain operative and in full force and effect.
15.4 Construction. Each party hereto hereby acknowledges that all parties hereto
participated equally in the negotiation and drafting of this Agreement and that, accordingly, no court
construing this Agreement shall construe it more stringently against one party than against the other.
15.5 Pronouns. All pronouns and any variations thereof shall be deemed to refer to the
masculine, feminine, neuter, singular or plural, as the identity of the person or entity may require.
NAI-1508450137v2
15.6 Assignment. Purchaser may assign its rights and obligations under this
Agreement, without the consent of Seller, to GREF GG EASTLAND CENTER LP, a Delaware limited
liability company, and/or to DWS Alternatives GmbH, a German limited liability company not in its
individual capacity, but acting on behalf of and with its liability limited to the assets of "Global Real Estate
Fund", a German Spezial-AIF. Upon such assignment, Seller shall have no further rights or obligations
under this Agreement.
15.7 Waiver; Modification. Failure by Purchaser or Seller to insist upon or enforce
any of its rights hereto shall not constitute a waiver thereof.
15.8 Governing Law. This Agreement shall be governed by and construed under the
laws of the State of California (without reference to any contrary choice of law provisions of the State of
California). SELLER AND PURCHASER FURTHER COVENANT AND AGREE THAT IN ANY
ACTION OR PROCEEDING BROUGHT BY EITHER PARTY AGAINST THE OTHER ON THIS
AGREEMENT OR ANY OF THE CLOSING DOCUMENTS DELIVERED HEREUNDER, EACH
SHALL AND DOES HEREBY WAIVE TRIAL BY JURY, TO THE FULLEST EXTENT
AVAILABLE.
15.9 Headings. The headings are used herein for convenience of reference only, and
shall not be deemed to vary the content of this Agreement.
15.10 Exhibits. All Exhibits and Schedules attached hereto are incorporated herein and
made a part of this Agreement.
15.11 Counterparts. To facilitate execution, this Agreement may be executed in as
many counterparts as may be required; and it shall not be necessary that the signature of each party, or that
the signatures of all persons required to bind any party, appear on each counterpart; but it shall be sufficient
that the signature of each party or that the signatures of the persons required to bind any party, appear on
one or more such counterparts. All counterparts shall collectively constitute a single agreement.
15.12 Notices. All notices, requests, consents, and other communications hereunder shall
be in writing and shall be personally delivered, sent by Federal Express or other nationally recognized
overnight delivery service to the addresses indicated below.
If intended for Purchaser to:
BRE DDR BR EASTLAND CA LLC
c/o Blackstone Real Estate Advisors L.P.
345 Park Avenue
New York, New York 10154
Attention: Andrea Drasites
Email: andrea.drasites@blackstone.com
With a copy to: Jones Day
901 Lakeside Avenue
Cleveland, Ohio 44114
Attn: Peter C. Bergan, Jr.
E-mail: pbergan@jonesday.com
NAI-1508450137v2
If intended for Seller to: City of West Covina
1444 West Garvey Avenue South
West Covina, CA 91791
Attn: David Carmany, Interim City Manager
Email: dcarmany@westcovina.org
With a copy to: Jones & Mayer
3777 N. Harbor Blvd.
Fullerton, CA 92835
Attn: Thomas Duarte, City Attorney
Email: tpd@jones-mayer.com
The addresses and parties set forth above may be changed from time to time by any party by notice to the
other. For purposes of this Agreement, notices shall be effective upon receipt or refusal thereof.
15.13 Mercer. Except as otherwise expressly provided in this Agreement, this
Agreement and all of the representations, warranties, covenants and agreements of the parties set forth in
this Agreement shall not survive Closing under this Agreement and shall merge into the delivery of the
Deed under this Agreement.
15.14 Prevailinc Party. If either Seller or Purchaser, or their respective successors or
assigns, file suit to enforce the surviving obligations of the other party under this Agreement, the prevailing
party shall be entitled to recover the reasonable fees and expenses of its attorneys and court costs.
15.15 As -Is Sale. EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, IT IS UNDERSTOOD AND AGREED THAT SELLER IS NOT MAKING ANY
REPRESENTATIONS OR WARRANTIES OF ANY KIND OR CHARACTER, EXPRESSED OR
IMPLIED, WITH RESPECT TO THE PROPERTY OR LOT, INCLUDING, BUT NOT LIMITED
TO, ANY REPRESENTATIONS OR WARRANTIES AS TO HABITABILITY,
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, PARKING RIGHTS, TITLE
(OTHER THAN SELLER'S IMPLIED COVENANTS CONTAINED IN THE DEED), ZONING,
TAX CONSEQUENCES, LATENT OR PATENT PHYSICAL OR ENVIRONMENTAL DEFECTS
OR CONDITIONS, VALUATION, THE COMPLIANCE OF THE PROPERTY WITH
COVENANTS OR LAWS, OR THE TRUTH, ACCURACY OR COMPLETENESS OF ANY
INFORMATION PROVIDED TO PURCHASER. PURCHASER ACKNOWLEDGES AND
AGREES THAT THIS AGREEMENT PROVIDES FOR A SALE AND CONVEYANCE OF, AND
UPON CLOSING SELLER SHALL SELL AND CONVEY TO PURCHASER, AND PURCHASER
SHALL ACCEPT, THE PROPERTY, "AS IS, WHERE IS, WITH ALL FAULTS", EXCEPT TO
THE EXTENT EXPRESSLY OTHERWISE PROVIDED IN THIS AGREEMENT. PURCHASER
REPRESENTS TO SELLER THAT PRIOR TO THE EXECUTION DATE PURCHASER HAS
HAD THE OPPORTUNITY TO CONDUCT INVESTIGATIONS OF THE PROPERTY,
INCLUDING BUT NOT LIMITED TO, LEGAL COMPLIANCE AND THE PHYSICAL AND
ENVIRONMENTAL CONDITIONS THEREOF, AND, EXCEPT FOR SUCH
REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER AS EXPRESSLY ARE
SET FORTH IN THIS AGREEMENT, SHALL RELY SOLELY UPON SUCH PURCHASER
INVESTIGATIONS AND FROM AND AFTER CLOSING, PURCHASER SHALL HAVE NO
NAI-1508450137v2
RIGHT OF CONTRIBUTION OR PAYMENT WITH RESPECT TO ANY PRE-EXISTING
ENVIRONMENTAL CONDITIONS AFFECTING THE PROPERTY.
15.16 Timing. Time is of the essence of this Agreement.
15.17 No Recordation. Neither this Agreement nor any memorandum hereof may be
recorded or filed in any public records unless the prior written consent therefor has been given by Seller
and Purchaser. The provisions of this Section 15.17 shall survive the termination of this Agreement.
15.18 No Personal Liability. Anything to the contrary notwithstanding, no officer,
director, trustee, member, agent, representative or employee of Seller shall have personal liability for any
matter pertaining to the transactions contemplated hereby.
[signature page follows]
NAI-1508450137v2 10
IN WITNESS WHEREOF, the parties hereto have executed this Agreement under seal
as of the day and year first above written.
BRE DDR BR EASTLAND CA LLC, a Delaware limited
liability company
By:
Name:
Title:
SELLER:
CITY OF THE WEST COVINA (a California municipal
corporation)
M.
Name:
Title:
NAI-1508450137v2
List of Exhibits and Schedules
Exhibit A:
Legal Description of Parcel D
Exhibit B:
Site Plan of Eastland Center
Exhibit C:
Form of Deed
Exhibit D:
Seller's Wiring Instructions
NAI-1508450137v2
EXHIBIT A
Legal Description of Parcel D
NAI-1508450137v2
EXHIBIT B
Site Plan of Eastland Center
NAI-1508450137v2
EXHIBIT C
Seller's Wiring Instructions
Per Settlement Statement
NAI-1508450137v2
EXHIBIT D
FORM OF DEED
FORM OF GRANT DEED
RECORDING REQUESTED BY AND WHEN
RECORDED RETURN TO:
Attention:
MAIL TAX STATEMENTS TO:
Attention:
APN #
(Space above this line for Recorder's use)
THE UNDERSIGNED GRANTOR(s) DECLARE(s)
Documentary Transfer Tax is: $ ❑ computed on full value of interest or
City Transfer Tax is: $ property conveyed, or
❑ full value less value of liens or encumbrances
remaining at the time of sale
❑ unincorporated area
❑ the City of
GRANT DEED
FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged,
a
("Pro e ") located in the City of
("Grantor"), hereby GRANTS to
_ ("Grantee"), the following described real property
County of State of California:
See Exhibit "A" attached hereto and incorporated herein by this reference.
This conveyance is made subject and subordinate to all matters of record, all matters which an
inspection or survey of the Property would disclose, real estate taxes and assessments which are a lien but
are not yet due and payable, leases and rights of tenants under leases, and all applicable laws and ordinances.
NAI-1508450137v2
The Grantee herein covenants by and for himself or herself, his or her heirs, executors,
administrators and assigns, and all persons claiming under or through them, that there shall be no
discrimination against or segregation of, any person or group of persons on account of race, color, creed,
religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy,
tenure or enjoyment of the land herein conveyed, nor shall the grantee or any person claiming under or
though him or her, establish or permit any such practice or practices of discrimination or segregation with
reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or
vendees in the land herein conveyed. The foregoing covenants shall run with the land.
[Signatures on next page]
NAI-1508450137v2
DATED:
GRANTOR:
ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who
signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of
that document.
State of California
County of
On , before me,
(insert name of notary)
Notary Public, personally appeared
who proved to me on the basis of satisfactory evidence to be the persons) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
(Seal)
NAI-1508450137v2
EXHIBIT A
Legal Description
NAI-1508450137v2
ATTACHMENT NO.4
RESOLUTION NO. 2019-62
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST
COVINA, CALIFORNIA, APPROVING AND DIRECTING THE CITY
MANAGER TO OPEN ESCROW AND NEGOTIATE & EXECUTE A
PURCHASE AND SALE AGREEMENT AND RELATED DOCUMENTS
NECESSARY TO COMPLETE THE SALE OF LAND TO BRE DDR BR
EASTLAND CA LLC (BLACKSTONE)
The City Council of the City of West Covina, California, does hereby resolves as follows:
SECTION 1. The City Council of the City of West Covina hereby approves and directs the
City Manager to execute a Purchase and Sale Agreement and all other related and necessary documents
for the sale of Parcel D of the Eastland Shopping Center Parking Facilities (APN NO: 8451-012-907)
in substantially the form of Exhibit A, attached hereto and by this reference incorporated herein to
BRE DDR BR EASTLAND CA LLC (BLACKSTONE) .
SECTION 2. The City Clerk shall certify to the adoption of this resolution.
SECTION 3. The City Council finds that the sale of the Eastland Center Parking Facilities
(Parcel D) is exempt from review under the California Environmental Quality Act pursuant to
California Code of Regulations Section 15061 (b) (3) - General rule of no potential for causing
significant impact; as the sale of property does not allow any new uses or activities, and no
development approvals are granted by this purchase and sale of the property.
PASSED, APPROVED, AND ADOPTED this 20`h day of August, 2019.
APPROVED AS TO FORM
Thomas P. Duarte
City Attorney
Lloyd Johnson
Mayor
ATTEST
Carrie Gallagher
Assistant City Clerk