HomeMy WebLinkAboutRes OB-123 (2)OVERSIGHT BOARD OF THE SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
ECONOMIC DEVELOPMENT DEPARTMENT
STAFF REPORT
REQUEST: AUTHORIZATION TO EXECUTE A PURCHASE AND SALE
AGREEMENT TO SELL THE SUCCESSOR AGENCY PROPERTY
LOCATED ON THE NORTH SIDE OF COUNTRY CLUB DRIVE, EAST
OF PORTOLA AVENUE (APNs: 620-430-024, 025) TO DESERT
EQUITY GROUP, LLC
SUBMITTED BY: Ruth Ann Moore, Economic Development Manager
PROPERTY: Desert Equity Group, LLC
BUYER
DATE: April 6, 2015
CONTENTS: Resolution No. OB- 123
Purchase and Sale Agreement (Contract No. SA34300)
Site Map
Exclusive Negotiating Agreement
Appraisal
Recommendation
Waive further reading and adopt Resolution No. OB - 123 to:
1. Approve the Purchase and Sale Agreement for the property located on the north side of
Country Club Drive, east of Portola Avenue, Palm Desert, California (APNs: 620-430-
024, 025) with the Desert Equity Group, LLC, in the amount of $2,800,000 (appraised
value) and authorize the City Attorney to make non -substantive changes; and
2. Authorize the Executive Director to execute said agreement after approval is received
from the Oversight Board and State Department of Finance.
Background
The subject property is listed on the Long Range Property Management Plan (LRPMP) as
Desert Willow Lot Pad 12(g) (known as "The Property). The Property consists of two (2)
undeveloped parcels totaling 9.34 acres, located on the north side of Country Club Drive, east
of Portola Avenue and its land use designation is commercial/office use.
Discussion
With the dissolution of the Redevelopment Agency and the recent approval of the Long Range
Property Management Plan, the Successor Agency is tasked with selling several properties.
Oversight Board Staff Report
Authorize Purchase/Sale Agreement for APNs: 620-430-024, 025
April 6, 2015
Page 2of2
On December 1, 2014 Desert Equity Group, LLC entered into an Exclusive Right to Negotiate
Agreement (ENA) for the purchase of the Property and development of a residential assisted
living facility and a residential memory care facility (known as "The Project").
In anticipation of the sale of the property, the Successor Agency contracted with Lidgard &
Associates, Inc. to conduct a fair market appraisal. Lidgard's appraisal complies with the
reporting requirements set forth in the Uniform Standards of Professional Appraisal Practice,
under Standard Rule 2-2(a). Lidgard's appraised value for the site is $2,800,000.00 (see
attached appraisal).
Staff recommends that the Successor Agency sell the site to Desert Equity Group, LLC, for the
appraised value of $2,800,000.00. If the Oversight Board authorizes the sale of the property,
staff recommends that the Executive Director be authorized to finalize and execute the attached
Purchase and Sale Agreement, once the State Department of Finance grants approval.
Fiscal Analysis
The subject property was listed on the LRPMP to be sold for fair market value. The LRPMP
requires that all proceeds of the sale be distributed as property taxes to the affected taxing
entities, in accordance with the terms of the California Health and Safety Code, Section 34191.5
(c)(2)(B). Each taxing entity including the City will receive a portion of the proceeds based on
their respective tax rate.
Submi
Off&
th nn Moor
Economic Dev-lopment Manager
Reviewed:
aul Gibbon, Director of Finance
Approved:
o n M. Wohlmuth, City Manager
Department Head:
Martin Alvarez
Director of Economic Development
Rudy costa
Assistant City Manager
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VERIFIED BY
Original on file with City Clerks Office
G:\Econ Development\Martin Alvarez\SA Property Sales\Desert Willow Lot Pads\Lot Pad G\Oversight Board staff report-02-23-15 Desert Willow Pad G.doc
NOTICE OF ADJOURNED REGULAR MEETING
OF THE OVERSIGHT BOARD OF
THE SUCCESSOR AGENCY TO
THE PALM DESERT REDEVELOPMENT AGENCY
Proposed Adoption of:
A Resolution Directing
the Execution of a Purchase and Sale Agreement with Desert Equity Group, LLC for Property Located on the North
Side of Country Club Drive, East of Portola Avenue known as APN: 620-430-024, 025, Property 12(g) Pursuant to
the Long Range Property Management Plan
Date: April 6, 2015
Time: 1:30 P.M. or as soon thereafter as the matter may be heard
Place: Administrative Conference Room, located at Palm Desert City Hall, 73-510 Fred Waring
Drive, Palm Desert, California
NOTICE IS HEREBY GIVEN that at the meeting of the Oversight Board (the "Oversight Board") of the
Successor Agency to the Palm Desert Redevelopment Agency (the "Successor Agency") to be held on April 6, 2015,
at 1:30 P.M., or as soon thereafter as possible, the Oversight Board will consider the adoption of a resolution
directing the execution of a Purchase and Sale Agreement with Desert Equity Group, LLC for Property located on
the North Side of Country Club Drive, East of Portola Avenue known as APN: 620-430-024, 025, Property 12(g)
pursuant to the Successor Agency's Long Range Property Management Plan. Such Long Range Property
Management Plan has been approved previously by the Oversight Board and the California State Department of
Finance.
Interested persons are invited to attend this meeting and be heard regarding this matter. An individual who
challenges any decision regarding the proposed action in court may be limited to raising only those issues such
individual or someone else raised at the meeting described in this notice or in written correspondence delivered to
the Oversight Board at, or prior to, the meeting. Due to the time constraints and the number of persons wishing to
give oral testimony, time restrictions may be placed on oral testimony at the meeting regarding the proposal. Any
interested person may wish to make comments in writing to assure that the relevant views are expressed adequately.
Written comments may be submitted to the Oversight Board prior to the time set for the meeting, to the attention of
the Secretary of the Oversight Board at 73-510 Fred Waring Drive, Palm Desert.
Further information may he obtained by contacting Martin Alvarez, Dir. of Economic Development, at 73-510 Fred
Waring Drive, Palm Desert, or by telephone at (760) 346-0611, Ext 467 or by email at
malvarez@cityofpalmdesert.org.
In compliance with the Americans with Disabilities Act, if you need special assistance to participate in an Oversight
Board meeting, please contact the Office of the City Clerk of the City of Palm desert at (760) 346-0611.
Notification at least 48 hours prior to the meeting or time when services are needed will assist the Oversight Board
staff in assuring that reasonable arrangements can be made to provide accessibility to the meeting or service.
Assisted hearing devices will be available at this hearing without prior notification
Dated this day' J� , 2015
Rathelle D. Klassen,
Secretary to the Successor Agency to the }palm Desert
Redevelopment Agency
RESOLUTION NO. OB- 123
A RESOLUTION OF THE OVERSIGHT BOARD OF THE SUCCESSOR
AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY
AUTHORIZING THE EXECUTION OF A PURCHASE AND SALE
AGREEMENT FOR PROPERTY LOCATED ON THE NORTH SIDE OF
COUNTRY CLUB DRIVE, EAST OF PORTOLA AVENUE, PALM DESERT,
CA (APN 620-430-024, 025) PROPERTY 12(g) OF THE LONG RANGE
PROPERTY MANAGEMENT PLAN) WITH DESERT EQUITY GROUP, LLC.
RECITALS:
A. Pursuant to AB X1 26 (enacted in June 2011), as modified by the California
Supreme Court's decision in California Redevelopment Association, et al. v. Ana
Matosantos, et al., 53 Cal. 4th 231 (2011), the Palm Desert Redevelopment Agency (the
"Former Agency") was dissolved as of February 1, 2012 and the Successor Agency was
established, and the Oversight Board to the Successor Agency (the "Oversight Board") was
constituted.
B. AB 1484 (enacted June 2012) amended and supplemented AB X1 26 (AB X1
26 and AB 1484, together, being referred to below as the "Dissolution Act").
C. Pursuant to the Dissolution Act, the Successor Agency is tasked with winding
down the affairs of the Former Agency.
D. Pursuant to Section 34175(b) of the California Health and Safety Code
("HSC"), all real properties of the Former Agency transferred to the control of the Successor
Agency by operation of law.
E. On May 5, 2014, the Oversight Board adopted Resolution No. OB-073,
approving a long-range property management plan (the "LRPMP") which addresses the
disposition of the real properties owned by the Successor Agency.
F. As indicated in the California Department of Finance's (DOF) letter dated
June 2, 2014, the DOF has approved the LRPMP.
G. Pursuant to HSC Section 34191.3, the DOF-approved LRPMP shall govern,
and supersede all other provisions of the Dissolution Act relating to, the disposition and use
of the real property assets of the Former Agency.
H. Pursuant to the approved LRPMP, the Oversight Board authorizes the
execution of a Purchase and Sale Agreement (see Exhibit A) with Desert Equity Group, LLC
for Property 12(g) of the LRPMP (APN 620-430-024, 025) in the amount of $2,800,000.00
(fair market value).
In accordance with the terms of California Health and Safety Code Section
34191.5(c)(2)(B), the proceeds of this property sale will distributed as property taxes to the
affected taxing entities.
-1-
J. The Oversight Board is adopting this Resolution to direct the execution of the
Purchase and Sale Agreement (see Exhibit A) with Desert Equity Group, LLC for fair market
value as directed by the approved LRPMP.
K. Notice of the proposed action presented in this Resolution was posted on the
Successor Agency's website (being a page on the City's website) and at three public
places: beginning on March 25 , 2015.
NOW, THEREFORE, THE OVERSIGHT BOARD OF THE SUCCESSOR AGENCY
TO THE PALM DESERT REDEVELOPMENT AGENCY DOES HEREBY RESOLVE,
DETERMINE AND ORDER AS FOLLOWS:
Section 1. The above recitals, and each of them, are true and correct.
Section 2. The Oversight Board hereby authorizes and directs the Successor
Agency to complete the execution of the Purchase and Sale Agreement (see Exhibit A) with
Desert Equity Group, LLC for fair market value as directed by the approved LRPMP. The
Executive Director of the Successor Agency is hereby authorized to execute the Purchase
and Sale Agreement to complete the disposition of the properties.
Section 3. The members of the Oversight Board and officers and staff of the
Successor Agency are hereby authorized and directed, jointly and severally, to do any and
all things which they may deem necessary or advisable to effectuate this Resolution.
Section 4. This Resolution shall become effective in accordance with HSC
Section 34181(f).
APPROVED and ADOPTED this day of , 2015.
AYES:
NOES:
ABSENT:
ABSTAIN:
ROBERT A. SPIEGEL, CHAIR
ATTEST:
RACHELLE D. KLASSEN, SECRETARY
OVERSIGHT BOARD FOR THE SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
RESOLUTION NO. OB - 123
EXHIBIT A
OVERSIGHT BOARD OF THE SUCCESSOR AGENCY TO THE
PALM DESERT REDEVELOPMENT AGENCY
PURCHASE AND SALE AGREEMENT FOR PROPERTY LOCATED COUNTRY
CLUB DRIVE, PALM DESERT, CA (APN 620-430-024, 025, PROPERTY 12g OF THE
LONG RANGE ROPERTY MANAGEMENT PLAN) WITH DESERT EQUITY GROUP,
LLC.
-3-
RESOLUTION NO. OB-123 CONTRACT NO. SA34300
AGREEMENT OF PURCHASE AND SALE
AND ESCROW INSTRUCTIONS
Foresite Escrow
("Escrow")
41-995 Boardwalk, Ste G-2
Palm Desert, CA 92211
Attention: Esther Lopez, Escrow Officer
("Escrow Holder")
Escrow No:
THIS AGREEMENT OF PURCHASE AND SALE AND ESCROW INSTRUCTIONS
("Agreement") is dated for reference purposes as of this day of , 2015, by
and between the SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT
AGENCY, a public entity ("Seller"), and DESERT EQUITY GROUP, LLC, a California
limited liability company ("Buyer"). This Agreement is made with reference to the following
facts:
RECITALS
A. Seller is the owner of certain real property located in the City of Palm Desert
("City"), Riverside County, California, located on the north side of Country Club Drive, east of
Portola Avenue, in Palm Desert, California, described as APNs 620-430-024, 025, consisting of
approximately 9.34 acres of unimproved land, and more particularly described in Exhibit A
attached hereto ("Property"). Reference herein to the Property includes all of Seller's right, title
and interest in and to any and all improvements, fixtures, rights -of -way, utility rights, casements
and other appurtenant interests, entitlements, claims or other privileges or benefits in any way
connected with the Property, excepting any public rights of way or public easements.
B. Buyer is interested in developing the Property as a residential assisted living
facility and a residential memory care facility ("Project"), subject to the necessary land use
approvals and entitlements (such approvals and entitlements of a discretionary nature being
referred to herein as the "Project Entitlements") to be submitted for approval to the City.
C. On December 4, 2014, Seller entered into an Exclusive Right to Negotiate
Agreement (the "ENA") for the purchase of the Property and development of the Project by the
Buyer.
D. Pursuant to the ENA, Buyer desires to acquire the Property and develop, construct
and operate thereon the Project, and Seller desires to sell the Property to Buyer pursuant to the
terms and conditions set forth in this Agreement.
THE PARTIES AGREE AS FOLLOWS:
1. Effective Date. The "Effective Date" of this Agreement shall he the date the
Seller delivers an executed copy of this Agreement to Buyer.
RESOLUTION NO. OB-123 CONTRACT NO. SA34300
2. Purchase and Sale of Property. Upon the terms and conditions described below,
Buyer agrees to purchase and Seller agrees to sell and convey the Property to Buyer.
3. Purchase Price.
3.1 Purchase Price. The purchase price for the Property will be an amount
equal to Two Million Eight Hundred Thousand Dollars ($2,800,000.00) ("Purchase Price"),
provided that such Purchase Price shall be subject to adjustment as provided in Section 3.2. The
purchase price shall be paid in cash, and this Agreement is not subject to any financing
contingency.
3.2 Adjustment to Purchase Price. Notwithstanding the foregoing, either party
shall have the right to commission an Updated Appraisal (as hereafter defined) at their sole cost
and expense, with the Purchase Price for the Property being adjusted to the Fair Market Value of
the Property determined by such Updated Appraisal, if the close of escrow on the Property has
not occurred by the Purchase Price Adjustment Date (as hereafter defined). In the event that an
Updated Appraisal would increase the purchase price of the Property by more than 5%, Buyer
shall have the right to terminate this Agreement and receive back the Deposit (as hereafter
defined). As used herein the term "Updated Appraisal" means a revision of the appraisal
prepared by Lidgard and Associates, Inc. (the "Appraiser") dated October 28, 2104 (the
"Appraisal") to determine the current Fair Market Value of the Property, to be performed by the
Appraiser, based upon the same general parameters that applied to the Appraisal (i.e., assuming
raw and unentitled land). As used herein the term "Purchase Price Adjustment Date" means
October 31, 2015 (the one-year anniversary of the Appraisal).
4. Payment of Purchase Price. Buyer will pay the Purchase Price to Seller through
Escrow as follows:
4.1 Deposit. Within five (5) business days following the Effective Date of
this Agreement, Buyer will deposit with Escrow Holder the sum of One Hundred Thousand
Dollars ($100,000.00) ("Deposit") in immediately available funds; provided that Twenty Five
Thousand Dollars ($25,000.00) of such deposit shall consist of a transfer of the deposit
previously made pursuant to the terms of the ENA. Escrow Holder will place the Deposit in an
interest bearing account, with interest to accrue for the benefit of Buyer. All references herein to
the "Deposit" will include interest accrued thereon. In the event the Buyer fails to deliver the
Deposit to the Escrow Holder within the time period specified herein, this Agreement will be
null and void.
4.2 Balance of Purchase Price. Not later than one (1) business day prior to
Closing, Buyer shall deposit with Escrow Holder in immediately available funds the balance of
the Purchase Price, together with such other amounts as may be required in order to pay Buyer's
share of closing costs and prorations.
4.3 Application of Deposit. The Deposit is nonrefundable except as otherwise
expressly provided in this Agreement. Upon Close of Escrow (defined below), the Deposit will
be credited against the Purchase Price. Notwithstanding anything in this Agreement to the
contrary, the first $100.00 of the Deposit shall be nonrefundable to Buyer under any and all
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RESOLUTION NO. OB-123 CONTRACT NO. SA34300
circumstances and shall constitute independent consideration payable to Seller for Seller's
agreement to sell the Property to Buyer pursuant to the terms of this Agreement.
5. Title.
5.1 Preliminary Title Report. Upon execution of this Agreement by both
parties, Buyer is deemed to have approved all exceptions to title as set forth in the preliminary
title report for the Property dated December 1, 2014 (the "Permitted Exceptions"), prepared by
Lawyers Title Company (through its Riverside, California office — "Title Company") (the
"Title Report"). In the event that any additional exceptions to title not caused or created by
Buyer and not reflected in the Title Report are reported by the Title Company prior to the Close
of Escrow (each an "Additional Exception"), Seller shall use commercially reasonable efforts
to remove any such Additional Exception so it no longer affects title to the Property or to
otherwise address and cure such Additional Exception in a manner reasonably acceptable to
Buyer ("Cure"), but in no event or circumstance shall Buyer be obligated to accept the Property
at the Close of Escrow subject to any such Additional Exceptions that have not been removed
from the title records or otherwise Cured in accordance herewith. Any Additional Exceptions
that are Cured in accordance herewith shall thereafter be deemed Permitted Exceptions.
5.2 Title Policy. At Close of Escrow, Seller will convey good and marketable
title to the Property to Buyer, subject only to the Permitted Exceptions, as evidenced by a CL"I'A
Standard Form Owners Policy of Title Insurance, or at Buyer's election and additional expense,
an ALTA Extended Owner's Policy of Title Insurance, issued by the Title Company in an
amount equal to the Purchase Price, and containing such endorsements (the "Endorsements") as
Buyer may, at Buyer's expense, reasonably require ("Title Policy").
6. Due Diligence Inspections/Entry upon the Property. Prior to Buyer's execution of
this Agreement, Buyer has been given an opportunity to inspect the Property. Notwithstanding
the foregoing, Buyer shall have the right, in its sole and absolute discretion, but shall not be
required, to further inspect and conduct tests and surveys on and with respect to the Property, and
Seller shall provide Buyer reasonable access to the Property for such inspections, tests and
surveys. Said foregoing inspection and testing may include, but shall not be limited to, soil
borings, soil and water sampling, soil compaction assessment, environmental assessment and
similar or related physical or invasive testing. Seller shall permit Buyer, its employees or agents,
a license for access over and through the property for the purposes of conducting the foregoing
tests, inspections, or surveys, provided Buyer shall hold Seller and the City harmless from any
liability, damage or expense which either may incur by reason thereof. Moreover, Buyer, or its
licensed agents, shall provide Seller a current certificate of insurance for commercial general
liability coverage in an amount not less than $1,000,000 that names Seller and City as additional
insureds. Any inspection or testing shall be at Buyer's sole cost and be done with reasonable
notice to Seller and with Seller's reasonable concurrence. Such inspection and testing shall be
conducted at a reasonable time and in a reasonable manner. Buyer shall be responsible for any
personal injury or property damage resulting from its negligence, gross negligence, or willful
misconduct in connection with Buyer's inspection and testing of the Property, provided that in
no event shall Buyer, or its licensed agents, have responsibility or liability under this Agreement
for legally required disclosure or any pre-existing conditions affecting the Property (including
the discovery or existence of hazardous substances in, on or about the Property and associated
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RESOLUTION NO. OB-123 CONTRACT NO. SA34300
groundwater). Prior to any on -site inspections, Buyer shall provide Seller a current certificate of
insurance for commercial general liability coverage in an amount not less than $1,000,000 that
names Seller and City as primary beneficiaries or as additional insureds. In the event that the
Close of Escrow does not occur for any reason other than a default by Seller hereunder, Buyer
shall restore any damage caused to the Property in connection with any Buyer inspections and
testing.
7. As Is Acceptance of Property. Buyer acknowledges that prior to Close of Escrow,
it will have had the opportunity to conduct such tests and evaluations as it deems reasonably
necessary in order to investigate the condition of the Property, including its environmental status.
Buyer acknowledges that it is acquiring the Property in its "as is" condition with no warranty or
representation from Seller regarding the physical condition of the Property, its environmental
condition or its suitability for Buyer's intended purposes except as may be contained in this
Agreement. Buyer acknowledges that it is acquiring the Property based solely in reliance on its
own inspections and examination and its own evaluation of the Property, except that Buyer shall
have the right to rely upon the truth and accuracy of any Seller representations or warranties
contained in this Agreement. Buyer agrees that no representations, statements or warranties have
at any time been made by Seller or its agents regarding the physical condition of the Property
except as may be contained in this Agreement. Buyer acknowledges that there may be
conditions affecting the Property unknown to Buyer that may adversely affect its value or use for
Buyer's intended purposes. Buyer nevertheless waives any rights or recourse it may have with
respect to such unknown conditions and any damage, loss, costs or expense related thereto,
including rights accruing under California Civil Code § 1542, which provides:
"A general release does not extend to claims which the creditor
does not know or suspect to exist in his or her favor at the time of
executing the release, which if known by him or her must have
materially affected his or her settlement with the debtor."
Buyer acknowledges that it has either consulted with or had an opportunity to consult
with legal counsel regarding the above waiver. The provisions of this Section 7 will survive
Close of Escrow.
Buyer Initials
8. Escrow.
8.1 Escrow Instructions. This Agreement shall constitute instructions of
Buyer and Seller to Escrow Holder. The parties agree to execute such additional pro forma
instructions as Escrow Holder may reasonably require, however, in the event of a conflict, the
terms and provisions of this Agreement shall govern.
8.2 Openinz of Escrow. Upon execution of this Agreement, Buyer and Seller
shall cause an escrow to be opened with Escrow Holder by depositing with Escrow Holder a
fully executed copy of this Agreement. Escrow shall be deemed opened as of the date this fully
executed Agreement is deposited with Escrow Holder ("Escrow Opening").
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RESOLUTION NO. OB-123 CONTRACT NO. SA34300
8.3 Close of Escrow; Closing Date. "Close of Escrow" shall mean the date
on which the Grant Deed conveying title from Seller to Buyer is recorded in the Official Records
of the County Recorder of Riverside County, California. The form of the Grant Deed will be as
set forth in Exhibit B attached hereto. Provided that this Agreement is not earlier terminated
pursuant to the terms and provisions hereof, and provided that all of the conditions precedent to
the Close of Escrow set forth in this Agreement have been approved or waived as herein
provided, Escrow shall close on or before the thirtieth (30th) day after Final Approval of the
Project Entitlements ("Final Approval" means, with respect to the Project Entitlements, that
they have been obtained beyond any challenge or appeal period with no challenge or appeal then
pending and with all City requirements regarding the issuance of such Project Entitlements fully
satisfied), but in no event after January 1, 2016 ("Closing Date"). Seller may terminate this
Agreement pursuant to Section 9.2 hereof if Seller has performed its obligations hereunder, and
failure to close Escrow results from a material default by Buyer, in which case the Deposit shall
be delivered to Seller as liquidated damages. Buyer may terminate this Agreement pursuant to
Section 9.1 hereof if Buyer has performed its obligations hereunder, and failure to close Escrow
results from a material default by Seller, in which case the Deposit shall be returned to Buyer.
By causing the Close of Escrow to occur, Escrow Holder shall be deemed to have irrevocably
committed to cause the Title Company to issue the Title Policy to Buyer upon payment of the
applicable premium. If the County Recorder of Riverside County, California is closed on the last
day for closing Escrow, then the parties agree that Escrow Holder shall have until the next day
the Recorder is open to record the Grant Deed and close Escrow.
8.4 Documents and Funds from Buyer. Not later than one (1) business day
prior to the Closing Date, Buyer will deliver or will assure that the following documents and
funds have been delivered to Escrow Holder:
(a) Purchase Price. The Purchase Price, as described in Section 3
above.
(b) Preliminary Change of Ownership Statement. A Preliminary
Change of Ownership Statement or in lieu thereof, the appropriate fee, to be provided to the
Recorder's office at Close of Escrow.
(c) Other Sums and Documents. All other sums and documents
required by Escrow Holder according to this Agreement to carry out and close the Escrow.
8.5 Documents and Funds from Seller. Not later than one (1) business day
prior to the Closing Date, Seller will deliver or will assure that the following documents and
funds have been delivered to Escrow Holder:
(a) Grant Deed. A fully executed and acknowledged Grant Deed
conveying the Property to Buyer, or Buyer's nominees or assigns, in fee simple subject only to
the Permitted Exceptions.
(b) FIRPTA Affidavit. An original affidavit, using Escrow Holder's
standard forms, certifying that Seller and this transaction are not subject to the withholding
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RESOLUTION NO. OB-123 CONTRACT NO. SA34300
requirements of the Foreign Investment in Real Property Tax Act and equivalent California
legislation.
(c) Other Sums and Documents. All other documents and sums
required by Escrow Holder according to this Agreement to carry out the Escrow and to issue the
Title Policy to Buyer in the form required by Buyer.
8.6 Conditions to the Close of Escrow. Close of Escrow shall not take place
unless and until:
(a) Seller's Obligation. Seller's obligation to sell the Property to
Buyer is contingent on the following:
(i)
Buyer shall have delivered the Purchase Price, less any
credits described in this Agreement, for the Property.
(ii) The Seller's Oversight Board has approved this Agreement
and/or the sale of the Property, and the California
Department of Finance has approved this Agreement and/or
the sale of the Property.
(iii) On and as of the Close of Escrow, all of the representations
and warranties of Buyer set forth in this Agreement shall be
true and correct in all material respects.
(iv) Buyer shall have timely performed all other obligations of
Buyer under this Agreement.
In the event that any of the foregoing conditions have not occurred
or been satisfied or waived by the Closing Date, Seller shall be entitled to terminate this
Agreement and, subject to the provisions of Section 8.9 below, any funds deposited, including
the Deposit by Buyer and any interest thereon will be returned to Buyer.
(b) Buyer's Obligation. Buyer's obligation to purchase the Property is
contingent on the following:
(i)
The Property shall be in substantially the same physical
condition that existed as of the date of this Agreement.
(ii) The Seller's Oversight Board has approved this Agreement
and/or the sale of the Property, and the California
Department of Finance has approved this Agreement and/or
the sale of the Property.
(iii) The Buyer shall have received Final Approval of the
Project Entitlements, and there shall be no moratorium or
similar development related restriction that would preclude
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RESOLUTION NO. OB-123 CONTRACT NO. SA34300
or materially restrict or delay Buyer's intended
development and construction of the Project.
(iv) Title Company shall be irrevocably committed to issue the
Title Policy to Buyer at the Close of Escrow in accordance
with the terms of Section 5.2 hereof, subject only to the
payment of any applicable premiums.
(v) Seller shall have performed all of its other obligations
under this Agreement.
In the event that any of the foregoing conditions have not occurred
or been satisfied or waived by the date(s) specified, Buyer shall be entitled to terminate this
Agreement and, subject to the provisions of Section 8.9 below, any funds deposited by Buyer,
including the Deposit, and any interest thereon will be returned to Buyer.
(c) Delivery of Sums and Documents. Both parties have deposited
with Escrow Holder all sums and documents required by this Agreement.
8.7 Closing Procedure. Upon receipt of all funds and instruments described in
this Section 8, and upon satisfaction or waiver of all contingencies and conditions set forth in this
Agreement, Escrow Holder shall:
(a) Record the Grant Deed. Record the Grant Deed in the Official
Records of Riverside County, California.
(b) Title Policy. Cause the Title Policy to be issued.
(c) Purchase Price. Deliver the Purchase Price to Seller, less any costs
and expenses shown on the closing statements approved by Seller and Buyer, which costs and
expenses shall be disbursed as instructed by Seller and Buyer in escrow instructions delivered to
Escrow Holder prior to the Closing Date.
8.8 Electronic/Counterpart Documents. In the event Buyer or Seller utilizes
"facsimile" or other electronically transmitted signed documents, then except as otherwise set
forth below with respect to recorded documents, the parties hereby agree to accept and instruct
Escrow Holder to rely upon such documents as if they bore original signatures. Buyer and Seller
hereby agree, if requested by Escrow Holder, to provide to Escrow Holder within seventy-two
(72) hours after transmission, such documents bearing the original signatures. Buyer and Seller
further acknowledge and agree that electronically transmitted documents bearing non -original
signatures will not be accepted for recording and that the parties will timely provide originally
executed documents to Escrow Holder for such purpose. Escrow Holder is authorized to utilize
documents which have been signed by Buyer and Seller in counterparts.
8.9 Costs of Escrow. Buyer will pay one-half of Escrow Holder's fee, and
any additional costs and charges customarily charged to buyers in accordance with common
escrow practices in Riverside County. Seller shall pay one-half of Escrow Holder's fee, the costs
and expenses associated with the Title Policy as described in Section 4, and any additional costs
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RESOLUTION NO. OB-123 CONTRACT NO. SA34300
and charges customarily charged to sellers in accordance with common escrow practices in
Riverside County.
8.10 Property Taxes and Assessments. Under Seller's ownership, the Property
has not been subject to real property taxes or assessments. At the Close of Escrow, Buyer will
become liable for all real property taxes and assessments (including any supplemental
assessments) allocable to the Property for the period commencing after the Close of Escrow.
8.11 Brokers' Commissions. Neither party has had any contact or dealings
regarding the Property, or any communication in connection with the subject matter of this
transaction, through any real estate broker or other person who can claim a right to a commission
or finder's fee in connection with the sale contemplated herein, except for Wilson -Johnson
Commercial Real Estate as broker for the Buyer, whose commission in an amount not to exceed
one percent (1%) of the Purchase Price shall be paid by Seller at the Close of Escrow, and any
amount in excess thereof shall be paid by the Buyer. If any other broker or finder perfects a
claim for a commission or finder's fee based upon any such contact, dealings or communication,
then the party through whom such person makes its claim shall indemnify, hold harmless and
defend the other party (the "Indemnified Party") from any and all costs, damages, claims,
liabilities, losses, or expenses, (including without limitation, reasonable attorneys' fees and
disbursements) incurred by the Indemnified Party in defending against the claim. The provisions
of this Section shall survive termination of this Agreement and the Close of Escrow.
8.12 Possession. Possession of the Property shall be surrendered to Buyer at
the Close of Escrow.
8.13 Report to IRS. After Close of Escrow and prior to the last date on which
such report is required to be filed with Internal Revenue Service ("IRS"), and if such report is
required pursuant to Section 6045(e) of the Internal Revenue Code, Escrow Holder shall report
the gross proceeds of the purchase and sale of the Property to the IRS on Form 1099-B, W-9 or
such other form(s) as may be specified by the IRS pursuant to said Section 6045(e).
Concurrently with such filing, Escrow Holder shall deliver a copy thereof to Buyer and Seller.
9. Remedies for Default.
9.1 Seller Default. If Seller defaults under this Agreement prior to the Close
of Escrow, Buyer may, at its option, terminate this Agreement (in which case the Deposit will be
returned by Escrow Holder to Buyer) or initiate an action for specific performance of this
Agreement.
9.2 Buyer Default. IF BUYER DEFAULTS IN ITS OBLIGATION TO
CLOSE THE PURCHASE OF THE PROPERTY, SELLER MAY TERMINATE THIS
AGREEMENT, IN WHICH EVENT SELLER SHALL RETAIN THE DEPOSIT AS FULL,
AGREED AND LIQUIDATED DAMAGES, AND SELLER'S RETENTION OF THE
DEPOSIT IS SELLER'S SOLE AND EXCLUSIVE REMEDY WITH RESPECT TO SUCH
BUYER DEFAULT. THE PARTIES IIERETO EXPRESSLY AGREE AND
ACKNOWLEDGE THAT IN THE EVENT OF A DEFAULT BY BUYER IN ITS
OBLIGATION TO CLOSE THE PURCHASE OF THE PROPERTY, SELLER'S ACTUAL
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RESOLUTION NO. OB-123 CONTRACT NO. SA34300
DAMAGES WOULD BE EXTREMELY DIFFICULT OR IMPRACTICABLE 1'O
ASCERTAIN, THAT THE AMOUNT OF THE DEPOSIT REPRESENTS 1'HE PARTIES'
REASONABLE ESTIMATE OF SUCH DAMAGES, AND THAT SUCH AMOUNT IS NOT
UNREASONABLE UNDER THE CIRCUMSTANCES EXISTING AT THE TIME THIS
AGREEMENT WAS MADE. WITHOUT LIMITING THE GENERALITY OF i'IIE
FOREGOING: (1) SELLER WILL INCUR ADMINISTRATIVE COSTS IN THE
NEGOTIATION AND REVIEW OF THIS AGREEMENT AND OTHER DOCUMENTS
RELATING TO THIS TRANSACTION, AND WILL INCUR DAMAGES BY
WITHDRAWING THE PROPERTY FROM THE OPEN MARKET; (2) CERTAIN COSTS
AND OTHER DAMAGES IN AN AMOUNT SUBSTANTIALLY IN EXCESS OF THE
DEPOSIT MAY BE INCURRED BY SELLER IF THE SALE OF THE PROPERTY
CONTEMPLATED HEREBY IS NOT COMPLETED; AND (3) SELLER IS ENTERING
INTO THIS AGREEMENT WITH BUYER IN RELIANCE UPON BUYER'S COMMITMENT
TO PURCHASE THE PROPERTY FROM SELLER. THE PAYMENT OF SUCH AMOUNT
AS LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR PENALTY
WITHIN THE MEANING OF CALIFORNIA CIVIL CODE SECTIONS 3275 OR 3369, BUT
IS INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO SELLER PURSUANT i'O
CALIFORNIA CIVIL CODE SECTIONS 1671, 1676 AND 1677. NOTWITHSTANDING
ANYTHING TO THE CONTRARY CONTAINED IN THIS SECTION 9.2, THIS
LIQUIDATED DAMAGES PROVISION IS NOT INTENDED AND SHALL NOT BE
DEEMED OR CONSTRUED TO LIMIT IN ANY WAY BUYER'S INDEMNITY,
RESTORATION OR CONFIDENTIALITY OBLIGATIONS UNDER TI IIS AGREEMENT.
SELLER'S INITIALS: BUYER'S INITIALS:
10. Notices. Any and all notices required or permitted to be given hereunder shall be
in writing and shall be (i) personally delivered, or (ii) sent by recognized overnight delivery
service, mailed by certified or registered mail, return receipt requested, postage prepaid. Any
such notice or communication shall be effective when received by the addressee or upon refusal
of such delivery to the parties at the addresses indicated below:
To Seller:
With copy to:
Successor Agency to the Palm Desert Redevelopment
Agency
73-510 Fred Waring Drive
Palm Desert, CA 92260
Attn: Executive Director
Facsimile: 760-341-6372
Best Best & Krieger LLP
74-760 Highway 111, Suite 200
Indian Wells, CA 92210
Facsimile: 760-340-6698
Attn: Robert Hargreaves
To Buyer: Desert Equity Group, LLC
77-700 Enfield Lane, Suite C-1
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RESOLUTION NO. OB-123 CONTRACT NO. SA34300
With copy to:
Palm Desert, CA 92211
Facsimile: 760-200-0779
Attn: William S. Bonnheim
E-Mail: bill'u)desertequitrgroup.com
Ferguson Law Firm
73200 El Paseo, Suite 2-D
Palm Desert, CA 92260
Facsimile: 760-776-8255
Attn: James Cato Ferguson
E-Mail: jiiri(a zovlaw.com
Any party may change its address by a notice given to the other party in the manner set forth
above.
11. Buyer Representations and Warranties. As of the date of this Agreement and
through and including the date that the Close of Escrow occurs, Buyer hereby represents,
warrants and covenants to Seller as follows:
(a) Buyer has the right, power and authority to enter into this
Agreement, to fulfill its obligations hereunder and to acquire the Property in accordance with the
terms hereof, having previously obtained any and all consents and approvals required in
connection therewith, and Buyer entering into this Agreement, fulfilling its obligations hereunder
and acquiring the Property in accordance with the terms hereof will not violate any existing
permit, approval, contract, agreement, law, obligation, restriction, requirement, writ, injunction
or judicial order to which Buyer is bound.
(b) There are no actions, suits, litigation or judicial proceedings in any
court, tribunal or dispute resolution forum pending or, to Buyer's knowledge, threatened,
affecting the right, power or authority of Buyer to enter into this Agreement, to fulfill its
obligations hereunder and to acquire the Property in accordance with the terms hereof, or which
question the validity or enforceability of this Agreement or of any action taken by Buyer in
accordance with this Agreement.
(c) The individual(s) executing this Agreement and the documents
contemplated herein on behalf of Buyer have the legal right, power and authority to bind Buyer
to the terms and conditions hereof or thereof, and this Agreement and the documents
contemplated to be executed and delivered herein are or will be upon full execution and delivery
valid, legal and binding obligations of Buyer, enforceable against Buyer in accordance with their
terms, subject to the effect of applicable bankruptcy, insolvency, reorganization, or other similar
laws affecting the rights of creditors generally.
(d) Buyer is not a, and is not acting directly or indirectly for or on
behalf of any, person, group, entity or nation named by any Executive Order of the United States
Treasury Department as a terrorist, "Specifically Designated National and Blocked Persons," or
other banned or blocked person, entity, nation or transaction pursuant to any law, order, rule or
regulation that is enforced or administered by the Office of Foreign Assets Control and Buyer is
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RESOLUTION NO. OB-123 CONTRACT NO. SA34300
not engaged in this transaction, directly or indirectly on behalf of, or instigating or facilitating
this transaction, directly or indirectly, on behalf of any such person, group, entity, or nation.
The breach of a representation or warranty of a party hereunder shall be addressed and resolved
pursuant to the terms of Section 8.6 or Article 9, as applicable.
12. Miscellaneous.
12.1 Integration. This Agreement supersedes all prior agreements and
understandings between the parties relating to the subject matter hereof. Neither of the parties
has relied upon any oral or written representation or oral or written information given to it by any
representative of the other party.
12.2 Binding Effect. This Agreement shall bind and inure to the benefit of the
parties, their respective heirs, successors and assigns.
12.3 Amendment/Modification. No change or modification of the terms or
provisions of this Agreement shall be deemed valid unless in writing and signed by both parties.
12.4 Governing Law/Venue. This Agreement shall be construed, interpreted
and applied in accordance with the laws of the State of California. Any litigation or arbitration
regarding the Property or this Agreement will be brought in Riverside County Superior Court or
conducted in Riverside County.
12.5 Business Days. Reference herein to "business days" means any day
excluding Saturday, Sunday and any day which is a legal holiday under the laws of the State of
California or in the City of Palm Desert.
12.6 Waiver. No waiver of any breach or default shall be construed as a
continuing waiver of any provision or as a waiver of any other or subsequent breach of any
provision contained in this Agreement.
12.7 Attorneys' Fees. In the event of any action or proceeding to enforce or
construe any of the provisions of this Agreement, the prevailing party in any such action or
proceeding shall be entitled to reasonable attorneys' fees and costs.
12.8 Assignability. Any assignment of Buyer's rights under this Agreement
shall require the prior written consent of Seller, which Seller may grant or withhold in its sole
discretion. Notwithstanding the previous sentence, Buyer may transfer its rights under this
Agreement to an entity controlled by the Buyer or a majority of the principals of Buyer without
approval of the Seller. Except as expressly provided herein, any purported transfer of this
Agreement, voluntarily or by operation of law, shall be null and void and shall confer no rights
whatsoever upon any purported assignee or transferee, unless otherwise approved in writing by
Seller pursuant to this Section 12.8.
11
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RESOLUTION NO. OB-123 CONTRACT NO. SA34300
12.9 Time of the Essence. Time is of the essence of this Agreement.
12.10 Escrow Holder. Escrow Holder shall conduct the Close of Escrow in
accordance with the terms and provisions of the escrow instructions to be given to Escrow
Holder by the parties in a form consistent with this Agreement. To the extent of any conflict or
inconsistency between the terms and provisions of this Agreement and the escrow instructions,
the terms of this Agreement shall control.
12.11 Exhibits. All Exhibits which are referred to herein and which are attached
hereto or bound separately and initialed by the parties are expressly made and constitute a part of
this Agreement.
12.12 Counterparts. This Agreement may be executed in counterparts and when
so executed by the parties, shall become binding upon them and each such counterpart will be an
original document.
12.13 Severability. If one or more of the provisions of this Agreement, or the
application thereof in any circumstances, is held invalid, illegal or unenforceable in any respect
for any reason, the validity, legality and enforceability of any such provision in every other
respect and of the remainder of this Agreement shall not be in any way impaired or affected
thereby, it being intended by the parties that all other rights, privileges and obligations under this
Agreement shall be valid and enforceable to the fullest extent permitted by law.
Notwithstanding the foregoing, this provision shall not apply in the event that a court of
competent jurisdiction determines that the application hereof would materially and adversely
affect a party hereto or the rights and interests of such party under this Agreement and would not
be consistent with the perceived intent of the parties as otherwise reflected in this Agreement.
12.14 Further Assurances. Upon the Close of Escrow, and from time to time
thereafter, and as an obligation surviving the Close of Escrow, Seller and Buyer agree that they
shall, at the request of the other make, execute and deliver or obtain and deliver all such
affidavits, deeds, certificates, and other instruments and documents, and shall do or cause to be
done all such acts or things, which either party may reasonably require in order to complete the
consummation of the transactions contemplated by this Agreement, provided that the party to
whom any such request is made is not subjected to any additional cost, expense or liability, or
any increase in duties or obligations or any reduction or impairment of rights and interests in any
material way in connection therewith.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOLLOWS
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RESOLUTION NO. OB-123
SELLER:
SUCCESSOR AGENCY TO THE PALM
DESERT REDEVELOPMENT AGENCY
By:
Name:
Its:
BUYER:
DESERT EQUITY GROUP, LLC, a
California limited liability company
By:
Name:
Its:
CONTRACT NO. SA34300
13
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RESOLUTION NO. OB-123
CONTRACT NO. SA34300
CONSENT AND ACKNOWLEDGMENT OF ESCROW HOLDER
Escrow Holder hereby agrees to (i) accept the foregoing Agreement, (ii) act as the
Escrow Holder under said Agreement and (iii) be bound by said Agreement in the performance
of its duties as Escrow Holder.
Escrow Holder acknowledges receipt on the date hereof of originals or counterparts of
the foregoing Agreement fully executed by Seller and Buyer.
Dated:
Escrow Holder advises the parties that the date of the Opening of Escrow is
, 2015.
, 2015 FORESITE ESCROW
By:
Its: Escrow Officer
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RESOLTION NO. OB-123 CONTRACT NO. SA34300
EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY
All that certain real property situated in the County of Riverside, State of California, described
as follows:
Parcel 1: Assessor's Parcel No: 620-430-024
The East half of the Southeast Quarter of the Southwest Quarter of the Southwest Quarter
of Section 4, Township 5 South, Range 6 East, San Bernardino Base and Meridian.
Excepting therefrom all oil, gas and other mineral deposits, together with the right to prospect
for, mine and remove the same, according to the provisions of Act of Congress of June 1, 1938
(52 Stat. 609) as reserved in Patent from the United States of America, recorded November 22,
1966 as Instrument No. 112922.
Except thereon the Southerly 44 feet as conveyed to the County of Riverside by deed
recorded March 31, 1958 as Instrument No. 23183 of Official Records.
Parcel 2: Assessor's Parcel No: 620-430-025
The West half of the Southwest Quarter of the Southeast Quarter of the Southwest Quarter
of Section 4, Township 5 South, Range 6 East, San Bernardino Base and Meridian.
Excepting therefrom all oil, gas and other mineral deposits, together with the right to prospect
for, mine and remove the same, according to the provisions of Act of Congress of June 1, 1938
(52 Stat. 609) as reserved in Patent from the United States of America, recorded November 22,
1966 as Instrument No. 112923 of Official Records of Riverside County, California;
Also excepting therefrom the Southerly 44 feet as conveyed to the County of Riverside by deed
recorded May 20, 1958 in Book 2273, Page 480 of Official Records of Riverside County,
California.
Exhibit A
72500 00000\9498140.1
RESOLUTION NO. OB-123 CONTRACT NO. SA343OO
EXHIBIT B
GRANT DEED
[See Attached]
72500.00000\9498 1 40.1
RESOLUTION NO. OB-123 CONTRACT NO. SA34300
EXHIBIT "B"
Form of Grant Deed
RECORDING REQUESTED BY:
SUCCESSOR AGENCY TO THE PALM DESERT
REDEVELOPMENT AGENCY
c/o CITY OF PALM DESERT
73-510 Fred Waring Drive
Palm Desert, California 92260
Attn: City Clerk
WHEN RECORDED RETURN TO:
Desert Equity Group, LLC
77-700 Enfield Lane, Suite C-1
Palm Desert, CA 92211
Attn: William S. Bonnheim
APN: 620-430-024, 025
Documentary transfer tax is $
Exempt from Recording Fees Pursuant to G.C. 6103
Above Space for Recorder's Use
GRANT DEED
FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged,
SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY, a
public entity ("Grantor"), hereby grants to DESERT EQUITY GROUP, LLC, a California
limited liability company ("Grantee"), the following described real property (the "Property")
situated in the City of Palm Desert, County of Riverside, State of California:
See Exhibit A attached hereto.
AND excepting any public rights of way or public casements.
IN WITNESS WHEREOF, Grantor has caused its name to be affixed hereto and this
instrument to be executed by its duly authorized officer.
DATED:
, 2015 GRANTOR:
SUCCESSOR AGENCY TO THE PALM
DESERT REDEVELOPMENT AGENCY
By:
Name: John M. Wohlmuth
Its: Executive Director
RESOLUTION NO. OB-123
EXHIBIT "B"
Form of Grant Deed
ACKNOWLEDGEMENT
CONTRACT NO. SA34300
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,
Notary Public, personally appeared ,
who proved to me on the basis of satisfactory evidence to be the person(s) 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)
RESOLUTION NO. OB-123 CONTRACT NO. SA34300
EXHIBIT "B"
Form of Grant Deed
EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY
All that certain real property situated in the County of Riverside, State of California, described
as follows:
Parcel 1: Assessor's Parcel No: 620-430-024
The East half of the Southeast Quarter of the Southwest Quarter of the Southwest Quarter
of Section 4, Township 5 South, Range 6 East, San Bernardino Base and Meridian.
Excepting therefrom all oil, gas and other mineral deposits, together with the right to prospect
for, mine and remove the same, according to the provisions of Act of Congress of June 1, 1938
(52 Stat. 609) as reserved in Patent from the United States of America, recorded November 22,
1966 as Instrument No. 112922.
Except thereon the Southerly 44 feet as conveyed to the County of Riverside by deed
recorded March 31, 1958 as Instrument No. 23183 of Official Records.
Parcel 2: Assessor's Parcel No: 620-430-025
The West half of the Southwest Quarter of the Southeast Quarter of the Southwest Quarter
of Section 4, Township 5 South, Range 6 East, San Bernardino Base and Meridian.
Excepting therefrom all oil, gas and other mineral deposits, together with the right to prospect
for, mine and remove the same, according to the provisions of Act of Congress of June 1, 1938
(52 Stat. 609) as reserved in Patent from the United States of America, recorded November 22,
1966 as Instrument No. 112923 of Official Records of Riverside County, California;
Also excepting therefrom the Southerly 44 feet as conveyed to the County of Riverside by deed
recorded May 20, 1958 in Book 2273, Page 480 of Official Records of Riverside County,
California.
EXCLUSIVE RIGHT TO NEGOTIATE AGREEMENT
` fr- (Desert Equity Group)
his Exclusive Right to Negotiate Agreement ("Agreement") is made this day
of Nvvtsttlbw , 2014, by and between the Successor Agency to the Palm Desert
Redevelopment Agency, a California public body, corporate and politic ("SARDA") and
Desert Equity Group, LLC, a California limited liability company ("Developer"). SARDA
and Developer are sometimes individually referred to herein as a "Party" and collectively
as the "Parties." This Agreement is entered into with regards to the following recited
facts:
RECITALS
A. SARDA owns that certain real property located on the north side of
Country Club Drive, east of Portola Avenue, in Palm Desert, California, which is more
particularly described in Exhibit "A" attached to this Agreement and incorporated herein
by this reference and which can be described as APNs 620-430-024, 025, consisting of
approximately 9.34 acres of unimproved land ("Property"). SARDA is interested in
selling the Property to Developer for the development of the Project as herein defined.
B. Developer is interested in developing the Property as a residential
assisted living facility and a residential memory care facility ("Project"), subject to the
necessary land use approvals and entitlements (such approvals and entitlements of a
discretionary nature being referred to herein as the "Project Entitlements") to be
submitted for approval to the City of Palm Desert ("City").
C. The SARDA is authorized to enter into this Agreement with Developer for
the purpose of selling the Property. The primary purpose of this Agreement is to
establish a period during which the Parties may explore the feasibility of the Project, and
negotiate the terms of a Purchase and Sale Agreement ("PSA"). Developer has
represented its willingness and ability to undertake certain studies, plans, and other
activities necessary to define the scope of development and determine the feasibility of
the Project on the Property. Such studies and plans to be prepared during the course of
this Agreement shall serve as the basis for entering into a PSA between SARDA and
Developer. SARDA is willing to enter into a period of exclusive negotiations with
Developer concerning Developer's potential development of the Project and the terms
of the PSA, subject to the terms and conditions of this Agreement.
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G.IEcon Development\Martin AlvareztSA Property SalastDasert Willow Lot Pads\Lot Pad GWD - SARDA - ENA Desert Equity Group-Fnal.doc
TERMS
1. Effective Date. This Agreement shall become effective on the date ("Effective
Date") when this Agreement has been executed and delivered by SARDA and
Developer. The term of this Agreement shall commence on the Effective Date and shall
continue thereafter until the earlier of: (1) this Agreement is superseded by a fully
executed PSA; (2) this Agreement is terminated as provided herein; (3) June 30, 2015.
("Exclusive Negotiation Period"). Subject to Section 2.2, during the Exclusive
Negotiation Period, SARDA shall not solicit or entertain offers or proposals from other
parties concerning the Property. The Exclusive Negotiation Period may be extended
upon the mutual written agreement of the SARDA and Developer and, unless sooner
terminated pursuant to the terms of Section 9 or Section 10 hereof, shall be
automatically extended during the Consideration Period (as hereafter defined).
2. Exclusive and Good Faith Negotiations. SARDA and Developer agree for the
Exclusive Negotiation Period to act and negotiate in a reasonable, diligent and good
faith manner, and on an exclusive basis, to comply with the terms and conditions set
forth in this Agreement and to complete the tasks set forth in Sections 4, 5 and 6,
respectively, subject to the following provisions:
2.1 The term "exclusive basis" as used in this Agreement shall preclude
SARDA, during the Exclusive Negotiation Period, from (a) soliciting, accepting for
review and analysis, evaluating, entertaining or considering, on a direct or indirect basis,
formal or informal offers or proposals from persons or entities other than Developer that
relate to or concern the acquisition, entitlement or development of the Property ("Other
Proposals"), and (b) or negotiating, discussing or meeting with any other party or entity
with respect to any such Other Proposals.
2.2 SARDA and City shall not be precluded by this Agreement from furnishing
to other persons or entities unrelated to Developer information in the possession of
SARDA and/or City which they are required by law to furnish or, subject to the terms of
Section 2.1, which they would otherwise normally furnish to persons requesting
information from SARDA and/or City concerning their activities, goals and matters of a
similar nature. Any such information to be provided by SARDA and/or City relating to
the Property, the Project or the Project Entitlements, or Developer's rights and interests
therein, shall not be disclosed without advance written notice to Developer affording
Developer the opportunity to appropriately limit such disclosure and ensure such
disclosure complies with the terms of this Agreement.
2.3 SARDA and City shall not be precluded by this Agreement from
undertaking any actions otherwise required by law, or mandated by any agency of the
State of California.
3. Tests/ Surveys. During the Exclusive Negotiation Period, Developer shall have the
right, in its sole and absolute discretion, but shall not be required, to inspect and
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conduct tests and surveys on and with respect to the Property, and SARDA shall
provide Developer reasonable access to the Property for such inspections, tests and
surveys. Said foregoing inspection and testing may include, but shall not be limited to,
soil borings, soil and water sampling, soil compaction assessment, environmental
assessment and similar or related physical or invasive testing. SARDA shall permit
Developer, its employees or agents, a license for access over and through the property
for the purposes of conducting the foregoing tests, inspections, or surveys, provided
Developer shall hold SARDA and the City harmless from any liability, damage or
expense which either may incur by reason thereof. Moreover, Developer, or its licensed
agents, shall provide SARDA a current certificate of insurance for commercial general
liability coverage in an amount not less than $1,000,000 that names SARDA and City as
additional insureds. To date, SARDA and City are unaware of any reports, and further
represent that they have no knowledge of any defects in the property, that would make
the property unsuitable for its Intended Use and SARDA and City will make available to
Developer any reports in their possession pertaining to the condition of the property.
Any inspection or testing shall be at Developer's sole cost and be done with reasonable
notice to SARDA and with SARDA's reasonable concurrence. Such inspection and
testing shall be conducted at a reasonable time and in a reasonable manner.
Developer shall be responsible for any personal injury or property damage resulting
from its negligence, gross negligence, or willful misconduct in connection with
Developer's inspection and testing of the Property, provided that in no event shall
Developer, or its licensed agents, have responsibility or liability under this Agreement
for legally required disclosure or any pre-existing conditions affecting the Property
(including the discovery or existence of hazardous substances in, on or about the
Property and associated groundwater). Prior to any on -site inspections, Developer shall
provide SARDA a current certificate of insurance for commercial general liability
coverage in an amount not less than $1,000,000 that names SARDA and City as
primary beneficiaries or as additional insureds.
4. Negotiation of Purchase and Sale Agreement. Following commencement of the
Feasibility Period (as hereafter defined), both SARDA and Developer shall exercise
reasonable, diligent and good faith efforts to negotiate and agree upon the final form of
a Purchase and Sale Agreement for the Property consistent with the terms of this
Agreement (such final form being referred to as the "PSA"). Except as otherwise
agreed to by the Parties in writing, this Agreement shall automatically terminate if the
Parties have not reached agreement on the form of the PSA pursuant to and in
accordance with the terms of this Agreement (the "Party Approvals") by June 30, 2015.
Party Approvals shall be documented by written notification of each Party to the other.
Without limiting the obligation of the Parties to act and negotiate in a reasonable,
diligent and good faith manner, nothing herein (a) shall be deemed to be a
representation by SARDA or Developer that a mutually acceptable PSA will be
concluded, (b) shall impose any obligation on City to approve any Project Entitlements
or provide any financial or other assistance to Developer for the Project or the Property,
or (c) shall be deemed to be a guarantee or representation that (i) the PSA will be
approved by SARDA's Oversight Board (the "Oversight Board Approval"), which entity
must approve the PSA and/or the sale of the Property, (ii) the PSA will be approved by
the California Department of Finance ("DOF Approval"), which entity must approve the
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PSA and/or the sale of the Property, or (iii) the Project Entitlements will be approved by
the City's governing boards. Developer further acknowledges that receipt of Oversight
Board Approval is subject to the sole and absolute discretion of the SARDA Oversight
Board, receipt of DOF Approval is subject to the sole and absolute discretion of the
California Department of Finance and that receipt of the Project Entitlements is subject
to the sole and absolute discretion of the City's goveming boards and all other
governmental entities with jurisdiction over the Property and the Project. In connection
with the foregoing, Developer acknowledges that the processing and pursuit of the
Project Entitlements will include all public hearings, public meetings, notices, factual
findings and other determinations required by applicable law in connection therewith.
Once the Party Approvals have been obtained, SARDA shall promptly pursue Oversight
Board Approval and DOF Approval (and Developer shall reasonably cooperate with
SARDA in connection therewith). SARDA shall utilize its best efforts to obtain such
Oversight Board Approval and DOF Approval as soon as practicable once the Party
Approvals have been obtained. SARDA shall not withhold execution of the PSA if both
Oversight Board Approval and DOF Approval have been obtained, but SARDA shall not
execute the PSA until Oversight Board Approval and DOF Approval have been
obtained. The period commencing with the Party Approvals and ending upon the later
to occur of (x) the final and unconditional rejection of the sale of the Property by
SARDA's Oversight Board or the California Department of Finance, or (y) the Parties
execution of the PSA following receipt of Oversight Board Approval and DOF Approval,
is referred to herein as the "Consideration Period".
5. Developer and SARDA Tasks During Exclusive Negotiation Period. During the
Exclusive Negotiation Period, the Parties shall, at their sole cost and expense,
undertake the following tasks. It shall be within the sole and absolute discretion of
Developer to engage architects, engineers, consultants, and other third parties of its
choosing to discharge its responsibilities under this Section and in this Agreement:
5.1 Purchase Deposit. Within three (3) business days after the mutual
execution of this Agreement, Developer shall deposit in an interest bearing account with
Foresite Escrow (the "Escrow Agent"), a cash deposit in the amount of Twenty Five
Thousand Dollars ($25,000) (the "Purchase Deposit"). Interest accruing on the
Purchase Deposit shall be for the benefit of Developer. In the event that the parties
enter into a PSA with respect to Developer's acquisition of the Property from SARDA in
accordance with the terms hereof, the Purchase Deposit shall be credited against and
applied to the Escrow Deposit (as hereafter defined).
5.2 Property Valuation. Subject to the terms of Section 5.5(b), the purchase
price for the Property in the PSA shall be the Fair Market Value of the Property as
determined by a qualified appraiser with at least 5 years' experience valuing raw land
who is active in the local market that is selected by SARDA with input from Developer
("Appraiser"), which determination of Fair Market Value of the Property shall be based
upon the current status of the Property as raw and unentitled land. Pursuant to Section
6.1, the Appraiser shall be retained by SARDA at its sole cost and expense within five
(5) days of the mutual execution of this Agreement and shall be charged with
determining the Fair Market Value of the Property ("Appraisal") within thirty (30) days of
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retention in accordance with the applicable terms of this Agreement. Developer shall
have a period of ten (10) days following Appraiser's determination of the Fair Market
Value of the Property to notify SARDA in writing whether it elects to proceed with
negotiations related to Developer's acquisition of the Property and its evaluation of the
Property in accordance with the terms of this Agreement or to terminate this Agreement
and receive back the Purchase Deposit. Developer's failure to provide such notice shall
be deemed Developer's election to proceed with transaction in accordance with the
terms of this Agreement.
5.3 Property Information. In the event that Developer elects or is deemed to
have elected to proceed with negotiations and its evaluation of the Property following
the determination of the Fair Market Value of the Property by the Appraisal pursuant to
section 5.2, SARDA shall promptly provide to Developer all documents, materials,
agreements, studies and reports in SARDA's possession or control concerning the
Property, including without limitation, all consulting and engineering, work product, plans
and specifications, reports, surveys, site plans, title reports and related documentation,
utility agreements and will serve letters, plats, maps, permits, approvals, authorizations,
traffic reports, soils and geotechnical reports, environmental assessments and reports
and the like (the "Property Information"). In connection with the foregoing, SARDA shall
obtain and deliver to Developer a current preliminary title report from Lawyers Title
Company that is applicable to the Property.
5.4 Feasibility Period. Developer shall have a period of forty-five (45)
calendar days following receipt of the Property Information (the "Feasibility Period") to
evaluate same, to approve the state of title to the Property and, subject to the terms of
and without prejudice to Developer's rights under Section 3, to conduct any other due
diligence inspections and investigations that it desires.
5.5 Purchase Aareement. Upon commencement of the Feasibility Period, and
subject to the terms of Section 4 hereof, Developer shall exercise reasonable, diligent
and good faith efforts to negotiate and agree with SARDA upon the form of the PSA
consistent with the terms set forth below.
(a) Buyer: Developer or an affiliate thereof, including any affiliated
assignee of such party.
(b) Purchase Price: The Purchase Price for the Property shall be the
Fair Market Value as determined by the Appraiser based on the current status of the
Property (i.e., raw and unentitled land) and shall be paid in cash at close of escrow.
Notwithstanding the foregoing, either Party shall have the right to commission an
Updated Appraisal (as hereafter defined) at their sole cost and expense, with the
purchase price for the Property being adjusted to the Fair Market Value of the Property
determined by such Updated Appraisal, if the close of escrow on the Property has not
occurred by the Purchase Price Adjustment Date (as hereafter defined). In the event
that an Updated Appraisal would increase the purchase price of the Property by more
than 5%, Developer shall have the right to terminate the PSA and receive back the
Escrow Deposit. As used herein the term "Updated Appraisal" means a revision of the
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existing Appraisal to determine the current Fair Market Value of the Property, to be
performed by the Appraiser, based upon the same general parameters that applied to
the existing Appraisal (i.e., assuming raw and unentitled land). As used herein the term
"Purchase Price Adjustment Date" means the one-year anniversary of the date of the
receipt of the Appraisal obtained pursuant to Section 5.2 hereof.
(c) Title and Escrow: Title will be with Lawyers Title Company and
Escrow to be with Foresite Escrow. The state of title to the Property shall be evaluated
by Developer during the Feasibility Period and, subject to any subsequent changes,
deemed approved by Developer upon execution of the PSA.
(d) Close of Escrow: Close of Escrow shall occur thirty (30) days
after Final Approval of the Project Entitlements ("Final Approval" means, with respect to
the Project Entitlements, that they have been obtained beyond any challenge or appeal
period with no challenge or appeal then pending and with all City requirements
regarding the issuance of such Project Entitlements fully satisfied), but in no event after
January 1, 2016. This date may be extended with the written approval of both parties if
any delay occurs through no fault of Developer. At closing, and as conditions to
Developer's obligation to close, SARDA shall deliver the Property to Developer vacant,
subject only to the permitted title exceptions approved by Developer pursuant to the
terms of the PSA, absent a SARDA default with all SARDA representations and
warranties true and correct, with Oversight Board Approval and DOF Approval, with
Final Approval of the Project Entitlements, and with the Property in substantially the
same physical condition that existed as of the date of the PSA.
(e) Closing and Costs: At Closing, (i) real estate taxes shall be
prorated between Developer and SARDA as of the closing date, and (ii) all other closing
costs and prorations shall be paid by county custom.
(f) As Is Purchase: Developer is purchasing the Property in its
existing condition, 'AS -IS, WHERE -IS, WITH ALL FAULTS', subject to the truth and
accuracy of any SARDA representations and warranties contained in the PSA.
(g) Brokers: The use of any brokers in the subject transaction by
either party shall be specified in the PSA. Currently, the Developer has Wilson -Johnson
Commercial Real Estate as its broker of record. Each of the parties will indemnity the
other party against any claims for brokerage commissions, except as otherwise
expressly provided for in the PSA.
(h) Additional Terms: In no event or circumstance shall Developer be
obligated to pursue the Project Entitlements prior to SARDA's execution of the PSA
following receipt of Oversight Board Approval and DOF Approval. Developer's escrow
deposits shall be consistent with Section 5.6 below. The PSA shall include any other
terms and conditions that are typical for the subject transaction.
5.6 Notice to Proceed. If at the end of the Feasibility Period, Developer elects
to proceed with the transaction, Developer shall notify SARDA and the Escrow Agent in
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writing of such decision (the "Notice to Proceed"). If Developer fails to timely deliver the
Notice to Proceed or delivers a termination notice, Escrow Agent shall immediately
release the Purchase Deposit, including any interest earned thereon, to Developer and
this Agreement shall be terminated and of no further effect. Once the Party Approvals
have been obtained, and subject to Developer's delivery of the Notice to Proceed,
Developer shall deliver a counterpart of the PSA to SARDA that has been duly executed
by Developer. Upon receipt of Developer's Notice to Proceed and Developer's
executed counterpart of the PSA, SARDA shall hold such executed counterpart until
SARDA has obtained Oversight Board Approval and DOF Approval. Upon receipt of
Oversight Board Approval and DOF Approval, SARDA shall promptly counter -sign the
PSA and deliver the fully executed PSA to the Escrow Agent with a copy to Developer.
Within five (5) business days after receipt of a fully executed copy of the PSA,
Developer shall deposit an additional Seventy Five Thousand Dollars ($75,000) into
escrow (the "Additional Deposit"), which, in combination with the Purchase Deposit
(which shall be transferred to the sales escrow), shall result in a total escrow deposit by
Developer of One Hundred Thousand Dollars ($100,000) (the "Escrow Deposit"). The
Escrow Deposit shall be applicable to the Purchase Price. If Developer fails to timely
deliver the Additional Deposit, this Agreement and the PSA shall automatically
terminate with the Purchase Deposit retumed to Developer. Following Developer's
delivery of the Additional Deposit, and provided the PSA has been fully executed, the
Escrow Deposit shall be non-refundable to Developer except in the event that the
transaction does not close due to a default by SARDA, the failure of a buyer closing
condition as set forth in the PSA or pursuant to the express terms of the PSA. Interest
accruing on the Increased Deposit shall be for the benefit of Developer.
5.7 Entitlements. Developer shall diligently and in good faith, with the
reasonable cooperation of SARDA, pursue Project Entitlements for the Property in form
and substance acceptable to Developer in its sole discretion following the mutual
execution of the PSA after SARDA has obtained Oversight Board Approval and DOF
Approval. Once the Party Approvals have been obtained Developer shall evaluate and
conceptualize the Project on a preliminary basis provided that Developer shall not be
obligated to retain third party consultants and engineers in connection therewith.
5.8 Hazardous Materials/Historical Artifacts. Developer shall have no
responsibility under this Agreement to make any determination as to the existence of
hazardous materials or historical artifacts on the Property nor shall have it liability or
responsibility for hazardous materials or historical artifacts on the Property discovered
during Developer's investigation or testing of the Property.
6. SARDA Tasks During Exclusive Negotiation Period.
6.1 Pursuant to Section 5.2, SARDA's staff shall commission an Appraisal of
the Property.
6.2 Pursuant to Section 5.3, SARDA shall provide Developer with the required
information.
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6.3 Upon commencement of the Feasibility Period, and subject to the terms of
Section 4 hereof, exercise reasonable, diligent and good faith efforts to negotiate and
agree with Developer upon the form of the PSA consistent with the terms set forth
herein.
6.4 In order to satisfy one of the closing conditions of Section 4 and Section
5.5(f), SARDA shall diligently and in good faith pursue the Oversight Board Approval
and the DOF Approval following receipt of the Party Approvals.
7. Acknowledgments and Reservations.
7.1 No Further Obligation. SARDA and Developer agree that, if this
Agreement expires or is terminated for any reason other than a default of a Party,
neither SARDA nor Developer shall be under any obligation, nor have any liability to the
other Party or any other person regarding the acquisition of the Property or the
construction of the Project, except as set forth in an executed PSA.
7.2 Development Standards and Desian Controls. Certain development
standards and design controls for the Project may be established between Developer
and City, but it is understood and agreed between the Parties that the Project must
conform to all City and other applicable governmental development, land use and
architectural regulations and standards, as supplemented with any variances granted by
City. Drawings, plans, and specifications for the Project shall be subject to the approval
of City through the standard development application process for projects within the
City. Nothing in this Agreement shall be construed as the approval of any plans or
specifications for the Project or of the Project itself by the City.
7.3 Further Information. SARDA reserves the right to reasonably obtain
further information, data, and commitments to ascertain the ability and capacity of
Developer to develop and operate the Property and/or the Project. Developer
acknowledges that it may be requested to make certain financial disclosures to SARDA,
its staff, legal counsel, or other consultants, as part of the financial due diligence
investigations of SARDA relating to the potential construction of the Project by
Developer and that any such disclosures may become public records. SARDA shall
maintain the confidentiality of financial information of Developer to the extent allowed by
law.
8. Disclosures and Cooperation. SARDA and Developer shall generally cooperate
with each other and supply such documents and information as may be reasonably
requested by the other Party to facilitate the negotiations. Unless precluded by law,
SARDA shall keep confidential all proprietary information provided by Developer to
SARDA.
8.1 Only PSA Binds SARDA. Developer acknowledges and agrees that,
except for those binding obligations set forth in this Agreement, SARDA will not be
bound by any statement, promise or representation made by SARDA and City staff
during the Exclusive Negotiation Period or arising from or related to the Project on the
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Property, and that SARDA shall be legally bound only upon the approval of the PSA by
SARDA's governing board.
8.2 No Representations About Future Agreements. Developer further
acknowledges and agrees that nothing in this Agreement or SARDA's cooperation in
satisfying its obligations under this Agreement shall be deemed a promise,
representation or guaranty that the Parties will reach any future agreement, enter into a
PSA or that City will approve Project Entitlements.
9. Default.
9.1 Cure. Failure or delay by either Party to perform any material term or
provision of this Agreement and to cure such failure within any applicable cure period
shall constitute a default under this Agreement. If the Party who is claimed to be in
default by the other Party cures, corrects or remedies the alleged default within fifteen
(15) calendar days after receipt of written notice specifying such default, such Party
shall not be in default under this Agreement, with the understanding that, if such default
is curable but cannot reasonably be cured within such fifteen (15) calendar days, the
cure period shall be extended to up to ninety (90) calendar days so long as the cure
shall have been commenced within such fifteen (15) calendar days and diligently
pursued thereafter. The notice and cure period provided in the immediately preceding
sentence shall not, under any circumstances, extend the Exclusive Negotiation Period.
If there are less than fifteen (15) days remaining in the Exclusive Negotiation Period, the
cure period allowed pursuant to this Section 9 shall be automatically reduced to the
number of days remaining in the Exclusive Negotiation Period.
9.2 Notice. The Party claiming that a default has occurred shall give written
notice of default to the Party claimed to be in default, specifying the alleged default.
Delay in giving such notice shall not constitute a waiver of any default nor shall it
change the time of default. However, the injured Party shall have no right to exercise
any remedy for a default under this Agreement, without first delivering written notice of
the default.
9.3 Breach. If a default of either Party remains uncured for more than fifteen
(15) calendar days following receipt of written notice of such default (as such cure
period may be extended pursuant to Section 9.1), a "breach" of this Agreement by the
defaulting Party shall be deemed to have occurred. In the event of a breach of this
Agreement, the Party who is not in default shall have the right to terminate this
Agreement by serving written notice of termination on the Party in breach, but without
prejudice to any express rights or remedies the Party may have under this Agreement
or at law (including equitable relief). In the event of breach, neither Party shall have the
right to compensatory, special, or consequential damages from the breaching Party.
10.Termination. This Agreement shall terminate upon the occurrence of any of the
following: (a) the end of the Exclusive Negotiation Period, subject to any extensions
approved by the Parties pursuant to Section 1; (b) the execution of a PSA by the Parties
following Oversight Board Approval and DOF Approval; (c) termination of this
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Agreement by any Party pursuant to Section 9; (d) the Developer determining in its
reasonable and good -faith discretion, reasonable evidence of which is to be provided to
SARDA, and notifying SARDA in writing that it has elected to terminate this Agreement
due to the physical condition of the Property or development, entitlement, financing,
feasibility (including the prospects for obtaining Oversight Board Approval and DOF
Approval) and/or operation issues; (e) Developer has elected to terminate this
Agreement pursuant to Section 5.2 or Section 5.6; or (f) failure of Developer to make
the Purchase Deposit within thirty (30) days of written request by SARDA.
11. Prohibition Against Assignment. The qualifications and identity of Developer and
its principals are of particular concern to SARDA. It is because of these qualifications
and identity that SARDA has entered into this Agreement with Developer. During the
Exclusive Negotiation Period, no voluntary or involuntary successor -in -interest of
Developer shall acquire any rights or powers under this Agreement, nor shall Developer
assign all or any part of this Agreement, without the prior written approval of SARDA,
which approval SARDA may grant, withhold, or deny in its sole and absolute discretion;
provided, however, that the SARDA shall not assess a fee for such approval.
Notwithstanding the previous sentence, Developer may transfer its rights under this
Agreement to an entity controlled by the Developer or a majority of the principals of
Developer without approval of the SARDA. Any purported transfer of this Agreement,
voluntarily or by operation of law, shall be null and void and shall confer no rights
whatsoever upon any purported assignee or transferee, unless otherwise approved in
writing by SARDA pursuant to this Section 11.
12. General Provisions.
12.1 Governina Law: Jurisdiction and Venue. This Agreement shall be
interpreted and enforced in accordance with the provisions of California law in effect at
the time it is executed, without regard to conflicts of law provisions, and as such laws
may be amended from time to time during the Exclusive Negotiation Period. Any action
brought conceming this Agreement shall be brought in the appropriate court for the
County of Riverside, California.
12.2 Solicitation and Conflicts of Interest. For the term of this Agreement, no
member, officer or employee of SARDA or City, during the term of his or her service
with SARDA or City, shall have any direct or indirect interest in this Agreement or obtain
any present or anticipated material benefit arising therefrom.
12.3 No Third Party Beneficiaries. SARDA and Developer expressly
acknowledge and agree that they do not intend, by their execution of this Agreement, to
benefit any persons or entities not signatory to this Agreement, with the sole exception
of the City as to certain provisions herein, including, without limitation, any brokers
representing the Parties to this transaction. The foregoing shall not be deemed to
release Developer from any obligation it may have to pay commissions or brokerage
fees which it may be obligated to pay pursuant to any other contract to which Developer
may be a party. No person or entity not a signatory to this Agreement, other than the
City, shall have any rights or causes of action against SARDA, City or Developer arising
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out of or due to SARDA and Developer's entry into this Agreement. Third parties, for the
purposes of this Section 12.3, shall include persons to whom fees are paid for
professional services, if rendered by attorneys, financial consultants, accountants,
engineers, architects and other consultants.
12.4 Notices and Demands. All notices or other communications required or
permitted between the Parties under this Agreement shall be in writing, and may be: (a)
personally delivered, (b) sent by United States registered or certified mail, postage
prepaid, return receipt requested, (c) sent by facsimile and/or electronic transmission,
confirmed by same day mailing of a "hard" copy, ordinary first class mail, postage
prepaid, or (d) sent by nationally recognized overnight courier service (e.g., Federal
Express), addressed to the Parties at the addresses provided below, subject to the right
of either Party to designate a different address for itself by notice similarly given. Any
notice given by registered or certified United States mail shall be deemed to have been
given on the second business day after the same is deposited in the United States mail.
Any notice personally delivered or delivered by facsimile or overnight courier service
(e.g., Federal Express), shall be deemed given upon receipt of the same by the Party to
whom the notice is given.
To SARDA:
Successor Agency to the Palm Desert
Redevelopment Agency
73-510 Fred Waring Drive
Palm Desert, CA 92260
Attn: Executive Director
Facsimile: 760-341-6372
With copy to: Best Best & Krieger LLP
74-760 Highway 111, Suite 200
Indian Wells, CA 92210
Facsimile: 760-340-6698
Attn: Robert Hargreaves
To DEVELOPER: Desert Equity Group, LLC
77-700 Enfield Lane, Suite C-1
Palm Desert, CA 92211
Facsimile: 760-200-0779
Attn: William S. Bonnheim
E-Mail: billAdesertequitvgrouo.com
With copy to: Ferguson Law Firm
73200 El Paseo, Suite 2-D
Palm Desert, CA 92260
Facsimile: 760-776-8255
Attn: James Cato Ferguson
E-Mail: jim cr.govlaw.com
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12.5 Entire Agreement. This Agreement constitutes the entire agreement
between the Parties with respect to the subject matter hereof and supersedes all
agreements, representations, warranties, statements, promises and/or understandings,
whether oral or written. This Agreement may only be amended by the written consent of
the Parties.
12.6 Severabilitv. In the event that any of the provisions, or portions thereof, of
this Agreement are held to be unenforceable or invalid by any court of competent
jurisdiction, the validity and enforceability of the remaining provisions, or portions
thereof, shall not be affected and shall remain in full force and effect.
12.7 Hold Harmless. Developer shall defend, indemnify, and hold harmless
SARDA, City and their respective officials, officers, employees, consultants, contractors
and agents (collectively, "Indemnitees") from and against any and all actual and alleged
claims, losses, damages, fines, costs, penalties, expenses (including reasonable
attorneys' fees, costs of experts and other litigation expenses), and liabilities of any type
or nature, including those related or due to death or injury to any person and injury to any
property, proximately resulting from any negligent acts, omissions, or material breach of
this Agreement by Developer or any of its officers, employees, agents, or
subcontractors related to the activities described or contemplated by this Agreement.
No officials, officers, employees, consultants, contractors or agents of SARDA or City
shall be personally liable to Developer, any voluntary or involuntary successors or
assignees, or any lender or other party holding an interest in the Project or the Property,
in the event of any default or breach by SARDA or City, or for any amount which may
become due to Developer or to its successors or assignees, or on any obligations arising
under this Agreement. No officials, officers, employees, consultants, contractors or
agents of Developer shall be personally liable to City or SARDA in the event of any
default or breach by Developer, or for any amount which may become due to SARDA or
City, or on any obligations arising under this Agreement.
12.8 Attorneys' Fees. In the event that either Party brings any legal action to
interpret or enforce any provision of this Agreement, the prevailing Party in that action
shall be entitled to receive, in addition to all other relief available to it, its costs of
litigation and reasonable attorney's fees, including costs and fees incurred on appeal
and in enforcing any judgment which may be rendered on the underlying action.
12.9 Waivers. No waiver of any breach of any term or condition contained in
this Agreement shall be deemed a waiver of any preceding or succeeding breach of
such term or condition, or of any other term or condition contained in this Agreement.
No extension of the time for performance of any obligation or act, no waiver of any term
or condition of this Agreement, nor any modification of this Agreement shall be
enforceable against any Party unless made in writing and executed by all Parties.
12.10 Construction. Headings at the beginning of each section and sub -section of
this Agreement are solely for the convenience of reference of the Parties and are not a
part of this Agreement. Whenever required by the context of this Agreement, the
singular shall include the plural and the masculine shall include the feminine and vice
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versa. This Agreement shall not be construed as if it had been prepared by one or the
other of the Parties, but rather as if the Parties prepared this Agreement. Unless
otherwise indicated, all references to sections are to this Agreement. All exhibits
referred to in this Agreement are attached to this Agreement and incorporated into this
Agreement by this reference. If the date on which the Parties are required to take any
action pursuant to the terms of this Agreement is not a business day of City, as
appropriate, the action shall be taken on the next business day of City.
12.11 Counterpart Originals. This Agreement may be executed in counterparts
which, when taken together, shall constitute but one and the same instrument.
[Signatures on Following Page]
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SIGNATURE PAGE TO
EXCLUSIVE RIGHT TO NEGOTIATE AGREEMENT
(Desert Equity Group)
IN WITNESS WHEREOF, this Agreement has been executed by the Parties
hereto on the day and year first written above.
SARDA:
Successor Agency to Palm Desert
Redevelopment Agency, a public body,
corporate and politic
By:
M. Wohlmuth
Its: - cutive Director
DEVELOPER: D-3'rt Equity Group, LLC,
a California limited liability company
By:
Name: /fia.4. 4e.A..
Its: ixva<< f / /;-//,— -"
v
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CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT CIVIL CODE § 1189
Y ii�ailL�OWtlluuW i/Y i�i•L: ur.iM1apW ll.. i14r ILJiWi i4 liri•, A it Li it cL il..tlu.il.iil..u/.ii/L.i1.Ji1d HI A ilI.1:: III.J,•IL\ilj1I it .i u.b it .J u .i1/.i1LJ il'A th.i/.{Mill ui
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 K t f/ e 2 S r (C
On ia/q/ S/
Date
personally appeared
before me,
'bo ui4 Av uf5/(/
Here Insert Name and Title of the Officer
/
Name(s) of Signer(s)
who proved to me on the basis of satisfactory evidence to be the person(a) whose name(sr is/a}rut'
subscribed to the within Instrument and acknowledged to me that he/s)aift/tt}e9 executed the same in
his/hef/thair authorized capacity(ie8), and that by his/hef/thdir signature(sy on the instrument the person(,
or the entity upon behalf of which the person(a) acted, executed the instrument.
C1n-1uu M • b1Sfl4
Mary Mao Collaels
IIMrN1e 1 01Jess*
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
Place Notary Seal Above
OPTIONAL
Though this section is optional, completing this information can deter alteration of the document or
fraudulent reattachment of this form to an unintended document.
Description of Attached Document
Title or Type of Document: F R Ai/9- Document Date:
Number of Pages: Signer(s) Other Than Named Above:
C ner s pes) s k�� laimfd by t/m ct i Sigfiner's Name: A1
Corporate Officer — Title(s):
`.J Partner — ❑ Umlted ❑ General
O Individual 0 Attorney in Fact
0 Trustee ❑ Guardian or Conservator
n Other.
Signer Is Representing:
/ 001/SI
Signer's Name:
0 Corporate Officer — Title(s):
0 Partner — 0 Umited ❑ General
0 Individual ❑ Attomey In Fact
U Trustee ❑ Guardian or Conservator
LI Other.
Signer Is Representing:
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02014 National Notary Association • www.NationalNotary.org • 1-800-US NOTARY (1-800-876-6827) Item #5907
CALIPORNIA ALL-PURPOSE ACKNOWLEDGMENT
CIVIL CODE § 1189
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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
Riverside
On December 9, 2014,
Date
personally appeared
beforeme, Rachelle D. Klassen, Notary Public,
Here insert Name and Title of the Officer
JOHN M. WOHLMUTH
Name(s) of Signer(s)
who proved to me on the basis of satisfactory evidence to be the person(i) whose name(i)
subscribed to the within instrument and acknowledged to me that hem executed the same In
his/l t authorized capacity(tlifl , and that by his/M111111 signatures on the instrument the personib),
or the entity upon behalf of which the person(*) 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.
RACHELLE 0. KLASSEN
Commission # 2021N114
Notary Mao • Wier*
RMIIIN Comfyilv CordEaN s. rss Jos 13, 2017
WITNESS my hand and official seal.
Signatu
Signature of Notary - blk
Place Notary Seal Above
OPTIONAL
Though this section is optional, completing this Infiamation can deter alteration of the document or
fraudulent reattachment of this form to an unintended document.
Description of Attached Document
Title or Type of Document: Exclusive Negotiating Agreement Date: 12/04/2014
Number of Pages: 18 Signer(s) Other Than Named Above: William S. Bonnhei.
Capacity(ies) Claimed by Signer(.)
Signer's Name:
O Corporate Officer — Titie(s):
Partner — 0 Limited 0 General
O Individual 0 Attorney In Fact
O Trustee 0 Guardian or Conservator
MOther: Executive Director
Signer Is Representing: Successor Agency
to the Pals Desert Redevelopment Agency
Sig - e:
O Corpo - • • — Title(s):
O Partner — ■ ited D General
O Individual ► omey In Fact
0 Trustee 0 G • Ian or Conservator
O Other.
Signer Is Representing:
11
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02014 National Notary Association • www.NationalNotary.org • 1-800-US NOTARY (1-800-8713-6827) Item #5907
EXHIBIT A
LEGAL DESCRIPTION
(APN: 620-430-024)
THAT CERTAIN PORTION OF LAND SITUATED IN THE CITY OF PALM
DESERT, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA DESCRIBED
AS FOLLOWS:
THE EAST HALF OF THE SOUTHEAST QUARTER OF THE SOUTHWEST
QUARTER OF THE SOUTHWEST QUARTER OF SECTION 4, TOWNSHIP 5
SOUTH, RANGE 6 EAST, SAN BERNARDINO BASE AND MERIDIAN.
EXCEPTING THEREFROM THE SOUTHERLY 44 FEET AS CONVEYED TO
THE COUNTY OF RIVERSIDE BY DEED RECORDED MARCH 31. 1958 AS
INSTRUMENT NO. 23183 OF OFFICIAL RECORDS.
SUBJECT TO EXISTING EASEMENTS, COVENANTS, RIGHTS AND
RIGHTS -OF -WAY OF RECORD.
CONTAINING 4.67 ACRES, MORE OR LESS.
EXHIBIT A
LEGAL DESCRIPTION
(APN: 620-430-025)
THAT CERTAIN PORTION OF LAND SITUATED IN THE CITY OF PALM
DESERT, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA DESCRIBED
AS FOLLOWS:
THE WEST HALF OF THE SOUTHWEST QUARTER OF THE SOUTHEAST
QUARTER OF THE SOUTHWEST QUARTER OF SECTION 4, TOWNSHIP 5
SOUTH, RANGE 6 EAST, SAN BERNARDINO BASE AND MERIDIAN.
EXCEPT THEREFROM THE SOUTHERLY 44 FEET AS CONVEYED TO THE
COUNTY OF RIVERSIDE BY DEED RECORDED MARCH 31, 1958 AS
INSTRUMENT NO. 23183 OF OFFICIAL RECORDS.
SUBJECT TO EXISTING EASEMENTS, COVENANTS, RIGHTS AND
RIGHTS -OF -WAY OF RECORD.
CONTAINING 4.67 ACRES, MORE OR LESS.
APPRAISAL REPORT
MARKET VALUE STUDY
APN: 620-430-024, 025
DESERT WILLOW GOLF RESORT
PALM DESERT, CALIFORNIA
Date of Report
October 31, 2014
Effective Date
of Appraisal
October 28, 2014
Prepared for
CITY OF PALM DESERT
73-510 Fred Waring Drive
Palm Desert, California 92260
Prepared by
Scott A. Lidgard, MAI, CCIM
LIDGARD AND ASSOCIATES, INC.
2492 North Santiago Boulevard
Orange, California 92867-1862
Report Reference No. 7556
LIDGARD AND ASSOCIATES
APPR AISFRS-COONS V LTANTS
October 31, 2014
City of Palm Desert
73-510 Fred Waring Drive
Palm Desert, California 92260
Attention:
Subject:
Long Beach Office.
3353 Linden Avenue
Suite 200
Long Beach, CA
In accordance with your request and authorization, I have completed an 90807 - 4503
appraisal study of the above -referenced property on behalf of the client
indicated above.
Ruth Ann Moore
Economic Development Manager
Market Value Study
APN: 620-430-024, 025
Desert Willow Golf Resort
Palm Desert, California
The valuation study consisted of (1) an inspection of the subject orange County Office:
property from the adjacent right-of-way, (2) a review of public records, 2592 N. Santiago Blvd.
(3) the research and collection of comparable market data in the Orange, CA
immediate and general subject market area, (4) a valuation employing 92867- 1862
the Sales Comparison Approach based on an analysis of the
comparable market data, and (5) preparation of this formal narrative
appraisal report in summation of the activities outlined above.
The subject property consists of two individually assessed contiguous
parcels located on the north side of Country Club Drive, beginning
effectively 700 feet east of Portola Avenue, within the Desert Willow Golf
Resort in the City of Palm Desert. The site has an effectively rectangular
land configuration, level topography, and contains 9.17± acres, or
399,611± square feet of land area, net of that portion lying within the
Country Club Drive right-of-way. The site has a highest and best use of
commercial and/or residential development which includes assisted
living facilities as proposed for the site. Reference the accompanying
appraisal report for a complete description of the subject property and
valuation analysis process.
The purpose of this appraisal study is to express an estimate of market
value of the subject land parcel based on its highest and best use of
large scale resort residential development. Market value as defined in
Title XI of the Financial Institutions Reform, Recovery and Enforcement
Act of 1989 (FIRREA) is defined as follows:
Telephone..
(562) 988-2926
(714) 633-8441
Facsimile.
(714) 633-8449
LIDGARD AND ASSOCIATES
INCORPORATED
Kral Estate Appraisal and Consultation
City of Palm Desert
Attention: Ruth Ann Moore
Economic Development Manager
October 31, 2014
Page 2
"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 and knowledgeably,
and assuming the price is not affected by undue stimulus. Implicit in
this definition is the consummation of a sale as of a specified date
and the passing of title from seller to buyer under conditions
whereby-
1. Buyer and seller are typically motivated,.
2. Both parties are well informed or well advised, and acting in what
they consider their own best interests;
3. A reasonable time is allowed for exposure in the open market;
4. Payment is made in terms of cash in U.S. dollars or in terms of
financial arrangements comparable thereto; and
5. The price represents the normal consideration for the property
sold unaffected by special or creative financing or sales
concessions granted by anyone associated with the sale."
The intended use of this appraisal report is to assist the City of Palm Desert in
potential sale negotiations with a private developer as well as to substantiate the
State's equity interest in the property. Intended users are City officials and
consultants thereof for the explicit purpose indicated above. This report is not
intended to be distributed to, or relied upon by, third parties, except as provided
for herein.
After considering the various factors which influence value, the market value of
the subject property, as of October 28, 2014, is as follows:
TWO MILLION EIGHT HUNDRED THOUSAND DOLLARS
$2,800,000.
This appraisal complies with the reporting requirements set forth in the Uniform
Standards of Professional Appraisal Practice, under Standard Rule 2-2(a). This
report contains a moderate level of detail with respect to the market data,
appraisal methodology, and reasoning supporting the analysis, opinions, and
conclusions. It contains sufficient information for the purpose, intent, client and
users for which it is written.
LLDGAB,D AND ASSOCIATES Real &dale A wraisx l and Consultation
INCORPOIRATED
City of Palm Desert
Attention: Ruth Ann Moore
Economic Development Manager
October 31, 2014
Page 3
This appraisal report is submitted in triplicate; we have retained a file copy.
Please do not hesitate to contact the undersigned in the event you require
additional information from our file.
Very truly yours,
LIDGARD AND ASSOCIATES, INC.
Scott A. Lidgard, MAI, CCIM
Certified General Real Estate Appraiser
California Certification No. AG 004014
Renewal Date: March 13, 2016
SAL:sp
LIDGARD AND ASSOCIATES
INCORPORATED
Red Palate Appraised wid Consultation-
TABLE OF CONTENTS
Title Page
Letter of Transmittal
Table of Contents
PREFACE
Executive Summary
Location Map
Date of Value
Purpose of the Appraisal
Intent and Users of the Appraisal
Property Rights Appraised
Appraiser's Certification
Scope of the Appraisal
Assumptions and Limiting Conditions
Terms and Definitions
SUBJECT PROPERTY DESCRIPTION
Apparent Vestee
Property Address
Legal Description
Plat Map
Site Description
Existing Improvements
Assessment Data
Ownership History
Neighborhood Environment
VALUATION ANALYSIS
Highest and Best Use Analysis
Valuation Methods
Sales Comparison Approach
Final Estimate of Market Value
Exposure Time
MARKET DATA
Summary of Acreage Land Value Indicators
Market Data Location Map
Acreage Land Sales Data and Photographs
LIDGARD AND ASSOCIATES
APPRAISP.RS-CONSULTANTS
TABLE OF CONTENTS (Continued)
ADDENDA
Additional Subject Property Photographs
Coachella Valley Region Description
Qualifications of Appraiser
LIDGARD AND ASSOCIATES
APPRAISP.RS-CONSULTANTS
PREFACE
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
EXECUTIVE SUMMARY
PURPOSE OF APPRAISAL: Market value of the subject property as of the
date of value employed herein.
CLIENT IDENTIFICATION: City of Palm Desert
PROPERTY ADDRESS: No situs address; property located in Palm De-
sert, California
APPARENT VESTEE: Successor Agency to the Palm Desert Rede-
velopment Agency
SITE DESCRIPTION:
Land area: APN: 620-430-024: 4.67 ac, or 203,425 sf
APN: 620-430-025: 4.67 ac, or 203.425 sf
Total gross land area 9.34 ac, or 406,850 sf
The net developable land area of the subject
parcel, exclusive of the south 11 feet which lies
within the Country Club Drive right-of-way, is es-
timated at 9.17± acres, or 399,611± square feet.
Land shape: Rectangular land configuration.
Zoning: PR-5 (planned residential).
Soil contamination: None known or observed by appraiser, howev-
er, a comprehensive soil study was not provid-
ed for review. The subject property has been
appraised herein as though free of soil contam-
inants, if any.
Present use: Vacant land.
Highest and best use: Large scale residential development.
Assessor's No.: 620-430-024, 025
EXISTING IMPROVEMENTS: There are no building or other on -site im-
provements located within the boundaries of
the subject property having significant mone-
tary value in a highest and best use context.
DATE OF VALUE: October 28, 2014
DATE OF REPORT: October 31, 2014
LIDGARD AND ASSOCIATES
A PP RAI SN RS-CON St! LTANTS
1
EXECUTIVE SUMMARY (Continued)
VALUATION ANALYSIS:
Sales Comparison
Approach:
Cost -Summation
Approach:
Income Capitalization
Approach:
RECONCILIATION:
FINAL ESTIMATE
OF VALUE:
$2,800,000.
Not applicable.
Not applicable.
Inasmuch as the subject property consists of a
vacant land parcel, the Sales Comparison Ap-
proach, as applied to land value, is the only ap-
proach considered applicable in the subject
case.
$2,800,000.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
2
DATE OF VALUE
The date of value employed in this report, and all opinions and computations
expressed herein, are based on October 28, 2014, said date being generally
concurrent with the inspection of the subject property and valuation analysis
process.
PURPOSE QF THE APPRAISAL,
The purpose of this appraisal report is to express an estimate of the unen-
cumbered fee simple market value of the subject property, absent any liens,
leases, or other encumbrances, as of the date of value set forth above. The
definition of market value is set forth in the following portion of this section
following the heading "Definition of Market Value".
Further, it is the purpose of this appraisal report to describe the subject
property, and to render an opinion of the highest and best use based on (1)
the character of existing and potential development of the property ap-
praised, (2) the requirements of local governmental authorities affecting the
subject property, (3) the reasonable demand in the open market for proper-
ties similar to the subject property, and (4) the location of the subject proper-
ty considered with respect to other existing and competitive districts within
the immediate subject market area.
Further, it is the purpose of this appraisal report to provide an outline of cer-
tain factual and inferential information which was compiled and analyzed in
the process of completing this appraisal study.
INTENT AND USERS OF APPRAISAL
The intended use of this appraisal report is to assist the City of Palm Desert
in potential sale negotiations with a private developer as well as to substanti-
ate the State's equity interest in the property. Intended users are City offi-
cials and consultants thereof for the explicit purpose indicated above. This
report is not intended to be distributed to, or relied upon by, third parties, ex-
cept as provided for herein.
PROPERTY RIGHTS APPRAISED
The property rights appraised herein are those of the unencumbered fee
simple interest. Fee simple is defined in the 12th Edition of The Appraisal of
Real Estate. as, Absolute ownership by any other interest or estate, subject
only to the limitations imposed by the governmental powers of taxation, em-
inent domain, police power, and escheat"
LIDGARD AND ASSOCIATES
A PPR A 1SIi R S-CON S V LTAN TS
3
CERTIFICATION
The undersigned does hereby certify, except as otherwise noted in this ap-
praisal report, that:
I have personally inspected the subject property from the adjacent right-of-
way; I have no present or contemplated future interest in the real estate which
is the subject of this appraisal report. Also, I have no personal interest or bias
with respect to the subject matter of this appraisal report, or the parties in-
volved in this assignment.
My engagement in this assignment, and the amount of compensation, are not
contingent upon the reporting or development of pre -determined values or di-
rection in value that favors (1) the cause of the client, (2) the amount of the
value opinion, (3) the attainment of predetermined/stipulated results, or (4) the
occurrence of a subsequent event directly related to the intended use of this
appraisal. To the best of my knowledge and belief, the statements of fact con-
tained in this appraisal report, upon which the analyses, opinions, and conclu-
sions expressed herein are based, are true and correct.
This appraisal report sets forth all of the assumptions and limiting conditions
(imposed by the terms of this assignment or by the undersigned), affecting
my personal, impartial, and unbiased professional analyses, opinions, and
conclusions.
The analyses, opinions, and conclusions, were developed, and this report has
been prepared, in conformity with the Uniform Standards of Professional Ap-
praisal Practice, and the Code of Professional Ethics. As of the date of this re-
port, I have completed the requirements of the continuing education program
of the State of California. Further, duly authorized representatives of the State,
as well as the Appraisal Institute, have the right to review this report.
I have not performed services, as an appraiser or in any other capacity, re-
garding the property that is the subject of this report within the 3-year period
immediately preceding acceptance of this assignment. Jason T. Clayton pro-
vided real property appraisal assistance to the person signing this report with
respect to data collection, inspection of the properties, and report preparation.
No one other than the undersigned prepared the analyses, conclusions, and
opinions of this appraisal study.
Scott A. Lidgard, MAI, CCIM
Certified General Real Estate Appraiser
California Certification No. AG 004014
Renewal Date: March 13, 2016
Date: October 31, 2014
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
4
SCOPE OF THE APPRAISA{.
The appraiser, in connection with the following appraisal study, has:
1. Been retained, and has accepted the assignment, to make
an objective analysis/valuation study of the subject property
and to report, without bias, his estimate of fair market value.
The subject property is particularly described in the follow-
ing portion of this report in the section entitled Subject Prop-
erty Description.
2. Toured the general area by automobile to acquaint himself
with the extent, condition, and quality of nearby develop-
ments, sales and offerings in the area, density and type of
development, topographical features, economic conditions,
trends toward change, etc.
3. Walked within the subject property, and some of the nearby
neighborhood, to acquaint himself with the current particular
attributes, or shortcomings, of the subject property.
4. Completed an inspection of the subject property for the
purpose of becoming familiar with certain physical charac-
teristics.
5. Made a visual observation concerning public streets, ac-
cess, drainage, and topography of the subject property.
6. Obtained information regarding public utilities and sanitary
sewer available at the subject site.
Made, or obtained from other qualified sources, calculations
on the area of land contained within the subject property.
Has made, or caused to be made, plats and plot plan draw-
ings of the subject property, and has checked such plats
and plot plan drawings for accuracy and fair representation.
8. Taken photographs of the subject property, together with
photographs of the immediate environs.
9. Made, or caused to be made, a search of public records for
factual information regarding the recent sales of the subject
property, and for recent sales of comparable properties.
LIDGARD AND ASSOCIATES
APPRAISFRS•CONSULTANTS
5
SCOPE OF THE APPRAISAL (Continued)
10. Has viewed, confirmed the sale price, and obtained certain
other information pertaining to each sale property contained
in this report.
11. Reviewed current maps, zoning ordinances, and other ma-
terial for additional background information pertaining to the
subject property, and sale properties.
12. Attempted to visualize the subject property as it would be
viewed by a willing and informed buyer.
13. Interviewed various persons, in both public and private life,
for factual and inferential information helpful in this appraisal
study.
14. Formed an opinion of the highest and best use applicable to
the subject property appraised herein.
15. Formed an estimate of market value of the unencumbered
fee simple interest in the subject property, as of the date of
value expressed herein.
16. Prepared and delivered this appraisal report, in triplicate, in
summation of all the activities outlined above.
LIDGARD AND ASSOCIATES
APPRAISP. RS-CONS V LTANTS
6
ASSUMPTIONS AND LIMITING CONDITIONS
This appraisal is made with the following understanding as set forth in items
No. 1 through 18, inclusive:
1. That liability of Lidgard and Associates, Inc., along with the
specific appraiser responsible for this report, is limited to the
client only and to the fee actually received by the firm.
There is no accountability, obligation or liability to any third
party reader/user of this report. In the event this appraisal
report is delivered to anyone other than the client for whom
this report was prepared, it is the client's responsibility to
make such party and/or parties aware of all limiting condi-
tions and assumptions of this assignment and related dis-
cussions.
2. That in the event the client or any third party brings legal ac-
tion against Lidgard and Associates, Inc., or the preparer of
this report, and the appraiser prevails, the party initiating
such legal action shall reimburse Lidgard and Associates,
Inc. and/or the appraiser for any and all costs of any nature,
including attorney's fees, incurred in their defense.
3. This appraisal report is intended to comply with reporting
requirements set forth in the Uniform Standards of Profes-
sional Appraisal Practice, under Standard Rule 2-2(a). It
contains a moderate level of detail with respect to the mar-
ket data, appraisal methodology, and reasoning supporting
the analysis, opinions, and conclusions. This report contains
sufficient information for the intended use and users for
which it was written.
4. That title to the subject properties is assumed to be good
and merchantable. Liens and encumbrances, if any, have
not been deducted from the final estimate of value. The
vesting was obtained from County Records, or other
sources, and has been relied upon as being accurate. The
subject properties have been appraised as though under
responsible ownership. The legal descriptions are assumed
accurate.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
7
ASSVMPTIONS AND LIMITING CONDITIONS (Continued)
5. That the appraiser assumes there are no hidden or unap-
parent conditions of the subject properties, subsoil, struc-
tures, or other improvements, if any, which would render
them more or less valuable. Further, the appraiser as-
sumes no responsibility for such conditions or for the engi-
neering which might be required to discover such condi-
tions. That mechanical and electrical systems and equip-
ment, if any, except as otherwise may be noted in this re-
port, are assumed to be in good working order. The proper-
ties appraised are assumed to meet all governmental
codes, requirements, and restrictions, unless otherwise
stated.
6. That no soils report, topographical mapping, or survey of the
subject properties was provided to the appraiser; therefore
information, if any, provided by other qualified sourcesper-
taining to these matters is believed accurate, but no liability
is assumed for such matters. Further, information, esti-
mates and opinions furnished by others and contained in
this report pertaining to the subject properties and market
data were obtained from sources considered reliable and
are believed to be true and correct. No responsibility, how-
ever, for the accuracy of such items can be assumed by the
appraiser.
7. That unless otherwise stated herein, it is assumed there are
no encroachments, easements, soil toxics/contaminants, or
other physical conditions adversely affecting the value of the
subject properties.
8. That no opinion is expressed regarding matters which are
legal in nature or other matters which would require special-
ized investigation or knowledge ordinarily not employed by
real estate appraisers, even though such matters may be
mentioned in the report.
9. That no oil rights have been included in the opinion of value
expressed herein. Further, that oil rights, if existing, are as-
sumed to be at least 500 feet below the surface of the land,
without the right of surface entry.
LI DGARD AND ASSOCIATES
APPRAISI RS•CONSULTANTS
8
ASSUMPTIONS AND LIMITING CONDITIONS (Continued)
10. That the distribution of the total valuation in this report be-
tween land and improvements, if any, applies only under the
existing program of utilization. The separate valuations for
land and improvements must not be used in conjunction
with any other appraisal and are invalid if so used.
11. That the valuation of the properties appraised is based upon
economic and financing conditions prevailing as of the date
of value set forth herein. Further, the valuation assumes
good, competent, and aggressive management of the sub-
ject properties.
12. That the appraiser has conducted a visual inspection of the
subject properties and the market data properties. Should
subsequent information be provided relative to changes or
differences in (1) the quality of title, (2) physical condition or
characteristics of the properties, and/or (3) governmental
restrictions and regulations, which would increase or de-
crease the value of the subject properties, the appraiser re-
serves the right to amend the final estimate of value.
13. That the appraiser, by reason of this appraisal, is not re-
quired to give testimony in court or at any governmental or
quasi -governmental hearing with reference to the properties
appraised, unless contractual arrangements have been
previously made therefor.
14. That drawings, plats, maps, and other exhibits contained in
this report are for illustration purposes only and are not
necessarily prepared to standard engineering or architec-
tural scale.
15. That this report is effective only when considered in its entire
form, as delivered to the client. No portion of this report will
be considered binding if taken out of context.
16. That possession of this report, or a copy thereof, does not
carry with it the right of publication, nor shall the contents of
this report be copied or conveyed to the public through ad-
vertising, public relations, sales, news, or other media, with-
out the written consent and approval of the appraiser, par-
ticularly with regard to the valuation of the properties
LIDGARD AND ASSOCIATES
A PPR A 1 ST R S-CON S LTAN TS
9
ASSVMPTIQNS AND LIMITING CONDITIONS (Continued)
appraised and the identity of the appraiser, or the firm with
which he is connected, or any reference to the Appraisal In-
stitute, or designations conferred by said organizations.
17. That the form, format, and phraseology utilized in this report,
except the Certification, and Terms and Definitions, shall not
be provided to, copied, or used by, any other real estate ap-
praiser, real estate economist, real estate broker, real estate
salesman, property manager, valuation consultant, invest-
ment counselor, or others, without the written consent and
approval of Scott A. Lidgard.
18. That this appraisal study is considered completely confiden-
tial and will not be disclosed or discussed, in whole or in
part, with anyone other than the client, or persons designat-
ed by the client.
LIDGARD AND ASSOCIATES
APPRAISFRS-CONSULTANTS
10
TERMS AND DEFINITIONS
Certain technical terms have been used in the following report which are de-
fined, herein, for the benefit of those who may not be fully familiar with said
terms.
MARKET VALUE (or Fair Market Value):
Market value is sometimes referred to as Fair Market Value; the latter is a
legal term, and a common synonym of Market Value. Market value as de-
fined in Title XI of the Financial Institutions Reform, Recovery and Enforce-
ment Act of 1989 (FIRREA) is defined as follows:
"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 and knowl-
edgeably, and assuming the price is not affected by undue
stimulus. Implicit in this definition is the consummation of a sale
as of a specified date and the passing of title from seller to buy-
er under conditions whereby:
1. Buyer and seller are typically motivated;
2. Both parties are well informed or well advised, and acting in
what they consider their own best interests;
3. A reasonable time is allowed for exposure in the open mar-
ket;
4. Payment is made in terms of cash in U.S. dollars or in terms
of financial arrangements comparable thereto; and
5. The price represents the normal consideration for the prop-
erty sold unaffected by special or creative financing or sales
concessions granted by anyone associated with the sale."
SALES COMPARISON APPROACH:
One of the three accepted methods of estimating Market Value. This ap-
proach consists of the investigation of recent sales of similar properties to
determine the price at which said properties sold. The information so gath-
ered is judged and considered by the appraiser as to its comparability to the
subject property. Recent comparable sales are the basis for the Sales
Comparison Approach.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
11
TERMS AND DEFINITIONS (Continued)
COST -SUMMATION APPROACH:
Another accepted method of estimating Market Value. This approach con-
sists of estimating the new construction cost of the building and yard im-
provements and making allowances for appropriate amount of depreciation.
The depreciated reconstruction value of the improvements is then added to
the Land Value estimate gained from the Sales Comparison Approach. The
sum of these two figures is the value indicated by the Cost -Summation Ap-
proach.
INCOME CAPITALIZATION APPROACH:
The Income Capitalization Approach consists of capitalizing the net income
of the property under study. The capitalization method studies the income
stream, allows for (1) vacancy and credit Toss, (2) fixed expenses, (3) operat-
ing expenses, and (4) reserves for replacement, and estimates the amount
of money which would be paid by a prudent investor to obtain the net in-
come. The capitalization rate is usually commensurate with the risk, and is
adjusted for future depreciation or appreciation in value.
DEPRECIATION:
Used in this appraisal to indicate a lessening in value from any one or more
of several causes. Depreciation is not based on age alone, but can result
from a combination of age, condition or repair, functional utility, neighbor-
hood influences, or any of several outside economic causes. Depreciation
applies only to improvements. The amount of depreciation is a matter for
the judgment of the appraiser.
HIGHEST AND BEST USE:
Used in this appraisal to describe that private use which will (1) yield the
greatest net return on the investment, (2) be permitted or have the reasona-
ble probability of being permitted under applicable laws and ordinances, and
(3) be appropriate and feasible under a reasonable planning, zoning, and
land use concept.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
12
SUBJECT PROPERTY
DESCRIPTION
LIDGARD AND ASSOCIATES
APPRAISERS•CONS V LTANTS
SITE DESCRIPTION
LOCATION:
North side of Country Club Drive, beginning
effectively 700 feet east of Portola Avenue,
within the Desert Willow Golf Resort which is
bounded by Frank Sinatra Drive, Country
Club Drive, Cook Street, and Portola Avenue,
on the north, south, east, and west,
respectively, within the corporate limits of the
City of Palm Desert.
MAP COORDINATES: Thomas Bros. Map Page 818, Grid G-3
CENSUS TRACT: Property located in Government Census
Tract 449.19.
LAND SHAPE:
Effectively rectangular land configuration;
see highlighted portion of plat map on the
opposite page.
DIMENSIONS: Approximate dimensions of the site are
658±' x 618±'.
LAND AREA:
The subject property consists of two
individually assessed land parcels; the total
gross land area, per Riverside County
Assessor's records, is as follows:
APN: 620-430-024:
APN: 620-420-025:
Total gross land area:
4.67 ac, or 203,425 sf
4.67 ac, or 203.425. sf
9.34 ac, or 406,850 sf
The net developable land area of the subject
parcel, exclusive of the south 11 feet which
lies within the Country Club Drive right-of-
way, is estimated at 9.17± acres, or 399,611±
square feet.
TOPOGRAPHY: Effectively level topography.
DRAINAGE:
Appears to be adequate; no depressions or
low areas were noted within the boundaries
of the subject property which would cause a
water ponding condition during the rainy
season.
LIDGARD AND ASSOCIATES
APPR AISI? RS-CONS V LTANTS
2
SITE DESQRIPTIQN (Continued)
SOIL STABILITY:
SOIL CONTAMINATION:
ACCESS:
RIGHT-OF-WAY WIDTH:
STREET SURFACING:
CURB AND GUTTER:
SIDEWALK:
STREET LIGHTS:
PUBLIC UTILITIES:
SANITARY SEWER:
ENCROACHMENTS:
EASEMENTS:
Appears to be adequate based upon the
existing development at the subject site, as
well as surrounding developments; it should
be noted that a soils report was not provided
for review.
None known or observed, however, a soils
study has not been provided for review. The
subject property has been appraised as
though free of soil contaminants.
The subject property has frontage along
Country Club Drive.
Country Club Drive: 88-110 feet.
Asphalt paved traffic lanes.
Concrete curb and gutter (each side of
street).
Concrete sidewalk (each side of street).
Mounted on ornamental standards.
Water, gas, electric power, and telephone
are available at the site.
Available to site.
None known, or observed during the field
inspection, however, a survey of the subject
property was not provided for review.
A title report pertaining to the subject
property was not provided for review.
Easements, if existing, are assumed to be
located along property boundaries not
interfering with the existing or future highest
and best use of the subject property. It is
further assumed there are no "cross -lot" or
"blanket" easements.
LIDGARD AND ASSOCIATES
APPRAISERS -CONS V LTANTS
3
SITE DESCRIPTION (Continued)
ILLEGAL USES: None observed.
EARTHQUAKE FAULT:
PRESENT USE:
ZONING:
The subject property is not located within an
earthquake fault study zone. The greater
Southern California area, however, is gener-
ally prone to earthquakes and other seismic
disturbances. No seismic or geological
studies have been provided for review. No
responsibility is assumed for the possible
impact on the subject property of seismic
activity and/or earthquakes.
Vacant land located along the perimeter of a
residential resort community. It is
understood that a developer is proposing to
construct an assisted living facility on the site.
The subject property is located within the
Planned Residential (PR-5) zone of the City of
Palm Desert. The general plan land use
designation is office professional (C-OP).
The purpose and intent of the PR-5 zone is to
provide for flexibility and development,
creative and imaginative design of parcels,
coordinating projects involving a mixture of
residential densities, housing types, and
public/private community facilities. The
district is intended to provide for the
optimum integration of urban and natural
amenities within developments.
Future development of the subject property
would most likely entail a general plan
amendment consistent with the current zone
designation.
Specific permitted uses within the PR-5 zone
include, but are not necessarily limited to,
small daycare facilities, public parks, and
private recreation facilities. Additional uses,
subject to the issuance of a conditional use
permit, include assisted living facilities,
condominium complexes, residential
planned unit developments, kennels, private
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
4
SITE DESQRIPTIQN (Continued)
ZONING: (Continued)
HIGHEST AND BEST USE:
clubs, religious and educational institutions,
commercial recreation uses, recreational
vehicle parks, resort hotels, and time shares.
Development standards vary depending on
the size of development and overall density.
A site plan review is required prior to the
issuance of building permits for properties
within the PR district.
The on -site automobile parking requirement
for hotels is based on 1.1 space per guest
unit plus additional parking for other uses on
the site based on the appropriate parking
requirement. Residential care facilities
require one space for each four beds. Single
family residences generally require two
spaces per dwelling unit. Additional parking
may be required by the director for resort
hotels through the precise plan process.
Based on an inspection of the subject
property, as well as a review of current
development standards, the optimal utility of
the subject site is as zoned.
The reader is referred to the first portion of
the Valuation Analysis Section for a detailed
discussion regarding the highest and best
use of the subject property.
EXISTING IMPROVEMENTS
COMMENT:
There are no building or other on -site
improvements located within the boundaries
of the subject property having significant
monetary value in a highest and best use
context.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
5
ASSESSMENT DATA
ASSESSOR'S PARCEL NO.: 620-430-024, 025
ASSESSED VALUATIONS: Not applicable; vested with public entity.
TAX CODE AREA: 18201
TAX YEAR: 2013-2014
REAL ESTATE TAXES: Not applicable; vested with public entity.*
SPECIAL ASSESSMENTS: None known.
Real estate taxes will be based upon approximately
1.15% of the current cash value placed on the
subject property by the Riverside County Assessor,
in the event the subject property is sold to a private
party (per Proposition 13).
OWNERSHIP HISTORY
COMMENT:
A quit claim deed conveying title from the
City of Palm Desert to the Successor Agency
to the Palm Desert Redevelopment Agency,
recorded December 11, 2012 as Document
No. 601626.
Prior to the quit claim deed transfer, the
property was vested with the Redevelop-
ment Agency in excess of five years. As
stated, sale negotiations are in process with
a private developer for the construction of an
assisted living facility. The property has not
been openly marketed for sale through local
or national Multiple Listing Services.
NEIGHBORHOOD ENVIRONMENT
COMMUNITY:
The City of Palm Desert was incorporated
November 26, 1973 as a general law city,
governed under California's State
regulations. The City's designation was
LI DGARD AND ASSOCIATES
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6
NEIGHBORHOOD ENVIRONMENT (Continued)
COMMUNITY: (Continued)
amended by Citywide referendum in 1997
from a general law to a charter city as a
means of preserving the historical principals
of self governance.
The Palm Desert City Council consists of five
councilpersons elected at large for four-year
terms; the mayor is appointed from among
the council members. The City Council
enacts City ordinances, establishes policies,
represents the public, maintains inter-
governmental relations, and exercises
general oversight over the affairs of City
government including the Redevelopment
Agency, Financing Authority, Housing
Authority, and Parking Authority.
Palm Desert is situated within the Coachella
Valley of the Colorado Desert, surrounded by
the San Jacinto Mountains to the east and
the Santa Rosa Mountains to the south.
Neighboring communities include Indio,
Thousand Palms, La Quinta, Indian Wells,
Rancho Mirage, Cathedral City, and Palm
Springs.
Interstate 10 is the primary freeway
accessing the greater Coachella Valley
region. Predominant intersecting streets
entering the City of Palm Desert include
Washington Street, Cook Street, Portola
Avenue, Monterey Avenue, and Highway
111
The City of Palm Desert encompasses 27
square miles; the elevation is 220 feet above
sea level. The total permanent resident pop-
ulation within City limits is reported at 48,445
persons. Seasonal residents are reported at
32,000 persons. The average household
size is approximately 2.08 persons. The
median household income is $67,328, and
the per capita income is $42,339.
LIDGARD AND ASSOCIATES
APPRAISBRS•CONSUI.TANTS
7
NEIGHBORHOOD ENVIRONMENT (Continued)
COMMUNITY: (Continued)
The Palm Desert labor market is allocated
between a primary market area (30-mile
radius), and a secondary market area (60-
mile radius). The top ten private employers
within the City of Palm Desert, as of 2010, are
summarized as follows:
No. of
Fmplovar Emoloveea
JW Marriott Desert Springs Golf Resort 2,000
Universal Protection Services 1,500
Guthy-Renker 825
Securitas 700
Desert Arc 400
Wal-Mart 350
Marriot Desert Springs Villas 304
Macy's 301
Toscana Country Club 300
Bighorn Golf Club 250
There are a total of 17 hotels and 20
shopping centers/plazas located within the
City boundaries. The predominant hotels
include Embassy Suites, Fairfield Inn, JW
Marriott Desert Springs Resort and Spa,
Marriott Shadow Ridge, Shadow Mountain
Resort, Best Western Palm Desert Resort,
etc. Predominant shopping centers include
the El Paseo shopping district, Westfield
Shoppingtown, Palm Desert, Desert
Crossing, and the Desert Gateway anchored
by Super Walmart and Sam's Club.
The Palm Springs International Airport is the
hub of the transportation network for the
Coachella Valley region. The airport facility
serves nine airlines including four major and
five regional carriers. Recent airport
improvements include a 60,000 square foot
terminal building, expansion of the runway,
and state-of-the-art taxi/bus holding facilities.
The Union Pacific Railroad runs parallel to
LI DGARD AND ASSOCIATES
APPRAISI:RS•('ONSVLTANTS
8
NEIGHBORHOOD ENVIRONMENT (Continued)
COMMUNITY: (Continued) Interstate 10, and offers Amtrak trans-
continental service. Bus transportation within
the City limits is provided by Greyhound and
Sunline Systems.
LOCATION:
LAND USES:
The Coachella Valley region offers a wide
variety of cultural, recreational, educational,
and entertainment options.
The subject property is located toward the
northwesterly portion of the City of Palm
Desert, approximately one mile south of the
Interstate 10 Freeway. Primary vehicular
access to the subject neighborhood is via
Frank Sinatra Drive, Monterey Avenue,
Portola Avenue, Cook Street, Country Club
Drive, and Fred Waring Drive. The property
has a relatively good centralized location with
above -average freeway accessibility.
Land uses in the immediate area include
numerous resort hotels or housing
developments oriented around private golf
course and club house facilities.
Commercial retail developments are located
along primary thoroughfares such as
Highway 1 1 1, Bob Hope Drive, and Cook
Street.
Predominant land uses include Marriott
Shadow Ridge Resort, Resort Falls Country
Club, Avondale Golf Club, Palm Valley
Country Club, Indian Ridge Country Club,
Lakes Country Club, the subject Desert
Willow Golf Resort, Marriott Desert Springs
Golf Club, Chaparral Country Club, Monterey
Country Club, Rancho Las Palmas Country
Club, and Rancho Mirage Country Club.
Other predominant non -resort or country
club developments include Palm Desert Civic
Center, Civic Center Park, Cook Sports
LI DGARD AND ASSOCIATES
APPRAISFRS.CONS V LTANTS
9
NEIGHBORHOOD ENVIRONMENT (Continued)
COMMUNITY: (Continued) Complex, Bob Hope Cultural Center, Hahn
Amphitheater, Palm Desert Skate Park,
Eisenhower Medical Center, Desert Crossing
Shopping Center, El Paseo Shopping District,
Westfield Shoppingtown at Palm Desert,
Palm Desert Soccer Park, and Cal State
University at San Bernardino Palm Desert
Campus.
BUILT-UP:
OCCUPANCY:
PRICE RANGE:
Based on a tour of the general subject
vicinity, the overall compatibility of existing
land uses is rated average. No substantial
adverse conditions were noted which would
have a measurable impact on the value of
the subject property.
Effectively 65% built-up.
Residential:
Commercial:
Industrial:
55±% owners
45±% tenants
30±% owners
70±% tenants
35±% owners
65±% tenants
Large acreage land parcels zoned for resort
or large scale commercial/residential
development generally range between $5.00
and exceeding $10.00 per square foot of
land area. Smaller commercial land parcels
zoned for retail use generally range from
$15.00 to exceeding $30.00 per square foot
of land area. Land parcels zoned for
commercial office use generally range in
value from $6.00 to $10.00 per square foot.
The upper range of value pertains primarily
to prominent commercial corner locations,
whereas the lower range consists of large
unimproved acreage land parcels.
Improved single family residential properties
generally range in value from $300,000 to
exceeding $600,000. The lower value range
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
10
NEIGHBORHOOD ENVIRONMENT (Continued)
PRICE RANGE: (Continued)
AGE RANGE:
PRIDE OF OWNERSHIP:
primarily consists of 2-bedroom/1-bathroom
dwellings, whereas the upper value range
includes three and four bedroom dwellings
located within resort developments.
Multiple family residential properties are
within a much broader value range; smaller
complexes such as duplexes and triplexes,
generally range from $350,000 to exceeding
$650,000. Larger multiple family residential
complexes range in value in excess of
several million dollars.
Improved commercial properties range in
value from approximately $500,000 for
single tenant, typically owner -user facilities, to
exceeding several million dollars including
large multi -tenant commercial facilities
anchored by national tenants.
Improved single family and low density
multiple family residential developments
generally range from $250,000 to exceeding
$500,000. Improved commercial properties
range in value from $500,000 to exceeding
$1,000,000.
The age range of all types of improved
properties is rather broad. Single family
residential properties generally range in age
from effectively new to exceeding 40 years.
There are numerous commercial properties
which have been recently built in the
immediate area.
Overall pride of ownership in the general
subject market area, evidenced by an
ongoing maintenance program, is rated
above average.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
11
NEIGHBORHOOD ENVIRONMENT (Continued)
OTHER:
COMMENT:
The availability and adequacy of public
facilities, transportation, and commercial
retail facilities is rated average. The City of
Palm Desert provides police and fire
protection to the subject district.
The reader is referred to a detailed
description of the Coachella Valley Region in
the Addenda Section.
See Valuation Analysis in the following section.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
12
VALUATION ANALYSIS
LIDGARD AND ASSOCIATES
APPRAIS1 RS-CONS1LTANTS
VALUATION ANALYSIS
The purpose of this valuation study is the estimation of market value of the
unencumbered fee simple interest in the subject property based on its
highest and best use of commercial and/or residential development
including an assisted living facility as proposed for the site. The date of value
employed herein is October 28, 2014.
Prior to the application of the appraisal process, which in this case employs
the Sales Comparison Approach as applied to land value, it is necessary to
consider and analyze the highest and best use of the subject property.
HIGHEST AND BEST USE ANALYSIS:
Highest and best use is defined in The Appraisal of Real Estate, by the
Appraisal Institute, 14th Edition, Page 332, as:
"The reasonably probable and legal use of property that results
in the highest value."
In the process of forming an opinion of highest and best use, consideration
must be given to various environmental and political factors such as zoning
restrictions, probability of zone change, private deed restrictions, location,
land size and configuration, topography, and the character/quality of land
uses in the immediate and general subject market area.
There are three basic criteria utilized in the highest and best use analysis of
a property as if vacant, as well as presently improved. The three criteria are
summarized as follows:
1. Physically possible.
2. Legally permissible.
3. Financially feasible.
The foregoing are typically considered sequentially; for example, a specific
use may prove to be maximally productive, however, if it is not legally
permissible, or physically possible, its productivity is irrelevant.
Physically Possible:
The physical possibility of developing a specific property is governed, in part,
by the size, shape, area, and terrain of the property in question. The
availability of public utilities is also an important consideration in the analysis
of a property's overall development potential.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
1
VALUATION ANALYSIS (Continued)
HIGHEST AND BEST USE ANALYSIS: (Continued)
Physically Possible: (Continued)
Additional physical considerations are warranted when analyzing the highest
and best use of the subject property, as presently improved. The size,
architectural design, and condition of the existing building improvements are
important elements, and may have a substantial impact on the highest and
best use of a property, as presently improved.
Legally Permissible:
Legally permissible uses are determined, in part, by a community's general
plan, zoning requirements, local building codes, and private deed
restrictions.
The general plan of a community is established to assure continuity of
development within the community and the surrounding area. There is
usually a consistency between the general plan of a community and the
various zone classifications. The zone classification sets forth the various
types of development allowed within a specific zone district. Zoning
requirements typically constitute the available choices of development for a
property. Local building codes are generally addressed as part of the zone
classification, and include items such as maximum building densities,
building height restrictions, setback and parking requirements, etc. Private
deed restrictions relate to mutual agreements under which a property was
acquired. Said restrictions may prohibit certain types of development.
Financially Feasible:
Those uses which meet the first two criteria, i.e. physically possible and
legally permissible, are further analyzed in order to determine which uses
produce an adequate return on the investment. The specified use is
considered financially feasible if the net income capable of being generated
is enough to satisfy the required rate of return and provide a return on the
land.
Among those uses which are considered financially feasible, that use which
produces the highest price, or value, consistent with the required rate of
return, is considered the highest and best use of the property.
LIDGARD AND ASSOCIATES
APPRAISI RS-CONSULTANTS
2
VALUATION ANALYSIS (Continued)
HIGHEST AND BEST USE ANALYSIS: (Continued)
Concluslon:
The subject property comprises two individually assessed contiguous
parcels situated within the Desert Willow Golf Resort. The site has an
effectively rectangular land configuration, level level topography, and
contains 9.17± acres, or 399,61 1 ± square feet of land area, net of that
portion lying within the Country Club Drive right-of-way. Vehicular and
pedestrian accessibility to the subject site is rated above average.
All public utilities such as water, gas, electric power, telephone, as well as
sanitary sewer are available to the site. The physical characteristics of the
subject parcel are considered adequate to accommodate a variety of legally
permissible uses.
As stated, the subject property is located within the Planned Residential (PR-5)
zone of the City of Palm Desert. The general plan land use designation is office
professional (C-OP). Future development of the subject property would most
likely entail a general plan amendment consistent with the current zone
designation. The purpose and intent of the resort center zone is to provide for
the development of hotel, entertainment, and restaurant facilities with related
commercial uses. The optimal utility of the subject site is as zoned.
Based on the demand, physical characteristics of the site, as well as the
legally permissible uses, it is the appraiser's opinion that the maximally
productive use, and therefore, the highest and best use of the subject land,
as if vacant, commercial and/or residential development including an
assisted living facility as proposed for the site.
VALUATION METHODS:
There are three conventional methods (approaches) which can be used to
estimate value. They are the Sales Comparison Approach, Cost -Summation
Approach, and Income Capitalization Approach. Following is a brief
description of each approach to value.
Sales Comparlson Approach:
This approach consists of the investigation of recent sales of
similar properties to determine the price at which said
properties sold. The information so gathered is judged and
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
3
VALVATION ANALYSIS (Continued)
VALUATION METHODS: (Continued)
considered by the appraiser as to its comparability to the
subject property. Recent comparable sales, either vacant land
or improved properties, are the basis for the application of the
Sales Comparison Approach.
Cost -Summation Approach:
The Cost -Summation Approach consists of estimating the
construction cost new of the building and yard improvements
and making allowances for the appropriate amount of accrued
depreciation. The depreciated reconstruction value of the
improvements is then added to the land value estimate. The
sum of these two figures is the value indicated by the Cost -
Summation Approach.
Income Capitalization Approach:
The Income Capitalization Approach consists of the capitalizing
of net income of the property under appraisement. The
capitalization methodology studies the income stream, allows
for (1) vacancy and credit loss, (2) fixed expenses, and (3) oper-
ating expenses. The value indicated by the Income
Capitalization Approach represents the money which would be
paid by a prudent investor to obtain the net income capable of
being generated by the property. The capitalization rate is
usually commensurate with the inherent risk.
Inasmuch as the subject property consists of a vacant commercially zoned
land parcel, the Sales Comparison Approach, as applied to land value, is the
only approach considered applicable in the subject case.
SALES COMPARISON APPROACH:
The Sales Comparison Approach takes into account properties which have
sold in the open market. This approach, whether applied to vacant or
improved property, is based on the Principle of Substitution which states,
"The maximum value of a property tends to be set by the cost of acquiring
an equally desirable substitute property, assuming no costly delay is
encountered in making the substitution." Thus, the Sales Comparison
Approach attempts to equate the subject property with sale properties by
analyzing and weighing the various elements of comparability.
LI DGARD AND ASSOCIATES
APPR AISE RS-CONS V LTANTS
4
VALUATION ANALYSIS (Continued)
SALES COMPARISON APPROACH:(Continued)
The Sales Comparison Approach was applied after conducting an
investigation of market data (acreage land sales) in the greater subject
market area. The reader is referred to the Market Data Section for
comprehensive information pertaining to each sale property employed
herein. Reference the Market Data Map on the following page for an
illustration of the location of the various sale properties.
Primary indicators studied included sales of acreage land parcels suitable
for large scale developments as well as land sales construction cost
estimates and depreciation schedules. Other elements considered included
(1) pride of ownership exhibited by an aggressive and on -going
maintenance program, and (2) trends toward change evidenced by private
redevelopment and remodeling, or gradual continued building degeneration
in certain areas.
The knowledge and understanding of present and historical value patterns
and trends affecting the local real estate market are based on the
observation of market conditions and the appraisal of other commercial
properties, as well as information obtained from various sources which
include the following:
• Owners: Interviews were conducted with owners of
commercial properties in the general research area to
determine various market trends, and value patterns.
• Tenants: Interviews were conducted with various tenants of
properties located within the immediate subject market area.
• Real estate brokers and salespersons: A number of active
brokers and salespersons within the greater subject market
area were interviewed regarding existing and historical lease
and sales data, as well as value patterns and trends.
• Public officials: Various public officials were interviewed
regarding (1) existing or proposed projects which have an
impact on real property values, (2) economic trends, (3) level
of public services, (4) zone classifications and building
standards, and (5) property tax structure and assessment
districts.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
5
VALUATION ANALYSIS (Continued)
SALES COMPARISON APPROACH:(Continued)
• Published data: Information was gathered and studied
regarding population, unemployment levels, employment
centers, commercial sales data as well as rental data, and
other demographic and economic factors.
Land Value:
Following is a summary of those sales considered helpful when estimating
the value of the subject underlying land parcel as if vacant and readily
available for development.
Land Area Street
Data Date Zoning Acres Sa.Ft. Corner Frontaae $ale Price $ Per SF
A. 5-13 SP 10.70 ac 466,092 sf yes 969 feet $ 2,400,000. $ 5.15
NWC Hwy. 1 1 1 and Mirage Cove Dr., Rancho Mirage
B. 8-13 C-G 23.71 ac 1,032,808 sf no 672 feet $ 4,000,000. $ 3.87
W/S State Highway 111, 960' S/O Mirage Cove Dr., Rancho Mirage
C. 11-13 CG 4.72 ac 205,603 sf* no 938 feet $ 1,050,000. $ 5.11
SW'Iy/C State Hwy. 1 1 1 and Thunder Rd., Rancho Mirage
D. 11-13 RMH 19.33 ac 842,015 sf yes 1,594 feet $10,400,000. $12.35
NWC Jefferson St. and Ave. 52, La Quinta
E. 11-13 O-SC 5.46 ac 237,985 sf yes 1,026 feet $ 1,600,000. $ 6.72
NEC Bob Hope Dr. and Gerald Ford Dr., Rancho Mirage
F. 4-14 CO 2.28 ac 99,460 sf* no 590 feet $ 750,000. $ 7.54
S/S Ramon Rd., 1,314' W/O Belardo Rd., Palm Springs
Net land area, exclusive of future required street dedication.
The land sale properties surveyed are located within the general subject
vicinity, and represent the most recent comparable land sale transactions.
The properties range in size from 99,460 to 1,032,808 square feet of land
area. The overall purchase prices range from $750,000 to $10,400,000,
reflecting a relatively wide range of value between $3.87 to $12.35 per
square foot of land area.
Due to the absence of a representative number of large acreage land sale
properties having recently sold within the immediate subject market area, it
was necessary to (1) employ smaller acreage parcels, and (2) expand the
LIDGARD AND ASSOCIATES
APPKAISPRS-CONSV LTANTS
6
VALUATION ANALYSIS (Continued)
SALES COMPARISON APPROACH: (Continued)
Land Value: (Continued)
geographic search area to include neighboring communities of Rancho
Mirage, La Quinta, and Palm Springs. Particular consideration has been
assigned to overall land area, general location, as well as immediate
environmental influences in the analysis of the individual sale properties.
All of the sales employed herein conveyed title to the fee simple interest, and
represent arm's length transactions. Financing terms of each sale are
considered generally typical of the subject market area. Adjustments for
property rights conveyed, conditions of sale, and financing terms, therefore,
are not warranted.
Market Conditions:
Certain of the land sales data considered extended over a time period back
to the second quarter of 2013. The time frame permitted the development
of a rather comprehensive real estate market profile. The sales employed in
this report are set forth in chronological order, and took place between May,
2013 and April, 2014.
Virtually all types of real estate within the greater Southern California region
experienced relatively high levels of value appreciation throughout 2005 to
the first half of 2008. The highest levels of appreciation were evident during
2007 and 2008. The lack of available properties offered for sale, along with
the expansion of subprime lending practices, were the primary reasons for
the unprecedented rate of real estate appreciation, particularly with respect
to single family and low density multiple family residential properties.
While the appreciation rate pertaining to residential properties began to
subside in the middle part of 2006, the market for commercial and industrial
properties, along with vacant land parcels continued to thrive. The destabili-
zation of the residential market was caused by numerous factors including
(1) increasing interest rates, (2) an oversupply of properties available for
sale, (3) the tightening of credit markets wherein difficulty of obtaining
financing began, and (4) the lack of, or diminishing, confidence level
regarding future value appreciation for residential properties.
Based on market research findings and analysis of the immediate and
general subject vicinity, it is apparent that values of commercial properties
continued to appreciate through the last quarter of 2007 despite the
meltdown of the residential market. Interviews with active real estate
LIDGARD AND ASSOCIATES
A PPR A I S1, RS-CONSULTANTS
7
VALUATION ANALYSIS (Continued)
SALES COMPARISON APPROACH: (Continued)
Land Value: (Continued)
Market Conditions: (Continued)
brokers and salespersons indicate that commercial and industrial
properties, including vacant land parcels, have declined in value
substantially since the peak period.
Both local and national economies suffered a major housing and credit crisis
beginning in the fourth quarter of 2008 which had a significant impact on
market activity involving all types of real property. The lack of financing
options available for purchase and refinancing activities has had a
detrimental impact on demand and value. Virtually all market activity was
immediately suspended.
Declining market conditions stabilized during the second half of 2010. The
stabilized conditions continued throughout 2011. There has been an
increase in the demand for vacant land parcels within the past several
months. The increased demand has resulted in a slight upward value trend.
This condition has been considered in the analysis of the individual land sale
properties employed herein.
Elements of Comparability:
After viewing each of the sale properties, and obtaining certain information
pertinent to land value, the appraiser analyzed the various elements of
comparability for each sale property which, among others, include the
following:
General location. Availability of public alley.
Immediate environmental influences. Overall developability.
Zoning. Site frontage/depth ratio.
Vehicular and pedestrian access. Site prominence and exposure.
Vehicular and pedestrian traffic. Proximity to freeway.
A Relative Comparison Analysis (RCA) has been conducted between the
individual comparable properties and the subject property. The RCA is a
qualitative technique for analyzing comparable sales, and is a valuable tool
employed to illustrate whether the characteristics of a comparable property
are inferior, superior, or similar to those of the property under appraisement.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
8
VALUATION ANALYSIS (Continued)
SALES COMPARISON APPROACH: (Continued)
Land Value: (Continued)
Elements of Comparability: (Continued)
The Relative Comparison Analysis is similar to paired data analysis without
the use of arbitrary or unsupportable quantitative adjustments. This
technique acknowledges the imperfect nature of the subject real estate
market. The primary objective is to bracket the subject property between
the comparable sales with respect to the similarity, superiority, and inferiority
thereof. Superior elements of comparability of an individual sale property
would reflect a downward adjustment to the value indication thereof.
Conversely, inferior elements suggest an upward adjustment.
Additionally, it is important to note that the above elements of comparability
were not assigned equal weight in making the analysis of each property.
The general location, immediate environmental influences, vehicular
accessibility, site conditions, site prominence/exposure, and land plottage
were considered the most important factors in the subject case, as follows:
General Location:
Social, economic, and governmental forces have a substantial
influence on property values. Locational factors considered
include, but are not limited to, demographics such as proximity
to housing, schools, employment centers, transportation
facilities, as well as quality of public services, proximity to
freeway corridors, enforcement of codes, and median income
levels.
Immediate Environmental Influences:
Considered with respect to the density and quality of existing
developments within the immediate proximity to a specific
property. By contrast, immediate environmental influences
represent a myopic consideration of location as opposed to
more generalized characteristics considered with respect to
general location.
Vehicular Accessibility:
Commercial and industrial properties rely heavily on vehicular
accessibility. Generally, corner locations with multiple access
points command higher values than interior parcels having
single point ingress/egress.
LIDGARD AND ASSOCIATES
APPR AISFRS-CONSULTANTS
9
VALUATION ANALYSIS (Continued)
SALES COMPARISONAPPROACH:(Continued)
Land Value: (Continued)
Elements of Comparability: (Continued)
Site Conditions:
This factor is considered with respect to the condition of the
property at the time of the sale. While certain properties are
acquired based on the underlying land value, often times
improvements exist on the site which either contribute or
detract from the value. In many instances, an additional
expense must be incurred to demolish existing improvements
which expense increases the cost of the underlying land. In
contrast, however, a nominally improved property may be
receiving income for an interim period during the planning and
entitlement phase of a future development.
Site Prominence/Exposure:
Commercial retail and office properties, along with certain
industrial uses, rely heavily on site prominence/exposure as a
means of attracting customers and clients. The advertising
exposure along commercial thoroughfares can also be
beneficial to industrial and business park oriented properties. In
general terms, signalized corner parcels offer superior
prominence/exposure than interior sites. Additionally, heavily
traveled corridors are preferred by commercial uses over
secondary collector streets. The subject property has a
relatively prominent location along the perimeter of the Desert
Willow Golf Resort. Overall site prominence/exposure of the
subject site is judged generally similar to that of the sale
properties employed herein.
Land Area:
The functional utility or desirability of a site often varies
depending on the types of contemplated uses. Different
prospective uses have ideal size and shape characteristics that
influence value as well as highest and best use. The purchase
price per square foot of land area can fluctuate greatly
depending on the size of property.
Smaller parcels lend themselves to a higher degree of market
participants capable of purchasing and developing the sites.
Due to the precept of "economies of scale", it is the general
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
10
VALUATION ANALYSIS (Continued)
SALES COMPARISON APPROACH: (Continued)
Land Value: (Continued)
Elements of Comparability: (Continued)
consensus that smaller parcels tend to sell on a higher per
square foot basis than larger parcels. Due to the relatively wide
range of land areas among the sale properties employed
herein, particular consideration has been assigned to land size
in the analysis of the subject parcel.
Overall marketability of each sale property was also considered.
Marketability is the practical aspect of selling a property in view of all the
elements constituting value, and certain economic and financing conditions
prevailing as of the date of sale. All of the sale properties employed herein
are considered having generally similar marketability as the subject
property.
Sales Comparison Analysis:
Following are comments regarding the various sale properties employed
herein.
Data A
Located at the northwest corner of Highway 111 and Mirage
Cove Drive, Rancho Mirage. The site was vacant at the time of
sale and was acquired for speculation and future value
appreciation. The parcel has a signalized corner location,
effectively rectangular land configuration, level topography, and
contains 10.70± acres, or 466,092± square feet of land area.
The property was originally offered for sale at $2,796,552 and
was on the market 121 days. The purchase price was
$2,400,000, which included $700,000 cash down to a
concurrent first trust deed note of $1,700,000 with a private
lender. The cash down payment represents 29% of the total
purchase price. The deed recorded May 31, 2013, as
Document No. 259677. Further details regarding the
transaction are summarized as follows:
Grantor: Dekirmendijan Family Trust
Grantee: Home Tech Visions, LP
Assessor's Parcel No.: 689-030-004, 005
LIDGARD AND ASSOCIATES
APPRAISE. RS-CONSULTANTS
11
VALUATION ANALYSIS (Continued)
SALES COMPARISON APPROACH:(Continued)
Land Value:(Continued)
Sales Comparison Analysis: (Continued)
Data B
Located at the west side of Highway 111, beginning 960 feet
south of Mirage Cove Drive, Rancho Mirage. The site was
vacant at the time of sale; the buyer intends to construct a five-
star luxury resort and spa development. The parcel has an
interior (versus corner) location, irregular land configuration,
generally level topography, and contains 23.71± acres, or
1,032,808± square feet of land area.
The purchase price was $4,000,000, which included $1,750,000
cash down to a concurrent first trust deed note of $2,250,000
with a private lender. The cash down payment represents 44%
of the total purchase price. The deed recorded August 20,
2013 as Document No. 405408. Further details regarding the
transaction are summarized as follows:
Grantor: Bighorn Ventures, LP
Grantee: RMSW, LLC
Assessor's Parcel No.: 689-030-006
Data C
Located at the southwesterly corner of State Highway 111 and
Thunder Road, Rancho Mirage. The site was vacant at the time
of sale; the buyer intends to construct a commercial retail
development commonly referred to as the "The Shops of
Rancho Mirage" The parcel has a secondary nonsignalized
corner location along heavily traveled Highway 111 with
additional frontage along a secondary residential thoroughfare,
irregular land configuration, generally level topography, and
contains 205,603 square feet of land area.
The purchase price was $1,050,000, all cash. The deed
recorded November 8, 2013 as Document No. 532943. Further
details regarding the transaction are summarized as follows:
LIDGARD AND ASSOCIATES
APPRAISF.RS-CONSULTANTS
12
VALUATION ANALYSIS (Continued)
SALES COMPARISON APPROACH: (Continued)
Land Value: (Continued)
Sales Comparison Analysis: (Continued)
Grantor: CML-CA One, LLC
Grantee: Gill Development, LLLP
Assessor's Parcel No.: 689-210-019, 021
Data D
Located at the northwest corner of Jefferson Street and Avenue
52, La Quinta. The site consists of a partially improved
residential subdivision which will eventually comprise 82
dwellings. Existing improvements include the main driveway
entrance extending from Avenue 52, security office, along with
building foundations and numerous palm trees. It is understood
that the entitlements had expired. The buyer intends to re -
entitle the property and complete the development. The parcel
has a relatively prominent corner location, effectively
rectangular land configuration, generally level topography, and
contains 19.33± acres, or 842,015± square feet of land area.
The purchase price was $10,400,000, all cash. The deed
recorded November 15, 2013 as Document No. 541510.
Further details regarding the transaction are summarized as
follows:
Grantor: Pacific Watermarke, LLC
Grantee: Beazer Homes Holding Corp.
Assessor's Parcel No.: 776-220-012, 013, 014
Data E
Located at the northeast corner of Bob Hope Drive and Gerald
Ford Drive, Rancho Mirage. The was vacant at the time of sale;
the buyer intends to construct a medical office building. The
parcel has a relatively prominent signalized corner location
along the heavily traveled Bob Hope Drive corridor, triple street
frontage, rectangular land configuration, generally level
topography, and contains 237,985 square feet of land area.
The purchase price was $1,600,000, which included $500,000
cash down to a concurrent first trust deed note of $1,100,000
with the seller. The cash down payment represents 31% of the
LIDGARD AND ASSOCIATES
APPRAISIRS-CONSULTANTS
13
VALUATION ANALYSIS (Continued)
SALES COMPARISON APPROACH:(Continued)
Land Value: (Continued)
Sales Comparison Analysis: (Continued)
total purchase price. The deed recorded November 27, 2013
as Document No. 559124. Further details regarding the
transaction are summarized as follows:
Grantor: FMH Recovery Partners, LLC
Grantee: Katrina B. Heinrich -Steinberg Living Trust
Assessor's Parcel No.: 685-120-003, 004
Data F
Located at the southwest corner of Frank Sinatra Drive and
Monterey Avenue, Rancho Mirage. The site was vacant at the
time of sale. The buyer intends to construct a medical office
building. The parcel has a relatively prominent signalized
corner location at the intersection of two heavily traveled
commercial thoroughfares with additional street frontage along
a secondary street. The site has an effectively rectangular land
configuration, generally level topography, and contains 99,460
square feet of land area.
The property was originally offered for sale at $1,290,000 and
was on the market 572 days. The purchase price was
$750,000, all cash. The deed recorded April 22, 2014 as
Document No. 145079. Further details regarding the
transaction are summarized as follows:
Grantor: Peter Solomon, Inc.
Grantee: Do Stuff Partnership, LP
Assessor's Parcel No.: 685-251-009
Reference the Market Analysis Comparison Grid set forth on the opposite
page. The sale properties have been compared to the subject property with
consideration assigned to property rights conveyed, date of sale, financing
terms, along with the various elements of comparability.
By way of review and comparison, the subject property has an interior
(versus corner) location within the Desert Willow Golf Resort, has an
effectively rectangular land configuration, level topography, and contains
9.17± acres, or 399,611± square feet of land area, net of that portion lying
within the Country Club Drive right-of-way. The property and has a highest
and best use of large scale residential development such as an assisted
living facility.
LIDGARD AND ASSOCIATES
APPRAIS1RS•CONSULTANTS
14
VALUATION ANALYSIS (Continued)
SALES COMPARISON APPROACH: (Continued)
Land Value: (Continued)
Sales Comparison Analysis: (Continued)
In addition to the consummated sale transactions discussed herein,
research was expanded to include four reasonably comparable land parcels
presently offered for sale within the general subject market area, as follows:
Street Days on
Data Zoning Land Size Corner Frontage Askina Price Per SF Market
1. PCD 456,073 sf yes 1,963 feet $5,000,000. $10.96 450
W'Iy/S Technology Dr., btwn. Gerald Ford Dr. and College Dr. Palm Desert
2. PC 833,303 sf yes 1,031 feet $4,458,804. $ 5.35 1,608
SEC Monterey Ave. and "A" St., Palm Desert
3. C 655,142 sf no 658 feet $9,391,536. $14.34 981
N/S Hwy. 111, W/O Dune Palms Rd., La Quinta
4. CY 355,014 sf no 624 feet $4,950,000. $13.94 95
S/S Hwy. 111, 673' W/O Shields Rd., Indio
The properties surveyed range in size from 355,014 to 833,303 square feet
of land area. The overall asking prices range from $4,458,804 to
$9,391,536, reflecting $5.35 to $14.34 per square foot of land area. The
marketing times range between 95 and 1,608 days.
All of the sale transactions employed herein were considered helpful in the
land valuation analysis of the subject property. The purchase price per
square foot of land area has been utilized herein as the primary indication of
value inasmuch as it is most commonly utilized by market participants.
Following is a summary relating the overall comparability of the individual
sale properties to the subject property.
Continued . .
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
15
VALUATION ANALYSIS (Continued)
SALES COMPARISON APPROACH: (Continued)
Land Value: (Continued)
Sales Comparison Analysis: (Continued)
Overall
Data Comparability $ Per SF
B similar $ 3.87
C similar $ 5.11
A similar $ 5.15
E similar $ 6.72
Subject - - - - $ 7.00
F similar $ 7.54
D similar $12.35
After considering the various elements of comparability, as well as economic
and financial conditions prevailing during the consummation of the various
sale properties, when compared to current market conditions, it is the
appraiser's opinion that the unencumbered fee simple market value of the
subject underlying land parcel, assuming a readily developable condition, is
estimated at $7.00 per square foot of land area, as follows:
399,611 SF @ $7.00 = $2,797,277.
Adjusted: $2,800,000.
FINAL ESTIMATE OF MARKET VALUE:
Based on the foregoing valuation study, the unencumbered fee simple
market value of the subject property, as of the date of value employed
herein, is estimated at $2,800,000.
EXPOSURE TIME:
Exposure time is defined in the 2014-2015 Edition of the Uniform Standards
of Professional Appraisal Practice as the `estimated length of time that the
property interest being appraised would have been offered on the market
prior to the hypothetical consummation of a sale at market value on the
effective date of the appraisal" Exposure time is a retrospective opinion
based on an analysis of past events assuming a competitive and open
market. The reasonable exposure time is a function of price, time, and use,
not an isolated opinion of time alone.
LIDGARD AND ASSOCIATES
AP PR AI SF RS•CON SV LTAN TS
16
VALUATION ANALYSIS (Continued)
EXPOSURE TIME: (Continued)
The exposure time of a particular property is a direct function of supply and
demand within a particular market segment. Generally, a higher demand
results in a shorter marketing period. During the course of extensive market
research, interviews were conducted of parties involved in the transactions
regarding the sale properties employed in the Sales Comparison Approach.
Based on said interviews, as well as interviews with a number of real estate
brokers and other market participants, the exposure time estimated for the
subject property, assuming an aggressive and comprehensive marketing
program, is estimated at approximately six to nine months.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
17
MARKET DATA
LI DGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
MARKET DATA SUMMARY
COMMERCIAL LAND VALUE INDICATORS:
Land Area Street
Data Date Zoning Acres Sa.Ft. Corner Frontaae Sale Price $ Per SF
A. 5-13 SP 10.70 ac 466,092 sf yes 969 feet $ 2,400,000. $ 5.15
NWC Hwy. 111 and Mirage Cove Dr., Rancho Mirage
B. 8-13 C-G 23.71 ac 1,032,808 sf no 672 feet $ 4,000,000. $ 3.87
W/S State Highway 111, 960' S/O Mirage Cove Dr., Rancho Mirage
C. 11-13 CG 4.72 ac 205,603 sf* no 938 feet $ 1,050,000. $ 5.11
SW'Iy/C State Hwy. 111 and Thunder Rd., Rancho Mirage
D. 11-13 RMH 19.33 ac 842,015 sf yes 1,594 feet $10,400,000. $12.35
NWC Jefferson St. and Ave. 52, La Quinta
E. 11-13 O-SC 5.46 ac 237,985 sf yes 1,026 feet $ 1,600,000. $ 6.72
NEC Bob Hope Dr. and Gerald Ford Dr., Rancho Mirage
F. 4-14 CO 2.28 ac 99,460 sf* no 590 feet $ 750,000. $ 7.54
S/S Ramon Rd., 1,314' W/O Belardo Rd., Palm Springs
* Net land area, exclusive of future required street dedication.
LIDGARD AND ASSOCIATES
APPRAISFRS-CONSULTANTS
1
COACHELLA VALLEY
REGION DESCRIPTION
LIDGARD AND ASSOCIATES
APPRAISF RS-CONS V LTANTS
REGIONAL DATA
The value of real property is influenced by the attributes and utility of land
and physical improvements, as well as inter -relationships of markets and
demographic forces, transportation, government, environmental influences
and other factors. Said factors influence the location and density of
population distribution and activities in certain areas and regions over others.
COACHELLA VALLEY REGION:
Coachella Valley is located in the easterly portion of the County of Riverside.
Coachella Valley consists of 13 individual communities including Palm
Springs, Desert Hot Springs, Cathedral City, Rancho Mirage, Palm Desert,
Indian Wells, La Quinta, Indio, Coachella, Bermuda Dunes, Thousand Palms,
Mecca, and Thermal. The current population of Coachella Valley is 336,398
persons, which represents a growth of 45.7% since 1990, and 175.5% since
1980. The Coachella Valley population represents approximately 20% of the
entire Riverside County population.
The current labor work force is estimated at 1 1 1,900± persons, which
represents approximately 33% of the entire Coachella Valley population.
17% of the remaining population consists of persons 65 years and older;
25% represents persons 18 years and younger. The demographic make-
up of Coachella Valley is summarized as follows:
Population by Race
Caucasian:
African -American:
Hispanic:
Other:
47.8%
2.0%
46.4%
3.9%
Population bvAae
Under 18 years:
18-44 years:
56-65 years:
65 & over:
29.4%
31.8%
20.3%
17.4%
The population of Coachella Valley is forecasted to increase at a rate of 6%
per annum, which rate would more than double the current population in
approximately 20 years. The median household income is $31,735; the
median family income is $37,119. The per capita income is estimated at
$17,347.
Tourism and agriculture are major forces in the Coachella Valley's economy.
There are over 270 hotels containing approximately 15,800 hotel rooms and
over 85 golf courses. The total annual economic impact of tourism is
estimated to exceed 1 billion dollars. The agricultural industry accounts for
approximately 58,000 acres. The four major crops include grapes, citrus,
dates, and vegetables. The total annual economic impact of agriculture is
estimated at slightly below 1 billion dollars.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
REGIONAL DATA (Continued)
COACHELLA VALLEY REGION: (Continued)
While tourism and agriculture are dominant economic forces, the greater
Coachella Valley has a relatively diverse economic base. The distribution of
work force is segregated among the following industries:
Agriculture & mining:
Construction:
Manufacturing:
Education:
Wholesale trade:
12,637
11,967
2,550
7,747
1,496
Retail trade:
Finance/real estate:
Services:
Government:
Distribution:
23,765
5,589
33,129
6,474
5,434
There are a number of major manufacturing and non -manufacturing firms
located within Coachella Valley. The individual corporations, along with their
respective products/services, are summarized as follows:
Manufacturing Employment.
Emolovers
VIAYSS
Design MTC
Spates Fabricators
Menage Furniture
Tvoe of Business
Medical equipment
Marble products
Roof trusses
Furniture
Non -manufacturing Employment
Emolovers
Peter Rabbit Fox
Desert Hospital
Eisenhower Hospital
Renaissance Esmeralda Resort
Vons Companies
Type of
Business
Agriculture
Health
Health
Tourism
Retail
Emolovers
Armtec Products
Guy Evans, Inc.
Palm Springs Golf Co.
U. S. Filter
Tvoe of Business
Defense
Cabinetries
Golf equipment
Water treatment
Emolovers
Marriott Desert Springs
Palm Springs School District
La Quinta Hotel
Westin Mission Hills Resort
Sunrise Company
Type of
Business
Tourism
Education
Tourism
Tourism
Developer
Coachella Valley sits atop a vast underground lake, thus providing an
abundant water supply. The average maximum temperature is 107.8° with
an average minimum temperature of approximately 53.7°. The average
annual rainfall is 5.20 inches.
Coachella Valley has three school districts; there are a total of 33 elementary
schools, 12 middle schools, and nine high schools. Higher education is
provided by (1) College of the Desert, a community college accredited for
AA degrees, (2) California State University, San Bernardino -satellite campus,
LIDGARD AND ASSOCIATES
A P R A ISI°. RS•CON S .' LTA N TS
REGIONAL DATA (Continued)
COACHELLA VALLEY REGION: (Continued)
(3) University of California, Riverside, a one -hour drive from Coachella Valley,
(4) the University of California Riverside A. Gary Anderson School of
Management, and (5) University of California Riverside Campus in Palm
Desert.
There is a wide variety of community services and facilities. Medical care is
provided by the Desert Hospital, Eisenhower Medical Center, John F.
Kennedy Memorial Hospital, Canyon Springs Hospital, and Heart Institute of
the Desert.
Cultural facilities and special events include the Palm Springs Desert
Museum, Annenberg Theater, McCallum Theater (Bob Hope Cultural
Center), The Living Desert, National Data Festival, La Quinta Arts Festival, U.
S. Polo Open, Palm Springs Film Festival, and a number of annual golf
tournaments.
Recreational facilities include over 105 golf courses, the Palm Springs Aerial
Tramway, polo grounds, natural hiking trails, a water park, casinos, and the
newly completed Indian Wells Championship Tennis Facility.
Transportation in Coachella Valley is provided for by a variety of means. The
Palm Springs Regional Airport has direct service for many major western
and midwestern cities. The commercial air carriers include American
Airlines, Delta, Northwest, Continental, and Alaska Skywest. The Bermuda
Dunes Airport supports commuter flights serving Los Angeles, Ontario, San
Diego and Phoenix. Thermal Airport provides a base for privately owned
noncommercial aircraft.
Passenger rail service is available via Amtrak. Freight rail service is provided
by Union Pacific Railroad which offers a direct link -up with the Mexican
National Railroad. Bus service is provided by Greyhound Bus Lines. There
are a number of trucking lines which serve the Coachella Valley. Primary
highways include Interstate 10, State Highway 1 1 1, and State Highway 86.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
QUALIFICATIONS OF
APPRAISER
LI DGARD AND ASSOCIATES
APPRAISTtRS•CONS V LTANTS
BACKGROUND AND QUALIFICATIONS
Scott A. Lidgard, MAI, CCIM
President of
LIDGARD AND ASSOCIATES
INCORPORATED
Full service appraisal firm encompassing all types of real
property including commercial, industrial, complex residential,
and special use properties. Scott A. Lidgard has over 25 years
experience in the appraisal of real property for various clients
including public agencies, corporations, law firms in connection
with litigation support, accountants, and private clients.
OFFICE ORGANIZATIONAL STRUCTURE;
Principal Appraiser:
Market Research Analyst:
Market Research Analyst:
Market Research Assistant:
Office Administrator:
Office Assistant:
Scott A. Lidgard
Jason T. Clayton
Jason Boyer
Mayra Villegas-Garcia
Sarah A. Petty
Kelly M. Lidgard
PROFESSIONAL ORGANIZATION AFFILIATIONS;
MAI Designated Member of the Appraisal Institute
(Member No. 11715).
CCIM (Certified Commercial Investment Member) designated
member of the CCIM Institute (Member No. 11262).
STATE CERTIFICATION;
Certified General Real Estate Appraiser by the Office of Real
Estate Appraisers, State of California. Certificate No.
AG004014.
BROKER'S LICENSE;
Licensed California Real Estate Broker (License No. 00825141).
EXPERT WITNESS;
Qualified as an expert on Real Property Valuation in the Los
Angeles, Orange, San Bernardino, and Riverside County
Superior Courts, as well as Federal Bankruptcy Court.
LIDGARD AND ASSOCIATES
APPRAISP.RS-CONSULTANTS
BACKGROUND AND QUALIFICATIONS (Continued)
ACADEMIC BACKGROUND
California State University, Fullerton
B.A., Business Administration, emphasis in real estate finance.
Successfully completed various educational courses and
seminars sponsored by the Appraisal Institute, as well as
other real estate and business organizations.
BUSINESS AFFILIATIONS;
Appraisal Experience:
President, Lidgard and Associates, Inc., Orange, California,
established October 1, 1997.
Vice President, R. P. Laurain & Associates, Inc., Long Beach,
California, between 1984 and 1997.
Real Estate Sales Associate, Merrill Lynch Realty, Placentia,
California, between 1982 and 1984.
BOARD OF DIRECTORSHIPS;
Sergeant at Arms, Long Beach Rotary
President, Belmont Estates HOA, Orange
Vice President, Canyon Rim Villas HOA, Anaheim Hills
Treasurer, Orchard Owner's Association, Orange
Board of Directors, Villa Heights HOA, Villa Park
APPRAISAL SERVICES RENDERED;
Real estate appraisal services performed on projects for the
following public agencies and private corporations, since 1984:
Cities:
City of Anaheim City of Garden Grove City of Mission Viejo
City of Azusa City of Glendora City of Montclair
City of Baldwin Park City of Hawaiian Gardens City of Monterey Park
City of Bell City of Highland City of Murrieta
City of Bellflower City of Huntington Park City of Ontario
City of Bell Gardens City of Indio City of Palm Desert
City of Brea City of Irvine City of Palm Springs
City of Carson City of La Mirada City of Pasadena
City of Cathedral City City of La Habra City of Pico Rivera
City of Costa Mesa City of La Quinta City of Placentia
City of Diamond Bar City of Laguna Hills City of Pomona
City of Downey City of Long Beach City of Rancho Mirage
City of Fullerton City of Lynwood City of Redondo Beach
LIDGARD AN D ASSOCIATES
APPRAISI RS•CONSVLTANTS
BACKGROUND AND QUALIFICATIONS (Continued)
APPRAISAL SERVICES RENDERED (Continued)
Cities: (Continued)
City of Rialto
City of Riverside
City of San Clemente
City of San Bernardino
City of San Juan Capistrano
City of Santa Ana
City of Santa Clarita
City of Signal Hill
City of Stanton
City of Tustin
City of Upland
City of Whittier
City of West Covina
City of Yorba Linda
City of Victorville
Redevelopment Agencies:
Baldwin Park Redevelopment Agency
Bell Redevelopment Agency
Bell Gardens Redevelopment Agency
Buena Park Redevelopment Agency
Carson Redevelopment Agency
Cathedral City Redevelopment Agency
El Monte Redevelopment Agency
Garden Grove Redevelopment Agency
Glendale Redevelopment Agency
Huntington Beach Redevelopment Agency
Huntington Park Redevelopment Agency
Inglewood Redevelopment Agency
La Puente Redevelopment Agency
Long Beach Redevelopment Agency
Los Angeles Community Redevelopment Agency
Norwalk Redevelopment Agency
Ontario Redevelopment Agency
Palm Desert Redevelopment Agency
Rialto Redevelopment Agency
Riverside Redevelopment Agency
San Bernardino Redevelopment Agency
Signal Hill Redevelopment Agency
West Covina Community Development Commission
Whittier Redevelopment Agency
Yorba Linda Redevelopment Agency
Other Government Agencies:
Calleguas Municipal Water District
County of Los Angeles, Internal Services Division
County of Riverside
Inland Empire Utilities Agency
Long Beach Unified School District
Los Angeles County Sanitation District
Los Angeles Unified School District
Orange County Transportation Authority
Palm Springs Unified School District
LIDGARD AND ASSOCIATES
A PPR A1SF RS-CONSULTANTS
BACKGROUND AND QUALIFICATIONS (Continued)
APPRAISAL SERVICES RENDERED (Continued)
Other Government Agencies: (Continued)
Placentia Unified School District
Port of Long Beach
Port of Los Angeles
Resolution Trust Corporation
Riverside County Transportation Commission
State of California
U. S. Department of Navy
U. S. Marshal Service
Victor Valley Wastewater Reclamation Authority
Financial Institutions:
American First Federal Credit Union
Farmers and Merchants Bank
First Federal Bank
First Federal Credit Union
Fiscal Federal Credit Union
Harbor Bank
Long Beach Bank
Mineral King National Bank
Northern Trust Bank
Queen City Bank
Sumitomo Bank, Ltd.
Union Bank
Asset Management Companies:
Amresco, Inc.
American Residential Mortgage Corporation
BEI Management, Inc.
Emerson International
Equitable Real Estate Investment Management
EQ Services
Icon Associates
Independence One
Pacific Southwest Partners
Private Companies/Corporations:
Allstate Insurance Company
Best, Best & Krieger, LLP
Bonnie, Hopkins & Bastardi, LLP
Bridgestone/Firestone, Inc.
Black & Vetch Corporation
Buchalter Nemer, A Professional Corporation
Burke, Williams & Sorenson, LLP
California Eminent Domain Law Group
Ll DGARD AND ASSOCIATES
APPR AIS1i RS•CUNS V LTANTS
BACKGROUND AND OUALIFICATIONS (Continued)
APPRAISAL SERVICES RENDERED (Continued)
Private Companies/Corporations: (Continued)
Carl Karcher Enterprises
Chapman University
Century Law Group
Daley & Heft, LLP
Eastman Kodak Company
Ferro Corporation
Flagstar Companies
Guild Financial
Hahn & Hahn, LLP
Harbor Chevrolet
Inland Partners Corporation
Kaufman and Broad
Latham & Watkins, Attorneys at Law
Long Beach Memorial Medical Center
Madden, Jones, Cole & Johnson, Attorneys at Law
Oliver, Vose, Sandifer, Murphy & Lee
Pan Pacific Development
Rutan & Tucker, LLP
Scotsdale Insurance
Snell & Wilmer, Attorneys at Law
T.R.W.
The Trust for Public Land
Westport Packers
Windes and McClaughry, Accountancy Corporation
Wise, Wiezorek, Timmons & Wise, Attorneys at Law
LIDGARD AND ASSOCIATES
APPRAISF,RS-CONSULTANTS
APPRAISAL REPORT
MARKET VALUE STUDY
APN: 620-430-024, 025
DESERT WILLOW GOLF RESORT
PALM DESERT, CALIFORNIA
Edon
131
131
Dinah Shore Dr ck)
Via Vail 0 �` Rq
0h
sy
9,
Ginger Rogers Rd 35th Ave
Via Florencia
A St
Via Marta Paris Way
Gerald Ford Dr
6
4
O
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o rn
in
0
a
rr Frank Sinatra Dr
Vista del Sol
Clancy Ln
Vista Dunes Rd
Subject
Property
Q>
134
Frank Sinarra 6r
Country Club DP 3
0
O
- 0
r6
▪ Hovley Ln IN
V Lomas
Palm Desert
- J
o N Soccer Pa•i�
1 Arr ey
c
° Merle Dr
Magnesa Faros Gary Ave
Castetlana S Crry Park
Monterey Ave
Country Club Dr
a 0
Rutledge
a m
ci n St w
fain) Desert
0
7
Catalina Way
0
134
nilth
Palm \I%
Eldorado Dr
0
41-unning Springs Dr 236. Tod
• a
u1
k Dt
42nd Ave Hovley Ln E
Fred Waring Dr
Indian Wells
LIDGARD AND ASSOCIATES
A P PR Al tiro RS-CONSULTANTS
mow
0mi 05 1
SUBJECT PROPERTY
Aerial view of subject property comprising two individually assessed
contiguous land parcels located on the north side of Country Club Drive,
beginning effectively 700 feet east of Portola Avenue, within the Desert
Willow Golf Resort development in the City of Palm Desert. See additional
photographs in the Addenda Section.
APPARENT VESTEE:
PROPERTY ADDRESS:
LEGAL DESCRIPTION:
Successor Agency to the Palm Desert
Redevelopment Agency
Mailing Address: 73-510 Fred Waring Drive
Palm Desert, CA 92260
Telephone: c/o Martin C. Alvarez
Director of Economic Development
(760) 346-0611, ext. 414
No situs address; property located in Palm
Desert, California
Portion of the Southwest '/a. of Section 4,
Township 5 South, Range 6 East, San
Bernardino Baseline and Meridian. A
complete metes and bounds legal
description of the subject property was not
provided for review.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
1
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LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
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LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
r'sta Chino
Rimlon
111
Ramon Rd Ramon
Cathe
Rancho Mirage
Palm Springs
Agua
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I.R.
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al City
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Subject
Property
Indian Wells,
i7
tir 0
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Eisenhower Dr
0
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Avenue 48
f-
Avenue 50
N
0
Avenu
52tn
Lake Cahuilla
Recreation Area
Avenue
48
50th Av
52nd A,
54th Ave
0 mi
LIDGARD AND ASSOCIATES
A PPR A 1 Sr? RS-CONSULTANTS
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Purchase price:
Purchase price per sq. ft.:
Property rights conveyed:
standard sale
standard sale
standard sale
standard sale
standard sale
standard sale
Conditions of sale:
m
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31% cash down
(0
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44% cash down
29% cash down
4/22/2014
11/27/2013
11/15/2013
1 1 /8/2013
8/20/2013
5/31/2013
i
1 1
Conds. of sale consideration:
Sale terms:
Date of sale:
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4 mi. northwest
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Entitlements:
Land shape:
Topography:
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Site conditions:
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Overall developability:
Site prominence/exposure:
Overall comparability:
4sla Chino
1,.
Ramon Rd Ramon R
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Caliente
I.R
Gerald Ford Or
oCathe. al City
Rancho Mirage
Palm Springs
ternardino National Forest
0
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Ramon Rd
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Monterey Ave
O
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Country Club Dr
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0
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6Palm 1 sert
Howley Ln E
Subject
Property
Hidden P
Bermuda
Dunes 42nd
Palm Desert
Country
Indian Wells,��
11 19
La Quintao
Eisenhower Or
(A
Macomber
Palms
yoma
ve
Fred nng Dr
Avenue 48
Biskra Pa
Indio
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en
Avenue 50 50th Av
m
N
D
Avenu
e 52 N 52nd A%
1
Lake Cahuilla
Recreation Area
54th Ave
0 mi
LI DGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
2 4
MARKET DATA A
Northwest corner of Highway 1 1 1 and Mirage Cove Drive, Rancho Mirage.
GRANTOR: Dekirmendijan Family Tr. APN: 689-030-004, 005
GRANTEE: Home Tech Visions, LP LAND SIZE: 466,092 sq.ft.
SALE DATE: May 31, 2013 ZONING: SP
DOC. NO.: 259677 CORNER: Yes
SALE PRICE: $2,400,000. DOC. STAMPS: $2,640.00
H & B USE: Commercial PRESENT USE: Vacant land
TERMS: 29% cash down IMPROVEMENTS: None at time
of sale.
ENTITLEMENTS: None ST. FRONTAGE: 969 feet
VALUE INDICATION: $5.15 per SF land.
DATE INSPECTED: August 27, 2014 BY: Scott A. Lidgard, MAI
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
2
MARKET DATA A (Continued)
VERIFICATION: Document of public record, CoStar Comps, and Susan Harvey,
broker representing grantor.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
3
MARKET DATA B
West side of Highway 111, beginning 960 feet south of Mirage Cove Drive,
Rancho Mirage.
GRANTOR: Bighorn Ventures, LP APN: 689-030-006
GRANTEE: RMSW, LLC LAND SIZE: 1,032,808 sq.ft.
SALE DATE: August 20, 2013 ZONING: C-G
DOC. NO.: 405408 CORNER: No
SALE PRICE: $4,000,000. DOC. STAMPS: $4,400.00
H & B USE: Commercial PRESENT USE: Vacant land
TERMS: 440/0 cash down IMPROVEMENTS: None at time
of sale.
ENTITLEMENTS: None ST. FRONTAGE: 672 feet
VALUE INDICATION: $3.87 per SF land.
DATE INSPECTED: August 27, 2014 BY: Scott A. Lidgard, MAI
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
4
MARKET DATA B (Continued)
{ urll.i: 3
Vik
4Nuiw,•
.pril[ �ii•
t.{.thli"r*
�r QIU IX,I .Adva'1Intikaricela
VERIFICATION: Document of public record, CoStar Comps, and Jeff Adkison,
broker representing grantor.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
5
MARKET DATA C
Southwesterly corner of State Highway 111 and Thunder Road, Rancho
Mirage, La Quinta.
GRANTOR: CML-CA One, LLC APN: 689-210-019, 021
GRANTEE: Gill Development, LLLP LAND SIZE: 205,603 sq.ft.
SALE DATE: November 8, 2013 ZONING: CG
DOC. NO.: 532943 CORNER: Yes
SALE PRICE: $1,050,000. DOC. STAMPS: $1,155.00
H & B USE: Commercial PRESENT USE: Vacant land
TERMS: All cash IMPROVEMENTS: None at time
of sale.
ENTITLEMENTS: None ST. FRONTAGE: 938 feet
VALUE INDICATION: $5.11 per SF land.
DATE INSPECTED: August 12, 2014 BY: Scott A. Lidgard, MAI
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
6
MARKET DATA C (Continued)
etX
J®/Y
r/Ml
MI pt•EiY ss.+IJ
1�J_11 r
tRJ. 7-AP,
>RA OIT• 023
i)a
IIM1AM
Ave e I �
I
C —.vs•• P'E— 1F o CEAS90
AD4 At.
VERIFICATION: Document of public record and CoStar Comps.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
t
7
MARKET DATA D
Northwest corner of Jefferson Street and Avenue 52, La Quinta.
GRANTOR: Pacific Watermarke, LLC APN:
776-220-012,013,014
GRANTEE: Beazer Homes LAND SIZE: 842,015 sq.ft.
Holdings Corp.
SALE DATE: November 15, 2013 ZONING: RMH
DOC. NO.: 541510 CORNER: Yes
SALE PRICE: $10,400,000. DOC. STAMPS: $11,440.00
H & B USE: Commercial PRESENT USE: Vacant land
TERMS: All cash IMPROVEMENTS: None at time
of sale.
ENTITLEMENTS: None ST. FRONTAGE: 1,594 feet
VALUE INDICATION: $12.35 per SF land.
DATE INSPECTED: August 27, 2014 BY: Scott A. Lidgard, MAI
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
8
MARKET DATA D (Continued)
JEFFERSON
` 1
TRA B9POH
!✓ r- ",
•
STREET
R,
r
VERIFICATION: Document of public record, CoStar Comps, and Justin Esayian,
broker representing grantor.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
9
MARKET DATA E
Northeast corner of Bob Hope Drive and Gerald Ford Drive, Rancho Mirage.
GRANTOR: FMH Recovery Ptnrs., LLC APN:
685-120-003, 004
GRANTEE: Heinrich -Steinberg Trust LAND SIZE: 237,985 sq.ft.
SALE DATE: November 27, 2013 ZONING: O-SC
DOC. NO.: 559124 CORNER: Yes
SALE PRICE: $1,600,000. DOC. STAMPS: $1,760.00
H & B USE: Commercial PRESENT USE: Vacant land
TERMS: 31 % cash down IMPROVEMENTS: None at time
of sale.
ENTITLEMENTS: None ST. FRONTAGE: 1,026 feet
VALUE INDICATION: $6.72 per SF land.
DATE INSPECTED: August 12, 2014 BY: Scott A. Lidgard, MAI
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
10
MARKET DATA E (Continued)
int
G�
yf
251
u
a
1
Aur
1! ca.
alo
64—
i
CERA CD —
11
MMAff** — =
DRIVE
rl
(1 20)
of SO NO
TWA MVO
4S•ACMI
1
r
sn.e
.i
VERIFICATION: Document of public record and CoStar Comps.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
11
MARKET DATA F
Southwest corner of Frank Sinatra Drive and Monterey Avenue, Rancho
Mirage.
GRANTOR: Peter Solomon, Inc. APN: 685-251-009
GRANTEE: Do Stuff Partnership, LP LAND SIZE: 99,460 sq.ft.
SALE DATE: April 22, 2014 ZONING: CO
DOC. NO.: 145079 CORNER: Yes
SALE PRICE: $750,000. DOC. STAMPS: $825.00
H & B USE: Commercial PRESENT USE: Vacant land
TERMS: All cash IMPROVEMENTS: None at time
of sale.
ENTITLEMENTS: None ST. FRONTAGE: 590 feet
VALUE INDICATION: $7.54 per SF land.
DATE INSPECTED: August 12, 2014 BY: Scott A. Lidgard, MAI
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS
12
MARKET DATA F (Continued)
FRANK
SINATRA
ORWE
LOT
i 'VW WOj
—CAT4PAW
- ~ l.O. D
044.
IW
51
Oa
IPA I
W Mob
<I
VERIFICATION: Document of public record, Multiple Listing Service, and Scott
Wilson, broker representing grantor.
LIDGARD AND ASSOCIATES
APPRAISERS•CONSULTANTS
13
ADDENDA
LIDGARD AI\ L) ASSOCIATES
%rrt2Atta-k,
See Photo No. 1 on first page of Subject Property Section.
'HOTO NO. 2: View looking northwesterly at the subject
property from Country Club Drive.
PHOTO NO. 3: View looking northeasterly at the subject
property from Country Club Drive.
LIDGARD AND ASSOCIATES
APPRAISFRS-CONSULTANTS
STREET SCENE 1: View looking west along Country Club Drive
from the subject frontage.
STREET SfFNIF 9 \/i AA/ Innkinci aaat ninnri lni intni Club Drive
from the subject frontage.
LIDGARD AND ASSOCIATES
APPRAISERS -CONSULTANTS