HomeMy WebLinkAboutStaff ReportMayor
Ron Morrison
Council Members
Alejandra Sotelo-Solis
Louis Natividad
Mona Rios
Rosalie Zarate
TO:
FROM:
SUBJECT:
CALIFORNIA -'- I,(y
NATIONAL
1. INCORRATEn
Office of the City Attorney
City Attorney
Claudia Gacitua Silva
Legal Counsel
George H. Eiser, III
Senior Assistant City Attorney
Jodi L, Doucette
Mayor and City Council DATE: February 15, 2011
George H. Eiser, III, Legal Counsel
Agreement for Exchange of City -Owned Property at 522 West 8th Street for
Property Owned by Illes Family Trust at 2020 Hoover Avenue; Fifth Amendment
to Agreement
On September 23, 2010, the City and the Illes Family Trust ("Illes") entered into an Agreement
for Exchange of Real Property and Joint Escrow Instructions (the "Agreement") whereby the
parties agreed to an exchange of the City -owned property at 522 West 8th Street for the Illes-
owned property at 2020 Hoover Avenue. Since the Agreement was entered into, it has been
necessary for the Agreement to be amended four times to allow sufficient time to resolve certain
environmental issues surrounding the City -owned property. The environmental issues have now
been adequately addressed, and the parties are now in a position to complete the transaction.
Section 3.2 of the Agreement provides that Close of Escrow shall occur on or before the date that
is 30 days after expiration of the Contingency Period, as defined in Section 6.1.2. Pursuant to
Section 6.1.2, as revised pursuant to the Fourth Amendment, the Contingency Period shall expire
at 5:00 p.m. of the third day following receipt by the Parties of the soils investigation report for
522 West 8th Street by Geosyntec Consultants pursuant to Geosyntec's proposal dated January
21, 2011 (the "Soils Report"). The Soils Report was received by the Parties on February 8, 2011.,
making the expiration of the Contingency Period 5:00 p.m. on February 11, 2011, and resulting
in a Close of Escrow date of March 13, 2011.
The Illes Property at 2020 Hoover Avenue is encumbered by a small business loan which must
be satisfied prior to closing. Pursuant to the regulations governing small business loans, the pay-
off of the subject loan must occur on March 17, 2011. Therefore, in order to facilitate the pay-off
of the small business loan, it is necessary to amend Section 3.2 of the Agreement to extend the
date of Close of Escrow to M.arch 17, 2011.
The proposed Fifth Amendment to Agreement for Exchange of Real Property and Joint Escrow
instructions would amend Section 3.2 of the Agreement to provide as follows:
1243 National City Boulevard; National City, California 91950-4301
Tel.: (619) 336.4220 Fax: (619) 336.4327
Fifth Amendment to Agreement
February 15, 2011
Page 2
3.2. Close of Escrow. "Close of Escrow" shall be the date that
the grant deed, the form of which is attached hereto as Exhibit "E" ("City Grant
Deed"), conveying the City Property to Illes, and the grant deed, the form of which
is attached hereto as Exhibit "F" (the "Illes Grant Deed"), conveying the Illes
Property to the City, are recorded in the Official Records of San Diego County,
California ("Official Records"). The Close of Escrow shall occur on March 17,
2011 (the "Closing Date"). The City shall deliver possession of the City Property
to Illes on the Closing Date, and Illes shall deliver possession of the Illes Property
to the City pursuant to Section 6.1.27, entitling Illes to lease back the Property,
upon the Close of Escrow, subject only to the "Approved Condition of Title" (as
defined in Sections 4.1 — 4.4 below) and the provisions of the City Grant Deed and
the Illes Grant Deed.
It is recommended that the City Council approve the Fifth Amendment to Agreement by
adoption of the proposed resolution.
GEORGE H. EISER, III
Legal Counsel
GHE/gmo