HomeMy WebLinkAbout4.1a 7470 East Point Douglas Second Amendment to the Purchase Agreement Memo
TO: Economic Development Authority
FROM: Jaime Mann, Assistant to the City Administrator
DATE: September 23, 2022
RE: Second Amendment to the Purchase Agreement with Hang, LLC
Background/Discussion
The property at 7470 East Point Douglas Road, which is located at the corner of Hefner Avenue
and East Point Douglas Road, is currently owned by the EDA and is vacant. The previous uses
at the site included a gas station and most recently the Village Transmission Shop, which closed
the fall of 2018. In 2019, the EDA purchased the land to prepare it for redevelopment and the
building was demolished that same year.
The City of Cottage Grove received a Letter of Intent (LOI) from HANG LLC dated February 4,
2022, for the purchase of the vacant parcel located 7470 East Point Douglas Road. The EDA
authorized the execution of the LOI at the meeting on February 8, 2022 by a unanimous vote.
The EDA held a public hearing for the sale of the property and approved the purchase agreement
at the meeting on April 12, 2022. The vacant parcel is approximately 0.54 acres and the has a
purchase price of $188,179.20. The property is zoned B-2 Retail Zoning District to encourage
retail sales and services by grouping businesses that minimize the influence on surrounding
residential neighborhoods.
Economic Development Authority
Page 2 of 2
The site would be the future home of Thai Garden. They are a small, family owned business
and currently have a location in St. Paul, MN.
The building shown in the site plan is 3,050 square feet and shows indoor seating for
approximately 100 people and outdoor seating for approximately 40 people. The Planning
application was approved on August 22, 2022 by the Planning Commission and on September
7, 2022 by the City Council.
The lender for Hang, LLC has reached out and stated that they are working to secure a Small
Business Administration (SBA) loan for the purchase of the property. With that, comes additional
due diligence requirements. Being that this property previously had petroleum storage, the SBA
requires that the lender must perform their own Phase I review. With having the additional due
diligence items, Hang, LLC is requesting extending the closing date an additional 60 days to
complete the process with the SBA.
Along with this extension, Hang, LLC has agreed to deposit and additional $5,000 to the escrow
account as consideration upon receipt of a fully executed second amendment to the purchase
agreement.
Recommendation
1. Approve Resolution 2022-011 authorizing the Second Amendment to the Purchase Agreement
between the City of Cottage Grove and Hang, LLC.
2. Authorize the EDA President and City Administrator to execute the Second Amendment to
the Purchase Agreement with Hang, LLC for the sale of 0.54 acres for development purposes.
Attachments
Resolution 2022-011
Second Amendment to the Purchase Agreement with Hang, LLC