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HomeMy WebLinkAbout0174 f \J ~' /\ RECEPTION NO. F0060388 75.00 PG: 0001-013 743 RECORDED IN JEFFERSON COUNTY, COLORADO 5/25/95 14:00 / , DEVELOPMENT AGREEMENT " / I ')-i \ , f This DEVELOPMENT AGREEMENT is dated this 28th day of April, 1995, ("Effective Date") among the CITY OF WHEAT RIDGE, a Colorado Home Rule Municipal Corporation (hereinafter referred to as the / /'~ "City"), 38TH & SHERIDAN LTD. PARTNERSHIP, a Colorado Limited /' Partnership (hereinafter referred to as "Owner") and DILLON COMPANIES, INC., a Kansas corporation doing business as KING SOOPERS, INC. (hereinafter referred to as "King Soopers"), together collectively referred to herein as the "Parties". RECITALS WHEREAS, Owner owns certain real property and improvements thereon located at 5305 38th Avenue, Wheat Ridge, Colorado, which is a neighborhood shopping center known as Ridge Village Shopping Center ("Shopping Center") the legal description of which is set forth on Exhibit A attached hereto and made a part hereof ("Property"); and WHEREAS, King Soopers is the anchor tenant of the Shopping Center; and WHEREAS, King Soopers desires to expand its current facility by approximately 17,500 square feet; and WHEREAS, the expansion of the King Soopers facility will result in increased tax revenues for the City and projected additional traffic on 38th and Sheridan; and WHEREAS, the City, in anticipation of the projected increased traffic count, as well as, the long term goal to expand and improve the corner of 38th and Sheridan, has agreed to acquire, by purchase or, if necessary, other legal means, the property located at the northwest corner of 38th and Sheridan, as more particularly described on Exhibit B attached hereto and made a part hereof (hereinafter referred to as the "Redevelopment Area"); and WHEREAS, the parties have agreed that the Redevelopment Area shall be developed and utilized in accordance with the terms of this Agreement and that all future owners of the Property shall be bound thereby; and 1 WHEREAS, the parties have furthermore agreed that certain modifications to the curb cuts on the Property are necessitated as a result of the modifications made to 38th and Sheridan; and WHEREAS, the parties desire to set forth their mutual responsibilities and agreements with respect to modifications to the Property and the Redevelopment Area; 2 NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: AGREEMENT 1. City's Acquisition of the Redevelopment Area. The City agrees that it shall acquire by purchase or, if necessary, other legal means, the Redevelopment Area from its current owners. The City agrees to complete such acquisition by no later than August 1, 1995. Any and all costs associated with the acquisition of the Redevelopment Area shall be the sole responsibility of the City. 2. Demolition of Existing Improvements. The City agrees to use its best efforts to demolish and remove, on or before August 1, 1995, the existing improvements located on the Redevelopment Area. Any and all costs associated with such demolition and removal shall be the sole responsibility of the City. 3. Construction of Improvements on Redevelopment Area. The City agrees that it shall use its best efforts to: a. Right-of-Way. On or before March 1, 1996 (weather permitting) construct the improvements to the right-of- way along 38th and Sheridan Streets, including the acceleration and deceleration lanes, side walks, curbs and gutters, all as more particularly described on Exhibit C attached hereto and made a part hereof; and b. Redevelopment Area. On or before August 1, 1995 pave, with asphalt, the remaining portion of the Redevelopment Area, stripe same for parking and install appropriate lighting commensurate with existing lighting on the Property. 2 Any and all costs and expenses associated with such construction of the right-of-way improvements and the improvements on the balance of the Redevelopment Area shall be the sole responsibility of the City, except that Owner shall reimburse City for paving and striping costs incurred by the city in the remaining portion of the Redevelopment Area. City agrees to provide Owner with appropriate invoices depicting actual costs incurred which Owner shall pay within thirty (30) days after receipt. The City agrees to use its best efforts to minimize the portion of the Redevelopment Area required for the right-of-way and maximize the portion of the redevelopment Area available for parking. 4. Modifications to Curb Cuts. Owner agrees that the current curb cut and entry way to the Shopping Center located on Sheridan, in closest proximity to 38th, shall be moved as set forth on Exhibit D attached hereto and made a part hereof. The City agrees to pay for any and all costs of relocating the curb cut, including, but not limited to, concrete removal, concrete replacement, asphalt removal and asphalt replacement and re-striping of those parking areas affected by the change in curb cut. ~ 5 5. Minimize Disruption. The City agrees to use its best efforts to minimize any disruption to patrons, tenants, invites, King Soopers and Owner of the Shopping Center during any period of construction. In the event any current means of ingress or egress is required to be restricted or terminated, the City agrees to provide Owner and King Soopers with at least ten (10) business days advance notice. 6. Variances. The parties agree that variances from applicable city land use requirements concerning parking and setbacks may be desirable or required to accommodate the proposed King Soopers expansion. Owner and/or King Soopers shall be responsible for making the pursing proper application for such variances. The City shall support such applications and urge their prompt hearing and approval by the Board of Adjustment, but the City cannot and does not guarantee that the Board of Adjustment will approve such applications. The Parties understand and agree that review of variance applications by the Board of Adjustment is a quasi-judicial function. 7. Ground Lease. The City agrees to lease the parking spaces located within the Redevelopment Area to Owner, its successors and assigns, for a term equal to the King Soopers Lease and any additional option periods, commencing on the date such improvements to the Redevelopment Area have been 3 completed for a total rental of $10.00 ("Ground Lease") for the entire term. Any and all costs of maintaining the parking spaces within the Redevelopment Area, including, without limitation, costs for repaving, painting striping, snow removal and related items which shall be the responsibility of the Owner during the term of the Ground // Lease. Such responsibilities shall include capital ~ reconstruction and repair to maintain the Redevelopment Area in the same condition as the Shopping Center parking lot. It is the intention of the Parties that Owner shall be responsible for all costs of operation and maintenance of the Redevelopment Area, of whatever kind or nature, throughout the entire term of the Ground Lease. Owner hereby agrees to indemnify and hold harmless the City from and against any and all claims, and any and all damages, injuries or including costs and attorneys' fees, arising out of or in any manner related to the Redevelopment Area. Owner shall continuously maintain liability insurance covering the Redevelopment Area, naming the City as an insured party thereon, in amounts and coverages no less than any policy or policies of insurance maintained for the balance of the Shopping Center parking lot. Because of the potential for extensions to the original lease agreement, the City requires the owner to provide it with any and all extensions, amendments and/or modifications and any and all written notices of King Soopers intention to exercise its options to renew its lease. 8. Collateral Assignment of Ground Lease. The City acknowledges that the Shopping Center is currently subject to a certain first deed of trust for the benefit of Commonwealth Life Insurance Company, a Kentucky corporation and Peoples Security Life Insurance Company, a North Carolina corporation (collectively "Lender"). The city agrees that Owner may collaterally assign the Ground Lease to Lender or any further lender as additional security for Owner's current and any future obligations. 9. Temporarv Construction Easement. Owner agrees to provide the City with a temporary construction easement across the Property for purposes of completing the modifications to the right-of-ways and any relocation of utilities associated therewith, as permitted hereby. Such easement shall be in locations and widths to be mutually agreed upon for ingress and egress for engineering, inspection and construction purposes. Such temporary easement shall automatically terminate upon completion of the right-of-ways and the improvements on the Redevelopment Area. 4 10. Landsca9in~. The City agrees to install landscaping, in appropriate locations of the redevelopment area. Owner shall annually during the period of the Ground Lease, reimburse the city for the City's cost to maintain such landscaping. 11. Utilities. To the extent that any existing utilities must be relocated as a result of the reconfiguration of the rights-of-way or the Redevelopment Area, the city agrees to complete such relocations at its sole cost and expense. ~ ~ 12. Kin~ Soogers' Exoansion. Subject to and conditioned upon the City's performance hereunder and the Owner's performance hereunder and under that certain Third Amendment to Lease, a copy of which is attached hereto as Exhibit E and made a part hereof, King Soopers agrees to commence its expansion by no later than October 1, 1995 and to diligently pursue completion thereof. 13. Termination of Tenancies. Owner and King Soopers acknowledge and agree that City shall have no responsibility to participate in any required payments to tenants of the Shopping Center for termination of leases or relocation costs resulting from King Sooper's expansion. 14. Lender Consent. Within thirty (30) days after the Effective Date of this Agreement, Owner shall procure in form and content reasonably satisfactory to City and King Soopers, a written consent from Lender for this Agreement and an acknowledgement by Lender to be bound by the terms hereof. In the event such consent is not obtained within that time (or within such additional time as the Parties, by written amendment hereof may agree), this Agreement shall be null, void and of no effect. 15. Covenants fulnnina with the Land Recordin~. The parties intend that the benefits and burdens created by this Agreement shall be restrictive covenants running with the land and binding the parties hereto, their successors and assigns and all future owners of the Property. To that end, this Agreement shall be filed for record with the Clerk and Recorder of Jefferson County, Colorado. 16. Amendment or Termination of this Agreement. Other than as provided at Paragraph 14, and subject to Subparagraph 19(m), hereof this Agreement may be amended or terminated only by an instrument in writing signed by all Parties hereto or their duly authorized successors or assigns. 5 17. Maximum amount to be expended by the City. Not-with- standing any provision in this agreement, the City shall only expend a maximum total sum of $800,000 to fulfill its obligations under this agreement. Any costs in excess of / the aforementioned $800,000 must gain prior approval and yo authorization of the expenditure by city Council. 18. Ri~ht to Purchase. Owner shall have the right to purchase the entire parking area of the redevelopment area, for fair market value, at the time of exercise, at any time during the term of the ground lease as described in paragraph 7 of this agreement by providing a written notice of its intent to exercise its right to purchase the parking area. Fair market value shall be determined by the city on the basis of an independently contracted MAl real property appraisal of value. Owner shall acquire the property within a period of 180 days after its written notice of intent to exercise its right to purchase. 19. Enforcement. The performance by the City, King Soopers or Owner of their respective obligations set out in this Agreement shall be in strict compliance with all applicable laws and the rules and regUlations of all governmental agencies, municipal, county, state and federal, having jurisdiction. This Agreement may be enforced according to its terms by the City, King Soopers or Owner by an action at law, and/or in equity, by decree of specific performance, injunctive relief, damages and/or pursuant to such other legal and/or equitable relief as may be available under Colorado law. 20. Notices. All notices hereunder shall be given to the following by hand delivery or by certified mail, return receipt requested: CITY: Mayor of the City of Wheat Ridge 7500 West 29th Avenue P.O. Box 638 Wheat Ridge, CO 80034 Copy to: The Wheat Ridge City Administrator 7500 West 29th Avenue 6 P.O. Box 638 Wheat Ridge, CO 80034 Copy to: Gerald E. Dahl Gorsuch Kirgis, L.L.C. P.O. Box 17180 Denver, CO 80217-0180 1 OWNER: Robert E. Perry and Jeffrey W. Bailey 38th & Sheridan Ltd. Partnership 6500 S. Quebec, #300 Englewood, CO 80111 Copy to: Robert Preeo Elrod, Katz, Preeo, Look, Milson & Silverman, P.C. 1120 Lincoln Street, Suite 1100 Denver, CO 80203 KING SOOPERS: Robert Letcher Director of store Services 65 Tejon street Denver, CO 80223 Russ Dispense Vice President of Real Estate 65 Tejon street Denver, CO 80223 Copy to: James J. Soran, III, Esq. Montgomery Little & McGrew, P.C. 5445 DTC Parkway, Suite 800 Englewood, CO 80111 Any party hereto may designate in writing, from time to time, the address of substitute or supplementary persons to receive such notices. The effective date of service of any such notice shall be the date such notice is deposited in the mail or hand delivered to the City, King Soopers or Owner. 7 21. Standard Contract Provisions. The following standard contract provisions shall apply to this Agreement: a. Authority of City. This Agreement is expressly subject to and shall not be or become effective or binding on the City until approved by the Wheat Ridge City Council and fully executed by all signatories of the City of Wheat Ridge. 1 b. Authority of Owner. Owner and the person executing this Agreement on behalf of Owner warrants that Owner is a limited partnership duly formed under the laws of the state of Colorado and that the governing documents of Owner authorize Owner and the person executing this Agreement on behalf of Owner to enter into this Agreement and to consummate the transactions contemplated hereby. c. Authority of Kina Soopers. King Soopers and the person executing this Agreement on behalf of King Soopers warrants that King Soopers is a corporation duly authorized to do business' in Colorado and that the governing documents of King Soopers authorizes King Soopers and the person executing this Agreement, on behalf of King Soopers, to enter into this Agreement and to consummate the transactions contemplated hereby. d. Force Majeure. No party shall be liable for failure to perform hereunder if such failure is the result of any cause beyond the reasonable control of such party, and any time limit expressed in this Agreement shall be extended for the period of any delay from any cause beyond the reasonable control of the party required to perform within such time limit. This provision shall include delays incurred by the City from encountering hazardous substances in the Redevelopment Area, Such delays resulting from soil contamination shall not exceed 45 days. e. Time of the Essence. Except as provided under the section of this Agreement entitled "Force Majeure", time shall be of the essence with respect to performance required under this Agreement, 8 f. Severability. If any provision of this Agreement shall be declared by a court of competent jurisdiction to be invalid, illegal or unenforceable, it shall not affect or impair the validity, legality or enforceability of any other provision of this Agreement, and there shall be substituted for the affected provision a valid and enforceable provision as similar as possible to the affected provision. 7 g. Captions for Convenience. All headings and captions used herein are for convenience only and are of no meaning in the interpretation of this Agreement. h. Applicable Law. This Agreement shall be interpreted and enforced according to the laws of the state of Colorado. The parties agree that any action brought with respect to this Agreement shall be brought and maintained in the district court of Jefferson County, State of Colorado. i. Recitals and Exhihits Incorporated. All recitals and exhibits to this Agreement are incorporated herein and made a part hereof. j. Costs of Leoal Proceedjnqs. In the event that any party institutes legal proceedings with respect to this Agreement, to the extent permitted by law the prevailing party or parties shall be entitled to recover, in addition to any other relief to which it is entitled, its costs and expenses incurred in connection with such legal proceedings, including, without limitation, reasonable attorneys' fees. k. Exculpation. The Owner of any portion of the Property shall not be personally liable for the performance of this Agreement after the Owner has conveyed its interests in the burdened Property to a subsequent owner. Any subsequent Owner shall be subject to the terms and conditions set forth herein. 1 . Assi~nment. of and shall Parties. This agreement shall inure to the benefit bind the successors and assigns of the 9 m. Com~liance with Amendment One. It is the intention of the Parties to comply with the provisions of Article X, Section 20 of the Colorado Constitution, "Amendment One" as adopted by the voters on November 3, 1992. To /0 that end, all obligations of the City herein are specifically understood and agreed by the Parties to be subject to annual appropriation. This Agreement does not create any multi year fiscal obligation of the City. IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed as of the day and year first above written. CITY: ATTEST: CITY OF WHEAT RIDGE ~ By' 5::)tfd-~,{~ 4,,~ Wanda Sang City Clerk ~ By: ~~~ Dan Wilde, Mayor RECOMMENDED AND APPROVED: ~7 { ~;~ert Mid~~U-;h: ~:yc-~~~;::i'~trator I ' , , By: Robert Works " .~l ___ Public 10 OWNER: 38TH & SHERIDAN LTD. ! PARTNERSHIP, A Colorado Limited ~ Partnership By: Perry & Bailey Limited Liability Company, a Wyoming Limited Liability compan(j ~en('j' Partner By: ~~~ Robert E. Perry Managing Member By: " ~!Cl' I)~~( Je rey\W. Baj,.Xe Managihg Memb~r KING SOOPERS: Dillon Companies, Inc. a Kansas Corporation dba King Soopers, Inc. ....-, By: lz:;V>-7----'~~ Its: _ i//.~ 11 I t I i \ i I ,; THIRD AMENDMENT TO LEASE (Store #57) J':< THIS THIRD AMENDMENT TO LEASE, made and entered into this ~ day of -rn(~ ' 1995, is by and between 38th & Sheridan, Ltd. P~rtnership (hereinafter referred to as "Lessor") and Dillon Companies, Inc., a Kansas corporation (hereinafter referred to as "Lessee"). RECITALS A. By Lease date July 30, 1981, Lessor's predecessor in interest demised and leased unto Lessee certain premises located in the Ridge Village Shopping Center, 3817 Sheridan Blvd." Wheat Ridge, Colorado ("Shopping Center"), which Lease was thereafter amended by the First Amendment to Lease, dated June 3, 1982 ("First Amendment") and the Second Amendment to Lease dated October 27, 1993 (the "Second Amendment"). B. The original lease and the First Amendment and Second Amendment are collectively the "Lease". C. Lessor and Lessee are desirous of amending and modifying said Lease to the extent provided herein. NOW, THEREFORE, in consideration of mutual covenants and conditions contained herein and in the original Lease Agreement and other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto agree as follows: AGREEMENT 1. Expansion. Lessee hereby exercises its option to expand contained in Paragraph 8 of the Second Amendment. Lessee and Lessor waive the requirement for twelve (12) months prior written notice. The "Expansion Area" as defined in the Second Amendment is modified to include approximately 700 square feet of the south entrance and an area of up to 32 feet directly east of the current premises extending the full width of the building in a north-south direction. No additional minimum base rent shall be payable for these portions of the Expansion Area. The new Expansion Area is shown on Exhibit A attached hereto and denominated "New Addition". Lessee agrees, subject to the conditions set forth in Paragraph 2 below, to commence construction of the Expansion Area on or before October 1, 1995. 2. Lessor Obliqation. Lessee's exercise of its option to ti.expand is conditioned upon Lessor completing the following obligations: ) A_ (a) Lessor shall no later than June 1, 1995 provide ~ Lessee with written commitments from existing tenants to vacate the "Improved" 8,250 square feet of Expansion Area as designated in Paragraph 8 of the Second Amendment; (b) Lessor shall on or before August 21, 1995 acquire fee simple title or a leasehold interest by ground lease extending for the full term of the Lease plus any option periods to the area designated as "Existing Restaurant" on Exhibit A excluding the areas required by the City of Wheat Ridge for intersection modifications (the area to be acquired or leased is referred to as the "N~w Parking Area"); (c) Lessor shall no later than August 21, 1995 deliver possession of the "Improved" 8,250 square feet of Expansion Area as designated in Paragraph 8 of the Second Amendment; In the event that Lessor fails to meet any of the obligations provided for above, the Lessee's exercise of the expansion option and this Third Amendment to Lease shall be null and void and the parties' rights shall remain as contained in the Lease as modified by the First Amendment and Second Amendment. 3. Parking Area. Upon compliance with the terms and conditions provided for in Paragraph 2 above, Lessor shall cause the demolition of any improvements existing on the New Parking Area and shall reconfigure the New Parking Area as shown on attached Exhibit A or such other configuration as may be approved by the City of Wheat Ridge and agreed upon by Lessor and Lessee. 4. Lender Consent. Within thirty (30) days of execution of this Third Amendment, Lessor shall procure in form and content reasonably satisfactory to Lessee a written consent from all existing mortgagees for the Shopping Center to this Third Amendment and an acknowledgment to be bound by the provisions of Paragraph 1 of Article XXVIII of the Lease. 5. Terms and Conditions. Except as amended and modified herein, all of the terms and conditions contained in the aforementioned Lease shall remain in full force and effect and are hereby ratified and affirmed by the parties hereto. ...L ~ 1/"'~"-'S '.b. ~~tt )Lf IN WITNESS WHEREOF, the parties have executed this Second Amendment to the Lease as of the day and year first written above. LESSOR: 38TH & SHEflDAN, LTD. By: CRt L-- Managing Partner PARTNERSHIP LESSEE: DILLON COMPANIES, INC., a Kansas corporation \dil1on\d5786 838\thlrd.new (03/31/95, t1j, jw} ... . , t.'I ~ ! 1 ~r I" ! n ;~ .~ h ~--------~ ----- .; I ~~1 ~ ! I . = = V;/~~~!' I -. --I 1 ~~~~~~~~~~~~~~ -- ; : fjjjjjjjjjjjj2] Ii : ~ ~\\\\~31! I ~ 0 I :::::; -. \s +-1 ;! : I ~~~~~~~~~~~~~~~ --I , o --l o fjjjjjjjjjjjj~ -- ~~~~~~~~~~~~~ ~ Z -----I l>l > ~ < < < < < < < < ( < < < (~ , i -. . ~~ , ~ . _. u II ----- 1 <nIV A3'1!l0ll NVal'dIDfS I I ~j +- --l 3.sv:n 01 1N3.WGN3.WV mlIH1 OJ. "V" 1IHIHX3 ,~ ~ )c; z < ..:l "" ~ iD TELEPHONE: (303) 234-5900 7500WEST29THAVENUE . WHEATRIDGE,COLORAD080215 The City of CWheat GRidge To: Bob Middaugh City Administrator Steve SChmitz~ Economic Development Coordinator From: Date: April 20, 1995 Re: The Development Agreement for the expansion of the King Soopers store at 38th and Sheridan with Perry and Bailey, the Dillon Corporation dba King Soopers and the City of Wheat Ridge. Attached to this memo is the development agreement which we have presented to Bob Perry and Jeff Bailey for the expansion of the King Soopers store at the Fudge Village Shopping Center Summary: The agreement stipulates that King Soopers will expand their store by taking additional space inside the shopping center and physically expand their store by to the east. This expansion and the subsequent need for parking will require us to make improvements to the traffic flow on the northwest corner of 38th Avenue and Sheridan. Improvements encompass the construction of acceleration and deceleration lanes on Sheridan southbound and 38th Avenue westbound. This project, in conjunction with the added requirement for parking spaces necessitated by the King Soopers expansion will require the City of Wheat Ridge to acquire the property currently occupied by the business known as Breakfast Queen, raze the structures and prepare the area for both the traffic flow improvements and the additional parking. Benefit to the City of Wheat Ridge: By King Soopers' estimates, this project will create a demand which will translate to sales of approximately $30M annually This represents a 56% increase in current sales. Sales tax would be expected to grow in equal proportions, Again, using the information provided by King Soopers, the additional sales tax attributable to the Kings expanded operation would be approximately $330,000 annually Development Agreement ,., Page 2 Cost to the City of Wheat Ridge: At this time, we cannot know what the actual cost to the City will be. Estimates have a wide range and are based upon the extent to which the acquisition costs and the costs to remedy the underground gas storage tank will be. Our estimates for the project are as follows: Acquisition of the corner property (15,000 sq.ft, @ $20) $ Relocation of the Breakfast Queen Construction of public improvement. Potential Storage Tank Remedy Paving and striping 300,000 50,000 125,000 90,000 10,000 Total City Investment $ 575,000 We believe that we have estimated these costs at a high level to take into account unforeseen circumstances which could arise, Additionally, we wanted to provide King Soopers with a certain level of certainty that the City had allocated sufficient funds to complete the project within the time frames stipulated in the development agreement. I am available to answer any questions you might have about this agreement.