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Commission waives city’s reversionary interest for 1275 Dudley, transfers reverter to buyer contingent on identical language
Summary
The commission agreed to waive the city's reversionary interest in the deed for 1275 Dudley Avenue contingent on simultaneous execution of a new deed by the buyer that includes identical reversionary language; staff said action is meant to secure home construction while preserving the city's reverter rights if conditions are not met.
The City Commission on March 11 approved staff’s recommendation to waive the city’s reversionary interest in the deed for 1275 Dudley Avenue on the condition that the buyer execute a new deed containing identical reversionary language so the city’s right to revert the property remains enforceable if development conditions are not satisfied.
Jake Eckholm, director of development services, explained the background: “So this 1 is an unusual situation...the city sold this lot in the Marquette neighborhood to mister Lawrence Baker with Artistic Builders. He's here this evening, with his intent to build a custom home on it…We sold a lot in 02/2005 for $10,900.” Eckholm said the buyer the city is considering has plans to build two housing units on the site and had negotiated with the current owner, who had not completed construction following the earlier sale.
Staff recommended transferring the reversionary restrictions to the new purchaser rather than attempting to exercise reversion now and re-sell the lot, citing the city’s interest in producing infill housing and the administrative burden and timing of reversion and re-sale. Eckholm said staff discussed that the current policy generally requires 12 months to commence and 18 months to complete an infill residential build in today’s policy, and that the proposed new buyer said they intend to start both houses this calendar year.
Commissioner Kilgo moved to waive the city’s reversionary interest contingent on a simultaneous new deed with identical language; Commissioner German seconded. The roll call recorded one no vote by Commissioner Kelgo (recorded in the roll call as a dissenting vote); the motion passed. Staff noted the city’s net financial position on the lot has been roughly neutral over time, with the property originally sold for $10,900, a proposed current sale price of $16,000, and annual taxes of about $500 (the city’s portion roughly $125). Staff also noted the city retains the legal reverter language and may exercise it if the new owner fails to perform.
