Request for Committee Action
A briefing memo explaining the purpose, background, and impact of the requested action.
Land Sale: 3718 Fremont Ave N to Khabir Rasheed (RCA-2018-00787)
ORIGINATING DEPARTMENT
To Committee(s)
| # | Committee Name | Meeting Date |
|---|---|---|
| 1 | Housing Policy & Development Committee | July 25, 2018 |
Action Item(s)
| # | File Type | Subcategory | Item Description |
|---|---|---|---|
| 1 | Resolution | Land Sale | Passage of Resolution approving the sale of the property at 3718 Fremont Ave N, (Disposition Parcel No. MH-85), to Khabir Rasheed for $1,000, subject to conditions. If Khabir Rasheed fails to close, approving the sale to Ram Construction for $1,000, subject to conditions. |
Ward / Neighborhood / Address
| # | Ward | Neighborhood | Address |
|---|---|---|---|
| 1. | Ward 4 | Folwell | 3718 Fremont Ave N, Minneapolis |
Background Analysis
PARCEL ADDRESS SALE PRICE
MH-85 3718 Fremont Ave N $1,000
PURCHASER
Khabir Rasheed.
3820 W 41st Street
Minneapolis, MN 55416
ALTERNATE PURCHASER
RAM Construction
2825 Oliver Ave N
Minneapolis, MN 55411
PROPOSED DEVELOPMENT:
The property was constructed in 1907 and is a 1,210 square foot, three-bedroom, one-bath single family home that will be rehabilitated to meet the Minneapolis Homes Program’s rehabilitation standards.
The lot size is 40’ x 126’ = approximately 5,042 total square feet.
Purchaser proposes to invest $115,450.00 to rehabilitate 3718 Fremont Ave N as a four-bedroom, two-bath single family home to be sold to an identified owner-occupant.
Alternate Purchaser proposes to invest $111,664.00 to rehabilitate 3718 Fremont Ave N as a three-bedroom, one-bath single family home to be marketed exclusively to an owner-occupant.
LAND DISPOSITION POLICY:
The sale of this property is in compliance with the City’s Disposition Policy. The sales price of this property does reflect the full re-use value (the price was reduced to $1,000 due to the structural costs related to the unstable foundation).
FINANCING:
Purchaser: Financing documented with a pre-approval letter statement dated within 60 days of application.
Alternate Purchaser: Provided a pre-approval letter dated within 60 days of application
COMMENTS:
On April 14, 2016, the City acquired this single family home from Hennepin County as tax-forfeited land for $5,000. The property was publicly advertised on the City’s website and through e-mail notification to a list of over 2,300 developers and homebuyers. The City is selling this property in its as-is condition. An informational meeting was held to inform potential developers and homebuyers about the City’s disposition process and Minneapolis Homes program information is posted on the City’s website. An open house was held on March 8, 2018 to allow potential purchasers to inspect the property and a three-week application period was provided after the open house.
There were six offers received for the property from Khabir Rasheed, RAM Construction, Tai Hon LLC, Eric Hyde, CTW Group Inc., and Wilson Molina. The offers were evaluated based on program criteria stated in the Minneapolis Homes program manual, including: financial capacity, experience, responsibility, scope of work, subsidy request (if any), and occupancy intentions. To evaluate responsibility, we consulted with the Department of Regulatory Services staff to verify the status of vacant buildings, rental properties, or other properties owned by the applicant in the City of Minneapolis.
Notification was provided to the Folwell Neighborhood Association on April 5, 2018. The Folwell board did not make a recommendation. Staff recommends Khabir Rasheed for providing the most extensive scope of work (including the needed estimates for a structural engineer) and having an identified buyer. RAM Construction is recommended as an Alternate Purchaser as the second highest ranked applicant. Construction management staff has reviewed the scope of work and construction estimates and confirmed that they are sufficient to meet Minneapolis Homes rehabilitation standards.
FISCAL NOTE
- No fiscal impact anticipated