TRANSMITTAL LETTER FOR BOARD MEETING OF DECEMBER 1, 2016
COMMITTEE ON PROCUREMENT
Mr. David St. Pierre, Executive Director
Title
Authority to advertise Contract 17-360-11 for public tender of bids a 10-year lease on 5.95 acres of District real estate located at 3154 S. California Avenue in Chicago, Illinois; Main Channel Parcels 42.05 and 42.16. The minimum initial annual rental bid shall be established at $195,000.00
Body
Dear Sir:
On September 1, 2016, the Board of Commissioners authorized the commencement of statutory procedures to lease the subject property located at 3154 S. California Avenue in Chicago, Illinois and known as Main Channel Parcels 42.05 and 42.16. Connelly-GPM, Inc. (Connelly) leases the property under two separate leases. The lease on Parcel 42.05 comprises 4.63 acres, commenced May 1, 1918, and expires April 30, 2017. The annual rent is $1,410.00. The lease on Parcel 42.16 comprises 1.32 acres, commenced February 1, 1999, and expires April 30, 2017. The current annual rent under this lease is $41,004.00. Connelly uses the property to operate an iron sponge manufacturing business.
Pursuant to statute, the lead applicant, Connelly, submitted two appraisals and the Law Department obtained a third appraisal as follows:
Appraiser Value
Appraisal Associates
William J. Enright, MAI $1,950,000.00
(District’s appraiser)
Sterling Valuation
Thomas W. Grogan, MAI $1,250,000.00
Madison Appraisal, LLC
Joseph J. Calvanico, MAI $1,000,000.00
It is recommended that the subject real estate’s fair market value be based upon the highest of the three appraisals and established at $1,950,000.00 and that the minimum initial annual rental bid be established at 10% of the property’s fair market value or $195,000.00.
It is further recommended that the Executive Director recommend to the Board of Commissioners that it authorize and approve the issuance of the following orders:
1. The real estate consisting of 5.95 acres located at 3154 S. California Avenue in Chicago, Illinois, and known as Main Channel Parcels 42.05 and 42.16 depicted in the exhibit attached hereto be declared surplus and not needed for the District’s corporate purposes and available for lease as set forth herein.
2. The fair market value of the 5.95 acres of real estate be established at $1,950,000.00 and that the minimum initial annual rental be established at 10% thereof or $195,000.00.
3. The Director of Procurement and Materials Management be authorized to advertise said 5.95 acres of real estate as available for lease for a term of ten (10) years at the minimum initial annual rental bid of $195,000.00 and report the results of the bidding to the Board of Commissioners for further action.
It is requested that the Executive Director recommend to the Board of Commissioners that it authorize the Director of Procurement and Materials Management to advertise Contract 17-360-11 for public tender of bids a 10-year lease of 5.95 acres of District real estate located at 3154 S. California Avenue in Chicago, Illinois and known as Main Channel Parcels 42.05 and 42.16. The minimum initial annual rental bid shall be established at $195,000.00.
Requested, Ronald M. Hill, General Counsel, RMH:SM:vp
Recommended, Darlene A. LoCascio, Director of Procurement and Materials Management
Respectfully Submitted, Barbara J. McGowan, Chairman Committee on Procurement
Disposition of this agenda item will be documented in the official Regular Board Meeting Minutes of the Board of Commissioners for December 1, 2016
Attachment