TRANSMITTAL LETTER FOR BOARD MEETING OF FEBRUARY 2, 2012
COMMITTEE ON PROCUREMENT
Mr. David St. Pierre, Executive Director
Title
Authority to advertise for public tender of bids a 39-year lease of approximately 0.693 acres of improved District real estate located southeast of the intersection of McCormick Boulevard and Devon Avenue in Chicago, Illinois, and known as the approximate northerly half of North Shore Channel Parcel 8.06. The minimum initial annual rental bid shall be established at $59,500.00.
Body
Dear Sir:
At its meeting of November 19, 2009, the District’s Board of Commissioners authorized the commencement of statutory procedures for the leasing of the entire North Shore Channel Parcel 8.06, comprising approximately 2.0 acres located southeast of the intersection of McCormick Boulevard and Devon Avenue in Chicago. The site is improved as a parking lot and is unoccupied.
In accordance with the leasing statute, the lead applicant, Cheder Properties, LLC (“Cheder”), was required to obtain two appraisals. In 2010, Cheder submitted two appraisals and the District submitted a third report. However, during the review process, it was determined that the submitted appraisals contained irregularities requiring that the appraisals be rejected, and the submission of new appraisals became necessary.
Subsequently, Cheder submitted new appraisals in 2010 on the entire parcel; however, it has been its preference to lease only the northern section of the parcel rather than the entire parcel. Accordingly, in 2011, the District obtained a third appraisal on the approximate northern half of the entire parcel, comprising 0.693 acres. The square footage values of the two Cheder appraisals were applied to the 0.693 acres, arriving at the following values:
Appraiser Value
Integra Realty Resources
Patricia L. McGarr, MAI $595,000.00
(District’s Appraiser)
The Metron Group
Peter Poulos, MAI $166,030.00
Lorenz & Associates
Francis S. Lorenz, MAI $150,935.00
It is recommended that the subject real estate’s fair market value be based upon the highest of the three appraisals and established at $595,000.00, and that the minimum initial annual rental bid be established at 10% of the property’s fair market value or $59,500.00.
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 improved real estate consisting of approximately 0.693 acres located southeast of the intersection of McCormick Boulevard and Devon Avenue in Chicago, Illinois, and known as the approximate northerly half of North Shore Channel Parcel 8.06, 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 0.693 acres of real estate be established at $595,000.00, and that the minimum initial annual rental be established at 10% thereof or $59,500.00; and
3. The Director of Procurement & Materials Management be authorized to advertise said 0.693 acres of real estate as available for lease for a term of 39-years at the minimum initial annual rental bid of $59,500.00 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 for public tender of bids a 39-year lease of approximately 0.693 acres of improved District real estate located southeast of the intersection of McCormick Boulevard and Devon Avenue in Chicago, Illinois, and known as the approximate northerly half of North Shore Channel Parcel 8.06. The minimum initial annual rental bid shall be established at $59,500.00.
Requested, Ronald M. Hill, General Counsel, RMH:STM:JCC:rg
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 February 2, 2012
Attachment