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HomeMy WebLinkAboutAgr 2007-11-08 (Integra Realty Services) AGREEMENT FOR PROFESSIONAL SERVICES - APPRAISAL OF REAL PROPERTY THIS AGREEMENT, made and entered this )"~i day of ,>J:'0" l>c"~2007, by and between the TOWN OF TIBURON, a political subdivision of the State of California, hereinafter called "Town," and INTEGRA REALTY RESOURCES - SAN FRANCISCO, a ('it C, .0 [licensed to do , business in California], hereinafter referred to as "Consultant," RECITALS A. The Martha Company ("Owner") owes a 93. 13 acre parcel, identified by the Marin County Tax Assessor's Office as parcel number 059-251-05 ("Property"), and is applying to Marin County to subdivide the Property into 43 residential lots. The development of the Property has been the subject of repeated and on-going litigation involving the Owner, Marin County, the Town and several interested Town residents. B. The Property lies near the Town borders and any develop is likely to impact Town residents. Accordingly, the Town wishes to negotiate with Martha to settle and prevent further litigation while ensuring that the proposed subdivision minimizes the project's impacts. The Property's current fair market value will be an important factor in these negotiations. C. Consultant has particular expertise in the appraisal of raw and transitional land and such that the Town Council finds that it is in the Town's interest to retain Consultant to prepare an appraisal ofthe Property for the Town Attorney, for her use in advising the Town Council regarding actual and potential litigation. D. The parties wish to contract for the Consultant to provide the services described in Exhibit A ("Services"), which is attached hereto and incorporated herein by reference, in accordance with all applicable State requirements. AGREEMENT I. Scope of Services. Consultant shall perform, and carry out in a professional manner the Services described in Exhibit A, which is attached hereto and incorporated herein by reference. Because of the nature of the underlying controversy, Consultant shall report to the Town Attorney. Consultant shall provide the Town Attorney with a draft report for comment prior to finalizing the appraisal. 2. Costs and Method of Compensation. Consultant's total compensation for the Services shall be as set for in Exhibit A, not to exceed $20,000 (twenty thousand dollars) without written authorization from the Town. 3. Standard of Work: Indemnitv. Consultant shall perform the services in a skillful and professional manner compatible with the usual, customary standard of Consultant's profession. Consultant shall indemnifY, defend and hold Town harmless from and against I C:\Documents and Settings\cmooradian\Local Settings\Temporary Internet Files\OLKB6\Appraisal Prof Services Ag 11-1-07 dr.doc claims, liabilities, suits, loss, cost, expense and damages to the extent caused by a negligent act or omission of Consultant's in performing of the Services pursuant to this Agreement. 3. Consultant as Independent Contractor. Consultant (including its agents, employees and subcontractors) is not an agent or employee of the Town but is an independent contractor not subject to the direction and control of the Town. Without limiting the foregoing, Consultant shall maintain complete control of its operations and personnel and shall be solely liable and responsible to pay all required salaries, wages, expenses, taxes and other obligations, including, but not limited to, withholding and Social Security. 4. Attendance at Hearings. If requested by the Town Attorney, Consultant shall appear at litigation and/or administrative hearings that pertain to the Project. Town shall reimburse Consultant for such appearance(s) at the hourly rate specified in Exhibit A. 5. Audit of Books and Records. Town may, in its sole discretion, undertake an independent audit and/or evaluation of the Consultant's records and accounts of expenditures and program activities at its own expense. Consultant shall furnish all items necessary in the Town's discretion to complete said audit and/or evaluation subject to restrictions on confidentiality limited to expenditure or receipt of program funds, and program quality. 6. Insurance. Consultant shall maintain insurance as set forth below. Town shall be added as an additional insured to all required insurance policies: A. Commercial General Liability: Combined single limit of$1 ,000,000 for each single occurrence and $2,000,000 annual aggregate. B. Commercial Automobile Liability: Combined single limit of $1 ,000,000 for each single occurrence and $2,000,000 annual aggregate. 7. Ownership of Documents; Re-Use; Indemnitv. A. All documents, including drawings and specifications prepared by Consultant pursuant to this Agreement shall be the property of Town. Town acknowledges that said documents are prepared for use only in connection with the Project described in the Exhibit A. Consultant makes no representation that said documents are suitable for re-use on any other project or on any expansion of the Project. Any such re-use by Town without specific written approval by Consultant shall be at Town's sole risk. Town shall indemnifY and hold Consultant harmless from all claims, losses, damages and expenses, including attorneys fees, which may arise from Town's unauthorized re-use of said documents for another project or for any expansion of the Project. B. Nothing in this Section is intended nor shall it be construed to require Consultant to provide any proprietary software to the Town 8. Stop Work Order. Town may at any time, by written notice to Consultant ("Stop Work Order"), require Consultant to stop or suspend performance ofthe Services, in whole or in 2 C:\Documents and Settings\cmooradian\Local Settings\Temporary Internet Files\OLKB6\Appraisal Prof Services Ag 11-1-07 dr.doc part, for a period of up to ninety days after such notice is delivered to Consultant. Upon receipt of the Stop Work Order, Consultant shall immediately comply therewith and take all reasonable steps to minimize the incurrence of costs allocable to the Services covered by the Stop Work Order during the period of work stoppage. Within ninety days of the delivery of the Stop Work Order, or such later time as may be agreed to by the parties, Town shall either cancel the Stop Work Order or terminate this Agreement as provided in Paragraph 13. Consultant shall resume work upon the cancellation of the Stop Work Order. To the extent that the Stop Work Order results in a documentable increase in the cost of performing the Services or the time required for such performance, Consultant shall receive an equitable adjustment in compensation or an extension of time for performance, as appropriate. 9. Delinauencv. In the event that a proper invoice remains unpaid for more than 45 days after submittal, Consultant may commence to charge interest of the unpaid amounts at the lesser of 1.5% per month or the maximum rate allowed under applicable usury laws. In addition, Consultant may suspend the performance of the Services after giving Town 10 days notice of its intent to do so. In the event of such suspension, the Base Fee shall be increased to include Consultant's reasonable costs of suspending and restarting the Services. 10. Termination of Contract. It is expressly understood that either party shall have the right to terminate this agreement within five (5) days written notice to the other party. In such event, Consultant shall deliver to the Town copies of all finished and unfinished surveys, studies, documents, computer disks, and/or reports pertaining to the contract, and Consultant shall be entitled to receive just and equitable compensation for any satisfactory work completed through the effective date of termination. II. Discrimination. In the performance of the terms of this Agreement, Consultant shall not engage in nor permit others he may employ to engage in discrimination in the employment of such persons based on race, color, religion, sex, sexual preference, age, or handicapped conditions. 12. Services and Materials to be Furnished bv the Town: The Consultant shall advise the Town of the data required to compete the Services within 10 days of the execution of this Agreement. The Town will make its best efforts to provide all data in its possession specifically requested by the Consultant, including documentation and information, to the Consultant in a timely manner. 13. Miscellaneous. A. Other Contract Provisions. Other contract provisions are set forth in Exhibit A. To the extent that there are any inconsistencies with such Exhibit and the other portions of this Agreement, the latter shall prevail. B. Governing Law; Venue. The laws of the State of California shall govern this Agreement. The County of Marin shall be the venue for resolving any disputes arising from this Agreement. 3 C:\Documents and Settings\cmooradian\Local Settings\Temporary Internet Filcs\OLKB6\Appraisal Prof Services Ag 11-1-07 dr.doc C. Severability. If any prOVISIOn of this Agreement is found to be invalid or unenforceable, the validity and enforceability ofthe remaining portions shall not be affected unless the effect thereof would materially change the economic burden on either party. D. Successors in Interest Assignment. This Agreement shall be binding on the assigns and successors in interest to both parties. Neither party may assign their obligations under this Agreement without the written consent of the other party. Notwithstanding the foregoing, Consultant may assign this Agreement without the further consent of the City to Consultant's parent corporation or to an affiliated company that succeeds to business of Consultant contemplated herein E. Entire Agreement Amendment. This Agreement represents the entire Agreement between the parties. This Agreement may only be amended in writing. IN WITNESS WHEREOF the parties hereto have caused their duly authorized representatives to execute this Agreement the day and year above written. CONSULTANT TOWN OF TIBURON ;1 i .' . T L )"--'_-1.-<--____ 7\: /} );',1 t"{"(~ 11/~'--^-42H!~.L--.- Margaret . Curran, Town Manager Town ofTiburon Cherin 1. Mooradian, Director Integra Realty Resources - San Francisco APPROVED AS TO FORM: ~/~_. Ann R. Danforth, Town Attorney 4 C:\Documents and Settings\cmooradian\Local Settings\Temporary Internet Files\OLKB6\Appraisal Prof Services Ag I 1-1-07 dr.doc fi~b;l-- ;4-, INTEGRA",.,~ ""',"" Local Expertise.. .Nationally SAN FRANCISCO November 8, 2007 Ann R. Danforth Tiburon Town Attorney 1505 Tiburon Boulevard Tiburon, CA 94920 SUBJECT: Transitional Land ("Subject Property") APN #059-251-05 Tiburon, Main County, California Dear Ms. Danforth: Integra Realty Resources-San Francisco ("IRRSF") appreciates the opportunity to provide this proposal for real estate valuation services to you (the "Client"). Purpose The purpose of the assignment will be to provide an opinion of the market value of the fee simple interest in the "Subject Property" under the following optional premises. I) As Is including any current progress toward entitlements. 2) As Entitled for subdivision into 43 Residential Lots or Tentative Map. 3) As Entitled for subdivision into 43 Residential Lots plus installation of infrastructure and/or as Finished Lots. Intended Use: The intended use of the appraisal report is to assist the Client, as the intended user of the appraisal report, in evaluating the "Subject Property" for negotiation purposes as described in Recital B of the Agreement for Professional Services attached to this engagement letter. Date of Value Unless otherwise instructed by the client, the date of value will be the date on which IRRSF inspected the property. Scope and Description of Assignment IRRSF proposes to conduct the necessary investigations and analyses leading to the preparation of a narrative appraisal report intended to conform with the Uniform Standards of Professional Appraisal Practice (USP AP) and the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute and the American Society of Appraisers. IRR. 101 Montgomery Street. Suite 1800 . San Francisco. CA 94104 Phone 415-248-5000 . Fax 415-248-0080 . wwwirrcom Ann R. Danforth Tiburon Town Attorney Page 2 The report will consider the three traditional approaches to value: cost, sales comparison, and income approaches. However, consideration of these approaches does not mean that all will, necessarily, be valid and/or reliable. Unless otherwise required by the client, the report will only detail and rely upon that or those approaches determined to be valid and reliable in reaching the value conclusion. The "subject property" is identified by the Marin County Tax Assessor's office as parcel number 059-251-05, owned by MARTHA CO, and comprised of about 93.13 acres. The site is located in an unincorporated portion of Marin County associated with the Town of Tiburon. Development of the site is under the jurisdiction of the Marin County planning department. Approvals for construction on the site, (site and building improvements), is under the jurisdiction of the Town of Tiburon. The "subject property" has been owned by the same entity for many years. Thet:e have been several applications for subdivision. In September, 2007, Marin County settled litigation with the owner of the "subject property" agreeing to approve 43 lots. To date the actual approval has not been granted. A conceptual plan has been drawn. However, there have not been any approvals for tentative or final map. An appraisal has been prepared by David Tattersall, MAl, for the owners of the "subject property" dated June 26, 2007 with an effective date of May 1,2007. In addition to our appraisal analysis, we have been asked to review and comment on this appraisal and its conclusions and methodology. The scope of the assignment will include research into the history of the subject especially relating to attempts to develop the site with residential dwellings. Our due diligence will include review of all Environmental Impact Reports, Geological Studies and any other documents that have been either prepared for submission with subdivision approvals or required by the county and town for further understanding of the project. A study of the market and feasibility of development of residential uses within the area will be conducted. Although a search for comparable sales will be part of our due diligence it is anticipated that there will be a lack of truly comparable transitional land sales. Therefore an alternative development analysis with discounted cash flow to present value may be performed. It is anticipated that there may be a requirement for assistance to the appraiser in areas of special expertise, specifically site development and infrastructure construction costs. Should this be the case, the client will be responsible for any fees related to the engagement of these experts. Their specific engagement will be approved by the client in advance. The fees will be over and above the professional fees stated on a following page. The results of our research and analysis will be reconciled into a final conclusion of value for the subject as of a current date. Ann R. Danforth Tiburon Town Attorney Page 3 Type of Report The report to be furnished will be a "Summary Report" as defined by Standard 2-2 (a) of USPAP. The Summary appraisal report which is our standard business report used for most purposes, contains summary discussions of the data, reasoning, and analyses that are used in the appraisal process whereas supporting documentation is retained in our file. The depth of discussion contained in this report is specific to the needs ofthe client and the intended use of the appraisal. Providers of Service Valuation services will be conducted by Cherin 1.. Mooradian, MAl, ASA, who holds a Certified General Real Estate Appraiser license in the State of California. The primary appraiser may be assisted as appropriate by the professional staff of IRRSF. As previously mentioned, it is anticipated that there may be requirement for assistance to the appraiser in areas of special expertise and experience such as but not limited to site development and infrastructure construction costs. Should this be the case, the client will be responsible for any fees related to the engagement of these experts. The client will be consulted for their approval in advance. Fee, Retainer, Delivery Schedule and Number of Reports The fee for our services will be based on hourly charges with an estimate of costs of about $20,000 as outlined below: . Principal Consultant . Researchers . Other - Production . Depositions . Testimony . Office/Court Standby $275 per hour. $75 to $125 per hour depending on level. $50 per hour. $325 per hour with a 3-hour minimum. $1,300 per half-day or part thereof. $900 per half day. We will use support staff wherever possible to facilitate the client's position. However, Cherin 1.. Mooradian, MAl, ASA, will assume total professional responsibility for the work product. Fees will be billed monthly for services performed during the month and are due within fifteen (15) days of rendering the billing. If any ofthe agreed upon fee is not paid within thirty (30) days of becoming due, such will be subject to a 0.83% per month (10.0% per year) carrying charge. Ann R. Danforth Tiburon Town Attorney Page 4 Retainer: A retainer fee of $5,000 is requested to commence this engagement. The balance of fee is due and payable within fifteen (15) days of delivery of the report, Electronic transmission of a complete PDF constitutes "delivery" if no paper bound copies are requested. We will provide Two (2) copies of the report, and a PDF. Additional paper bound copies of the report(s) are available at an additional cost. The current minimum cost is $100 per copy. Based on our current schedule, we expect to be able to complete the assignment within 6 weeks from our receipt of this fully executed engagement. Attachment I delineates a request for documents that will be pertinent to this analysis should they be available. If the terms of this engagement require the review of a draft report prior to completing and delivering the final appraisal report, then this assignment shall be considered to have been completed with the delivery of the draft report and all fees shall be considered earned and payable. Any required revisions to a draft report, other than the correction of an error by IRRSF, will be charged on an hourly basis at the hourly billing rate of the professional or professionals preparing the revisions. Unless arrangements are made otherwise, a late charge of 15% per annum, commencing thirty (30) days after the receipt of invoice will be charged on any balance not paid; however, in no event shall this delinquency rate of interest exceed the maximum rate permitted by law. We shall also be entitled to recover our costs (including attorneys' fees), associated with collecting any amounts owed or otherwise incurred in connection with this engagement. Upon default, we shall be permitted to file a lien against the subject property for any amounts owed pursuant to this engagement. In the event the assignment is canceled prior to completion, an invoice will be prepared reflecting the percentage of work completed as of that date. Any credits to the Client will be promptly refunded or any remaining balances to IRRSF will be indicated on the invoice. Any out-of-pocket expenses incurred during this assignment will be billed at cost and included on the invoice. Should the Client request the assistance of IRRSF in hiring a special expert to contribute to this assignment (including but not limited to, a surveyor, environmental consultant, land planner, architect, engineer, business, personal property, machinery and equipment appraiser, among others), the Client agrees to perform their own due diligence to qualify said special expert. The Client agrees and acknowledges it is solely responsible in paying for the services of said special expert. Furthermore, the Client acknowledges that IRRSF is not responsible for the actions and findings of the special expert and agrees to hold IRRSF harmless from any and all damages that may arise out of the Client's reliance on the special expert. Ann R. Danforth Tiburon Town Attorney Page 5 Relationship After Delivery of Report The above fees include necessary client meetings and conferences during the performance of the appraisal. If additional consultation is required as a result of this undertaking, such will be provided at our customary hourly billing rates in effect at the time. Checklist to Start Assignment We are in receipt of a I) a conceptual site plan for the subdivision known as Easton Point, 2) an appraisal report dated June 26, 2007 with an effective date of May I, 2007 performed by David Tattersall & Co. relating to the subject property, and 3) a zoning map for the Town of Tiburon. Upon review we will contact you with an additional information request. The appraisal report and conclusions therein will be predicated upon the accuracy and completeness of the information provided by the Client. In the absence of some of this information, the appraisers will attempt to obtain this information from other sources and/or may require the use of Extraordinary Limiting Conditions and Assumptions within the appraisal report. Additional Terms (Attachment II) The terms of Attachment II apply to this engagement and are hereby incorporated by reference. Assumptions and Limiting Conditions (Attachment III) The appraisal reports will be limited by our standard Assumptions and Limiting Conditions and any Extraordinary Assumptions and Limiting Conditions, which become apparent or necessary during the course of the assigrunent. By acceptance of this proposal you agree to accept those assumptions and limiting conditions, and agree to accept the report subject to the same. A copy of the standard Assumptions and Limiting Conditions is set forth in Attachment II. Market Value Definition Unless IRRSF is instructed to the contrary, wherever the term "market value" is utilized, said term shall mean: "The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of the sale as of a specified date and the passing of title from seller to buyer under conditions whereby: A. buyer and seller are typically motivated; B. both parties are well informed or well advised, and acting in what they consider their own best interests; C. a reasonable time is allowed for exposure in the open market; Ann R. Danforth Tiburon Town Attorney Page 6 D. payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and E. the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale." Litigation It is understood that the appraisal is to be prepared for possible use in connection with pending litigation. Unless this appraisal is specifically being prepared for use in connection with litigation, no right to expert testimony, pre-trial or other conferences, depositions, or related services will be included with the appraisal. If testimony or related litigation services are requested in the future as a result of this undertaking, such shall be subject to the reasonable availability of the MAl appraiser signing the report. The fee for said services shall be at the applicable hourly and daily rates and the rendering of our services will be subject to a new engagement letter setting forth the scope of services to be provided and fee arrangement. Authorization to Proceed If this proposal is acceptable, please authorize us to proceed by executing this letter agreement where noted below and returning one copy to the undersigned. Should you have any additional questions, please do not hesitate to contact the undersigned. IRRSF appreciates the opportunity to be considered for this assignment. Sincerely, INTEGRA REALTY RESOURCES - SAN FRANCISCO I' . ( /:.i'-u~ eJ :>- '))~-i.I.."'" . , .- v __ ; c . ~ '- (#- -J<..._ Cherin 1.. Mooradian, MAl, ASA Director Attachments AGREED & ACCEPTED TillS DAY OF ,2007. BY: Ann R. Danforth, Tiburon Town Attorney AUTHORIZED SIGNATURE NAME (PRINT) Ann R. Danforth Tiburon Town Attorney Page 7 ATTACIIMENT I-DATA REQUEST Property Data . Environmenlal1mpact Reports. . Environmental Conditions Assessment Report (Phase I, II, and/or III) if available. . Engineering and/or Geological Reports, if any, specifically soil reports. . Any other documents that the client may feel are relevant to the analysis. Ann R. Danforth Tiburon Town Attorney Page 8 ATTACHMENT II - ADDITIONAL TERMS This assignment is subject to the following terms: ~ Use of the Appraisal: The use of the appraisal report by anyone other than the Client is prohibited. Accordingly, the appraisal report will be addressed to and shall be solely for the Client's use and benefit unless we provide our prior written consent We expressly reserve the unrestricted right to withhold our consent to your unauthorized disclosure of the appraisal report (or any part thereof including, without limitalion, conclusions of value and our identity), to any third parties, Unless our prior written consent is obtained, no third party may rely on the appraisal report (even if their reliance was foreseeable). ~ Completion Date Estimate: lRRSF agrees to use reasonable commercial efforts to complete this report as per the attached letter agreement Said completion date is an estimate and does not take into consideration pre-trial or court time as well as delays beyond the control of 1RRSF such as illness, lack of specific necessary data andlor Acts of God. ~ Database: Both parties acknowledge that real eslate appraisal requires current and historical market data to competently analyze the subject property. Accordingly, the Client agrees that: (i) the data collected by 1RRSF in this assignment will remain the property of IRRSF; and (ii) with respect to any data provided by the Client, IRRSF and its partner companies may utilize, sell and include such data (either in Ihe aggregate or individually), in the 1RRSF database and derivative products so long as the identity of the Client is kept confidential. The Client agrees that all data already in the public domain may be utilized on an unrestricted basis. ~ Limitations of Liability: It is expressly agreed that in any action which may be brought against IRRSF. or their respective officers, owners, managers, directors, agenls, subcontractors or employees (the "Integra Parties"), arising out of, relating to, or in any way pertaining to this engagement, the appraisal reports, or any estimates or information contained therein, the Integra Parties shall not be responsible or liable for an incidental or consequential damages or losses, unless the appraisal was fraudulent or prepared with gross negligence. It is further agreed thai the collective liability of the Integra Parties in any such action shall not exceed the fees paid for the preparation of the appraisal report unless the appraisal was fraudulent or prepared with gross negligence. Finally, it is agreed that the fees charged herein are in reliance upon the foregoing limitations ofliability. ~ Arbitration: The parties agree that any dispute relating to this letter agreement or the appraisal report shall be submitted to, and resolved exclusively pursuanl to arbitration in accordance with the commercial arbitration rules of the American Arbitration Association. Such arbitration shall take place in a neutral setting and shall be subject 10 the substantive laws of the stale of California. Decisions pursuant 10 such arbitration shall be final, conclusive and binding on the parties. Upon the conclusion of the arbitration, the parties may apply to any appropriate court to enforce the decision of such arbitration. ~ Litigation: In the event 1RRSF is called upon to provide teslimony or receives a subpoena concerning any suit or proceeding or otherwise become involved in any litigation relating to this engagemenl or assignment, in which IRRSF is not a party, IRRSF will make every reasonable effort to assist the Client and give such testimony. The Clienl agrees to compensate IRRSF at its then current rates, on an hourly basis, plus reimbursement for all expenses incurred as a result of said litigalion: