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HomeMy WebLinkAbout231-20 RESOLUTION113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 Resolution: 231-20 File Number: 2020-0706 BRIAN AND DAY CROWNE LAND SALE: A RESOLUTION TO AUTHORIZE THE LEASE OF A SMALL PARCEL OF LAND SOUTH OF GEORGE'S MAJESTIC LOUNGE AND WEST OF THE RAILROAD TRACKS TO BRIAN CROWNE HOLDINGS, LLC FOR THE AMOUNT OF $50.00 PER MONTH FOR ONE YEAR WITH FOUR ADDITIONAL TERMS OF ONE YEAR EACH IF NOT TERMINATED OR CHANGED BY THE CITY COUNCIL WHEREAS, the City of Fayetteville has determined that to further its assistance to hard hit Fayetteville entertainment businesses, the City should lease about 720 square feet of its 1,689 square foot parcel to Brian Crowne Holdings, LLC for one year at the rate of $50.00 per month subject to the approved lease which can be renewed unless terminated or changed by the City Council for up to four additional one year terms. NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section l: That the City Council of the City of Fayetteville, Arkansas hereby determines that to assist George's Majestic Lounge as one of Fayetteville's entertainment businesses economically challenged by the Covid-19 virus pandemic emergency, the City should lease a portion (720 square feet) of the City's 1,689 square foot parcel described on Exhibit A which adjoins George's to its owner, Brian Crowne Holdings, LLC, for $50.00 per month for a year pursuant to the lease approved by the City Council which hereby authorizes Mayor Jordan to sign this attached Lease Agreement. PASSED and APPROVED on 9/15/2020 Page 1 Printed on 9116120 Resolution: 231-20 File Number.' 2020-0706 Attest: 111111rrrr/f ER K ' T� �ii �Z��y�•• GITY FPA G �,n9J'G� Kara Paxton, City Clerk TreasurelE ; ITrn •;0, , S ''i;C;ON CO zo% jJjv Page 2 Printed on 9116120 City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 ;t Text File File Number: 2020-0706 Agenda Date: 9/15/2020 Version: 1 Status: Passed In Control: City Council Meeting File Type: Resolution Agenda Number: B 5 BRIAN AND DAY CROWNE LAND SALE: A RESOLUTION TO AUTHORIZE THE LEASE OF A SMALL PARCEL OF LAND SOUTH OF GEORGE'S MAJESTIC LOUNGE AND WEST OF THE RAILROAD TRACKS TO BRIAN CROWNE HOLDINGS, LLC FOR THE AMOUNT OF $50.00 PER MONTH FOR ONE YEAR WITH FOUR ADDITIONAL TERMS OF ONE YEAR EACH IF NOT TERMINATED OR CHANGED BY THE CITY COUNCIL WHEREAS, the City of Fayetteville has determined that to further its assistance to hard hit Fayetteville entertainment businesses, the City should lease about 720 square feet of its 1,689 square foot parcel to Brian Crowne Holdings, LLC for one year at the rate of $50.00 per month subject to the approved lease which can be renewed unless terminated or changed by the City Council for up to four additional one year terms. NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby determines that to assist George's Majestic Lounge as one of Fayetteville's entertainment businesses economically challenged by the Covid-19 virus pandemic emergency, the City should lease a portion (720 square feet) of the City's 1,689 square foot parcel described on Exhibit A which adjoins George's to its owner, Brian Crowne Holdings, LLC, for $50.00 per month for a year pursuant to the lease approved by the City Council which hereby authorizes Mayor Jordan to sign this attached Lease Agreement. City of Fayetteville, Arkansas page 1 Printed on 911612020 Legistar ID No.: 2020-0706 AGENDA REQUEST FORM FOR: Council Meeting of September 1, 2020 FROM: Council Member Matthew Petty ORDINANCE OR RESOLUTION TITLE AND SUBJECT: A RESOLUTION TO AUTHORIZE THE SALE OF A SMALL PARCEL OF LAND SOUTH OF GEORGE'S MAJESTIC LOUNGE AND WEST OF THE RAILROAD TRACKS TO BRIAN AND DAY CROWNE FOR THE AMOUNT OF $17,000.00 APPROVED FOR AGENDA: Akwo-A Council Mem er Matthew Petty 4L��- Asst. City Attorney Blake Pennington Approved as to form E-.,/Iq(zo� Date ZOZID Date RESOLUTION NO. aI -aO A RESOLUTION TO AUTHORIZE THE SALE OF A SMALL PARCEL OF LAND SOUTH OF GEORGE'S MAJESTIC LOUNGE AND WEST OF THE RAILROAD TRACKS TO BRIAN AND DAY CROWNS FOR THE AMOUNT OF $17,000.00 WHEREAS, the City of Fayetteville may only begin the process to sell its real property after "the City Council has passed a resolution expressly authorizing such sale," §34.27 (A) Sale of Municipally Owned Real Property of the Fayetteville Code. and WHEREAS, this small parcel totaling approximately 1.689 square feet is isolated from other city property by the railroad tracks, is not necessary for the Cultural Arts Corridor, and is, "no longer needed for municipal purposes." §34.27 (B): and WHEREAS, Brian and Day Crowne have submitted an offer to purchase this parcel of land for $17,000.00: and WHEREAS, the appraisal obtained by the City in February of 2018 supports the proposed sale price. NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby detennines that the 1.689 square foot parcel described on Exhibit A is no longer needed for municipal purposes and should be sold to Brian and Day Crowne for the amount of $17,000.00, that no new appraisal is necessary, and that the property should not be rezoned. PASSED and APPROVED this 15th day of September, 2020. Approved:, Attest: `\����►►t►tr►rrrrr R K =.���.• GITYO�.9J,G KARA PAXTON, City Clerk 74surer'YZ7-rE 'z 519 W. Dickson St, Fayetteville AR 72701 August 11, 2020 To whom it may concern with the City of Fayetteville, Brian & Day Crowne the owners of George's Majestic Lounge would like to purchase Tract A off the south end of our current property line from the city. Our property is 519 W Dickson St. The intent of use for the land if allowed to purchase is to allow us to expand outdoor programming offerings. We would build a deck / stage in and around the trees for bands to perform on. When not hosting shows and special events the deck would be a very cool seating area under the tree canopy. We are confident we can build the deck and have it functunal with minimal impact to the existing trees. Only two of the smaller ones in the middle would need to be removed we expect. We would like to pay $17,000 for this tract if the council will approve. We appreciate the consideration and believe this would allow us to program more outside events that we know are safer during the pandemic. Respectfully, Brian & Day Crowne I OT AREA MOM" -NONE TRACT "A" A PART OF THE BLOCK SEVEN (7) OF THE ORIGINAL TOWN SUBDIVISION OF THE CITY OF FAYETTEVILLE. WASHINGTON COUNTY, ARKANSAS, BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT A POINT THAT IS SOUTH 03'01'11"WEST 280.50 FEET FROM THE NORTHWEST CORNER OF SAID BLOCK SEVEN (7), SAID POINT BEING ON THE WEST LINE OF SAID BLOCK; THENCE LEAVING SAID WEST LINE OF SAID BLOCK SOUTH 87°03'28" EAST 43.96 FEET: THENCE SOUTH 24°04'26" WEST 54.68 FEET: THENCE NORTH 77°00'51" WEST 24.69 FEET TO THE WEST LINE OF SAID BLOCK SEVEN (7); THENCE ALONG SAID WEST LINE NORTH 03°01'17' EAST 46.70 FEET TO THE POINT OF BEGINNING, CONTAINING 1,689 SQUARE FEET. MORE OR LESS. TRACT'B" A PART OF THE BLOCK SEVEN (7) OF THE ORIGINAL TOWN SUBDIVISION OF THE CITY OF FAYETTEVILLE, WASHINGTON COUNTY, ARKANSAS, BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT A POINT THAT IS SOUTH 03001" 7"WEST 327.20 FEET FROM THE NORTHWEST CORNER OF SAID BLOCK SEVEN (7), SAID POINT BEING ON THE WEST LINE OF SAID BLOCK; THENCE LEAVING SAID WEST LINE SOUTH 77°00'51" EAST 24.69 FEET: THENCE NORTH 24°04'26' EAST 54.68 FEET; THENCE NORTH 87'OT28' EAST 5.58 FEET TO THE WEST RIGHT-OF-WAY LINE OF THE ARKANSAS AND MISSOURI RAILROAD, SAID RIGHT-OF-WAY BEING OFFSET 25' EQUIDISTANT AND PARALLEL OF THE CENTERLINE OF SAID RAILROAD; THENCE ALONG SAID RIGHT-OF-WAY ALONG A NON -TANGENT CURVE TO THE RIGHT HAVING AN ARC LENGTH OF 103.30 FEET. A RADIUS OF 942.42 FEET, AND A CHORD BEARING AND DISTANCE OF SOUTH 20°4816" WEST 103.25 FEET; THENCE CONTINUING ALONG SAID RIGHT-OF-WAY ALONG A COMPOUND CURVE TO THE RIGHT HAVING AN ARC LENGTH OF 47.88 FEET, A RADIUS OF 1,180.20 FEET. AND A CHORD BEARING AND DISTANCE OF SOUTH 25°06'24' WEST 47.88 FEET TO THE WEST LINE OF SAID BLOCK SEVEN (7); THENCE ALONG SAID WEST LINE NORTH 03'01'17' EAST 95.91 FEET TO THE POINT OF BEGINNING, CONTAINING 2.134 SQUARE FEET, MORE OR LESS. 0 20 40 Scale: 1" = 20' S 03°01'17" W /) 280.50_ — P.O.C. Naenresl Carver 6b T of 0,,R, 1T—SWuirsan of the City of Fe Itm&,, 765 '741-000 Bm, C-8 H0009s LLC CONC. SWALE L � R911ROgO RW J U) H O J W F) O O w a ti QL J LL LL1 V— F� p J > 2 Q. J J Z O J � LLI F_ W � � Z u- j O m I— O U w z d J O E (n WU) ! LL E 0)ZQ Y CD � LL z Lr W; W 4 z € FLOOD CERTIFICATION. W 5 NO PORTION OF PROPOSED TRACT'A' NOR'B' LIES IN FLOOD ZONE % AS DETERMINED BY THE NATIONAL J8E7 19, 2D1$ FT ODD INSURANCE PROGRAM, FI DOD INSURANCF RATE MAP FOR WASHINGTON COUNTY ARYANSAS. FIRM PANEL . 405143002 OF EFFECTIVE AS OF APRIL 2. MW 1 CITY PLAT PAGE. 484 n' fie.'.-q ld Wlvle CERTIFICATE OF MAILING I hereby certify that a true and correct copy of the attached written notice was placed in the U.S. mail, first-class, postage prepaid this 13th day of August, 2020, and addressed as follows. - Name: City of Fayetteville Street., 113 W Mountain Street City, State, Zip: Fayetteville, AR 72701 Name: West Dickson Street Development Co Street: 609 W Dickson Street, STE 206 City, State, Zip: Fayetteville, AR 72701 Name: Reindl Properties Inc. Street: 509 W Spring Street STE 460 City, State, Zip: Fayetteville, AR 72703 Name: Southwestern Electric Power Co Street: PO Box 16428 City, State, Zip: Columbus, OH 43216 Name: Brian Crowne Holdings LLC Street: 15469 Hale Road City, State, Zip: Elkins, AR 72727 Name: Street: City, State, Zip Name: Street. City, State, Zip. Tagon Corp PO Box 1223 Fayetteville, AR 72702 AR & MO Railroad 306 E. Emma Ave. Springdale, AR 72764 Devin Howland (name of person completing the mailing) (signature of person , ompleting the mailing) City File No. /Name. ADM-20-04 CITY OF FAYETTEVILLE ARKANSAS August 13, 2020 Public Notice- Sale of Municipally owned real property Dear Property Owner, Please be aware that the Fayetteville City Council will consider a resolution to sell 0.039 acres of municipally owned land (tract A of parcel 765-01745-001) to Brian and Day Crowne for $17, 000. This possible sale will be considered by the City Council during it's 5:30 p.m meeting on September 1, 2020. The meeting will be held virtually due to the pandemic and you can obtain a link to attend and speak during the City Council meeting by visiting the week of the meeting at: https://www.fayetteville-ar.gov/1 503/Meetin_q-Agendas-and-Video City Council; 5:30PM; September 1, 2020 You can also submit public comment through this form: https://documents.fayetteville- ar.gov/Forms/publiccomment If you wish to learn more about the proposed sale, please contact Devin Howland, Director of Economic Vitality at 479.575.8221. You are also invited to attend the September 1, 2020 City Council meeting via Zoom and make comments when the resolution is presented for the City Council's consideration. Sincerely, Devin Howland Director of Economic Vitality City of Fayetteville, Arkansas Mailing Address: 113 W. Mountain Street www.fayetteville-ar.gov Fayetteville, AR 72701 MWO ADM -i94M) Ilk ;fir;, ✓� 1, Devin Howland attest that the above sign was posted on August 13, 2020 adjacent to parcel 765-01745-001 (east of N Powerhouse Ave). (signature of person completing the sign posting) City File No./Name: ADM 20-04 Arkansas Democrat -Gazette 08/13/20 11:52 AM Arkansas Democrat -Gazette Account 5182985 Name CITY OF FAYETTEVILLE Credit Card Phone 479-521-7700 Type Address 113 W MOUNTAIN Num Auth Expire! City FAYETTEVILLE State AR Zip 72701 Country Code US Start 08/16/20 Paytype BL Issues 1 Stop 08/16/20 Rate Code NL4 Class 1230 Copy ph - Georges land Amount 65.36 Tax 0.00 Amount Paid 0.00 Payment Due 65.36 Received by 08/13/20 Rep 285 Ad # 75308165 Paytype Billed Balance 0 Receipt No NOTICE OF 11 CLI,, HFARI N; Am eefing of the i;U of Far etteville Gh Co ncil wAI he held on Se utember 1. 2020 at 5.30 pm The of will be held virtually due to the pandemic Neese visit Fayettevil ar.govto register for the zoom meeting it you wesfi to view the meeting or speak during public comment. The Idbwmg item is required to be published in the heal news paper pursuant to the Code of Ordmancas of the City of Far e" Al. and will be heard at the Seplender 1. 2020 Fayetteville City calncil Meelkg AIM1: 20-04 SALE OF MMC- RPLLYOWNED REAL PROPERTY Submitted by Council Member Pettryry for the p�oparty located SOUIFI of 519 W Dirk.©n Sheet. The Fayetteville COY Council is considering the sale of 0.039 aces �Ippaarce1765.01745-601 R n nwns SOUTH of 519 W Dmkvon Sheet to Bran and Day Ciowne. The proposed use is expanded outdoor programing within the trees The xisable sale will he considered by Iha Cdy Council during its Sepptember 1, 2020 meeting011 1y via zoom. 75300165 Aug 16, W20 Ad shown is not actual print size 172 Words Ad Size 1 cols x 3.08 inches Customer Receipt Arkansas Democrat -Gazette Arkansas Democrat -Gazette Account 5182985 Name CITY OF FAYETTEVILLE Phone 479-521-7700 Type Address 113 W MOUNTAIN Num Auth Expire! City FAYETTEVILLE State AR Zip 72701 Country Code US Credit Card Start 08/16/20 Paytype BL Issues 1 Stop 08/16/20 Rate Code NL4 Class 1230 Copy ph - Georges land Amount 65.36 Tax 0.00 Amount Paid 0.00 Payment Due 65.36 Rep 285 Ad # 75308165 Paytype Billed Balance 0 Receipt No Date 11'52 AM NOTICE OF PIAUC HEARM A mee0ng of the Cdy of Fay- etteville City counci wAI be held on September 1. 2020 at 5.30 p.m. The meeting will be held virtually due to the pandemic. Pesise visit Fayetteville -our. gov td register for the zoom meeting it You wish to view the meeting or speak during public comment. The fdlov;V item is reeqpuired to be published in the brat news- paper pursuant to the Code of Ordinances of the City of Fayy-- ettaville and will be heard ar the September 1. 2020 Fayetteville Gty Colmci Meeting. ADM: 20.04 SALE OF MUNG IPPLLY OWNED REAL PROPERTY Suppbmitted byor theyDCouncil Mamben SeOUTFI of 519 Wof*aonocated street. The Fayetteville Cit9 Council is considering the sale of 0.039 acres 1�terwl 765-01745-0011 A owns ,01TH of 519 W Dickson Street to Brian and Day Gown. The proposed use is upended outdoor programing within the trees The posade sale will be considered by the City Council during its September 1. 2020 .ing virtually via tram. 14111i; 202n Ad shown is not actual print size 172 Words Ad Size 1 cols x 3.08 inches Received by Date 71ie City of Tayetteviffe- Engineering (Division As of February 15, 2018 Client: City of Fayetteville Engineering Division 125 W Mountain St Fayetteville, AR 72701 Presented By: The Real Estate Consultants 118 N. East Avenue Fayetteville, AR 72701 Produced By: Mark E. Risk, GAA State Certified General Appraiser #0202 File #17-0225 © Copyright 2018 by The Rea(Estate Consultants Afffthts Reserved March 1, 2018 Ms. Holly Jones, City Land Agent City of Fayetteville 113 W. Mountain Fayetteville, AR 72701 RE: Appraisal Services City of Fayetteville Proposed Lot Split — N.Powerhouse Ave. Fayetteville, AR 72701 Dear Ms. Jones: In compliance with your request and to determine the Market Value of the above captioned property, I hereby certify that I have personally inspected the property and made a survey of matters pertinent to the estimation of its value. The subject property was inspected by the appraiser on February 15, 2018. The intended use is for potential sale evaluation of the aforementioned property by the City of Fayetteville. I further certify that I have no interest present or contemplated in the property under appraisement, and that my fee was not contingent upon the value estimate reported. The opinions set forth in this letter are stated as of March 1, 2018. The following narrative appraisal report contains the data gathered in my investigation and shows the method of appraisal in detail. The report has been prepared in conformity with the Uniform Standards of Professional Appraisal Practice as promulgated by the Appraisal Foundation. This report is considered an "Appraisal Report". This appraisal is based upon information gathered by the appraiser from the subject owner, public records, and other reliable sources, and upon an inspection of the subject property and neighborhood. In developing the appraisal approaches used, data was collected from the Real Estate Consultants' office files and courthouse records. The appraiser has applied the Market Data, Cost and Income Approaches in this appraisal. Based upon my inspection of the subject property and the investigation and analysis carried out in this report, it is my considered opinion that the Market Value of the subject property as of February 15, 2018, and subject to the assumptions and limiting conditions set forth in the body of this report, is as follows: SEVENTEEN THOUSAND DOLLARS ($17,000) Respectfully submitted. Mark A. Risk GAA State Certified General Appraiser # CG0202 7abfe of Contents Section I — Eyecutive Summary............................................................................. 4 SalientFacts & Conclusions....................................................................................................4 SubjectLocation Map..............................................................................................................5 SubjectPictures........................................................................................................................6 SubjectPictures........................................................................................................................7 SubjectPictures........................................................................................................................8 SubjectPictures........................................................................................................................9 LegalDescription...................................................................................................................10 AppraisalInspection Comments..........................................................................................10 Section II-AppraisafPremises ...........................................................................11 MarketValue Defined...........................................................................................................I I HypotheticalCondition Defined...........................................................................................II ExtraordinaryAssumption Defined.....................................................................................I t PurposeOf The Appraisal....................................................................................................12 Intended Use And User Of The Appraisal...........................................................................12 PropertyRights Appraised...................................................................................................12 SubjectHistory.......................................................................................................................12 SubjectStatus.........................................................................................................................12 Assumptionsand Limiting Conditions................................................................................13 Scopeof the Appraisal...........................................................................................................18 GeneralComments................................................................................................................18 Scope of the Appraisal — Appraisal Methods Used.............................................................19 Section III — Data Presentation......................................................................... 20 NeighborhoodDescription....................................................................................................20 PropertyDescription..............................................................................................................21 SubjectProperty Aerial Map................................................................................................22 CityDowntown Zoning Map................................................................................................22 Subject Site Water and Utility Map.....................................................................................23 Section Iv — Su6ject Analysis e� Valuation Approaches .................................... 26 Highest And Best Use Analysis.............................................................................................26 The Four Tests of Highest & Best Use.................................................................................27 Four Tests Of Highest & Best Use Continued.....................................................................28 TheMarket Data Approach..................................................................................................29 Market Data Approach -- Comparable Land Sales Map...................................................30 Analysis Of Comparables And Conclusion Of Land Value...............................................39 Correlation, Analysis, and Conclusion................................................................................43 CertificateofAppraiser....................................................................................... 44 SectionV -Addendum ......................................................................................... 45 ZoningInformation...............................................................................................................46 WSsume...........................................................................50 Section I — Executive Summary Salient Facts e� Confusions Property A part of Block seven of the original town subdivision County. Washington Parcel #(s� 765-01745-001 Fee Owner City of Fayetteville Subject Location: N. Powerhouse Ave., south of Dickson St. - Fayetteville, AR 72701 Estate.Appraised Fee Simple Size: Site — 1,689 sq. ft. or .039 ac. Effective Date: February 15. 2018 - The Date of Inspection vt&ttties. All Municipal Utilities Are Available Zoning. Main Street/ Center JTfyhtest and Best Vse: Assemblage with adjoining property Value Indications: Market Data Approach $17.000 Cost Approach NA Income Approach NA Final Estimate of 911arket Value: $17,000 Note. This appraisal report has been prepared for the exclusive benefit of The City of Fayetteville. It may not be used or relied upon by any other party. Any party, who uses or relies upon any information in this report without the preparer's written permission, does so at their own risk. 4 ,ri f i a a`J , o CL i S H.0 Ave 7 is ap�sallyFls �r A r A rl Wmrth.,rn r K N Arkansas Ave 3 N N University Ave :E m Z a �a m 04Erhase Ave 6�s9N cS n j N Gregg Ave and N Wilson AFn F T S West Ave N West Ave N West Ave A C f � Y a o n >r O � C 7 _ 13 N Vandeveoter Ava� «a N School Ave i{ N Shipley Alley j� 111 NCampbell Ave N ShAdy Ave N locust Ave N Rollslon Ave `e n Q N { 01 ti N Thorn on Ave Subject (Pictures N. Powerhouse Ave. looking south RI s / ,l , ! Awl 9 R',TA � , r. u. _Al ..� . f2sf 17 ir f ° 6 �-, `tom.: • �' •.*�e 1 a y� Alm Oro PAO - �. 'e►;. ...... Su6iect (Pictures Subject Site looking North near the SE corner of the subject Railway tracks east of the subject looking north ftoperty identification The property under appraisement is a small vacant tract of land south of Dickson St. on N. Powerhouse Ave., in Downtown Fayetteville, Washington County, Arkansas. The property is owned by the City of Fayetteville. Lega(Desg ption A part of the Block Seven (7) of the original town subdivision of the City of Fayetteville, Washington County, Arkansas, Being more particularly described as follows: Beginning at a point that is South 03*01' 17"West 280.50feet from the Northwest corner of said Block Seven (7), said point being on the west line of said Block; thence leaving said west line of said Block South 87*03'28"East 43.96 feet; thence South 24*04'26"West 54.68 feet; thence North 77*00'51" West 24.69 feet to the West line North 03*01' 17"East 46.70 feet to the POINT OF BEGINNING, containing 1,689 square feet, more or less. Appraisaflnspection Comments Date: February 15, 2018 Inspection Notes: Mark Risk visually inspected the subject land on the above date. The inspection consisted of a walking tour of the property. Owner Contact: Ws. Yfolfy.Yones 11 Section II - Appraisal 'remises Warkf t Vafue Define The Appraisal Foundation defines market value as follows: "The most probable price that 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, knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: 1. Buyer and seller are typically motivated. 2. Both parties are well informed or well advised, and each acting in what he considers his own best interest. 3. A reasonable time is allowed for exposure in the open market. 4. Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto. 5. 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." Jjpothetica(Condition Defined Hypothetical Condition — A condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis. Uniform Standards of Professional Appraisal Practice Extraordinary Assumption Defined Extraordinary Assumption — An assumption, directly related to a specific assignment, as of the effective date of the assignment results, which, if found to be false, could alter the appraiser's opinion or conclusions. Uniform Standards of Professional Appraisal Practice Purpose Of qWeAlTraisaf The purpose of this report is to estimate the Market Value of the subject property. Intended Vse And Vser Of The Appraisaf The intended use of the appraisal is for potential sale evaluation purposes of the client. The intended user is the client, The City of Fayetteville - Engineering Division. 4 A I a The property is appraised as though owned in fee simple and unencumbered. A fee simple title is the fullest type of private ownership possible, subject to all public limitations including zoning, taxation, and eminent domain; and subject to private limitations, which may exist, such as easements and restrictions of record. Su6Lect Ifistory According to Washington County records, the City of Fayetteville has held the subject property since 1990. The most recent ownership change occurred on September 28, 1990 per Deed 1387 page 141 of the Washington County Courthouse Records. In this transaction the property was deeded to the City of Fayetteville from the Dickson Street Central Business District # 1. This. sale included additional land on the east side of the railroad tracks. No revenue stamps were placed on the deed. However, the appraiser was able to obtain a copy of the City of Fayetteville's Resolution No. 145-90 which indicated the City paid a total of $58,371 for the two parcels. Furthermore, the public records indicate that the Dickson Street Central Business District #1 acquired the original property on August 7, 1989 from the Burlington Northern Railroad Company for a reported $82,000. This purchase may have included additional lands. Due to the lapse of time the appraiser was unable to verify this transaction. No other arm's length transactions were discovered involving the subject property within the past five years. The City of Fayetteville has recently split the original property into a Parcel A and a Parcel B. Parcel B is the subject of this appraisal assignment. Su6ject Status The subject property is currently being offered for sale to the public by the City of Fayetteville through a sealed bid method. There is no list price or asking price for the property. A Assumptions andGimitigg Conditions ACCEPTANCE OF AND/OR USE OF THIS APPRAISAL REPORT BY THE CLIENT OR ANY THIRD PARTY CONSTITUTES ACCEPTANCE OF THE FOLLOWING ASSUMPTIONS AND LIMITING CONDITIONS: Limit of Lia6ifsty The liability of TREC, Inc., The Real Estate Consultants, Mark E. Risk GAA, and associates and employees is limited to the client only and to the fee actually received. Further, there is no accountability, obligation, or liability to any third party. If this report is placed in the hands of anyone other than the client, the client shall make such party aware of all limiting conditions and assumptions of the assignments. The appraiser is in no way to be responsible for any costs incurred to discover or correct any deficiencies of any type present in the property - physically, financially, and/or legally. In the case of limited partnerships, client agrees that if any lawsuit brought by a lender, partner, part owner, tenant, or other party, results in any award or settlements of any type in such suit regardless of outcome, that the client, who is the intended sole recipient of this report, will hold the appraiser completely harmless in any such action. Copies, Tu6Cication, Distribution, and Vse of the Report Possession of this report or any copy thereof does not carry with it the right of publication, nor may it be used for any purpose other than its intended use. The signer of this report is a candidate for membership in the National Association of Independent Fee Appraisers, and a member of the National Association of Realtors and its Appraisal Section. The Bylaws and Regulations of these organizations require their members to control the use and distribution of each report signed by such member. Therefore, except as hereinafter provided, only the party for whom this report was prepared may distribute copies of this report, and only in its entirety, to such third parties as may be selected, but not without prior written consent and approval of the signatory of this report. The physical report remains the property of the appraiser for the use of the client. Neither all nor any part of the contents of this report (especially any conclusions as to value, the identity of the appraiser or the firm with which he is connected, or any reference to the National Association of Independent Fee Appraisers, the National Association of Realtors or any designations shall be disseminated to the public through the advertising media, public relations media, news media or any public means of communication without prior written consent and approval of the signer of this report. The authentic copies of this report are sealed with my Seal. Any copy that is not so sealed is unauthorized and may have been altered. ConfidentiaCty and Trade Secrets: This appraisal consists of trade secrets and commercial or financial information which is privileged and confidential and exempted from disclosure under 5 U.S.C. 552 (b) (4). The appraiser may not divulge the material contents of this report, the analytical findings and conclusions, or give a copy of this report to anyone other than the client or his designee as specified in writing - except as may be required by the National Association of Independent Fee Appraisers, the National Association of Realtors, or other organizations as they may request in confidence for ethics enforcement, or by a 13 court of law of body with the power of subpoena. This appraisal is to be used only in its entirety and no part is to be used without the whole report. No change of any item in the report shall be made by anyone other than the appraiser, and the appraiser shall have no responsibility if any such unauthorized change is made. The client shall notify the appraiser signing the report of any request to reproduce this appraisal in whole or part. Testimony, Consultation, and -Completion of Appraisa(Services The contract for appraisal, consultation, or analytical services is fulfilled and the total fee payable upon completion of this report. The appraiser or those assisting in preparation of this report will not be asked or required to give testimony or be subpoenaed in court of any public or private hearing because of having made this appraisal, in full or in part, nor engage in post appraisal consultation with the client or third parties except under separate and special arrangement and at additional fee. A MINIMUM TWENTY DAYS NOTICE MUST BE GIVEN BEFORE COURT APPEARANCE FOR PURPOSES OF REVIEW AND STUDY. If testimony or deposition is required because of any subpoena, the client shall be responsible for any additional time, fees, and charges regardless of the issuing party. Information'Jsed No responsibility is assumed for the accuracy of information as to description (legal, physical, etc.) of the premises, restrictions, improvements, and income features of the property furnished by others, the client, his designee, or public records. All information furnished by others is assumed to be true, correct, and reliable and a reasonable effort has been made to verify such information. An impractical amount of time and money would be necessary to furnish unimpeachable verification in all instances. It is suggested that the client consider independent verification if so desired before making a significant commitment regarding the subject property. No responsibility for the accuracy of data and information obtained or the work of possible subcontractors is assumed by the appraiser. 14 sl uappiq `lios aql gleauaq suoilipuoo anaasgo ,(lleuosaad of algissod lou seen li `.ianaMoH •uoaaagl sluawanoadwi iql pue puel agl uoilemasgo Xci `algissod se nj su `paloadsui suq nsieadde 3qj •laodaa sigl uiglim palou ssalun ssedsail of luawgoeonw ou si antil legl put, `pagymap Xindoid agl3o sauil (vidoid io sauepunoq agl uiglim si sluawanoadwi pup puel aql jo uoileZililn aql legl pawnsse si it •aasieadde aql ,Cq panlaap se ao 'aauSIsap siq `luailo agl ,Cq pagsiwnj se loauoo aq of pawnsse si laodw sigl ui pasn uoildiaosap leSal aq L •ainleu Suyaaui5w 10 `leoluegoaw `leanlonals `leanloaligoae `,Canans jo siallew ao3 pawnsse si,(l►ligisuodsaa oN suoj&nssy'Buuaau:Bug�yuv yvnuvpox ymmxwy ynswa tryuI( •laodw sigl ui pauoisinua legl uegl luanjj!p si 5uiouuug io ,Clilua IuOal io leois,Cgd aql j! a5uego of loafgns si alewilsa amen pup liodai lesie.dde s►q,L •pals3SOns uaaq lou aneq sluawaimbai ,Clinba pup `uoilezipowe uual `soilea ueol offloads legl palou aq pinogs li `sasoclind ueol 3BuBjjow io3 pasn si lesieadde s►gl3l •laodw aql uiglim p331o3ds os ssalun sapnlinaas pue `saseal `saoueagwnoua `suail `saft,5laow lle jo malo puu awj se ssoa? ui pasieadde si ,CIadoad aq L •algeluegoaaw pue poo5 aq of pawnsse si allu aq jL •paaapuaa allil jo uoiuido up si aou ,Claadoad aql of all!1 Ouiloage ainleu le5al a 3o saalluw ao3 pawnsse si ,Cilligisuodsaa oN suo�d�unss)� jvauvui,� yuv�nBa7 •p3gsiu3 si laodw aql aage wig of umoul sawooaq legl luawu2isse aql of luauilaad sis,Cleue ao ,Cpnis snoinaad ,Cue ao `sisXleue ao ,Cpnis luanbosgns ,Cue uodn paseq suoisnlouoo ao `saluwilsa `sanlen `suoiuido `s2uipuU `sluawalels aql jo ,Cue pulosaa ao `asInaa `puawe `aalle of jgSp paliwilun aql sanaasw aesieadde aq L •laodw aql ui ao saoinaas a03 lu3w33a2e up u► p331oads asinuaglo ssalun apew ao palsanbaa uaaq suq ,Cpnis ,Cliligiseaj ao `,Cpnis sis,Cluuu asn isaq pue lsagiiiq `sis,Cleuu jo,Cpnis lalaew leloads `saipnis loedwi ao leluawuoainua otq •paseq si laodw sigl ui alewilsa amen aql goigm uo asn ,Cue aoj p3m;)uaa ao pauielgo aq ueo ao uaaq aneq uoileziuu5ao ao ,Clilua aleniad ao/pue luawuaanoS leaapaj ao `alels `leool ,Cue woa3 ,Cliaogine anile.ilsiuiwpe ao 3nilels1531 aaglo ao `sliuuad `sluasuoo `sasuaoil paainbaa lle legs pawnsse si it •laodaa lesieadde aql ui paiapisuoa pue `pau13ap `palels uaaq suq ,Cliuuojuoauou ssalun `ql!m Paildwoo uaaq aneq sad,Cl Ile jo suoiloialsaa pup suoileingw asn pue `sapoo Suiplinq 12uluoz algeoildde lip legs pawnsse si 11 •laodaa aql ui paaapisuoo put, `p3ug3p `palels si aoueildwoo-uou ssalun smul put, suoileln2w leluawuoainua leool pue `alels `leaapaj algeaildde lit, qj!m aoueildwoo lln3 si aaagl legs asimaid aql uo paseq si laodaa sigj, sai�myynvj4 yuv asa fo 4yvBa7 •an000 ,Cew legs slalaew lelauuu!J agl ui sasuego oiweu,Cp of loafgns pue les►eaddejo alep agl3o se aae salewilsa gonS •uoilewaojui lajaew ogloads Put' leaauaS woaJ paniaap sa013e3 aaglo pue `splai,C `awoow jo uoilelaadaalui s,aasieadde aql sloagw anlen 1a)laew3o alewilsa aql `slg3u3q awoom aaninj jo uoilezilelideo aql Suinlonui slesmAde ul -MIJ aano aoeldlalaew aql ui saSuego oiwouooa of loafgns pup Supago aql Suipunouns suoilipuoo pue `uoilenilow `swaal `laojja leuoilowoad `awil `aansodxa of palelaa XlgSiq si amen 1a1aeW •alewilsa amen agl jo mup agl jo se aellop aql jo aolad put, n mod Swsegoand aql uo paseq aae slunowe aellop llb' •lesieadde agl jo alep aniloaJJa aql ol,Cluo alelaa pasn sisoo aql pup anlen 131aew palewilsa aq 1, saauanjful v-yivW yuv IaBuvy,) anivA `iamoj) Buisvyain& structural components, or any mechanical components within the improvements and no representations are made as to these matters unless specifically stated and considered in this report. This appraisal is based on there being no hidden, unapparent or apparent conditions of the property site, subsoil, or structures which would render it more or less valuable. No responsibility is assumed for any such conditions or for any expertise or engineering needed to discover such factors. The appraiser does not warrant against the occurrence of problems arising from the soil conditions. All mechanical components are assumed to be in operable condition and states standard for properties of the subject's type. Conditions of heating, cooling, ventilating, electrical, and plumbing equipment is considered to be commensurate with the conditions of the balance of the improvements unless otherwise stated. No judgment is made as to the adequacy of insulation or energy efficiency of the improvements or equipment. The lender, owner, or buyer should inspect the property before purchase or any disbursement of funds. Any of those parties may wish to require mechanical or structural inspection by a qualified and licensed contractor, civil or structural engineer, architect, or other expert. The appraiser has not been requested to make an investigation of the possible existence of any potentially hazardous insulation or material used in the construction or maintenance of the building, or the possible existence of toxic waste which may or may not have been stored on the property or the possible existence of radon gas on the property. The appraiser represents that he is not qualified to test for the presence or absence of such items and has not considered, and assumes no responsibility for, such products which might render the property more or less valuable. The client is advised to retain an expert in this field if this information is presumed appropriate and necessary. This appraisal has not considered conditions relating to surface or subsurface waters; including, but not limited to water table, flood plain, flood hazard, or rights, if any, claimed nor or in the future in riparian lands and drainage - unless otherwise noted in this report. The appraiser assumes no responsibility for any costs or consequences arising from the need for flood hazard insurance. An agent for the Federal Flood Insurance Program should be contacted to determine the actual need for Flood Hazard Insurance. Management of 4ropeny It is assumed that the property being appraised will be operated under prudent, responsible, and competent ownership and management - being neither inefficient nor super -efficient. E-xhi6its The sketches and maps in this report are included only to assist the reader in visualizing the property and are not necessarily to scale. Various photos, if any, are included for the same purpose and are not intended to represent the property in other than actual status as of the date of the photos. Site plans are not surveys unless shown from a separate surveyor. R Component values The distribution of the total valuation in this report between land and improvements applies only under the reported highest and best use of the property. Neither the analysis and conclusions herein nor the allocations of value for land and improvements may be used in conjunction with any other appraisal and are invalid if so used. (Personal Property Furnishings, fixtures, or equipment of the business operation except as specifically indicated and typically considered as a part of the real estate have been disregarded unless otherwise stated. For some property types, business and real estate interests and values are combined. Tederar.A ter Tax Analysis Any after tax income and investment analysis or measures of return on investment are intended only to reflect possible and general market considerations at an assumed value of price paid. The appraiser does not claim expertise in tax matters and advises the client and any other person using this appraisal to seek competent tax advice. The appraiser is in no way to be considered a tax or investment advisor. Hypothetical Condition There are no hypothetical conditions regarding the appraisal of the subject property. Extraordinary Assumptions It is assumed by the appraiser that there are no utility easements or other easements aside from the proposed drainage easement affecting the subject site. It is further assumed that a small building can be constructed on the site per the Main Street/Center zoning classification. If this assumption is found to be false, it could alter the appraiser's opinion or conclusions. 17 Scope of the Appraisaf Introduction "The term scope of the appraisal refers to the extent of the process of collecting, confirming, and reporting data."I The appraiser determines a report's scope (extent of data collection & depth of reporting) according to the following primary factors: 1) Satisfaction of standards as set forth by USPAP 2) Satisfaction of any additional standards/specific requirements as defined by client request &/or organization(s) for which an appraiser has professional membership 3) Perceived needs of the intended user(s) as related to a report's intended use. The scope of this appraisal encompasses the necessary research and analysis to prepare a report in accordance with its' intended use, the Code of Professional Ethics & Standards of Professional practice of the National Association of Realtors, and the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation. The appraiser has determined an " appraisal report" conforming to USPAP Standard 2-2(b) would satisfy the needs of the intended user(s). A Summary report offers basic statements of fact &/or brief summary comments when describing data, reasoning, and analysis used in the appraisal process to develop an opinion of value. As such, some documentation supporting the data, reasoning, and analysis was kept in the appraiser's files. Genera(Comments Basic information pertaining to this assignment is based upon information gathered by the appraiser from inspection of the subject property and neighborhood, public records, and other identified sources. Data believed to be unreliable was not included in this report nor used as a basis for the value conclusion. Region, county, city, and neighborhood data were based on information in the Real Estate Consultants library and files, physical inspection of the immediate neighborhood, and data from the City of Fayetteville and Washington County. The appraiser physically inspected the subject on February 15, 2018, with subject photographs taken on February 15, 2018. Subject property data was based upon information gathered from physical inspection of the subject property and immediate neighborhood, documentation provided by the City of Fayetteville, public records, and other identified sources. In evaluating the highest and best use for the subject property, an analysis was made of data compiled in the steps noted above. The appraiser's opinion of subject's highest and best use is based on important factors such as physical location, physical characteristics, zoning requirements, and use history/potential. In addition, a study of the downtown land development market in the subject area has been made to help determine the economic feasibility of the subject property. ' Appraisal Institute, The Appraisal of Real Estate-10h Edition, (Chicago: The Appraisal Institute, 1992), p. 575 18 Scope o{ the AMaisal—AppraisaC�biethocfs `tJsecf Warket Data (Sales Companson)Approach — Underlying land value based upon analysis of available market data for land comparables, either vacant or with improvements extracted, in the central downtown area. Comparables were gathered from the appraiser's files, Realtors ® multi -list service, Courthouse records, and interviews with knowledgeable market participants. The most important individual examples are discussed in digest format, and then reconciled on a price per square foot basis to the subject after discussion. Applied appreciation over time, if any, is based on accumulated data in the appraiser's files and the appraiser knowledge of the local market. Income Approach — The income approach was developed using a basic capitalization technique. To begin this process, data for existing market lease rates of downtown parking spaces was gathered from the appraiser's files, Realtors ® multi -list service, and persons/data reporting services knowledgeable of the subject's market niche. The most important examples were reported in a brief summary format, and then reconciled on a price per space per month basis to the subject. The appraiser then developed an estimate of Net Operating Income using the above -determined potential annual lease income less expenses, reported in a summary grid format. Applicable capitalization rates and related economic factors were based on accumulated data retained in the appraiser's files, prevailing mortgage rates as of the effective date of the report, and discussions with persons knowledgeable of the subject's market niche. Reporting of these factors and subsequent development of a final estimate of value via the Income Approach was reported in a brief summary format. Cost Approach -- Cost estimates for improvements are based on `replacement cost' defined as follows: "The estimated cost to construct, at current prices as of the effective appraisal date, a building with utility equivalent to the building being appraised, using modern materials and current standards, design, and layout." 2 Improvements construction cost is based on independent publications referenced interviews with local market participants, and data provided by the Marshall& Swift valuation service. Aggregate costs are represented in a price per space format. 2 Appraisal Institute, The Dictionary of Real Estate Appraisal-3"' Edition, (Chicago: The Appraisal Institute, 1993), p. 303 IN Section III — Data Presentation Neighborhood Desyrption For appraisal purposes, a neighborhood is considered to be a portion of a larger community in which there is a homogeneous grouping of inhabitants, buildings, or business enterprises. Neighborhood inhabitants usually have a more casual community of interest and similarity of economic level and cultural background. Neighborhood boundaries may consist of well-defined natural or man-made barriers, or they may be more or less well defined by a distinct change in land use, or in the character of the inhabitants. The immediate area is commonly known as Fayetteville's Dickson Street Entertainment District, with neighborhood boundaries defined as such: N- Maple, S- Center St., E- College Ave., and W- U of A Campus. The central downtown encompasses the City's financial and entertainment centers and continues to undergo revitalization as it adapts to current market demands and trends. The neighborhood is viewed by the market as one of the most desirable for commercial use, especially within the entertainment niche, both within the city and throughout the NW Arkansas region. College Avenue (Highway 71 B) is the most important N-S open -access business route in the region. Close proximity to the University of Arkansas. 20 ftcperty Description Site Based upon the survey provided by the client, the subject size is approximately 46.70' x 43.96' x 54.68' x 24.69 ft. This is a very small tract of land totaling 1,689 sq. ft. or .039 ac. It is an irregular shaped urban lot, with a moderate slope down from N. Powerhouse Ave. to its east boundary. The City has a drainage swale along the east boundary of the subject between the site and the railroad right of way. The site is mostly cleared but there are several trees on the land. The tract offers 46.70± feet of frontage along Powerhouse Ave. Powerhouse Ave. has two lanes and is paved with asphalt. It is not a through street, essential ending at the Seafood Powerhouse and electrical substation. The land appears to lie outside any FEMA identified flood zone area. It appears that the site has had some fill put along the northern boundary with George's Majestic Lounge. The site has access to all municipal utilities. No adverse easements, encroachments, or other conditions were noted upon inspection. There does not appear to be utility easements affecting the subject. The city of Fayetteville's water and sewer maps indicate a 6" PVC water line along Powerhouse Ave. and an 8" sewer line also along Powerhouse Ave. City staff has informed the appraiser that there are no water or sewer easements encumbering the subject property. However, the City's survey provided the appraiser shows a 10' wide proposed drainage easement along the south and east boundaries of the subject. It is not known at the time of the appraisal if Black Hill Energy has a gas line easement that would affect the subject property. Per the City's Downtown Master Plan zoning code, zoning is Main Street/Center. This is a broad classification, primarily designed to allow high -density development. See zoning information in the addendum to this report. Improvements There are no permanent improvements on the subject site. There is an old metal storage building at the northwest corner of the tract on slats and is considered to be personal property not real estate. No value has been given to this building. EnwvnmentalAnalysis My routine inspection of and inquiries about the subject property did not develop any information that indicated any apparent significant hazardous substances or detrimental environmental conditions that would affect the subject property negatively. The value estimated in this report is based on the assumption that the property is not negatively affected by the existence of hazardous substances or detrimental environmental conditions. However, the appraiser is not an expert in the identification of hazardous substances or detrimental environmental conditions. It is unlikely but possible that tests and inspections made by a qualified hazardous substance and environmental expert would reveal the existence of hazardous substances or detrimental environmental conditions on or around the property that would negatively affect its value 21 Subject ftiMertyAeria(Xgp Source: City of Fayetteville GIS Mapping System City Downtown Zoning 9ft r \ \� a �\ 4 \` 0 Source: City of Fayetteville GIS Mapping System 22 Subject Site Water and V 61itx 3fa� ;';u 542 � G� !4 4 y 53J 51ri 'Q lt!1 471 4" 410 W9 603 Walton AIfS .n. [enter a 495 e SUGJECT 255 Y >1 a Parking m Deck 3 6'"PYC i2"PVC 416 Source: City of Fayetteville GIS Mapping System 23 Su6iect Site Survey • X- PM'ERHOUSE AVENUE AD 142.6 1 P.O.B. 46.70' S 03'01'17' /V MOBILE STORAGE PRO BUILDING //E�LCT "A' . JIV 69,00, O� CD w co V cy) C\f 00 Cl) Brian C-Dw-ne Holdings LLC 942 42, 24 kL—;: 2 Lol Builda6CeArea o Subj ct Site A POWERHC JSE A,--NJE 142.61' F O-E. 46.70' MD61LE BDILDWG k TRACT 25 Lli rn co cn U-) c p; O ac co S 03"01'17"�j 765017e.•-OpJ 6rre� 1..'OIknE Hoj&,;s l_C CONC;. S WFLL F Section IV —Sub 'ect naf sis d, Valuation Approaches YCighest An t Best Vse Analysis The Appraisal Institute defines highest and best use as follows: "The reasonably probable and legal use of vacant land or improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value. The four criteria the highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum profitability." The following tests must be met in estimating the highest and best use of the subject: It must be physically possible based on subject site characteristics. 2. It must be a legal use under current or likely zoning regulations. 3. It must be probable and not based upon conjecture or speculation. 4. There must be a profitable demand for such use and it must return to the land the highest net return for the longest period of time. I applied these tests to the subject. The Highest and Best use of a property is based on current trends and necessities in its neighborhood with respect to overall supply and demand factors, and required rates of return for specific investment types. An appraiser's interpretation of highest and best use is essentially an economic study of market forces as they affect a specific property. Appraisal theory and USPAP generally require development of two Highest and Best use opinions - 'as though vacant' and `as improved'. 'As though vacant' is essential to determining underlying land value and intimately connected to the Cost Approach. The 'as improved' conclusion considers potential economic contribution (if any) of existing improvements and assists in determining how a prudent investor would utilize such improvements (renovation, expansion, demolition, et cetera). 'The Appraisal of Real Estate- lb th Addition' (Appraisal Institute, Chicago, 1992) offers this statement: "The use that maximizes an investment property's value, consistent with the long-term rate of return and associated risk, is its highest and best use as improved." Any determination of highest and best use includes identifying the motivations of probable purchasers. The benefits of an investment property like the subject relates to net income potential and eventual resale or refinancing. Thus, the highest and best use will be that use which maximizes the net operating income on a long-term basis. This use must meet the four criteria previously mentioned. The subject property is currently unimproved without any significant structure. Hence, the Highest and Best Use as though vacant is applicable only to the subject site. `As though vacant'- It is my opinion the land's highest and best use as though vacant is for a small commercial building. A summary discussion on the four tests of highest and best use is offered on the following pages. OW die Four Tests of Yft hest d Best `iJse Generalcomments The subject land is well located in central Fayetteville entertainment district, with the immediate neighborhood established for commercial and residential uses. Its' current zoning allows for very dense development. The subject's shape and size is likely too small to construct a significant structure. However, city staff has informed the appraiser that a small building can be erected on the site. Nysicaay Possi6Ce: Basic factors affecting the potential for physically constructing improvements on a specific site include tract size, shape, topography, and soils. Further utility depends on utilities availability, roadway frontage, and tract depth in relation to width. Irregularly shaped parcels may cost more to develop and usually have less overall utility than a rectangular parcel. The sites terrain has a moderate slope to it which would also increase construction costs. The site offers inadequate size to comply with current design standards for most commercial buildings. Residential use of the site is considered doubtful due to the proximity to the railroad tracks and bars and restaurants, although, there is demand for housing in the neighborhood. I am unaware of any adverse soil conditions that might hinder full use of the lot. Considering these factors, prospective developers would not likely purchase this site for development. However, there is possibility a small scale project could be constructed on the property. Lepay Permissi6Ce: Land use options are further restricted by legal considerations, primarily determined by civil authorities, but also possible via private contract. The most obvious example is zoning. Other important factors include building codes and environmental regulations. Private, non -governmental examples include deed restrictions, subdivision covenants, easements, and long-term land leases. These legal factors limit current use &/or development options in the absence of `grand fathering', allowed `non- conforming use', or other usually rare privileges. The subject lies within Fayetteville city limits and zoned Main Street/Center. This zoning designation is planned for high -density use. Many options are therefore available according to the legality test, including development into commercial and residential uses. After discussions with the City's planning office it was determined that a small building could be constructed on the site under the Main Street/Center zoning classifications. It would be difficult but not impossible to place a building on the site under current zoning requirements for setbacks. The zoning code requires a setback from the street of 0' to 25' and 5' from the rear. There are also proposed drainage easements along the east and south boundary that will further decrease the building area of the site. The City's planning office provided the appraiser a drawing (See Attached) which indicates a building area of approximately 1,216 sq. ft. This number was updated to 1,232 sq. ft. by city staff. The subject's depth is 24.69' along its south boundary and 43.96' along its northern boundary. There is also ample street frontage under the subject's zoning classification. Hence, allowing a small area to construct a building. Furthermore, there are not any off street parking requirements for commercial use of the site. 27 Four Tests O �fighest e� Best Vse Continued EinanciaCfy Feasible: After limiting the array of uses by tests of physical possibility and legal permissibility, the appraiser then judges remaining possibilities according to financial considerations. A potential use is deemed financially feasible if that use promises a positive return on investment all things considered. Positive return is contingent upon potential net operating income matched with appropriate required rates of return for a particular use. Important factors affecting such return include operating expenses, debt satisfaction, and capital amortization. In my opinion, the subject's best financial return will be realized by a small commercial building. 911a. dmally Productive. `The Appraisal of Real Estate Tenth addition' (Appraisal Institute, Chicago) defines this concept as such: "Of the financially feasible uses, the use that produces the highest residual land value consistent with the rate of return warranted by the market for that use is the highest and best use." Among all potential uses remaining after consideration of the first three tests, a single specific use that results in the highest estimated residual land value is then determined. Most often, due to the durability of most real estate related improvements, prospective uses are narrowed according to a long -tern scenario. Thus, the highest and best use will be that use which maximizes the net operating income on a long -tern basis. Per Tenth addition: "The stream of benefits, or income, produced by the buildings reflects a carefully considered, and usually very specific, land use program." i believe the subject's best use is to develop the site with a small commercial building. 28 The 5Warket Data.Approach The Market Data Approach or Sales Comparison Approach is an attempt to measure the reactions of typical buyers and sellers in the market. In this approach a direct comparison is made between the property being appraised and comparable properties that have either sold recently, have received bonafide offers by prospective buyers, or are currently offered for sale. The value of the property being appraised is inferred from the selling prices, offers, and asking prices of the comparable properties. To be "comparable" a property need not be identical to the subject. The word "comparable" is used in its ordinary sense meaning something that is capable of being compared with or worthy of comparison. The appraiser assumes that a typical buyer in the market will not pay more for the subject property than it would cost to buy a comparable substitute property. The price a typical buyer is willing to pay is generally the result of an extensive searching process in which he is constantly comparing alternative properties. In the meantime, the typical seller is usually trying to obtain the highest possible price for his property based upon his knowledge of the market place. In applying the Market Data Approach, the appraiser takes the following steps: 1. Researches the market for available comparable properties in which actual sales, listings, or offerings has occurred. 2. Confirms the prices and bonafide nature of the data and qualifies the terms and motivating forces. 3. Compares the property being appraised with each of the comparable properties, under the general division of location, time, physical characteristics, and other economic factors. 4. Formulates an opinion of the market value of the property being appraised based upon the price of each comparable property. Pursuant to the appraisal of the subject property, I researched courthouse records, reviewed company files, accessed the Realtor's ® multi -list database, and interviewed knowledgeable market participants to locate recent market activity involving properties comparable or similar to the subject. Land sales selected for comparison with the subject property are included on the following pages. 29 3Karket Data,4roach -- Compara6Ce LandSafes 3fa� as ERolhny rt.:;; p. J a la mode, inc: W ETrake St - GrK.x of i q M�dde S, Lakeside =• V,Ooge Gultry Z v Oork n E Townsh,p St E Townstnp St as 8 Q >� e 2 - a = S W Pow, st FQINMW 2 65 W aedne St E Aar, St Mort 1 c—Wery 0 W Sycamore St - i Z w+,ttc rq Y v W Wedrn E - Comparable # 5 W North St North St 7 11--y i S 1 W Lafayette O 0.19 miles NY i u Subject ` 19 Dickson St e_VjFkI7,,. 0.45 rnilL E c - Irk•` w v.u�. S• 112 w it— S W Spring St J,al. , 3,. �Ehet King . - W 5th St E o „ H—twdte Rd M f� Bout ; 6.2 stod—at 1 re McNair .� 15th St ce Fy d 8R 6t o „ t E tg,h St 0 - Fayette — 0 Junetlon �� wcero sse,ga R„ i w z4 .. tk j E 15F W Skeftw, St s Y fayetterAr � Cauttry Club 30 0 E V,.rt•p Sr,y bn ae a ST 28008M1 S�Om 8 2018 E@tE8 20181fnow* Caarx T- The Ala et Data -Approach — Compara6fe Safes Data LandSafe #1 >t W Pr�ai f• R .'VISO ►NFNID 1. t Grantor. Grantee: Date of Safe: Property Location: LegafOescription: Zoning Category: Size: Improvements: "rted dice: (Data Source: Wfmarks: Indicated Price: s' W Prairie St W Prairie St W Prairie `„ti' < XPRAIRIFNIiNJKJI ` M: C y FPS[ G1 1. � V � World Domination, LLC PrairieMonkeys, LLC 04/21 /2017 495 W Prairie St, Fayetteville, AR A part of Lot 22 of Block 14 in Ferguson's Addition in Fayetteville, AR MSC (Main Street/Central) .21 acres or 9,148 sq. ft. None of Contributory Value $157,529 Washington County Records- Parcel #765-05508-000, Deed 2017-11826 Small, irregular shaped lot on W. Prairie St. one half block west of S. School Ave.. Very shallow lot. Recent sale. Multi -Family residential units are under construction at the time of this appraisal. $17.22/Square Foot 31 Zoning Category. Size. Improvements• imported ft ce: Data Source. 1?fmarks: Indicated Price: Land Safe #2 Grantor. David L. & Ronda L. Chuoke Grantee. Jane Hunt Meade Date of Safe. 05/ 19/2017 Property Location: 322 W. Meadow, Fayetteville, AR LegafDescription: A part of Block 10 as designated on the original plat of the Town (now City) of Fayetteville, Washington County, AR DG (Downtown General) .13 acres or 5,500 sq. ft. None of Contributory Value $225,000 Washington County Records- Parcel #765-01770-000, Deed Book 2017- 15559, MLS# 1047994 Small lot on W. Meadow between N. School and N. Locust. Also has frontage on Shipley Alley. Recent sale in downtown Fayetteville. $40.90/Square Foot 32 Land Safe #3 Grantor. Cravens & Company, Inc. Grantee: JMSH, LLC (Date of Safe. 09/ 14/2016 (Property Location: W. Spring St., Fayetteville, AR LegafDescription: Part of Lot #7 Block 3, of Fayetteville Original Zoning Category. MSC (Main Street/ Center) Size .35 acres or 15,386 sq. ft. Improvements: None of contributory value &ported Price: $325,000 (Data Source: Washington County Records - Parcel # 765-01677-000 & 765-01678-000, Deed Book 2016-26894, & MLS# 1021953 Rfmarks: Average size tract for downtown area. The tract is located on the north side of Spring St. between N. Church and N. Block Ave. in downtown Fayetteville. New townhouse style condominiums have been recently built on this property. Indcated4 ce: $21.12/Square Foot 33 Land Safe #4 ' " Grantor. Home Traders, LLC Grantee. RPH, LLC (Date of Safe: 08/ 19/2014 (Property Location: E. Spring Street, Fayetteville, AR Lega(Description: Lot 001 of Fayetteville Original Zoning Category: MSC (Main Street Center) Site Qualities. .13 A or 5,500 sq. ft. Improvements: None of contributory value ftortedT ce. $100,000 Data Source: Washington County Records Parcel #765-01641-000, Deed 2014-21275 Remarks: This lot is located on the north side of Spring St. and approximately one half block to the west of N.College Ave.. The shape is rectangular and the topography is level and ideal for construction. A new office building has been built on the site. Indicated Price: $18.18/Square Foot 34 Zoning Category. Size. Improvements: (ported dice: Data Source: &marks - Indicated Price: LandSare #S Grantor. Adam Russell Grantee. Triangle Builders Supply, Inc. Date of Safe: 09/ 19/2016 Property Location: North Street and Frisco Ave., Fayetteville, AR LegafDescrlption: Part of the E'/2 of the SW '/4 of Section 9, T-16N, R-30W, Washington County, AR RMF-24(Residential Multi -family) 2.152 acres or 93,741.12 sq. ft. None $150,000 Washington County Records, Parcel #765-14007-005, Deed 2016-29489, and MLS# 1000176 Sale of vacant land along the railroad right of way north of the subject between Prospect St. and North St.. This tract had previously been part of the BNSF Railway Company R-O-W. $1.60/Square Foot 35 LandSafe #6 Grantor. BNSF Railway Company Grantee: City of Fayetteville Date of Safe. 07/23/2008 (Property Location: Frisco Trail and N. Gregg Ave., between W. Lafayette St. and W. Maple St. L egaf (Desaip tion: A part of the E ''/z, SW '/4 of Sec. 9, and pt. of the N W '/4, NE '/4, and the NE 'A of the NW '/4 of Section 16, all in Township 16 north, Range 30 West. Zoning Category: DG (Downtown General) Size: 6 acres or 261,360 sq. ft. Improvements: None of Contributory Value "rted Price. $73,180 Data Source: Washington County Records- Parcel #765-12875-020, Deed 2008-27512 Rfmarks: this Sale involved the purchase of railroad right of way along both sides of the railroad tracks between W. Lafayette St. and W. Maple St.. Older sale. The City acquired the land for the Scull Creek Trail. Indicated Prtce: $.28/Square Foot 36 Zoning Category: Size: Improvements. (ported Price: (Data Source: &marks: Indicated nice: Land Safe #7 Grantor. Billy Wayne Batson Grantee. Trailside Townhomes, LLC Date of Sale: 08/29/ 17 (Property Location: 15 S. West Ave, Fayetteville, AR LegafDescription: A part of Lot 2 of Block 22 in the Original Plat of the Town of Fayetteville, Washington County, AR MSC (Main Street/Central) .37 acres or 16,224 sq. ft. None of Contributory Value $250,000 Washington County Records- Parcel #765-01891-000, Deed 2017-26781, and MLS# 1019080 Recent sale of similarly zoned property. Structure on property was razed by buyer. A new multi -family project is underway on the site. $15.41 /Square Foot 37 Land Safe #8 mal III Grantor Arkansas Missouri Railroad Company Grantee: William & Betty Harrison Date of Safe: 10/ 10/02 Troperty Location: Dickson St, Fayetteville, AR Legaf(Description: A part of Lot 7 as designated upon the Original Plat of the Town of Fayetteville, Washington County, AR Zoning Category: MSC (Main Street/Central) Size: .0775 acres or 3,378 sq. ft. Improvements: None of Contributory Value ftorted Price: $24,000 Data Source. Washington County Records, Deed 2002-154073 Womarks: Old sale of similarly zoned property. This was railroad right of way adjacent to George's Majestic Lounge acquired by the then owners. It has since been improved with an outdoor patio area. Indicated nice: $7.10/Square Foot 38 Ana1j_s_u O�ampara6lesAndConcfiuwn Q[Landyahm In my opinion, there are an adequate number of comparables available to render a reliable opinion of the subject's underlying land value according to its' highest and best use. I offer a variety of verified transactions considered representative of recent market activity, while retaining additional examples in my files. The comparables are summarized as follows: Sale Date Tract Size Land -Price $/SF Comparability 1 04/21 /17 9,148 SF $157,529 $17.22 Superior 2 05/19/17 5,500 SF $225,000 $40.90 Superior 3 09/14/16 15,386 SF $325,000 $21.12 Superior 4 08/19/14 5,500 SF $100,000 $18.18 Superior 5 09/19/16 93,741 SF $150,000 $1.60 Larger/Similar 6 07/23/08 261,360 SF $73,180 $.28 Larger/Similar 7 08/29/17 16,224 SF $250,000 $15.41 Superior 8 10/10/02 3,378 SF $24,000 $7.10 Similar All comparables are located in close proximity, with most considered having similar immediate Downtown neighborhood influence. Appreciation over time within the subject's land market niche is still prevalent. But, there are fewer top -end prices paid compared to the more speculative time of 2004-2007. However, some recent sales are approaching the prices paid in that era. The researched sales indicate an unadjusted price range of $.28 - $40.90. This is a wide range in which to comfortably place the subject. Primary differences are attributable to location relative to the Downtown grid, total size, buildability of the tract, date of sale, and overall potential. The upper end of the value range are of good buildable sites, many of which have been developed into multi- story residential townhomes. The lower end of the range are of tracts which were formally railroad right of way along the railroad tracks. These tracts are irregular shaped and narrow in width, similar to the subject. Generally speaking, per square foot values decline as the size of the tract increases. This rule of thumb does not always hold true, though, especially when considering the unique requirements of urbanized areas. Some tracts suffer discounts if they are too small to satisfy zoning ordinances (e.g. parking). In addition, owing to the current trend of condominium/mixed-use projects prevalent downtown, tracts too small for development into multi -story structures do not have nearly the same desirability as the City grows upward. 39 The appraiser has prepared a sales adjustment grid on the following pages. This grid shows the adjustment process in detail and is used to render a value estimate of the subject property. It is my opinion the subject's land would fall near the mid to lower area of the stated range. Therefore, based upon the above recited sales and analysis thereof, and after adjustments are made for differences in time, size, location, visibility, land qualities, and other economic factors, it is my considered opinion the subject's land value, as of February 15, 2018, is as follows: 1,689t SF @ $10.00/SF = $16,890 Say $17,000 40 Powerhouse Ave. Lot Fayetteville, AR Appx. 1,689 sq.ft. PRICE DATA PURCHASE PRICE CONCESSIONS/TERMS Adjustment PRICE PER Square Foot DATE OF SALE Adjustment ADJUSTED PRICE LOCATION Adjustment SIZE (sq.ft.) Adjustment TOPO/SHAPE Adjustment UTILITIES Adjustment IMPROVEMENTS Adjustment ZONING Adjustment FLOOD HAZARD Adjustment VISIBILITY/ACCESS Adjustment NET ADJUSTMENT INDICATED PRICE SUBJECT N.Powerhouse Ave Fayetteville NA Cash to Seller Mar-18 NA Downtown Fay. 1,689 GentlySlope/Irreg. Average NA MSC None Fair/Avg. COMPARABLE LAND SALES ADJUSTMENT GRID COMP #1 COM P #2 COMP #3 W. Prairie St. W.Meadow St. W. Spring St. Fayetteville Fayetteville Fayetteville $ 157,529 $ 225.000 $ 325.000 Cash/None Cash/None Cash/None $ 17.22 $ 40.91 $ 21.12 Apr-17 May-17 Sep-16 $0.86 $2.05 $1.58 $ 18.08 $ 42.95 $ 22.71 Inferior Similar Superior $ 1.81 $ - $ - 9,148 5,500 15,386 $ (0.90) $ (2.15) $ (1.14) Level/Irregular GentleSlope/Rect. Level/Rectangular ($6.89) ($20.45) ($10.56) Similar Similar Similar $ $0.00 $ None None None MSC DG MSC None None None Avg./Avg. Avg./Avg. Avg./Avg. $ (1.72) $ (4.09) $ (2.11) $ (7.71) $ (26.69) $ (13.81) $ 10.38 $ 16.26 $ 8.90 Mean $ 8.99 Weighted Average S 10.03 Say $10.00 /sq.ft. :t Indicated Value S16,890 Say S17,000 COMP #4 COMP #5 COMP #6 COMP #7 COMP #8 North St. & Frisco E.Sping St. Av N.Gregg Ave. S.West Ave. Dickson St. Fayetteville Fayetteville Fayetteville Fayetteville Fayetteville $ 100,000 $ 150.000 $ 73,180 $ 250,000 $ 24,000 Owner Cash/None Cash/None Cash/None Cash/None Finance/None $ 1&18 $ 1.60 $ 0.28 $ 15.41 $ 7.10 Aug-14 Mar-16 Jul-08 Aug-17 Oct-02 $2.73 $0.16 $0.08 $0.77 $3.55 $ 20.91 $ L76 $ 0.36 $ 16.18 $ 10.66 Similar Similar Similar Similar Similar 5,500 93,741 261,360 16,224 3,378 $ (1.05) $ 0.44 $ 1.09 $ (0.81) $ Gentle GentSlpe/Rectangula Level/Rectangular Slope/Irregular Steep/Irregular r Level/Irregular ($9.09) $0.00 $0.21 ($1.54) $0.00 Similar Similar Similar Similar Similar None None None Razed None MSC RMF -24 DG MSC MSC $ $ 0.30 $ $ $ None None None None None $ $ $ $ $ Fair/Avg. Fair/Fair Fair/Fair Avg./Avg. Good/Avg. $ (0.91) $ 0.08 $ 0.01 $ (1.54) $ (0.71) $ (11.05) $ 0.82 $ 1.32 $ (3.89) $ (0.71) $ 9.86 $ 2.58 $ 1.68 $ 12.29 $ 9.95 42 Correlation, Analysis, and Conclusion The Market Data Approach exclusively was used to estimate the value of the subject land. The Cost & Income Approaches were not considered to be applicable under the scope of this appraisal. The Market Data Approach resulted in the following indicated value: The 3Karket Data 4pproach $ 17,000 It is the appraiser's opinion that an adequate amount of Market Data was available to obtain a reliable value estimate for the subject land as if vacant. A sufficient amount of sales activity has occurred in the general vicinity of the subject property. The sales analyzed and included in this report are considered reliable and do indicate the prices being paid for commercial/residential land in the Downtown Fayetteville area. Due to the small size of the subject it was difficult to find truly comparable sales. The appraiser has analyzed recent sales of similar zoned land in the subject area which are suitable for development of multi -story residential/commercial buildings. These are sales are considered superior to the subject property. Furthermore, the appraiser has analyzed sales of land along the railroad right of way which reflect a much lower value than the aforementioned sales. It is the appraiser's opinion that the subject's value should fall somewhere in between the stated value range. The appraiser has assumed that a small building can be built on the subject property. Therefore, based upon the data collected and analyzed within this report and the preceding discussion, it is the considered opinion of this appraiser that the Fair Market Value of the subject property as of February 15, 2018 is as follows. $ 17,000 4 Certi fuate of Appraiser I hereby certify, that to the best of my knowledge and belief, that the statements of fact contained in this report are true and correct; that the reported analysis, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are my personal, unbiased professional analyses, opinions and conclusions; that I have no present or prospective interest in the property that is the subject of this report, and I have no interest or bias with respect to the property that is the subject of this report or to the parties involved with this assignment; that my engagement in this assignment was not contingent upon developing or reporting predetermined results; that my compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. I hereby certify, that my analyses, opinions, and conclusions were developed, and this report has been prepared in conformity with requirements of the code of Professional Ethics and the Standards of Professional practice of the National Association of Realtors; that the use of this report is subject to the requirements of the National Association of Realtors relating to review by its duly authorized representatives; that all signatories of this report have physically inspected the subject property and are familiar with the comparables stated within. The appraiser further certifies that the analyses, opinions and conclusions were developed, and this report was prepared in conformity with the Uniform Standards of Professional Appraisal Practice ("USPAP"), except that the Departure Provision of the USPAP does not apply. In the previous sections of this report, the appraiser has analyzed the relevant facts and applied the appropriate appraisal processes to the subject property. It is the considered opinion of this appraiser that the Market Value of the subject property as of the effective date of February 15, 2018 is: SEVENTEEN THOUSAND DOLLARS ($17,000) Respectfully Submitted, �, S' � f� ' ��arxKikimarc+'�"d��' Mark E. Risk, GAA State Certified General Appraiser #0202 44 Section V-Addendum 45 Zoning Information Fayetteville. AR Code of Ordinances Page I of 4 161.27 - Main Street/Center (A) Purpose. A greater range of uses is expected and encouraged in the Main Street/Center. The Center is more spatially compact and is more likely to have some attached buildings than Downtown General or Neighborhood Conservation. Multi -story buildings in the Center are well -suited to accommodate a mix of uses, such as apartments or offices above shops. Lofts, live/work units, and buildings designed for changing uses over time are appropriate for the Main StreeUCenter. The Center is within walking distance of the surrounding, primarily residential areas. For the purposes of Chapter 96: Noise Control, the Main Street/Center district is a commercial zone. (6) Uses. (1) Permitted uses. Unit 1 City-wide uses by right l Unit 4 Cultural and recreational facilities Unit 5 Government facilities ` Unit 8 Single-family dwellings Unit 9 Two-family dwellings Unit 10 f Three (3) and four (4) family dwellings Unit 13 Eating places Unit 14 Hotel, motel, and amusement facilities j Unit 16 Shopping goods Unit 17 Transportation trades and services Unit 19 Commercial recreation, small sites Unit 24 Home occupations about:blank 46 2/15/20I8 Fayetteville, AR Code of Ordinances Page 2 of 4 Unit 25 Offices, studios, and related services Multi -family dwellings Liquor stores Accessory dwellings Unit 26 Unit 34 Unit 41 Unit 44 Cluster Housing Development Unit 45 Small scale production Note: Any combination of above uses is permitted upon any lot within this zone. Conditional uses shall need approval when combined with pre -approved uses. (2) Conditional Uses Unit 2 I City-wide uses by conditional use permit i Unit 3 Public protection and utility facilities Unit 18 Gasoline service stations and drive-in/drive through restaurants 1 Unit 28 Center for collecting recyclable materials [Unit 29 Dance halls Unit 35 Outdoor music establishments Unit 36 Wireless communication facilities Unit 40 Sidewalk Cafes Unit 42 Clean technologies about:blank 47 2/15/2018 Favetteville. AR Code of Ordinances (C) Density. None. (D) BulkandAreaRegulations. (1) Lot Width Minimum. Dwelling (all unit types) , 18 feet (2) Lot Area Minimum. None. (E) Setback Regulations. Page 3 of 4 Front A build -to zone that is located between the front property line and a line 25 feet from the front property line. Side i None Rear 15 feet Rear, from center line of an alley 12 feet (F) Minimum Buildable Street Frontage. 75% of lot width. (G) Building Height Regulations. Building Height Maximum 5 stories/7 stories* about:blank 48 2'15/2018 Fayetteville, AR Code of Ordinances Page 4 of 4 * A building or a portion of a building that is located between 0 and 15 feet from the front property line or any master street plan right-of-way line shall have a maximum height of five (5) stories. A building or a portion of a building that is located greater than 15 feet from the master street plan right-of-way line shall have a maximum height of seven (7) stories. (Ord. No. 5028, 6-19-07; Ord. No. 5029, 6-19-07; Ord. No. 5042, 8-07-07; Ord. No. 5195, 11-6-08; Ord. No. 5312, 4-20-10; Ord. No. 5339, 8-3-10; Ord. No. 5462, 12-6-11; Ord. No. 5592, 6-18-13; Ord. No. 5664, 2-18- 14; Ord. No. 5735, 1-20-15; Ord. No. 5800. § 1(Exh. A), 10-6-15; Ord. No. 5921 . §1, 11-1-16; Ord. No. 5945 . §§ 5, 7-9, 1-17-17; Ord. No. 6015, §1(Exh. A), 11-21-17) about:blank 49 2/15/2018 X,sue Mark E. Risk, GAA POSITION University of Arkansas— Adjunct Instructor— Real Estate PRESIDENT TREC, INC. dba The Real Estate Consultants 118 N East Ave.. / P. O. Box 747 Fayetteville, Ar. 72702 (479)442-0762 STATE State of Arkansas — #CG-0202 CERTIFIED GENERAL APPRAISER LICENSED REAL State of Arkansas- Principal Broker #00005933 ESTATE BROKER EDUCATION University of Arkansas, MBA 1979 University of Arkansas, BSBA 1977 Major: Real Estate and Finance American Institute of Appraisers Real Estate Appraisal Principles Basic Valuation Procedures Standards of Professional Practice Capitalization Theory and Techniques (U of A) Marshall & Swift Building Cost Seminar Easement Valuation -- International Right of Way Assoc. GRI Course 306 -- Arkansas Realtors Association NAIFA Courses -- Standards of Professional Practice -- Reviewing the URAR Form -- The New URAR Report -- NAIFA, Springdale, Ar. Sales Comparison Approach -- Arkansas Realtors Assoc. Environmental Site Assessment -- Lincoln Graduate Center HUD/FHA Appraiser Training Seminar -- Little Rock HUD Office ASB Information Meeting (revisions to USPAP) -- Dallas, TX National Association of Realtors USPAP Update Course Instructors' Training Institute (ITI) -- San Antonio, TX Timberland Appraisal — Fayetteville, AR Evaluating Residential Construction -Springdale, Ar. Federal Regulation of Real Estate Appraisal -Springdale, Ar. Recerts, Updates and You -Bentonville, Ar. USPAP 2006 Update -Springdale, Ar. PROFESSIONAL National Association of Realtors (NAR) -- Appraisal Section MEMBERSHIPS Arkansas Realtor's Association Metro Area Board of Realtors PROFESSIONAL General Accredited Appraiser (GAA) - National Association DESIGNATIONS of Realtors c STATE BOARDS Appointed to the Appraiser's Licensing and Certification Board by Governor Bill Clinton in January 1992. Reappointed by Governor Jim Guy Tucker in 1994. Term Expired in January of 1997. BOARD OF DIRECTORS Served on Board of Directors of the UARK Federal Credit Union NATIONAL National Association of Realtors Appraisal Section COMMITTEES Subcommittee 1995-1998 Chair - 1998 Appraisal Forum 1995 Appraisal Committee 1997-98; 2000-2006 Real Estate Consultants 1981-present Actively appraising real estate in Northwest Arkansas since 1979 . Associated with Jim Sullivan (Sullivan Agency), 1979 to 1989. Associated with Tom Reed (Reed & Associates), 1981 to 1985. Employed by Keith S. Schultz (Associated Appraisers) 1980-81. TEACHING Real Estate Instructor at the University of Arkansas (1981 to date) Courses taught include: Real Estate Principles, Investments & Appraisal, and Finance Continuing Education Seminars: Basic Steps to Residential Appraisal, Environmental Concerns, Property Management PUBLICATIONS "Recreational Land Values and Trends in Northwest Arkansas", Arkansas Business and Economic Review, Vol. 16, No. 1, 1983; Picked up for reprint by the International Association of Assessors CLIENTS SERVED *LENDING 66 Federal Credit Union INSTITUTIONS American Airlines Credit Union Arkansas National Bank Arvest Bank UARK Federal Credit Union Bank of Arkansas Bank of Salem Bank of Eureka Springs Bank of Oklahoma Chambers Bank First Security Bank of NW Arkansas Community First Bank First State Bank Great Southern Bank First Federal Bank First Financial Bank 51 *LENDING INSTITUTIONS (Cont'd.) Metropolitan National Bank Simmons First Bank Signature Bank Liberty Bank of Arkansas Legacy National Bank Bank of Fayetteville Regions Bank -Dallas Telco Credit Union Bank of America First National Bank of St. Louis Bank of Jackson Hole *MORTGAGE Ameriquest Mortgage COMPANIES Arvest Mortgage Company Broyles Mortgage Company Federal National Mortgage Association (FANNIE MAE) James River Mortgage Company Lomas & Nettleton Norwest Mortgage PHH Home Mortgage Pulaski Mortgage Company Southern Mortgage U.S. Mortgage Lending Tree Ditech.com DEVELOPERS Dream Structures Copher Quality Homes Larry Carter Development Corporation Castle Development East Avenue Development, LLC Dr. J. B. Hays Houses, Inc. C & K Construction Riggins Construction RELOCATION Corporate Relocation COMPANIES Sirva Relocation Cendant Mobility Coldwell Banker Relocation Commonwealth Relocation Services Equitable Relocation Mgmt. Corporation Executive Relocation Forward Mobility Home Equity Corporation Prudential Relocation Management Re/Max Relocation Relocation Funding Corporation Relocation Resources Weichert Relocation 52 MISCELLANEOUS Anheuser Busch Ball Corporation Bell International Busch Skil Company Cargill Corporation Cannon Express Cummulus Broadcasting Central United Methodist Church City Of Eureka Springs City Of Fayetteville City Of Springdale City Of Rogers City Of Johnson City Of Bentonville Arkansas Department of Parks & Recreation Arkansas State Highway & Transportation Department Nature Conservancy SWEPCO Bentonville Airport Commission Colgate Palmolive CTS Corporation Deere Credit Services Federal Deposit Insurance Corp. (FDIC) Fulbright Enterprises Gates Rubber Company General Motors Gerald Carr (Retired Astronaut) Kraft, Inc. Love Box Company MGIC Michelin Tire Company Ozarks Electric Cooperative Phizer, Inc. Procter & Gamble Record Data, Inc. Resolution Trust Corporation Roadway Express Salvation Army Sioux Transportation Tyson Foods, Inc. Many Other Attorneys, Doctors, And Individuals COURT Benton County Circuit Court TESTIMONY Carroll County Circuit Court U.S. Federal Bankruptcy Court Washington County Circuit Court Crawford County Circuit Court GEOGRAPHIC Northwest Arkansas AREA SERVED Washington, Benton, Carroll & Madison Counties 53 August 20, 2020 City of Fayetteville 113 W. Mountain Street Fayetteville, AR 72701 Mayor Jordan and City Council, I received notice the city of Fayetteville plans to sell 0.039 acres of municipally owned land (tract A of parcel 765-01745-001). This same land was put up for sale in 2018 by the city under silent bid. I won the bid with an amount higher than the $17,000 now proposed. However, at the time, the City Council changed their mind and decided to table the issue. Resulting in the land not being sold. Today, once again, the land is up for sale and I am still interested in the property. I would like to purchase the property and would preserve all the mature trees on the property. Knowing that I won the previous bid and I am willing to pay more than the $17,000 proposed, I feel I should have the right to make an offer on the property. The silent bid process seems to be the fairest option. Prior to the bid process, I feel the City should first confirm they indeed want to sell the property. I do not believe the interested parties should be required to go through this process if the City is not actually interested in selling the property. d 611 West Dickson Street Fayetteville, AR 72701 D DAvis, BUTT, TAYLOR & CLARKPLC * COOIDNEY G. CLARR K* NSTANC G. CLARK* WM. JACKSON BUTT 11 DON A. TAYLOR WILLIAM F. CLARK WWW.DBTCFIRM.CONI JACOB T. NEWCOMB * Of Counsel WRITER'S E-MAIL ADDRESS: JBUTT@DBTCFIRM.COM August 28, 2020 RE: Resolution for sale of .039 acres to Brian and Dgy Crown Ella Email: citXclerk(a�layetteville-ar.gov Mayor Lioneld Jordan and Fayetteville City Council Members Via email through Fayetteville City Clerk, Kara Paxton Dear Mayor Jordan and Council: This letter addresses the Resolution scheduled for consideration by the Fayetteville City Council on September 1, 2020, regarding the sale of .039 acres of municipally owned land to Brian and Day Crowne for $17,000. This letter is behalf of my clients, Craig and Laura Underwood, who own Underwood's Jewelers on Dickson Street as well as interests in the building leased to Powerhouse Seafood, which are both proximate to this tract. The history of this sale is relevant. In November, 2017, Brian Crown requested through Council Member Justin Tenant a resolution to sell all of the larger tract of which this instant tract is a part, which lies on the west side of the railroad tracks which bound the Walton Center parking lot and lies on the east side of the alley that serves the Powerhouse Seafood Restaurant from Dickson Street. When that resolution was presented to the Council in 2017, it was amended to sell less than the entire tract, and to sell it by competitive bidding - it being the concern of Council member Petty that the property may well be worth more than Crown's offer. It was also of concern that its value may have exceeded the $20,000 required by statute for competitive bidding. The resulting winning bid was submitted by Craig Underwood at $25,203 which more than doubled Crowne's initial offer. Then, over Underwood's objection, the Council voted unanimously not to accept the bid nor sell the property because of the existence of trees on the tract and the uncertainty of its future in relation to the pending Cultural Arts Plaza. There is now pending before the Board for consideration its September 1, 2020 meeting, Councilman Petty's Resolution to privately sell to Crowne for $17,000 the exact, same tract which received two years ago a $25,203 public bid. As noted it was Petty who in 2017 successfully moved that the property be sold for competitive bids, that resulted in Underwood's $25,203 bid. Underwood has written a letter to the Mayor and Council, noting that he is prepared to bid more than the $17,000 offer, on terms that would preserve the mature trees. DAvls, BUTT, TAYLOR & CLARK, PLC 75 N. EAST STREET, SUITE #402 ♦ FAYETTEVILLE, AR 72701 ♦ P.O. BOX 1224 ♦ FAYETTEVILLE, AR 72702 PH 479.521.7600 ♦ FAX 479.521.7661 Mayor and Council Page 2 On the face of it, it makes no sense for the City, by private sale without bids, to sell property for $17,000 for which it had a firm offer (which Underwood remains prepared to equal or exceed) for $25,203; on the face of it, it smacks of undue favoritism. The impetus for this does not come from City staff, but rather solely Council member Petty. In justifying this counterintuitive proposal at the Agenda setting session Petty noted these reasons: He was approached privately by Crowne with this offer. 2. It is justified by a current appraisal for $17,000. 3. Petty's decision was on the basis of helping a local business and Fayetteville's tourism adjust to Covid. 4. Getting maybe $10,000 less for the property than Underwood (or someone else at public bid may offer) is not significant in light of these concerns. The Council should take a less myopic, and a more politically comprehensive view of the resolution than is presented. First, in response to Council member Petty's justifications: 1. He was approached privately by Crowne with this offer: This offer was not generated by, processed through, nor approved by City Staff. Crown caught a friendly ear and now the matter without any further vetting is directly before the Council. This compels the Council to thoroughly scrutinize what appears to be very inapt political favoritism by a Council member. 2. It is justified by a current appraisal for $17,000: The 53 page appraisal was attached to materials provided at the Agenda setting session. It asserts that it used exclusively the "Market Data" or comparable sales approach. This requires the appraiser to find similar properties that have recently sold, and then using a combination of objective and subjective standards, adjust those prices which were obtained at different times for properties that are different in their size, location and physical characteristics from the subject property, to the tract under consideration to estimate its value. Interestingly, the appraisal completely ignored the firm, written offer on this exact property, obtained only two years earlier by public bid for $25,203. This is like estimating the size of the elephant in the room by measuring the room, instead of the elephant itself, and with all due respect to the appraiser for following standards, is a completely illogical conclusion under the circumstances and merely a guise to accept a below -market offer. 3. Petty's decision was on the basis of helping a local business and Fayetteville's tourism adjust to Covid: Practically every business in Fayetteville relates somehow to the tourist trade, and has been affected by Covid. Why the Crowns and George's Lounge are picked out for special favoritism in these hard times for all is a real concern. Underwood's has been in business for 63 years on Dickson Street. It is a material tourist destination for the tens of thousands of U. of A. graduates who return regularly to their alma mater where they may have bought their first piece of jewelry there in the last half century. Underwood's has duly and fully paid a ton of city taxes in the last 63 years (and if not wiped out by Covid will continue to do so); employs a number of Fayetteville citizens whose employment is critical to each of them, and yes, Underwood's has been hit hard by Covid. In addition to the jewelry business, the Underwood's building houses two other tenants, with Mayor and Council Page 3 employees who, yes, have been hit hard by Covid. The Underwood family's tenant, Powerhouse Seafood has been hit hard by Covid. So who among all of these key parts of Fayetteville's economy, tourism and quality of life, truly has the greatest need? And more importantly, should the City of Fayetteville be in a position of making that subjective decision by singling out a single business for favorable treatment? ...or should it simply get the best price it can by public bid for its properties, so it has the funds to serve all of its citizens, most of whom have been hard hit by Covid? 4. Getting maybe $10,000 less for the property than Underwood (or someone else at public bid may offer) is not significant in light of these concerns: Council member Petty has reversed course on this, because in 2017, he rejected the Resolution from Council member Tenant to sell to the Crown's, because Petty thought it was important to get the highest price. At the Agenda setting session, City Attorney Kit Williams advised that the state statute requiring bids for property worth more than $20,000 was no longer in force, and opined that other factors could be considered than actual price, when the bid prices were not far apart. No one knows what Underwood may bid if given a chance, or what Crown may bid if he realizes he can't privately buy the building at a bargain price, or whether a yet unknown 3rd party may show up and outbid them all. But even as it stands, Crown's offer is not "nominally less" than Underwood's, it is a full 1/3 less. Council Member Petty opined at the Agenda session that 110,000" lost from not bidding it didn't give him concern ... how many face masks, bottles of hand sanitizer, or meals for people unemployed by Covid can the City support from $10,000? That is not a nominal amount. There are other concerns the City Council should seriously consider, if it proceeds to subjectively consider which long-standing, tax -paying, tourist industry -supporting, Covid threatened business should get the break here: 1. Parking: Underwood's, like all retail businesses, needs ample, proximate parking to serve its customers and compete in its trade. Underwood's has limited private parking, inadequate in high volume times for its customers. The annoyance of City imposed paid parking, a necessary evil for Dickson street businesses, impacts Underwood's. The monies raised from this necessary nuisance are used to build parking facilities to serve Dickson Street, which are not proximate to Underwood's. Underwood's is paying the City's price to serve all of Dickson street, with very little direct benefit. Underwood's needs the questioned space for parking to enhance the chances that its existing and potential customers will be encouraged to come to the store, because they know Underwood's will provide parking for them without the hassle of finding pocket change, remembering space numbers, and dealing with meter autopay systems they aren't accustomed to. Powerhouse, like Underwood's, has its own parking, but at high volume times needs more. This space could likewise serve Powerhouse's employee and customer parking needs so they aren't shifted to the annoyance of Dickson Street parking in high volume times, causing Powerhouse to lose patrons and business. 2. Contributions: The Underwoods are currently leasing to the City for free, 40 acres of land on the back side of Mount Sequoyah which augment the city bike trails in and around that area by several additional miles of trails for public use. The Underwoods spent a fair amount of unreimbursed time and money properly structuring this with the Fayetteville Parks Department to substantially extend the reach of Fayetteville's park resources for its bicycling residents. In addition, the Underwoods are presently well along in the process of contributing about 65 acres of parkland to the City on its west side. While in conjunction with proposed development, 53 acres are over and above the 12 acres required by the development ordinances. If the City is Mayor and Council Page 4 going to specially "scratch the back" of one of its citizens, it is perhaps the Underwoods. Please understand the Underwoods are not asking for special favor —only fair treatment and they not be the victim of special favors given to other citizens. 3. How big a difference in price, between a private sale and a public sale, justifies a legal challenge is yet to be determined. However, a public bid of the property, with terms to preserve the trees, is not legally challengeable. It is a safe, sure, alternative which also guarantees the highest price for selling public land. Thank you for considering all circumstances relevant to this Resolution before proceeding. Sincerely, DA WJB/ah cc: Kit Williams, City Attorney (via email: kwilliams@fayetteville-ar.gov) Mr. and Mrs. Craig Underwood (via email: Craig@underwoods.com) Ms. Susan Norton, Chief of Staff (via email: snorton@fayetteville-ar.gov) Submit Public Comment This page is provided for efficient submission of public comment for City Council and Planning Commission meetings. All submissions must be directly related to a specific agenda item for the next meeting. Please ensure your comments conform to the Rules of Order and Procedure. RULES OF ORDER AND PROCEDURE OF THE FAYETTEVILLE CITY COUNCIL Full Name* Ted Belden Address or Ward* Address Ward Locate Your Ward Number Address* 504 East Lafayette Phone Number 5015803762 Email TedBelden@aol.com Meeting Body* City Council Agenda Item 2020-0706 Brian Crowne purchase fo city land Number/Subject , Locate City Council Agenda Item Locate Planning Commission Agenda Item Position In Favor Comments I own The Dickson. west of the potential land purchase. This small site can be used to improve Georges Majestic Lounge to the benefit of the city by proving outdoor entertainment options.the area. I believe Brian will make good use of the property that the city does not utilize. Ted Belden Attachments Section from the RULES OF ORDER AND PROCEDURE OF THE FAYETTEVILLE CITY COUNCIL Adopted 01/07/2020 by Resolution #01-20 & Amended 06/16/2020 by Resolution #170-20: Public Comments. I'tlhllC conumnt at a ('ilN ( uuncil mectinu ,hull he allowed lot- all mcmhers of the audience \0o havc ;i;=ncd up prior to the he inning ol'thr i!cnda item thcv �v i h to addre,: hcin , opcncd tor Puhlic comment. Speakers Shull he limited to a mayinnun 01'11VC i51 minute, to he broken into,ezmcnt, of three and mo minute,. AmCndnICnt, mug reeei- Puhlic aunnunl> onl% if apprMCd by the ( itv Council by unaninu01-1s Con,cnt ur majori(N WtC. It Puhlic comment i, allowed lilt an amendment. speaker, will only he allowed to,peak for three Of minute,. I he City ( uunCil nut% ilkm hoth a ,pcaker additional time and Lill un,iLncd-up person to ,peak by Lill unin)Ous Cunscnt m' mxjorit\ v otC Courtesy and Respect. All members of the public. all city staff and elected officials shall accord the utmost courtesy and respect to each other at all times. All shall refrain from rude or derogatory remarks. reflections as to integrity, abusive comments and statements about motives or personalities. Any member of the public who violates these standards shall be ruled out of order by the Mayor. must immediately cease speaking and shall leave the podium. Enter the text you want this field to display Email TedBelden@aol.com i-CA OFFICE OF THE CITY ATTORNEY DEPARTMENTAL CORRESPONDENCE Kit Williams City Attorney TO: Mayor Jordan Blake Pennington City Council Assistant Cit}, Attorney Jodi Batker CC: Susan Norton, Chief of Staff Paralegal FROM: Kit Williams, City Attorney DATE: September 8, 2020 RE: Possible Lease for .038 parcel near George's Council Member Sarah Marsh made an excellent suggestion when she proposed that the City might offer a Lease rather than an outright sale of this small 1,689 square foot parcel. This is a very important and sensitive location overlooking the future Cultural Arts Plaza or Civic Plaza. (I do not know if the City Council has given this $12 Million Plaza an official name yet.) A lease rather than a sale could give the City Council the opportunity for a "dry run' to see whether an outdoor stage built on this parcel would be an enhancement for the Plaza or a detriment to the Plaza and neighbors. If the first year of operation presented problems or objections from neighbors, it is very simple for the City Council to pass a Resolution to not renew the lease and end this use. Trying to regulate a business that owned this parcel to address the problems and complaints would be legally difficult and possibly ineffective. George's Majestic Lounge was the central player in the outdoor music battles of the mid 90's in Fayetteville. These political battles during City Council meetings were similar those of the Smoking Regulating Ordinance, but not quite as contentious or lengthy as the first Civil Rights Ordinance. George's had difficulty avoiding substantial neighborhood complaints when it was still an open-air beer garden sporting a large tree in the middle of its outdoor seating area. Some thought that the outdoor music venues were inspired to increase the sound level of their outdoor bands as an advertisement to the crowds on Dickson Street to come on in. Only when George's enclosed and covered its former outdoor seating performance area which prevented most noise from escaping did the neighborhood complaints end. Because of our Noise Ordinance, which was enacted to try to resolve the issue of outdoor amplified music, but also because the terrain and nearby buildings block some of the noise from these venues, the current outdoor music venues in the Entertainment District have not seemed to cause great problems for the neighborhood. The stage location requested by George's presents a great entertainment opportunity, but also a substantial issue because sound from the proposed stage could dominate the Plaza. Our Noise Ordinance is not a perfect solution to this outdoor music issue. It is almost always complaint driven. Except after 10:00 PM, only a landlord or land owner adversely affected by noise can lodge an official complaint for the police to measure. Thus, visitors on the Plaza could rarely lodge a complaint. Neighbors to the North and Northwest could lodge a complaint, but very likely would be in the same basic unhappy situation as when George's beer garden was open and uncovered. The City has leased about the same size area adjoining the Old Post Office for many years and to several restaurants. We are currently charging Cheers double what Council Member Petty told me that Brian Crowne had suggested for rent. I believe it is much more important to ensure that this proposed stage not become a problem for neighbors or visitors to the Plaza than how much revenue the City would receive as rent. Thus, I propose to start the rent at the level suggested by Brian Crowne at only $50.00 per month. If there are no problems, additional annual terms for the Lease Agreement would increase the monthly rent by $10.00 per month until it reaches $100.00 per month during the 6th annual lease term. I used many of the terms and conditions, especially those relating to outdoor music that the City has required for the Old Post Office patio we lease. Because we would be using a renewable Lease, those provisions can be changed (weakened or strengthened) annually as needed. However, I believe that we have not had to change any such limiting condition during many years of our lease of the patio for the OPO. This patio has been operated successfully without adverse impacts on the Square Gardens or Farmer's Market for many years. I have attached both that current lease and a possible lease to the Crownes of the 1,689 square foot (about .038 acres) parcel under consideration. CONCLUSION Our citizens' Twelve Million Dollar investment to beautify and convert the Walton Arts Center parking lot into the Cultural Arts Plaza needs to be carefully protected by the City Council. Entering into a one-year lease which can be automatically renewed unless the City Council passes a Resolution not to renew keeps the City Council in control of its property. The risk will be on the Crownes, which is proper because they will also receive a very substantial benefit of using City property for at least a year (which should get us past the Covid-19 pandemic) at an exceeding low cost. If their use does not cause problems or objections that the City Council determines warrant not extending the lease, then the Crownes will continue to be able to enjoy the use of this parcel with its great location just West of the Plaza at a very small cost. LEASE AGREEMENT This Lease Agreement, is entered into on this day of September of 2020 by and between the City of Fayetteville (herein after City), which address is 113 West Mountain Street, Fayetteville, AR 72701 and Brian Crowne Holdings, LLC (hereinafter Brian Crowne), the Owner of George's Majestic Lounge on the corner of Dickson Street and Powerhouse Avenue in Fayetteville. WITNESSETH: 1. LEASED PREMISES. For and in consideration of the rents, duties, covenants and agreements herein entered into and agreed upon by Brian Crowne Holdings, LLC as obligations to the City of Fayetteville, the City of Fayetteville leases to Brian Crowne subject to the terms and conditions contained herein, a parcel containing about 720 square feet within a parcel containing about 1,689 square feet adjoining George's Majestic Lounge, fronting on Powerhouse Avenue and just west of the Cultural Arts Plaza and the railroad tracks as depicted on the attached plat/map. Brian and Day Crowne agree to lease this area from the City of Fayetteville for $50.00 per month paid by October 1, 2020 and the first of every month thereafter for this year long term and to abide by and faithfully perform all of the covenants, terms, and conditions stated below. 2. TERM. This lease shall commence on October 1, 2020 and shall extend until September 30, 2021. If at the end of the first term Brian Crowne shall have fully performed every agreement and covenant pursuant to the terms of this lease, and there have been no justified complaints or other reasons that the City Council by Resolution determines would justify nonrenewal of this lease, this lease shall be automatically renewed for another one-year term at the rent of $50.00 per month under all of the same terms and conditions unless otherwise agreed to by both parties in writing. Brian and Day Crowne shall have the right to continue to renew this lease on the same conditions unless agreed to in writing by both parties for an additional four (4) one-year terms if not denied by a City Council Resolution passed prior to the beginning of the annual term. All terms of this original Lease Agreement shall remain the same unless otherwise agreed to in writing by the parties. Once both parties have agreed to and signed this Lease Agreement, Brian Crowne Holdings, LLC may enter upon and occupy the premises and the larger 1,689 square foot parcel to construct the stage after obtaining a building permit. Upon satisfactory completion of the stage construction by Brian Crowne, all proper safety and other inspection requirements have been accomplished by the City and Brian Crowne has received any necessary permits for outdoor music, etc., Brian Crowne Holdings, LLC may begin its full use and enjoyment of the stage pursuant to the rights granted by this Lease Agreement. 3. RENT. Brian Crowne agrees to pay the City of Fayetteville the rental rate of Fifty Dollars ($50.00) per month payable in advance beginning on October 1, 2020. As further consideration for this Lease and in recognition of the substantial reduction in what would be the normal lease payments, Brian Crowne agrees: (a) to use this parcel to construct a small outdoor stage among the trees using construction methods to avoid adversely impacting trees to be preserved as recommended by the Urban Forester; (b) to follow the directions and guidelines of the Urban Forester during the design, construction, and use of the stage to preserve the majority of the trees currently growing on this entire parcel of 1,689 square feet and continue to take necessary precautions and efforts to ensure the health and vitality of these preserved trees throughout this total potential six year lease term; substantial neglect or damage to any of the trees designated by the Urban Forester to be preserved caused by the neglect or abuse of Brian Crowne Holdings, LLC would constitute a material breach of this Lease Agreement; (c) to prohibit smoking on the leased premises; (d) to respect and enhance the public's use of the Cultural Arts Plaza and faithfully obey the use of the stage pursuant to the requirements of the fifth paragraph of this Lease Agreement; 4. ALTERATION OF IMPROVEMENTS. Any alteration of the constructed stage or other improvements within the City of Fayetteville's premises leased to Brian Crowne must be approved by the Mayor prior to such alteration. 5. MUSIC. Brian Crowne agrees that only live music will be permitted on the leased premises used as the stage. This music shall be directed toward George's customers in its outdoor seating area and not toward the Plaza. The outdoor music from the stage shall be ended no later than 11:00 PM. 6. SIGNS AND ADVERTISING. Any sign, picture, advertisement, or notice that is displayed on any part of the leased premises (stage) shall be visible and directed toward George's customers in its outdoor seating area and not toward the Plaza without the previous written consent of the City of Fayetteville. 7. NO RIGHT OF ASSIGNMENT AND SUCCESSION. This Lease agreement shall only inure to the benefit of and be binding upon Brian Crowne and the City of Fayetteville. There shall be no right to assign this Lease Agreement. 8. TAXES. Brian Crowne shall pay any and all ad valorem taxes or special improvement district taxes levied and assessed against the leased premises and the improvements located thereon during the term of this lease. Brian Crowne also agrees to promptly and properly pay all Fayetteville Hotel, Motel, and Restaurant taxes and all Alcoholic Beverage taxes during this Lease. Failure to properly and timely pay all HMR, Alcoholic Beverage or other State or City tax would constitute a material breach of this Lease and justify the City of Fayetteville to terminate this Lease for cause. 9. COMPLIANCE WITH LAWS. Brian Crowne agrees not to violate any law, ordinance, rule or regulation of any government authority having jurisdiction of the leased premises. 10. INSURANCE ON LEASED PROPERTY. Brian Crowne shall be solely responsible for maintaining whatever insurance the LLC deems necessary on the leased property. The City of Fayetteville makes no warranty that this area is fit for any purposes 01 to which Brian Crowne may use it and shall not be liable for any injuries or damage which might occur upon the Leased premises. 11. RIGHT OF INSPECTION. The City of Fayetteville shall have the right, in person or through the City of Fayetteville's duly authorized representative, at all reasonable times to inspect the leased premises. 12. ACCEPTANCE OF PREMISES. Brian Crowne acknowledges that it has inspected the premises and determined them adequate for their intended uses. Brian Crowne accepts the premises in their current condition. 13. MAINTENANCE OF LEASED PREMISES. Brian Crowne shall be responsible for maintaining the improvements upon the leased premises in a satisfactory condition and the premises shall, at all times, be maintained in a neat and orderly condition. 14. RETURN OF LEASED PROPERTY. At the end of the term of this lease, or upon any other earlier termination, Brian Crowne agrees to promptly and peaceably to restore possession of the leased premises to the City of Fayetteville in as good condition as they were when delivered to Brian Crowne, ordinary wear and tear excepted. 15. NOTICES. Any notice called for or permitted under the terms hereof shall be given in writing and sent by certified mail to Brian Crowne at George's Majestic Lounge on Dickson Street, Fayetteville, AR 72701 and to the Mayor's Office, City of Fayetteville, 113 W. Mountain St., Fayetteville, AR 72701. If such certified mail is returned to sender, the City of Fayetteville may provide adequate notice by posting said Notice on the premises of George's or the stage. 16. WASTE. Brian Crowne agrees not to commit waste, nor permit waste to result or to be done to or upon the leased premises, nor to store or permit to be stored thereon any, explosives, combustible substances or dangerous materials; nor to operate or permit tp exist thereon any public or private nuisance. 17. RIGHT TO CURE. If Brian Crowne shall default in any of the covenants, ,agreements, conditions, or undertakings herein contained to be kept, observed and performed by Brian Crowne, the City of Fayetteville shall give notice of such default in writing to Brian Crowne and request it cure the cause of such default within thirty days. If said default is corrected or cured within the aforementioned thirty (30) days, Brian Crowne shall not be considered in default or in breach of this lease. This right to cure does not extend to repeated violations of Paragraph 5, nor to repeated violations of the City's Noise Ordinance regulations either of which constitute a material breach of this Lease Agreement justifying termination of this Lease Agreement. 18. SEVERABILITY. Each paragraph of this lease agreement is severable from all other paragraphs. In the event any court of competent jurisdiction determines that any paragraph or subparagraph is invalid or unenforceable for any reason, all remaining paragraphs and subparagraphs will remain in full force and effect. 19. INTERPRETATION AND VENUE. This lease agreement shall be interpreted according to and enforced under the laws of the State of Arkansas with proper jurisdiction and venue in Washington County, Arkansas. 20. ENTIRE AGREEMENT. This lease agreement contains the entire agreement of both parties hereto, and no other oral or written agreement shall be binding on the parties hereto. 21. NON -WAIVER PROVISION. The failure of the City of Fayetteville or Brian Crowne to insist upon the strict and literal performance of any agreement, term or condition herein or to exercise any option retained or granted by reason of a default by Brian Crowne shall not constitute a waiver of the City of Fayetteville's right thereafter to insist upon and enforce full performance of such conditions and agreements. IN AGREEMENT WITH ALL THE TERMS, CONDITIONS AND PROVISIONS ABOVE, the City of Fayetteville by Mayor Lioneld Jordan and tenant Brian Crowne for Brian Crowne Holdings, LLC sign below to evidence their agreement. BRIAN CROWNE HOLDINGS, LLC By: BRIAN CROWNE Witness: Name & Title Date signed: CLERK Attest: �`�C,��y' • C I T • •T� �'% Kara axton City Clerk/Treasurer ; • F4ke • c Date signed: '.2••:�SAS co r,. y r 'Qt!• ' XA It 51' 113 West Mountain Street Fayetteville. AR 72701 (479) 575-8323 Resolution: 42-19 File Number: 2019-0079 NWA OPO, LLC: A RESOLUTION TO APPROVE A FIVE-YEAR LEASE AGREEMENT WITH NWA OPO, LLC TO RENT THE PATIO AREA ADJOINING THE OLD POST OFFICE WHEREAS, the City of Fayetteville has long rented the patio area adjoining the Old Post Office to the tenant or owner of the Old Post Office for its use for its customers; and WHEREAS, NWA OPO, LLC. has purchased the Old Post Office, will be establishing a restaurant in the Old Post Office and would like to be able to use the patio area owned by the City of Fayetteville under the terms and conditions of the attached lease for the consideration of $100.00 per month, plus the faithful observance of the six conditions within the Rent paragraph and the other conditions and requirements of the lease; and WHEREAS, allowing this rental agreement will help this restaurant be financially successful while ensuring the patio area will enhance rather than detract from our citizens' enjoyment of the Square Gardens. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby approves the Lease agreement with NWA OPO, LLC attached to this Resolution and authorizes the Mayor to execute this Lease. PASSED and APPROVED on 2/19/2019 Approved: , Attest: mkd _66� C�,, I Ll ion d Jur):(,n, VV �ivor Sondra E. Smith, City Clerk Tree,'.: •`11�t 1 Pagel I .ti •� 4pr(nred on i� LEASE This Agreement, entered into this ._Wday of February, 2019, by and between the City of Fayetteville, whose address is 113 West Mountain Street, Fayetteville, AR 72701 and NWA OPO, LLC whose mailing address is Post Office Box 10856 Fayetteville, Arkansas 72703. WITNESSETH: 1, LEASED PREMISES. For and in consideration of the rents, covenants and agreements herein entered into and agreed upon by NWA OPO, LLC as obligations to the City of Fayetteville, the City of Fayetteville leases to NWA OPO, LLC subject to the terms and conditions contained herein, the unproved seating and patio area adjoining the old Post Office Building and within the fence containing approximately 1676 square feet. NWA OPO, LLC agrees to lease this patio area for $100.00 per month and to abide by and faithfully perform all of the covenants, terms, and conditions stated below, 2. TERM. This lease shall commence on March 1, 2019 and shall extend five (5) years until February 28, 2024. If at the end of the first term NWA OPO, LLC shall have fully performed every agreement and covenant pursuant to the terms of this lease, NWA OPO, LLC shall have the right to renew this lease for an additional five (5) year term if so requested in writing provided to the Mayor no later than January 15, 2024. All terms of the original Lease shall remain the same except that the rent shall increase to $200.00 per month. 3. RENT. NWA OPO, LLC agrees to pay the City of Fayetteville the rental rate of One Hundred Dollars ($100.00) per month payable in advance. As furQrer consideration for this Lease and in recognition of the substantial reduction in what would be the normal lease payments, NWA OPO, LLC agrees: (A) to continue to provide the space and electricity to operate the wireless internet broadcast antennas attached to its building and any necessary space within its building to enable public WIFI connectivity for persons on the Square as provided by Cox Communications; (B) to continue to allow the A & P Commission to attach and operate its outside speakers for Lights of the Ozarks and provide electricity for the speakers; (C) to continue to allow the City of Fayetteville to hang Christmas lights on the building; (D) to refrain from objecting or legally challenging the closure of City streets and parking spaces around the Square during the Saturday's Farmers' Market, First Thursday. Lights of the Ozarks and occasional special events authorized by the Mayor such as the FFIS homecoming parade and celebrations. (E) to continue to allow unfettered access by city employees to the storage shed constructed on the former loading area outside the leased premises. (F) To enforce the City's no smoking in City parks regulations by prohibiting smoking in the leased area (part of the Square Gardens city park) by its employees, customers and patrons. 4. ALTERATION OF IMPROVEMENTS. Any alteration of the improvements within the City of Fayetteville's leased premises must be approved by the Mayor prior to such alteration. 5_ MUSIC. NWA OPO, LLC agrees that only live, non -amplified music will be permitted on the leased premises. This music shall not be loud enough to disturb persons enjoying the Square Gardens, with the exception that on Razorback home football games amplified music shall be allowed from 2:00 P. M. until 10:00 P. M. if also approved by Conditional Use by the Planning Commission and in conformance with the City's Noise Ordinance. 6. SIGNS AND ADVERTISING. No sign, picture, advertisement, or notice shall be displayed on any part of the leased premises visible to the public outside the patio area without the previous written consent of the City of Fayetteville. 7. LIMITED RIGHT OF ASSIGNMENT AND SUCCESSION. This Lease agreement shall inure to the benefit of and be binding upon NWA OPO, LLC and the City of Fayetteville. If NWA OPO, LLC wishes to assign this Lease, it must notify the Mayor's Office in writing at least 30 days before such assignment is anticipated with the name of the proposed assignee. Unless the City Council objects by passing a Resolution forbidding such assignment within 30 days after proper notice, NWA OPO. LCC may assign this lease if the assignee has agreed in writing to honor all the terms of this Lease. 8. TAXES. NWA OPO, LLC shall pay any and all ad valorem taxes or special improvement district taxes levied and assessed against the leased premises and the improvements located thereon during the term of this lease. NWA OPO, LLC also agrees to promptly and properly pay all Fayetteville Hotel Motel and Restaurant taxes and all Alcoholic Beverage taxes during this Lease. Failure to properly and timely pay all HMR, Alcoholic Beverage or other State or City tax would constitute a material breach of this Lease and justify the City of Fayetteville to terminate this Lease for cause. 9. COMPLIANCE WITH LAWS. NWA OPO, .LLC agrees not to violate any law, ordinance, rule or regulation of any government authority having jurisdiction of the leased premises. 10. INSURANCE ON LEASED PROPERTY. NWA OPO, LLC shall be solely responsible for maintaining whatever insurance it deems necessary on the leased property. The City of Fayetteville makes no warranty that this area is lit for any purposes to which NWA OPO, LLC may use it and shall not be liable for any injuries or damage which might occur upon the Leased premises. 11. RIGHT OF INSPECTION. The City of Fayetteville shall have the right, in person or through the City of Fayetteville's duly authorized representative, at all reasonable times to inspect the leased premises. 12. ACCEPTANCE OF PREMISES. The NWA OPO, LLC acknowledges that it has inspected the premises and determined them adequate for its intended uses. NWA OPO, LLC accepts the premises in their current condition. 2 13. MAINTENANCE OF LEASED PREMISES. NWA OPO, LLC shall be responsible for maintaining the improvements upon the leased premises in a satisfactory condition and the premises shall, at all times, be maintained in a neat and orderly condition. NWA OPO, LLC's business operations will be carried on in accordance with the highest standards for such businesses, particularly in the areas of cleanliness, service and noise. 14. RETURN OF LEASED PROPERTY. At the end of the tern of this lease, or upon any other earlier termination, NWA OPO, LLC agrees promptly and peaceably to restore possession of the leased premises to the City of Fayetteville in as good condition as they were when delivered to NWA OPO, LLC, ordinary wear and tear excepted. 15. NOTICES. Any notice called for or permitted under the terms hereof shall be given in writing and sent by certified mail to NWA OPO, LLC, at 3862 East Chadwick Drive, Fayetteville, AR 72702 and to the Mayor's Office, City of Fayetteville, 113 W. Mountain St., Fayetteville, AR 72701. If such certified mail is returned to sender, the City of Fayetteville may provide adequate notice by posting said Notice on the premises. 16. WASTE. NWA OPO, LLC agrees not to commit waste, nor permit waste to result or to be done to or upon the leased premises, nor to store or permit to be stored thereon any explosives, combustible substances or dangerous materials; nor to operate or permit to exist thereon any public or private nuisance. 17. RIGHT TO CURE. If NWA OPO, LLC shall default in any of the covenants, agreements, conditions, or undertakings herein contained to be kept, observed and performed by NWA OPO, LLC, the City of Fayetteville shall give notice of such default in writing to NWA OPO, LLC and NWA OPO, LLC shall have thirty (30) days from and after the giving of such notice to eliminate and/or cure the cause of such default. If said default is eliminated or cured with the aforementioned thirty (30) days, NWA OPO, LLC shall not be considered in default or in breach of this lease. 18. SEVERABILITY. Each paragraph of this lease agreement is severable from all other paragraphs. In the event any court of competent jurisdiction determines that any paragraph or subparagraph is invalid or unenforceable for any reason, all remaining paragraphs and subparagraphs will retrain in full force and effect. 19. INTERPRETATION AND VENUE. This lease agreement shall be interpreted according to and enforced under the laws of the State of Arkansas with proper jurisdiction and venue in Washington County, Arkansas. 20. ENTIRE AGREEMENT. This lease agreement contains the entire agreement of both parties hereto, and no other oral or written Rgreement shall be binding on the parties hereto. 21. NON -WAIVER PROVISION. The failure of the City of Fayetteville or NWA OPO, LLC to insist upon the strict and literal performance of any agreement, term or condition herein or to exercise any option retained or granted by reason of a default by NWA OPO, LLC shall not constitute a waiver of the City of Fayetteville's right thereafter to insist upon and enforce full performance of such conditions and agrcements- iV 1411'Nh:SS %i Ilh:2tEO , the City of Fayetteville by Mayor Lioneld Jordan and NWA OPO, LLC by and duough its Owner and Managing Partner Mike Aniuld have Hereunto set their hands and seals and have caused their names to be itcrCtlntO affixed by the undersigned officers who are drily authorized to act. NWA OPO, LLC CITY OF FAYETJ'EV1L1.9, ARKANSAS MIKE ARNOLD By. �- OWNER OF NWA OPO, LLC / X NEI D ,ro' Witness.- i V rI �� Attest: ` t, tutu? & Title Sondra Smith, City Clerk Date signed: �Zz.. ��"l � Date signed. 4