In a closed executive session on July 13, Blaine City Council considered three offers on a vacant city-owned downtown property that hit the market two weeks before, but ultimately took no action on the offers.
After the meeting, city manager Michael Jones said the council didn’t reject the offers, but just didn’t want to decide on the offers at that time. Council did provide Jones with direction to move forward, he said, before the sale comes up at a future
council meeting.
At least two of the three offers were at, or above, the city’s asking price of $300,000 for the property, which is a vacant lot at 665 Peace Portal Drive, on the Drayton Harbor side of the street between Blaine Bouquets and Tiny Taproom. Jones described the offers before the executive session, calling them creative.
Nimbus Properties LLC offered up to $360,000, depending on the next highest viable offer, and proposed eight apartment units for the site, with commercial space on the main floor. Jones cautioned city council that the proposed development plans included with each offer are just initial plans, not guarantees.
“You have to take that all with a grain of salt,” he said. “The best laid plans don’t always come together.”
Sall LLC, made an offer of $429,000, but $129,000 of that is a deposit that would be returned to Sall if he obtained a building permit within six months
of closing.
“Really the purchase price is $300,000 if he obtains his building permit in a timely manner. If he doesn’t, the purchase price is essentially $429,000,” Jones said.
Sall LLC proposed to develop the site with four or more apartment units and two commercial spaces.
Fereydoon Pakzad offered $200,000 plus a $100,000 performance bond for the property. If Pakzad didn’t complete a project within 18 months of the closing date, the bond would be released to the city. Effectively, Pakzad’s offer is for $200,000 if he completes a project within 18 months, and $300,000 if he does not. That offer came with the least detailed development proposal – “a zoning-compliant mixed-use structure.”
The offers from Nimbus and Pakzad specified a 120-day contingency period after the two parties agree on the sale, while the Sall LLC offer specified a 14-day contingency period.
Council looked at more than just price when evaluating the offers. Having that land developed would benefit the downtown business district and aid the city financially through permit fees, sales tax on construction and development, and by bringing the land onto the tax records at a higher value.
The city obtained the property in lieu of foreclosure in October 2019. Before that, the city had sought to demolish a derelict building on the site for about two years and had not been able to contact the property’s owner. The city spent about $283,000 to demolish the property, included asbestos and other toxic abatement, staff time, legal fees and direct expenses on the property, according to meeting documents.
The three offers came in less than two weeks after the city listed the property. Council voted to list the property at $300,000 during a June 29 meeting. Jones noted in the meeting that the city was expecting a fourth offer, but it didn’t come together. He said he knows from talking to Ron Freeman, the city’s real estate agent for the sale, that that buyer was looking to hold on to the property without developing it.
Freeman wasn’t surprised by the swift offers on the property.
“There has been a pent up interest in some of the downtown properties for some time,” he said in a phone interview. Those who made offers were waiting for the property to go on the market.
“It’s not like a situation where we listed it one day, and that’s when people found out about it,” he said.
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