Title
Conveyance of Right of First Refusal to Hornets
Action
Action:
A. Adopt a resolution approving the conveyance of a Right of First Refusal for the real property located at 501 E. Trade Street (Parcel Identification Number 08005401) to Charlotte Arena Operations, LLC (Hornets); and
B. Authorize the City Manager or his designee to negotiate and execute all documents necessary to complete the transaction.
Body
Staff Resource(s):
Tracy Dodson, City Manager’s Office
Explanation
§ On June 13, 2022, the City Council approved the request for the City Manager to negotiate and execute an agreement for arena improvements and a new Performance Enhancement Center (PEC). This Right of First Refusal (ROFR) agreement would be incorporated into the Amended and Restated Arena Use and Operating Agreement.
§ The City of Charlotte proposes to convey to Charlotte Arena Operations, LLC, a Delaware limited liability company (Hornets), ROFR to purchase the real property located at 501 E. Trade Street and identified as Tax Parcel ID# 08005401(Grave Lot).
§ These rights were negotiated with the Hornets and are consistent with historical partnerships and efforts with them to ensure the long-term efficient operations of Spectrum Center, and to develop the PEC and as part of negotiations with the Hornets to extend their presence in Charlotte through 2045.
§ The material terms of the ROFR are as follows:
- Prior to the city entering into any agreement for the sale of Gravel Lot during the ROFR Term, the city shall first offer to sell the Gravel Lot to the Hornets upon the same material terms, provisions, and conditions, that would otherwise be acceptable to it in a transaction for the sale of the Gravel Lot with a third party. The ROFR will allow the Hornets to elect to purchase the Gravel Lot on the same material terms, provisions, and conditions as that third-party offer so long as the Hornets’ proposed development purpose will attain substantially the same assessed value, destiny, and overall economic impact and equivalent value to and objectives of the city; and
- The term of the ROFR, that is anticipated to expire in 2030, shall be for three years commencing on the date a temporary certificate of occupancy is issued for the Performance Enhancement Center planned in connection with the city’s Arena Renovation Project.
- The ROFR does not obligate the city to sell or redevelop the Gravel Lot, but under the Amended and Restated Arena Use and Operating Agreement, the city shall not develop the Gravel Lot prior to the date a temporary certificate of occupancy is issued for the PEC and the city is required to continue its reasonable efforts to continue to make the Gravel Lot or nearby streets available for use by the Hornets consistent with current practices, and upon sale or redevelopment of the Gravel Lot, subject to the ROFR, to make commercially reasonable efforts to provide substitute parking spaces in other city owned parking spaces, consistent with current practices and subject to any parking charges and rules and regulations imposed by the city or third-party operator for such city-owned parking facilities, and further subject to availability.
Attachments
Attachment(s)
Property Map
Resolution