HomeMy WebLinkAboutG-1 - Exercise Of Option On the Arthofer PropertyCITY OF NEWPORT BEACH
OFFICE OF THE CITY MANAGER
February 12, 1973
COUNCIL AGENDA G-1
TO: MAYOR AND CITY COUNCIL
FROM: City Manager
SUBJECT: EXERCISE OF OPTION ON THE ARTHOFER PROPERTY
RECOMMENDATION:
That the City Council exercise the option immediately on the
two lots currently belonging to Carl Arthofer.
DISCUSSION:
Members of the Council undoubtedly recall the option agreement
providing for the purchase of two lots from Carl Arthofer. This option
agreement stipulated a price of $47,500 per lot with a six months option
to purchase the first lot and an additional six months option to purchase
a second lot at seven percent (7%) interest. The City is experiencing a
good surplus in the Building Excise Tax Fund, and I have contacted a number
of individuals such as Mr. Arthofer to determine if discounts can be ob-
tained if the City exercised the option earlier than provided in the agree-
ment. Mr. Arthofer has agreed to discounts on both lots of $1,000 if the
City exercised its option during the month of February.
If the City exercised the option during the month of February
there would be a savings of $4,325 to the City. The savings is composed
of interest in the amount of $3,325 plus the $1,000 discount. Mr. Pappas
advises me that the City is receiving interest on cash deposits in the
amount of approximately five and one-half percent (5 1/2%). The City,
therefore, would make money if the option agreement is exercised and the
property purchased at this time.
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RLW:mm ROBERT L. WYNN