The City of Helena and Lewis and Clark County entered into an Agreement to Lease, Sell and Purchase Real Property (“Agreement”) on May 2018. That agreement was approved by the city commission on June 18, 2018 and was for the lease and ultimate purchase of the 406 Fuller Avenue building and associated parking lot for $1,290,000. The Agreement also called for an amended plat to be prepared so that the property with the 406 Fuller building and parking lot could be legally divided from the 404 Fuller Avenue building and property. Subsequently it was determined that legally dividing the properties would require extensive interior work to the 404 and 406 Fuller Avenue buildings to construct the necessary rated fire separation. Staff recommends that such work is not cost effective and that purchase of both structures and associated surface parking lots is a better approach. The city and county have been leasing the 406 Fuller Avenue building and associated parking lot and rent payments will go to the purchase price of the property.

The attached modification to the present agreement to lease, sell and purchase real property (“Modified Agreement”) would commit the City of Helena and Lewis and Clark County to purchasing 404 Fuller in addition to 406 Fuller Avenue for a total purchase cost of $1,950,000. This includes the surface parking lot properties at the northeastern corner of Lawrence Street and Park Avenue. The city manager has the authority to enter into the buy-sell upon successful conclusion of negotiations. However, the obligation to close on the property is contingent upon Helena City Commission approval.

An appraisal of all the property was conducted on December 13, 2017. Section 1-4-15, Helena City Code, requires two independent appraisals be conducted if the purchase price is over $500,000. Since the purchase price is $1,950,000 two appraisals are required unless the Commission finds a second appraisal will prevent the purchase from occurring or not in the best interest of the City.  Staff recommends the commission waive the requirement to obtain a second appraisal because a second appraisal is not in the best interests of the City.