| CAMT ACED OUT OF ACE PROJECT Purchase Agreement Excludes CAMT Pecuniary Demands - Tobacco Billianaire Will Be In-Charge |
Loveland - Oct. 27, 2011
The City of Loveland entered into a contract with Cumberland & Western Resources, LLC (CWR), incorporated in Wyoming,
this week to sell 177 acres together with 811,757 square feet of buildings of the former Agilent Campus located at 815 14th
Street in Loveland now referred commonly to as the “ACE Project” for a sales price of $5 million. In addition, CWR agreed to
pay an addition $10 (Exhibit F attached to the purchase agreement) for water and mineral rights to the property. Excluded from
the agreement are 144 units of Big-Thompson water shares and 3 Consolidated Home Supply Ditch units to be retained by the
city.
CWR added this week an additional $350,000 deposit towards the $150,000 already deposited with the title company as
earnest money for a total deposit of $500,000. The transaction balance of $4.5 million is to be paid upon closing the contract
now set for early December. The only seller financial assistance mentioned in the contract involves future good faith efforts by the
city in assisting CWR in obtaining certain incentives and tax waivers for the project indicating CWR is purchasing the property
with its own resources. Bidders not selected relied heavily on financing to purchase the property offered by the city in the request
for proposals.
CWR is owned by Kentucky Billionaire Brad Kelley, described by Forbes magazine whose estimated net worth is $1.7 billion,
"The low-profile billionaire made his fortune with discount cigarettes and today is among the 10 largest landowners
in the U.S.A." Loveland Business Development Director Betsey Hale flew to Georgia in late September where she met Kelley
after briefing CWR on the ACE Project and RFP. Hale has instructed reporters not to mention Kelley when reporting on the
project or CWR.
CAMT Role Uncertain
Conspicuously absent from the agreement is the Colorado non-profit trade group CAMT (Colorado Association for
Manufacturing and Technology) ownership, management or control of any portion the project as originally contemplated when
they chose Loveland as the location to develop ACE (Aerospace & Clean Energy ) Project. Instead of providing CAMT
ownership, kick-backs from leases or even the oversight they fought for with the city to have in the project is ambiguous in the
agreement regarding CAMT’s future role. Instead, CWR will be the sole owner of the property and enjoy wide discretion over
what companies can lease buildings and which commercial brokers they wish to compensate for bring such tenants.
Under the subheading 17 “Buyer Covenants” CWR agrees to;
“proceed with due diligence and in good faith to continue its discussions with the Colorado Association for
Manufacturing and Technology (“CAMT”) to determine, in Buyer’s reasonable exercise of its discretion, an
appropriate role for CAMT in the development of the property.”
Curiously, also listed under “Buyer Covenants” is a seller covenant (city promise) to cooperate with both buyer and CAMT in
developing an agreement to develop the property.
Councilors have been hinting at the potential for developing the property without CAMT for weeks in public statements that said
the ACE Project would likely proceed with or without CAMT’s participation. The purchase agreement signed by Loveland City
Manager Bill Cahill on October 25, and approved by council last night certainly paves the way for CWR and the City of
Loveland to proceed with the development of the property to draw high-tech companies with or without the consent, approval or
participation of CAMT.
Nothing in the agreement precludes CAMT from participating in future revenues or ownership, however, it does remove any
leverage CAMT enjoyed previously in forcing the developer to cooperate with their unpopular revenue sharing schemes.
Exhibit E – Deed Restriction On Types of Tenants
Instead of limiting CWR to the ACE Project, the agreement instead provides a deed restriction running for 5 years with the
property that disallows uses such as indoor housing or raising of animals, pawn shops, places of worship, hospital, retail gas
stations among many other more common commercial and retail business uses.
What Exhibit E does allow are high-tech companies, technology related manufacturing, development and research along with any
service business that offers services primarily to the “high-tech” tenants contemplated within the development. Absent from
Exhibit E is any reference specifically to CAMT or the ACE Project. CWR or any subsequent owner may lease the property to
any of the aforementioned prohibited uses like gas stations, pawn shops and kennels after 5 years once the deed restriction is
lifted.
City of Loveland Promises – “Seller’s Non-Financial Assistance”
Under the subheading 19. Seller’s Non-Financial Assistance (page 19 in the purchase contract), the city agrees to expedite any
development reviews and approvals by guaranteeing a 10 business day approval process for building permit applications for
tenant improvements and assign one city employee full time to “help expedite the City’s building permit and land use review
processes relating to the Real Property.”
Especially interesting in this section is how it contemplates and codifies the project receiving city support and assistance even if
CWR decides to proceed without CAMT,
“As an incentive to Buyer purchasing the Property and developing it as the Aerospace and Clean Energy Park in
cooperation with CAMT or similar development,..”
While CAMT may likley find a role it will be limited to what the new owners of the Agilent property, Brad Kelley and his
company CWR, agree and is unlikely to result in either a share of the equity, property or lease returns or other improbable
outcomes CAMT was hoping to impose on the project.
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| CAMT's Elaine Thorndike with CAMT board members lost leverage over project. CAMT was only given flattering and legally superfluous references in the agreemnt. |
| (typos same as original) From: Jo Ann Miabella Galvan <jgalvan@camt.com> Sent: Monday, Sept. 05, 2011 10:49 AM To: Betsey Hale; Bill Cahill; John Duval Cc: elaine.thorndike@colorado.edu; 'Paul Czarnecki' pzar50@hotmail.com; fraitano@earthlink.net; rcomer@faegre.com Subject: ACE RFP Final Betsey, I thought we'd have one last review before the final document went out. The review cycle time was so rushed. Here is the question I wanted to pose prior to the RFP going out but didn't get to before I saw this email. United Properties was given a 60 day ERN with the City of Loveland. Their final response included not having enough time to make a decision on such a complex project. Now we're going through the RFP process again and the timeframe given to negotiate an ERN has now be cut in half to 30 days. Do you really anticipate that a new developer will be able to this decision in half the time U.P. could not? I think this deadline is unrealistic for everyone involved. I'd like this to be a serious part of our discussion at Friday's meeting, if it can't happen before then. No consideration is being given to CAMT's schedule either at this point. The Wednesday - Friday developer and tenant tours schedule was put out there without any regard to our schedules, as were the developer meetings after proposals are submitted. Thank you JO ANN MIABELLA GALVAN CHIEF FINANCIAL OFFICER 719 964 3297 www.CAMT.com PEOPLE + PLANET + PROFIT LovelandPolitics' NOTE: Subsiquent emails reflect the lack of availability by CAMT personnel due to vacation, business travel, and apparently short work days. At the risk of quoting former City Manager Don Williams, Loveland city staff was, "Working at the speed of Commerce" while CAMT apparently cannot. |