HomeMy WebLinkAboutA001 - Council Action Form dated May 26, 2026ITEM #:45
DATE:05-26-26
DEPT:P&H
SUBJECT:HEARING ON APPROVAL OF A PURCHASE AGREEMENT FOR THE SALE
OF SIX SINGLE-FAMILY MARKET RATE LOTS LOCATED IN THE BAKER
SUBDIVISION
COUNCIL ACTION FORM
BACKGROUND:
At City Council's February 24, 2026 meeting, the City Council authorized staff to proceed with
a Request for Proposals (RFP) inviting interested builders/developers to submit proposals to
purchase up to 6 of the 12 market-rate lots on the north side of the Baker Subdivision located
on Tripp Street. The following lots were identified to be for sale: Lots 9, 13, 14, 16, 17, 21, 22,
23, and 26.
On March 9, 2026, staff issued the RFP. On March 31, 2026, the City received two proposals
as listed below:
1. Genesis Homes
2. Keystone Equity Group
At the April 28, 2026, City Council meeting, staff presented the two proposals and provided
specific details about each proposal. The City Council adopted a resolution to proceed
with the sale of six (6) market-rate lots available within the Baker Subdivision to
Keystone Equity Group and set a date of public hearing for approval of the purchase
agreement at the city council meeting on May 26, 2026, along with any other
agreements needed related to staff approval of house design for each lot prior to
construction. The purchase agreement shall require an earnest deposit of 5% of the lot
purchase price.
Attached for the City Council's review and approval is the Purchase Agreement prepared by
the Legal Department for the sale of Lots 9,13,14,16, 23, and 26 in the Baker Subdivision to
Keystone Equity Group. The total purchase amount is $331,225. The earnest deposit is
$16,566.25. The agreement describes the conditions and requirements for the purchase of the
six lots, with a closing date of October 1, 2026.
The agreement includes a separate Exhibit A (pages 8-12) with development conditions and
covenants to allow for the City's review and approval of the specific house plans consistent
with the RFP and staff review.
ALTERNATIVES:
1. The City Council can adopt a resolution approving the sale of the following six city-
owned market-rate lots: 9,13,14,16, 23, and 26 in the Baker Subdivision to Keystone
Equity Group as outlined in the terms and conditions of the attached purchase
agreement.
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2. The City Council can adopt a resolution approving the sale of the following six city-
owned market-rate lots: 9,13,14,16, 23, and 26 in the Baker Subdivision to Keystone
Equity Group as outlined in the terms and conditions of the purchase agreement with
modifications.
3. Reject finalizing the terms and conditions with Keystone Equity Group and refer this item
back to staff for further information.
CITY MANAGER'S RECOMMENDED ACTION:
The opportunity to sell market-rate lots in the Baker Subdivision is an important priority
for the City’s affordable housing program. Creating a mixed-income subdivision for
both affordable housing for low-income families and market-rate housing is consistent
with the goals and priorities of the City’s CDBG 2024-28 Five-year Consolidated Plan.
The sales prices are consistent with the minimum pricing established in the
R F P. Therefore, it is the recommendation of the City Manager that the City Council adopt
Alternative No. 1.
ATTACHMENT(S):
Sale to Keystone Equity Group (six lots) FIN (packet copy).pdf
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PURCHASE AGREEMENT
THIS IS AN AGREEMENT made by and between Sellers and Buyers upon the
following terms and conditions:
1. DEFINITIONS. As used in this Agreement, unless otherwise required by the
context:
(a) "" means the City of Ames, Iowa, whose mailing address is: 515
Clark Avenue, Ames IA 50010.
(b) "" means Keystone Equity Group, L.L.C. whose mailing address
is: 5031 Timberwood Ct., West Des Moines IA 50265.
(c) "" means this instrument as signed by Sellers and Buyers.
(d) "" means the real properties (together with all easements
and servient estates appurtenant thereto) in the City of Ames, Story County, Iowa, and
legally described as follows:
(i) 312 S. Wilmoth Avenue – Lot 9, Baker Subdivision, Ames, Iowa.
(ii) 232 S. Wilmoth Avenue – Lot 13, Baker Subdivision, Ames, Iowa.
(iii) 3249 Latimer Lane – Lot 14, Baker Subdivision, Ames, Iowa.
(iv) 3241 Latimer Lane – Lot 16, Baker Subdivision, Ames, Iowa.
(v) 3213 Latimer Lane – Lot 23, Baker Subdivision, Ames, Iowa.
(vi) 3201 Latimer Lane – Lot 26, Baker Subdivision, Ames, Iowa.
(e) "" means the date on which Buyers are to receive
possession of the Real Property from Sellers and are thereafter entitled to the beneficial
use of the Real Property.
(f) "" means a meeting of Sellers and Buyers at which the transaction
contemplated by this Agreement is finally concluded by delivery of a deed conveying title
in the Real Property to Buyers and payment of the purchase price to Sellers.
2. SALE OF REAL PROPERTY. Sellers agree to sell and Buyers agree to buy the
Real Property.
3. THE TOTAL PURCHASE PRICE. The total purchase price for the real
property is the sum of $ 331,325.00 which buyers agree to pay to sellers as hereinafter
provided.
4. ALLOCATION OF TOTAL PURCHASE PRICE. This Agreement is for the sale of
six unimproved lots. The purchase price is to be allocated among the six Baker Subdivision
lots in the following manner: (i) Lot 9 ($55,000), (ii) Lot 13 ($52,000), (iii) Lot 14
($56,000), (iv) Lot 16 ($55,000), (v) Lot 23 ($53,500), and (vi) Lot 26 ($59,825).
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5. DEPOSIT ON SIGNING. Buyers agree to pay to Sellers upon the signing of
this Agreement by Sellers and Buyers five percent (5%) of the purchase price or
$16,566.25 as a good faith deposit. Upon the Closing of this Agreement, Buyers shall
receive credit for partial payment of the purchase price in the amount of the deposit paid
under this paragraph. Upon the occurrence of any event or the failure of any condition
that results in the termination of this Agreement prior to Closing, if such event or failed
condition does not constitute a breach of this Agreement by either Sellers or Buyers, the
deposit paid under this paragraph shall be returned to Buyers.
6. PAYMENT AT CLOSING. At the Closing of this Agreement, Buyers agree to
pay to Sellers the remaining balance of the purchase price. Upon Buyer’s failure to pay to
Sellers the purchase price at Closing, this Agreement shall be null and void, and neither
party shall have any obligation to the other.
7. TIME AND PLACE OF CLOSING. The Closing of this Agreement shall take
place at 10:00 A.M. on October 1, 2026, at the City Clerk’s office located at 515 Clark
Avenue, Ames, Iowa, or such other time and place as the parties may mutually agree
upon.
8. CLOSING PROCEDURE. At the Closing, Sellers shall furnish, as applicable
and required, the municipal deed, valuation declaration, groundwater hazard statement
and corrective instruments. The deed transfer tax and the cost of preparing and recording
corrective instruments required to cure title deficiencies shall be paid for by Sellers.
9. INTEREST ON DELINQUENT SUMS. Buyers shall pay to Sellers interest on all
sums owing Sellers under this Agreement which are not paid when due. The rate of
interest shall be ten percent (10%) per annum for the period of such delinquency.
10. DATE OF POSSESSION. The Date of Possession, on which Buyers shall be
entitled to take possession of the Real Property, shall be the Closing date. If Sellers and
Buyers hereafter select an alternate Date of Possession, such alternate date shall become
the effective date for the accrual of interest earned under this Agreement and the
proration of real estate taxes, utility charges and rentals.
11. REAL PROPERTY TAXES. Property taxes due and owing, if any, until the
time of Closing shall be Seller’s responsibility. All property taxes due and owing after the
Closing date shall be the responsibility of Buyers.
12. ASSESSMENTS FOR PUBLIC IMPROVEMENTS. Sellers agree to pay all special
assessments levied or to be levied against the Real Property for public improvements
which have been installed at the date of this Agreement; and Buyers agree to pay, before
they become delinquent, all other special assessments that may be levied against the Real
Property for public improvements installed in the future.
13. Property Status – “As Is.” Buyer acknowledges that they have made a
sufficient and satisfactory inspection of the Real Property and are purchasing the Real
Property in its “as is” condition.
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14. RISK OF CASUALTY LOSS ON SELLERS. Sellers agree to keep in force at
their expense until the Date of Possession existing insurance policies insuring against loss
by fire, tornado and other casualties customarily covered by extended coverage for all
improvements now or hereafter constituting a part of the Real Property, if any.
15. ABSTRACT. No later than August 1, 2026, after the date of this agreement,
Sellers agree to deliver to Buyers for their examination abstract of title to the Real Property
continued to the date of this Agreement showing merchantable title in conformity with
this Agreement, the land title law of the State of Iowa and Iowa Title Standards of the
Iowa State Bar Association. After receipt of the abstract of title from Sellers, Buyers shall
have 10 days within which to give written notice to Sellers of any deficiencies in the Sellers’
title to the Real Property that renders it unmarketable. After examination of Buyers, the
abstract shall be held by Sellers until delivery of deed. The abstract of title shall become
the property of Buyers when the purchase price has been paid in full. Sellers agree to
pay for any additional abstracting which may be required by acts, omissions or change in
the legal status of Sellers occurring before delivery of deed. If title deficiencies render
title unmarketable, Sellers shall have 30 days after Buyers gives notice of such deficiencies
to Sellers within which to remove such deficiencies, failing which Buyers shall have the
option of either accepting the title as it then is or canceling this Agreement and receiving
a refund of any amount paid on the purchase price. The Closing date shall be extended
as necessary to include the title correction period allowed to Sellers under this paragraph.
16. DEED. Upon payment of all sums owing by Buyers to Sellers by virtue of
this Agreement, Sellers agree to contemporaneously execute and deliver to Buyers a
municipal deed without warranty conveying the Real Property to Buyers. The deed shall
be subject to: (a) Liens and encumbrances suffered or permitted by Buyers and taxes
and assessments payable by Buyers. (b) Applicable zoning, subdivision, health and rental
housing regulations; restrictive covenants of record; and existing easements, streets and
other public right-of-way that may cross the Real Property.
17. TIMELY PERFORMANCE. Time is of the essence in this agreement. The
failure to promptly assert rights of Sellers herein shall not, however, be a waiver of such
rights or a waiver of any existing or subsequent default.
18. FORFEITURE. If Buyers fail to pay any part of the purchase price as same
becomes due, or fail to pay taxes and special assessments before they become delinquent,
or otherwise fail to perform any of the agreements provided for in this Agreement, then
Sellers may, at their option, in addition to any and all other legal and equitable remedies
which they may have, proceed to forfeit and cancel this Agreement as provided by Chapter
656 of the Iowa Code. Upon completion of such forfeiture, Buyers shall have no right of
reclamation or compensation for money paid or improvements made; but such payments
and/or improvements if any shall be retained and kept by Sellers as compensation for the
use of the Real Property, and/or as liquidated damages for breach of this Agreement.
Upon completion of such forfeiture, if Buyers or any other person or persons are in
possession of the Real Property or any part thereof, such party or parties in possession
shall at once peacefully remove therefrom, or failing to do so may be treated as tenants
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holding over unlawfully after the expiration of a lease and may accordingly be ousted and
removed as such as provided by law.
19. FORECLOSURE AFTER NOTICE. If Buyers fail to pay any part of the purchase
price as same becomes due, or fail to pay taxes and special assessments before they
become delinquent, or otherwise fail to perform any of the agreements provided for in
this Agreement, then Sellers may upon 20-days' written notice to Buyers of Sellers'
intention to accelerate the payment of the entire balance owing under this Agreement,
during which 20 days such default or defaults are not removed, declare the entire balance
owing under this Agreement immediately due and payable; and thereafter at the option
of Sellers this Agreement may then be foreclosed in equity and a receiver may be
appointed to take charge of the Real Property and collect the rents and profits thereof to
be applied as may be directed by the court. It is agreed that periods of redemption after
sale on foreclosure may be reduced under the conditions set forth in Sections 628.26 and
628.27, Code of Iowa.
20. NOTICES. Unless otherwise required by law, any notice or demand required
or permitted by the terms of this Agreement shall be sufficient and deemed complete
when expressed in writing and either (a) personally delivered to the person entitled
thereto, or (b) deposited at any office of the United States Postal Service in the form of
certified mail addressed to the last known mailing address of the person entitled thereto,
or (c) served on the person entitled thereto in the manner of an original notice under the
Iowa Rules of Civil Procedure.
21. BROKER'S COMMISSION. Sellers and Buyers represent, respectively, that
they have not engaged or used the services of a broker at any time for purposes of
consummating the transaction represented by this Agreement and that no broker is
entitled to any compensation as a result of the consummation of the transaction
represented by this Agreement.
22. Non-Assignment. Buyers shall not assign its rights nor delegate its
duties under this Agreement without the prior written consent of the City.
23. CONCURRENT AGREEMENT. Attached hereto as Exhibit “A” containing
certain development conditions and covenants required by the Seller which shall be a
concurrent requirement of this Agreement to executed by the Parties at the time of this
Agreement. Sellers shall be responsible for recording said document with the Story County
Recorder at the time of Closing.
24. ENTIRE AGREEMENT. This instrument constitutes the entire agreement
between the parties with respect to the subject matter thereof and supersedes all prior
agreements, statements, representations and promises, oral or written. No addition to or
change in the terms of this Agreement shall be binding upon the parties unless it is
expressed in a writing signed by the parties.
IN WITNESS OF THIS PURCHASE AGREEMENT Buyers and Sellers have signed
their names as of the dates below.
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KEYSTONE EQUITY GROUP, L.L.C.
STATE OF IOWA, COUNTY OF __________________________, SS.:
This instrument was acknowledged before me on ______________________, 2026, by
Khoa Bui, as Manager of Keystone Equity Group, L.L.C.
NOTARY PUBLIC
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Passed and approved on ______________________________, 2026, by Resolution No.
26-______________ adopted by the Ames City Council.
CITY OF AMES, IOWA
By: Attest:
John A. Haila, Mayor Renee Hall, City Clerk
STATE OF IOWA, COUNTY OF __________________________, SS.:
This instrument was acknowledged before me on ______________________, 2026, by
John A. Haila and Renee Hall, as Mayor and City Clerk, respectively of the City of Ames,
Iowa.
NOTARY PUBLIC
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EXHIBIT ‘A’ – DEVELOPMENT CONDITIONS AND COVENANTS
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S P A C E A B O V E R E S E R V E D F O R O F F I C I A L U S E
Return document to:
Legal Description:
Document prepared by:
DEVELOPMENT CONDITIONS & COVENANTS FOR CERTAIN
MARKET RATE LOTS IN BAKER SUBDIVISION, AMES, IOWA
THIS AGREEMENT made and entered into ______________________, 2026, by and between
the City of Ames, (hereinafter “City”) and Keystone Equity Group, L.L.C. (hereinafter “Developer”),
collectively known as the “Parties” herein do agree and covenant as follows:
WITNESSETH THAT:
WHEREAS, the City issued a Request for Proposals (RFP) on or about March 9, 2026, to develop six
Market Rate (MR) lots owned by the City in Baker Subdivision; and
WHEREAS, Keystone Equity Group, L.L.C. submitted its proposal (“Keystone Proposal”) for the
development of Lots 9, 13, 14, 16, 23 and 26, in Baker Subdivision (the “Lot” or “Lots”) for consideration by
the City Council, and
WHEREAS, the City Council selected the Keystone Proposal at its April 28, 2026, meeting and adopted
Resolution No. 26-275 to record its approval of the same; and
WHEREAS, the RFP contained certain “Minimum Development Requirements” and “Buyer
Minimum Responsibilities/Requirements” that Developer must abide by and observe as
conditions of the purchase and development of said Lots; and
WHEREAS, with the consent of the Developer, the City seeks to memorialize the requirements
and responsibilities of the RFP as covenants running with the land; AND
NOW THEREFORE, the Parties herein have agreed and do agree as follows with respect to
the development of the Lots:
1. Developer shall comply with all terms and conditions of the City’s RFP No. 2026-089.
2. Developer shall abide by all material aspects of its written “Supplier Response” to RFP No.
2026-089.
3. Developer shall comply with the restrictive covenants for Baker Subdivision (“Baker
Covenants”) which were filed January 6, 2022, as Instrument No. 2022-00200, amended
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by a document filed May 9, 2024, as Instrument No. 2024-02923, amended again by a
document filed July 25, 2024, as Instrument No. 2024-05233, and further amended by a
document filed February 25, 2026, as Instrument No. 2026-01460.
4. Developer shall obey all laws affecting the development of the Lots and shall develop the
Lots in accordance with City standards and requirements.
5. Notwithstanding existing provisions in the Baker Covenants that govern the Developer’s
obligation to commence construction and timelines for completion of structures: (a)
Developer shall initiate construction upon at least three of the Lots no later than October
16, 2026, (b) Developer shall initiate construction upon the three remaining Lots no later
and December 31, 2026, and (c) Developer shall have nine months from the date that
construction is commenced on a Lot to complete the building structure and improvements.
6. The Developer shall construct structures upon the Lots using the house plans as set forth
in the Keystone Proposal, which are as follows:
Baker Subdivision Lot Required House Plan
9 Zeta XL – Standard Elevation with front porch
13 Zeta XL – Farmhouse Elevation
14 Alpha – Farmhouse Elevation
16 Alpha – Modern Elevation
23 Alpha – Standard Elevation
26 Zeta XL – Standard Elevation with front porch
7. Developer agrees that the Planning and Housing Director may approve minor changes or
substitutions of the required house plan for a Lot, in his sole discretion. Any change that
the Planning and Housing Director determines is not minor shall require consideration by
and approval of the City Council. Developer shall not be entitled to--and the City may
withhold--a building permit for any individual Lot in which the house plan has not been
approved by the Planning and Housing Director.
8. Developer shall construct the structures upon each Lot with the following standard features
used throughout the home:
a. Attached two-car garages
b. Open-concept floor plans
c. Quartz countertops
d. Luxury vinyl plank flooring
e. Pella brand windows
f. 100% LED lighting
9. Developer shall not assign the responsibility to serve as general contractor in the
construction of homes upon any of the Lots subject to this Agreement.
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10. Developer shall be prohibited from transferring any Lot subject to this Agreement in fee
simple until such time as the City issues an occupancy permit for the completed structure.
Upon issuance of an occupancy permit, Developer’s obligations under this Agreement shall
be deemed released and satisfied.
11. Upon Developer’s failure to comply with the terms herein, the City shall provide written
notice of default to Developer. Developer shall have 30 days to cure said default (or
commence cure and diligently pursue to completion where any cure cannot be reasonably
completed within 30 days) to the satisfaction of the City. The City may withhold certificates
of occupancy and revoke and/or withhold inspections for the affected Lot(s) and may
suspend review of subsequent development until the default is cured. Additionally, the City
may seek specific performance and injunctive relief to compel compliance with the terms of
this Agreement and prohibit continued or future violations without the necessity of
demonstrating irreparable harm or posting bond.
12. The Parties agree that this Agreement may not be modified without the written consent of
the City and Developer. Any request by Developer to modify or terminate any of the terms
herein shall be submitted in writing to the City with supporting documentation
demonstrating: (a) the specific relief requested; (b) the factual basis and good cause; (c)
that the requested change is consistent with the purposes of this Agreement; and (d)
proposed alternative measures, if any, to maintain the public benefits intended by the
covenants herein. The City may approve, approve with conditions, or deny such a request
in its sole discretion where applicable under the Agreement following such administrative
review and public consideration as the City deems appropriate. Any approval shall be in a
written instrument executed by authorized City officials and recorded against the affected
property. If the City is required to file any action to enforce this Agreement herein, it shall
be entitled to reimbursement of its reasonable costs to maintain said action provided that
the City prevails. The remedies herein are cumulative and in addition to any other rights or
remedies available at law or in equity. No delay or failure by the City to enforce any
covenant shall constitute a waiver or estoppel as to any past, present, or future violation.
IN WITNESS WHEREOF, the Parties hereto have caused this instrument to be executed
effective as of the date first above written.
[ S I G N A T U R E B L A N K S F O L L O W ]
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KEYSTONE EQUITY GROUP, L.L.C.
By:
KHOA BUI, Manager
STATE OF IOWA, COUNTY OF STORY, SS.:
This instrument was acknowledged before me on , 202 , by Khoa
Bui, as Manager of Keystone Equity Group, L.L.C.
NOTARY PUBLIC
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Passed and approved on , 202 , by Resolution No. 2 - adopted by
the City Council of the City of Ames, Iowa.
CITY OF AMES, IOWA
By:
John A. Haila,
Attest:
Renee Hall,
STATE OF IOWA, COUNTY OF STORY, SS.:
This instrument was acknowledged before me on , 202 , by John A.
Haila and Renee Hall, as Mayor and City Clerk, respectively, of the City of Ames, Iowa.
NOTARY PUBLIC
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