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CITY OF
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@ MUSKEGON
Agenda Item Review Form
Muskegon City Commission
Commission Meeting Date: August 26, 2025 Title: Sale of 561 Catherine
Submitted by: Samantha Pulos, Code Department: Planning
Coordinator
Brief Summary:
Staff is seeking authorization to sell the City-owned vacant lot at 561 Catherine to Habitat for
Humanity of Kent County.
Detailed Summary & Background:
Habitat for Humanity of Kent County would like to purchase the City-owned buildable lot at 56]
Catherine for $7,500 (75% of the True Cash Value of $10,000) plus half of the closing costs, and the fee
to register the deed. The lot will be split into three 44' x 132' lots. Habitat for Humanity of Kent County
will be constructing a single-family home on each of the properties. The homes will be sold to home-
buyers at or below the 80% AMI. The sale price of each home is estimated to fall between $165,000
and $185,000. Please note, the buyers have requested that their timeline to commence construction
be stated in the purchase agreement as “by April 30, 2026” instead of the standard 60 days, due to
concern about meeting the deadline with it almost being September.
Goal/Action Item:
2027 Goal 2: Economic Development Housing and Business
Is this a repeat item?:
Explain what change has been made fo justify bringing it back to Commission:
Amount Requested: Budgeted Item:
n/a Yes No N/A. | x
Fund(s) or Accouni(s): Budget Amendment Needed:
n/a Yes No N/A | x
Recommended Motion:
Authorize staff to sell the City-owned vacant lot at 561 Catherine to Habitat for Humanity of Kent
County.
Approvals: Name the Policy/Ordinance Followed:
immediate Division x Master Plan, Zoning Ordinance, Policy for the Use
Head & Sale of City-Owned Residential Property
Information
Technology
Other Division Heads
Communication
Legal Review
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PURCHASE AND DEVELOPMENT AGREEMENT
This Purchase and Development Agreement (“Agreement”) is made August 26th, 2025 (“Effective
Date”), between the City of Muskegon, a Michigan municipal corporation, of 933 Terrace Street,
Muskegon, Michigan 49440 (“City”), and Habitat for Humanity of Kent County, a Michigan nonprofit
corporation, of 425 Pleasant Street, SW, Grand Rapids, MI, 49503, (“Developer”), with reference to the
following facts:
Background
A. City is the owner of one (1) buildable lot, being 561 Catherine, more specifically described
in attached Exhibit A. Prior to closing, City shall split the lot into three (3) lots, more specifically described
in attached Exhibit B.
B. Developer proposes to purchase and develop the three (3) vacant lots owned by City, which
are all located in the City of Muskegon, Muskegon County, Michigan, and each commonly known and
legally described on the attached Exhibit B (each property individually, a “Parcel” and collectively “Project
Properties”).
C. City and Developer desire to establish the terms, covenants, and conditions upon which
City will sell and Developer will purchase and develop the Project Properties. Developer intends to develop
on each of the Project Properties a single-family house (the “Project”).
Therefore, for good and valuable consideration, the parties agree as follows:
1. Sale and Purchase of Project Properties. City agrees to sell to Developer, and Developer
agrees to purchase from City, on the terms and subject to the conditions set forth in this Agreement, the
Project Property, subject to reservations, restrictions, and easements of record.
2. Purchase Price. The total purchase price for the Project Property shall be $7,500.00,
which shall be paid in cash or other immediately available funds at Closing (defined below) less the $400
deposit that the Developer has paid to the City of Muskegon.
Pursuant to Paragraph 3(b) below, the parties acknowledge and agree that Developer shall be eligible to be
reimbursed all or a portion of the purchase price for the Parcel upon the completion of certain design
standards as further described herein.
3. Construction and Development Requirements.
a Construction Dates. The parties acknowledge and agree that Developer shali have
a period of eighteen (18) months from the date of Closing to complete the Project (“Construction
Period”), except as otherwise provided in this Agreement or as otherwise mutually agreed upon by
the parties in writing.
b. Construction Details; Purchase Price Reimbursement. Developer’s construction
and development of the Project Properties, including single-family homes, duplexes, triplexes, and
accessory dwelling units, shall be in substantial conformance with its plans and specifications
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provided to City by Developer or as otherwise agreed upon in writing between City and Developer.
As referenced above, Developer shall be eligible for reimbursement of all or a portion of the
purchase price for the Project Properties upon Developer’s satisfaction of the following design
standards for each single-family home, duplex, triplex, and accessory dwelling unit it constructs on
the Project Properties. If the Project includes an accessory dwelling unit, both the primary dwelling
unit (single-family home, duplex, triplex) and the accessory dwelling unit must meet the design
standards outlined below to be eligible for reimbursement.
Design Standard Purchase Price Reimbursement for Parcel
Open front porch of at least 60 sq. ft. 20%
Picture or bay window 20%
Alley-loaded parcel 20%
Shutter or other acceptable window 20%
treatments
Underground Sprinkling 20%
(By way of example only: If Developer completes three of the design standards listed above for
the construction at the Parcel located at 551 Catherine, Developer would be reimbursed $1,500.00,
which is 60% of the $2,500.00 purchase price for this Parcel. If Developer completes all five
design standards, Developer would be reimbursed the entire purchase price for this Parcel.)
4, Right of Reversion. Notwithstanding anything herein to the contrary, and as security for
Developer’s obligation to commence and complete construction of a single-family house on each of the
Project Properties, the quit claim deed conveying the Project Properties to Developer shall contain a right
of reversion in all of the Project Properties (“City’s Reversionary Right”), which may be exercised by City,
in its sole and absolute discretion, if any of the following conditions occur:
a. Developer does not commence construction by April 30", 2026, in which case title
to all of the Project Properties shall automatically revert to City upon the terms and conditions
further provided in this Paragraph 4 below. For purposes of this Paragraph 4(a), commencing
construction means furnishing labor and materials to the Parcel of the Project Property and
beginning installation of the approved single-family home.
db. Developer does not complete construction of the Project Property prior to
expiration of the Construction Period, in which case title to any of the Project Properties that are
not complete by the end of the Construction Period shall automatically revert to City upon the terms
and conditions further provided in this Paragraph 4 below. For purposes of this Paragraph 4(b),
completing construction means the issuance of an occupancy permit by City for the Project
Property. Provided, however, the parties agree to reasonably negotiate an extension of the
Construction Period up to a period of six (6) months for the Project Property that have a completed
foundation before the expiration of the initial Construction Period.
If any of the above conditions occur, City shall automatically have City’s Reversionary Right to reacquire
title to the Project Property, as the case may be. To exercise City’s Reversionary Right described herein,
City must provide written notice to Developer (or its permitted successors, assigns, or transferees) within
thirty (30) days of Developer’s failure under this Agreement, but in any event prior to Developer satisfying
the conditions set forth in Paragraph 4(a) or Paragraph 4(b) above, as the case may be, and record such
notice with the Muskegon County Register of Deeds. Upon request of City, Developer shall take all
reasonable steps to ensure City acquires marketable title to the Project Property, as the case may be, through
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its exercise of its rights under this Paragraph within thirty G0) days of City’s demand, including without
limitation, the execution of appropriate deeds and other documents.
In addition, if the Project Property revert to City, City may retain the purchase price for such Project
Property free and clear of any claim of Developer or its assigns. In the event of reversion of title of the
Project Property, improvements made on such Project Property shall become the property of City. In no
event shall the Project Property be in a worse condition than upon the date of Closing. These covenants and
conditions shall run with the land and be recorded in the quit claim deed from City to Developer.
5. Title Insurance. Within five (5) days after the Effective Date, Developer shall order a title
commitment for an extended coverage ALTA owner’s policy of title insurance issued by Transnation Title
Agency (the “Title Company”) for the Project Property in the amount of the total purchase price for the
Project Property and bearing a date later than the Effective Date, along with copies of all of the underlying
documents referenced therein (the “Title Commitment”). Developer shall cause the Title Company to issue
a marked-up commitment or pro forma owner’s policy with respect to the Project Property at the Closing
naming Developer as the insured and in form and substance reasonably satisfactory to Developer, but
subject to Permitted Exceptions (defined below). As soon as possible after the Closing, Developer shall
cause the Title Company to furnish to Developer an extended coverage ALTA owner’s policy of title
insurance with respect to the Project Property (the “Title Policy”). City shall be responsible for the cost of
the Title Policy; provided, however, Developer shall be solely responsible for the cost of any endorsements
to the Title Policy that Developer desires.
6. Title Objections. Developer shall have until the end of the Inspection Period (as defined
below) within which to raise objections to the status of City’s title to the Project Properties. If objection to
the title is made, City shall have seven (7) days from the date it is notified in writing of the particular defects
claimed to either (a) remedy the objections, or (b) notify Developer that it will not remedy the objections.
If Developer does not notify City in writing as to any title or survey objections, then Developer will be
deemed to have accepted the condition of title as set forth in the Title Commitment. If City is unwilling or
unable to remedy the title or obtain title insurance over such defects within the time period specified, then
notwithstanding anything contained herein to the contrary, Developer may, at its option, upon written notice
to City, either (i) terminate this Agreement and neither City nor Developer shall have any further obligation
to the other pursuant to this Agreement, except as otherwise provided herein, or (ii) waive such objection,
in which case such objection shall become a Permitted Exception, and thereafter proceed to the Closing
according to the terms of this Agreement. Any matter disclosed on the Title Commitment that is waived or
not objected to by Developer shall be deemed a “Permitted Exception.”
7. Property Taxes and Assessments. City shall be responsible for the payment of all real
estate taxes and assessments that become due and payable prior to Closing, without proration. Developer
shall be responsible for the payment of all real estate taxes and assessments that become due and payable
after Closing, without proration.
8. Survey. Developer at its own expense may obtain a survey of any or all of the Project
Property, and Buyer or its surveyor or other agents may enter any of the Project Property for that purpose
prior to Closing. If no survey is obtained, Developer agrees that Developer is relying solely upon
Developer's own judgment as to the location, boundaries, and area of the Project Property and
improvements thereon without regard to any representations that may have been made by City or any other
person. In the event that a survey by a registered land surveyor made prior to Closing discloses an
encroachment or substantial variation from the presumed land boundaries or area, City shall have the option
of affecting a remedy within seven (7) days after disclosure, or terminate this Agreement. Developer may
elect to purchase the Project Property subject to said encroachment or variation.
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9. Inspection Period. At Developer’s sole option and expense, Developer and Developer’s
agents may conduct inspections of each of the Project Property within thirty (30) days after the Effective
Date (“Inspection Period’). Developer’s inspection under this Paragraph may include, by way of example
but not limitation, inspections of any existing improvements to each Parcel, other systems servicing the
Parcel, zoning, and the suitability for Developer’s intended purposes for each Parcel. If Developer, in
Developer’s reasonable discretion, is not satisfied with the results of the inspections for any reason,
Developer shall notify City in writing of Developer’s prior to expiration of the 30-day Inspection Period. If
Developer so notifies City, this Agreement shall be terminated and have no further force and effect. If no
written objection is made by Developer within the stated period, this inspection contingency shall be
deemed to be waived by Developer and the parties shall proceed to Closing in accordance with the terms
of this Agreement.
10. Condition of Project Property. City and Developer acknowledge and agree that the Parcel
in the Project Property is being sold and delivered “AS IS”, “WHERE IS” in its present condition. Except
as specifically set forth in this Agreement or any written disclosure statements, City has not made, does not
make, and specifically disclaims any and all representations, warranties, or covenants of any kind or
character whatsoever, whether implied or express, oral or written, as to or with respect to (i) the value,
nature, quality, or condition of any of the Project Property, including without limitation, soil conditions,
and any environmental conditions; (ii) the suitability of the Project Property for any or all of Developer’s
activities and uses; (iii) the compliance of or by the Project Property with any laws, codes, or ordinances;
(iv) the habitability, marketability, profitability, or fitness for a particular purpose of the Project Property;
(v) existence in, on, under, or over the Project Property of any hazardous substances; or (vi) any other matter
with respect to the Project Property. Developer acknowledges and agrees that Developer has or will have
the opportunity to perform inspections of the Project Property pursuant to this Agreement and that
Developer is relying solely on Developer’s own investigation of the Project Property and not on any
information provided to or to be provided by City (except as specifically provided in this Agreement). If
the transaction contemplated herein closes, Developer agrees to accept the respective Project Property
acquired by Developer and waive all objections or claims against City arising from or related to such Project
Property and any improvements thereon except for a breach of any representations or warranties or
covenants specifically set forth in this Agreement. In the event this transaction closes, then subject to City’s
express representations, warranties, and covenants in this Agreement, Developer acknowledges and agrees
that it has determined that the respective Project Property it has acquired and all improvements thereon are
in a condition satisfactory to Developer based on Developer’s own inspections and due diligence, and
Developer has accepted such Project Property in their present condition and subject to ordinary wear and
tear up to the date of Closing. The terms of this Paragraph shall survive the Closing and/or the delivery of
the deed.
11. Developer’s Representations and Warranties of Developer. Developer represents,
covenants, and warrants the following to be true:
a. Authority. Developer has the power and authority to enter into and perform
Developer’s obligations under this Agreement.
b. Litigation, No judgment is outstanding against Developer and no litigation, action,
suit, judgment, proceeding, or investigation is pending or outstanding before any forum, court, or
governmental body, department or agency or, to the knowledge of Developer, threatened, that has
the stated purpose or the probable effect of enjoining or preventing the Closing.
C. Bankruptcy. No insolvency proceeding, including, without limitation, bankruptcy,
receivership, reorganization, composition, or arrangement with creditors, voluntary or involuntary,
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affecting Developer or any of Developer's assets or properties, is now or on the Closing Date will
be pending or, to the knowledge of Developer, threatened.
12. Conditions Precedent. This Agreement and all of the obligations of Developer under this
Agreement are, at Developer’s option, subject to the fulfillment, before or at the time of the Closing, of
each of the following conditions:
a. Performance. The obligations, agreements, documents, and conditions required to
be signed and performed by City shall have been performed and complied with before or at the date
of the Closing.
b. City Commission Approval. This Agreement is approved by the Muskegon City
Commission.
13. Default.
a. By Developer. In the event Developer fails to comply with any or all of the
obligations, covenants, warranties, or agreements under this Agreement and such default is not
cured within ten (10) days after receipt of notice (other than Developer’s failure to tender the
purchase price in full at Closing, a default for which no notice is required), then City may terminate
this Agreement.
b. By City. In the event City fails to comply with any or all of the obligations,
covenants, warranties or agreements under this Agreement, and such default is not cured within ten
(10) days after receipt of notice, then Developer may either terminate this Agreement or Developer
may pursue its legal and/or equitable remedies against City including, without limitation, specific
performance.
14. Closing.
a. Date of Closing. The closing date of this sale shall be as mutually agreed by the
parties, but in no event later than 60 days from the City Commission’s approval of the sale
(“Closing”), unless this Agreement is terminated in accordance with its provisions. The Closing
shall be conducted at such time and location as the parties mutually agree.
b. Costs. The costs associated with this Agreement and the Closing shall be paid as
follows: (i) Developer shall pay any state and county transfer taxes in the amount required by law;
(ii) City shall pay the premium for the owner’s Title Policy, provided that Developer shall pay for
any and all endorsements to the Title Policy that Developer desires; (iii) City shall be responsible
to pay for the recording of any instrument that must be recorded to clear title to the extent required
by this Agreement; (iv) Developer shall pay for the cost of recording the deed; and (v) Developer
and City shall each pay one-half of any closing fees charged by the Title Company.
C. Deliveries. At Closing, City shall deliver a quit claim deed for the Project
Properties and Developer shall pay the purchase price. The quit claim deed to be delivered by City
at closing shall include the City Right of Reversion described in Paragraph 4 above. The parties
shall execute and deliver such other documents reasonably required to effectuate the transaction
contemplated by this Agreement.
15. Real Estate Commission. Developer and City shall each be responsible for any fees for
any real estate agents, brokers, or salespersons regarding this sale that it has hired, but shall have no
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obligation as to any fees for any real estate agents, brokers, or salespersons regarding this sale that the other
party has hired.
16. Notices. All notices, approvals, consents and other communications required under this
Agreement shall be in writing and shall be deemed given: (i) when delivered in person; (ii) when sent by
fax or email: (iii) when sent by a nationally-recognized receipted overnight delivery service with delivery
fees prepaid; or (iv) when sent by United States first-class, registered, or certified mail, postage prepaid.
The notice shall be effective immediately upon personal delivery or upon transmission of the fax or email;
one day after depositing with a nationally recognized overnight delivery service; and five (5) days after
sending by first class, registered, or certified mail.
Notices shall be sent to the parties as follows:
To City: City of Muskegon
Attn.: Samantha Pulos, Code Coordinator
933 Terrace Street
Muskegon, MI 49440
To Developer: Habitat for Humanity of Kent County
Andrew Claucherty
425 Pleasant St. SW
Grand Rapids, MI 49503
Phone: (616) 588-5233
Email: aclaucherty@habitatkent.org
17. Miscellaneous.
a. Governing Law. This Agreement will be governed by and interpreted in
accordance with the laws of the state of Michigan.
b. Entire Agreement. This Agreement constitutes the entire agreement of the parties
and supersedes any other agreements, written or oral, that may have been made by and between the
parties with respect to the subject matter of this Agreement. All contemporaneous or prior
negotiations and representations have been merged into this Agreement.
c. Amendment. This Agreement shall not be modified or amended except in a
subsequent writing signed by all parties.
d. Binding Effect. This Agreement shall be binding upon and enforceable by the
parties and their respective legal representatives, permitted successors, and assigns.
e. Counterparts. This Agreement may be executed in counterparts, and each set of
duly delivered identical counterparts which includes all signatories, shall be deemed to be one
original document.
f. Full Execution. This Agreement requires the signature of all parties. Until fully
executed, on a single copy or in counterparts, this Agreement is of no binding force or effect and if
not fully executed, this Agreement is void.
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g. Non-Waiver. No waiver by any party of any provision of this Agreement shall
constitute a waiver by such party of any other provision of this Agreement.
h. Severability. Should any one or more of the provisions of this Agreement be
determined to be invalid, unlawful, or unenforceable in any respect, the validity, legality, and
enforceability of the remaining provisions of this Agreement shall not in any way be impaired or
affected.
i. No Reliance. Each party acknowledges that it has had full opportunity to consult
with legal and financial advisors as it has been deemed necessary or advisable in connection with
its decision to knowingly enter into this Agreement. Neither party has executed this Agreement in
reliance on any representations, warranties, or statements made by the other party other than those
expressly set forth in this Agreement.
j. Assignment or Delegation. Except as otherwise specifically set forth in this
Agreement, neither party shall assign all or any portion of its rights and obligations contained in
this Agreement without the express or prior written approval of the other party, in which approval
may be withheld in the other party's sole discretion.
k, Venue and Jurisdiction. The parties agree that for purposes of any dispute in
connection with this Agreement, the Muskegon County Circuit Court shall have exclusive personal
and subject matter jurisdiction and that Muskegon County is the exclusive venue.
This Agreement is executed effective as of the Effective Date set forth above.
CITY: DEVELOPER:
CITY OF MUSKEGON HABITAT FOR HUMANITY OF KENT COUNTY
By: OV,"aj Ovedbwacr ——_ py| Cen lawcherty — sixtieindesist
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Name! Ken Johison Name: Andrew Claucherty
Title: M Dated: 08/26/2025
Dated: C= 96-So95
ay Na ae
Name: Ann Marie Meisch
Title: City Clerk
Dated: SAC -RORS
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Exhibit A
The following described premises located in the City of Muskegon, County of Muskegon, State of
Michigan, and legally described as follows:
Legal Description: CITY OF MUSKEGON REVISED PLAT 1903 LOTS 4 & 5 BLK 81
Address: 561 CATHERINE AVE, MUSKEGON, MI 49442
Parcel #: 61-24-205-081-0004-00
Price: $7,500.00
(TO BE SPLIT INTO THREE BUILD-ABLE LOTS)
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Exhibit B
The following described premises located in the City of Muskegon, County of Muskegon, State of
Michigan, and legaliy described as follows:
Legal Description: CITY OF MUSKEGON REVISED PLAT 1903 E 44 FT LOT 4 BLK 81
Address: 561 CATHERINE AVE, MUSKEGON, MI 49442
Parcel #: TBD
Price: $2,500.00
Legal Description: CITY OF MUSKEGON REVISED PLAT 1903 W 22 FT LOT 4 & E 22 FT LOT
5 BLK 81
Address: 551 CATHERINE AVE, MUSKEGON, MI 49442
Parcel #: TBD
Price: $2,500.00
Legal Description: CITY OF MUSKEGON REVISED PLAT 1903 W 44 FT LOT 5 BLK 81
Address: 541 CATHERINE AVE, MUSKEGON, MI 49442
Parcel #: TBD
Price: $2,500.00
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