Item 17 - Public Hearing - Purchase and Sale Agreement for 1901 W. Walnut Street

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Purchase and Sale Agreement for 1901 W. Walnut St. February 17, 2026 Page 2 • Establishment of a micro -farm as an economic development initiative. • Creation of employment opportunities and organic produce production. • Promotion of a worker cooperative model encouraging resident participation in the local neighborhood economy. • Enhancement of civic engagement and healthy living. Since execution of the DDA, THRIVE Santa Ana, Inc. has completed the development of a community microform called La Colmena. La Colmena features a regenerative farm, a cafe, artisan retail space, and gathering areas for markets and events. Operated under the principles of a Community Land Trust, La Colmena promotes local food access, small business development, and community engagement, serving as a model for sustainable, resident -driven land stewardship in Santa Ana. The operation of a community micro -farm is consistent with the definition of a "Plant Nursery," which is an allowed use in the Community Commercial (C-1) zoning district. The subject property is located within the Community Commercial (C-2) zoning district, which allows additional uses permitted in the C-1 district pursuant to Section 41-377(a) of the Santa Ana Municipal Code. Accordingly, the micro -farm use is consistent with the applicable zoning regulations (Exhibit 5). The ground lease with THRIVE Santa Ana, Inc. granted the organization the exclusive option to purchase the property at a gross sales price equivalent to the negotiated fair market value, as determined through an appraisal. To initiate the option, THRIVE was required to submit a Letter of Intent (Exhibit 1) and a deposit of $5,000, which would be applied toward the cost of the appraisal. After being informed of this valuation, THRIVE noted that its State grant allows for a maximum acquisition amount of $852,000 and requested that the City consider providing a donation or subsidy for the difference (Exhibit 3). Staff informed THRIVE that any sale below fair market value would require preparation of an economic subsidy report for City Council approval. On July 16, 2019, the City Council approved a zoning map amendment for the subject site and properties, rezoning the subject site as General Commercial (C2). Concurrent with this rezoning and in accordance with the California Environmental Quality Act (CEQA), a Mitigated Negative Declaration (MND) (Environmental Review No. 2017-140) with technical studies was prepared for the rezoning. No areas of unavoidable impacts were identified as resulting from the construction or operation of the proposed project. Purchase and Sale Agreement On October 17, 2025, THRIVE submitted a Letter of Intent to the City requesting consideration for the purchase of the property. The Community Development Agency (CDA) received an independent appraisal report (Exhibit 2) dated November 11, 2025 that established the fair market value of the property at $1,030,000. On December 3, THRIVE submitted a revised letter (Exhibit 3) requesting an economic subsidy of $178,000, representing the difference between the property's appraised fair market value and the state grant funds available for its purchase.