Title
Resolution to Approve an Agreement for the Sale of Air Rights Over the Library Lot to the Ann Arbor District Library (8 Votes Required)
Memorandum
Per Resolution R-25-140, City Council authorized the City Administrator to negotiate the sale of air rights over the City property at 319 S. Fifth Ave. and 326 S. Division St. (commonly known as the Library Lot) to the Ann Arbor District Library (AADL) after approval by the voters of City Charter amendments authorizing the sale.
AADL’s stated intent is to construct (with its own development partners) a mixed use project consisting of two connected buildings, one on the current AADL parcel and one on the Library Lot respectively. The project is proposed to include a new library, a mix of housing, including market rate units, condos, and some affordable units, and outdoor public space on the ground level of the Library Lot parcel. The City would continue to operate the subsurface parking structure on the Library Lot.
This resolution approves a purchase agreement for the sale of air rights between the City and AADL which sets forth the conditions for closing. The air rights being conveyed generally consist of the air space from grade level up to 260 feet above the surface of the parking structure north of Library Lane. The height is the maximum allowed height under D1 zoning (including the possible height bonus for including affordable housing or sustainability components, provided the applicable code requirements are met). The Purchase Agreement also sets forth the parameters of an Easement, Development, and Construction Agreement (EDCA), which the parties will enter into prior to closing and which will govern the development process, requirements, and timeline going forward as AADL seeks a development partner, obtains necessary approvals, and commences construction of their proposed mixed use project.
This resolution authorizes the City Administrator to negotiate and finalize terms of the EDCA and any other instruments and agreements that may be needed to conclude the transaction and complete the development.
Budget / Fiscal Impact: The City is conveying the air rights property over the Library Lot for one dollar and the terms and conditions contained in the purchase agreement. The parties will generally bear their own expenses in implementing and administering this transaction. Expenses that fall outside of existing departmental budgets, such as additional legal or consultant fees, will require separate Council approval.
Staff
Prepared by: Christopher Frost, Senior Assistant City Attorney
Reviewed by: Atleen Kaur, City Attorney
Approved by: Milton Dohoney Jr., City Administrator
Body
Whereas, City Council has a goal to improve the affordability of living in the City by increasing the housing supply;
Whereas, AADL has expressed interest in developing a mixed use building with substantial housing as well as a new library on the City Library Lot property;
Whereas, In August of 2025, the voters approved amendments to the City Charter authorizing the City to convey a property interest in the Library Lot to the AADL;
Whereas, The City and AADL have come to a tentative agreement on the form of a Purchase Agreement and subsequent Easement, Development, and Construction Agreement to convey air rights over a portion of the Library Lot property and pursue approval and construction of a mixed use housing development and new public library;
Whereas, Per Section 1:321 of City Code, the City Administrator has recommended that an appraisal is not necessary because of the City’s interest in supporting the AADL’s proposed mixed use project consistent with the commitments from AADL contained in the Purchase Agreement;
RESOLVED, That City Council approves an agreement of sale for air rights over a portion of the Library Lot (“Purchase Agreement”) with AADL in substantially the form attached, and the Mayor and Clerk are authorized and directed to sign the Purchase Agreement after final approval by the City Administrator and City Attorney;
RESOLVED, That the City Administrator is authorized to negotiate and execute the Easement, Development, and Construction Agreement (“EDCA”) consistent with the terms of the Purchase Agreement after approval by the City Attorney;
RESOLVED, That City Council approves the acceptance of all easements necessary for the City to operate the Library Lot parcel and parking structure or perform any other City activity at or after conveyance of the air rights property, approval or amendment of AADL’s proposed project, or construction of the project, after such easements are approved by the City Administrator and City Attorney;
RESOLVED, That City Council approves the granting of all easements on, over, through, or beneath the Library Lot property necessary for the approval, construction, or operation of the AADL project, including utilities, access, and maintenance, after such easements are approved by the City Administrator and City Attorney;
RESOLVED, That the Mayor and Clerk are authorized and directed to sign the Purchase Agreement, the EDCA, and all related easements, instruments and other agreements, after approval by the City Administrator and City Attorney;
RESOLVED, That, per Section 1:321 of City Code, an appraisal is not necessary at this time because of the City’s interest in supporting the AADL’s proposed mixed use project consistent with the commitments from AADL contained in the Purchase Agreement; and
RESOLVED, That the City Administrator is authorized to take all appropriate actions to implement this resolution and the Purchase Agreement, to exercise all determinations and authority delegated to the City under any agreement contemplated by this resolution, and to negotiate, execute, and manage all ancillary documents, instruments, and agreements after approval by the City Attorney.
Sponsored By: Mayor Taylor