M E M O R A N D U M

      September 20, 2011


To:		Members of the Board of Trustees

From:		Nancy L. Zimpher, Chancellor 

Subject:	Acquisition of Property -- University at Buffalo 


Action Requested

		The proposed resolution authorizes the State University at Buffalo to acquire real property for the continued storage of library materials.  

Resolution
      
      I recommend that the Board of Trustees adopt the following resolution:

Whereas it is necessary for the purposes of the University at Buffalo (“UB”) to maintain a storage facility for its growing library materials; and 

Whereas since March 2005 UB has leased a building located off-campus at 3850-52 Rensch Road, Amherst, NY (“the Library Archive”) for library storage; and

Whereas the Library Archive had been constructed as a new building to UB’s specifications by its landlord following a Request for Proposals, and was designed specifically for UB’s library storage needs; and

Whereas under the lease held by UB for the Library Archive, its landlord, Buffalo Archive LLC, granted UB the option to purchase the building, and the real property on which it sits, by either (1) paying a set price in the lease (depending on the year in which the option is exercised) or (2) assuming the landlord’s mortgage; and 

Whereas UB is in the sixth year of its lease, which provides that the purchase price for that year shall be $3,600,000 (three million, six hundred thousand dollars); and
Whereas purchasing the Library Archive property outright at this point of the lease term, rather than paying the landlord rent over the 20 year term, will result in savings of over $3.5 million to the State University; now, therefore, be it

Resolved that the real property, totaling some 2.7 acres, situate at 3850 and 3852 Rensch Road, in the Town of Amherst, County of Erie, State of New York, as set out in the attached survey map, be purchased for a purchase price of $3,600,000, subject to an accurate survey and approval of title to said real property by the Attorney General; and, be it further 

Resolved that the Chancellor, or designee, be, and hereby is, authorized to execute any and all documents, notices, maps, or any other instruments necessary or appropriate to effect the acquisition of such property.  

Background

	Since March 2005, UB has rented a 17,800 sq. ft. storage building off-campus to house certain of its library holdings.  The building had been built pursuant to an RFP issued by UB for the construction and lease of the facility and UB’s detailed specifications.  UB retained the option under the lease to purchase the building at any time during the term for a set price (according to a schedule in the lease and which depended upon the year in which the option is exercised).  The State Comptroller approved the lease and the terms for UB to purchase the building, including the purchase price schedule.

	UB wants to purchase the building since paying a flat fee for the purchase of the facility at this relatively early point in the 20-year term will result in savings of over $3.5 million, compared with paying monthly rent and common maintenance charges of $29,000.  UB will purchase the building by using campus IFR (Income Fund Reimbursable) moneys that have been reserved for such purpose.  In addition, the UB Foundation Activities, Inc., one of the campus-related entities, has agreed to pay certain transaction-related costs.


Attachment






Board Resolution	-2-	September 20, 2011