Here's a related article from the Sac Business Journal. Some interesting stuff I think.
http://masshightech.bizjournals.com/masshightech/othercities/sacramento/stories/2006/07/31/story2.html?page=1&b=1154318400^1322846
Union Pacific: Railyard deal will close in 8 weeks
Sacramento Business Journal - July 28, 2006by Melanie Turner and Mike McCarthyStaff Writers
So many deadlines have come and gone in the proposed sale of the downtown Sacramento railyard that the developer trying to buy the parcel won't publicly speculate on when the deal might close and the property change hands.
But a Union Pacific Railroad Co. official said this week that he expects the sale of the company's 240-acre railyard to Thomas Enterprises to close in six to eight weeks.
The rail company has been in escrow with the Atlanta-based developer for two years, and has been negotiating for three years. If the long-awaited deal does happen, it would kick off one of the biggest developments yet in the Sacramento region. It would also remove the first big hurdle to placing an arena for the Sacramento Kings in the railyard.
Mike Casey, the rail company's general director for special properties, said that he hopes to wrap up a deal soon for insurance to protect Thomas from liability related to the site's environmental cleanup. The parties are arranging insurance with American International Group Inc.
If the insurance package is finalized in meetings at the insurer's New York offices this week, close of escrow should come within the next eight weeks, he said.
Technically, the contract between Union Pacific and Thomas calls for a September closing, said Tony Love, assistant vice president of real estate for the rail company. "We're hopeful," he said.
After years of hoping the deal would close sooner than expected, Thomas' Sacramento representative, Suheil Totah, would not confirm that the insurance talks would lead to close of escrow within that time. But his company plans to start on the first stage of the huge railyard project next year, he said.
The deal could be crucial to the Kings' arena plan recently announced by Sacramento city and county officials. They plan to put a measure on the November ballot asking for a quarter-cent sales-tax increase to raise $1.2 billion, about half for a new arena for the team to replace Arco Arena.
Although officials have alternative sites for the arena, the railyard is preferred.
Thomas officials are processing a development plan with the city that calls for an arena site of about 10 acres. It also proposes 1.3 million square feet of retail, including a Bass Pro Shops store, along with up to 10,676 homes and 3.9 million square feet of office space.
Thomas plans to build most of the retail immediately, and to renovate the Central Shops historic area as a mix of museum, public market and entertainment center. The $470 million-plus arena would be built by the team ownership and the city and county on land purchased from Thomas.
American International Group Inc. (NYSE: AIG) is one of the world's largest insurance and financial services companies.
The coverage would be for environmental-impairment liability, which typically is purchased separate from general liability insurance coverage. Coverage in the specialty line of insurance can be hard to obtain depending on the scope and nature of contamination that could be present.
Land buyers purchase insurance against the risk of pollution on their property, said Greg Van Ness, managing director of the west-central division of insurance brokerage Acordia Inc. He's not familiar with the railyard's situation, but his brokerage sells that type of insurance.
If pollution is known to exist on a property, land buyers typically buy coverage to cap the total amount they'll have to spend for the cleanup. It's essentially excess insurance against cost overruns for pollution found after the sale.
Land sales can be held up if prospective buyers can't be assured of some limit to which they'll be held responsible for any cleanup.
Sometimes sellers also buy a type of environmental insurance that caps their liability in a remediation project.
Staff writer Kelly Johnson contributed to this story.
Sacramento Business Journal - July 28, 2006by Melanie Turner and Mike McCarthyStaff Writers
So many deadlines have come and gone in the proposed sale of the downtown Sacramento railyard that the developer trying to buy the parcel won't publicly speculate on when the deal might close and the property change hands.
But a Union Pacific Railroad Co. official said this week that he expects the sale of the company's 240-acre railyard to Thomas Enterprises to close in six to eight weeks.
The rail company has been in escrow with the Atlanta-based developer for two years, and has been negotiating for three years. If the long-awaited deal does happen, it would kick off one of the biggest developments yet in the Sacramento region. It would also remove the first big hurdle to placing an arena for the Sacramento Kings in the railyard.
Mike Casey, the rail company's general director for special properties, said that he hopes to wrap up a deal soon for insurance to protect Thomas from liability related to the site's environmental cleanup. The parties are arranging insurance with American International Group Inc.
If the insurance package is finalized in meetings at the insurer's New York offices this week, close of escrow should come within the next eight weeks, he said.
Technically, the contract between Union Pacific and Thomas calls for a September closing, said Tony Love, assistant vice president of real estate for the rail company. "We're hopeful," he said.
After years of hoping the deal would close sooner than expected, Thomas' Sacramento representative, Suheil Totah, would not confirm that the insurance talks would lead to close of escrow within that time. But his company plans to start on the first stage of the huge railyard project next year, he said.
The deal could be crucial to the Kings' arena plan recently announced by Sacramento city and county officials. They plan to put a measure on the November ballot asking for a quarter-cent sales-tax increase to raise $1.2 billion, about half for a new arena for the team to replace Arco Arena.
Although officials have alternative sites for the arena, the railyard is preferred.
Thomas officials are processing a development plan with the city that calls for an arena site of about 10 acres. It also proposes 1.3 million square feet of retail, including a Bass Pro Shops store, along with up to 10,676 homes and 3.9 million square feet of office space.
Thomas plans to build most of the retail immediately, and to renovate the Central Shops historic area as a mix of museum, public market and entertainment center. The $470 million-plus arena would be built by the team ownership and the city and county on land purchased from Thomas.
American International Group Inc. (NYSE: AIG) is one of the world's largest insurance and financial services companies.
The coverage would be for environmental-impairment liability, which typically is purchased separate from general liability insurance coverage. Coverage in the specialty line of insurance can be hard to obtain depending on the scope and nature of contamination that could be present.
Land buyers purchase insurance against the risk of pollution on their property, said Greg Van Ness, managing director of the west-central division of insurance brokerage Acordia Inc. He's not familiar with the railyard's situation, but his brokerage sells that type of insurance.
If pollution is known to exist on a property, land buyers typically buy coverage to cap the total amount they'll have to spend for the cleanup. It's essentially excess insurance against cost overruns for pollution found after the sale.
Land sales can be held up if prospective buyers can't be assured of some limit to which they'll be held responsible for any cleanup.
Sometimes sellers also buy a type of environmental insurance that caps their liability in a remediation project.
Staff writer Kelly Johnson contributed to this story.
