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SURPLUS REAL PROPERTY SALES
Q. What is Real Property?
A. Land and anything permanently attached to land (appurtenances), including buildings, structures, fixtures, fences, improvements, etc.
Q. How can I purchase a City-owned vacant lot or unoccupied City building next to my house?
A. Before any City-owned real property is sold, the City department who has jurisdiction and control over the property must determine that it is no longer required for their use and must declare the property excess. Any real property, vacant or improved, under the control of any board authorized by the Charter or by law to acquire, hold or control the property shall not be sold without the approval of the board or officer having the management of the department.
For example, a vacated old branch library must first be declared no longer needed for operations by the Board of Library Commissioners before the old branch library can be offered for sale at public auction.
Property owner adjacent to a vacant City-owned remnant property may purchase The property when the City declares it surplus and eligible for sale to the adjacent property owner.
Q. What do you mean by Excess Property versus Surplus Property?
A. Excess Property is real property that the jurisdictional City department has formally determined that it no longer need for the department's current or future use.
Surplus Property is excess property formally designated by the City Council as real property no longer required for the use of the City and public interest and necessity requires to be sold subject to the limitations and exceptions prescribed in the Charter and Los Angeles Administrative Code.
Q. What pertinent sections in the City Charter and Administrative Code outline the provisions for the sale of real property?
A. Section 385 of the City Charter and Division 7, Chapter 1, Article 4 of the Los Angeles Administrative Code.
Q. What is a sale of a City-owned real property?
A. The sale is an ownership transfer to a non-City entity or private individual(s) of all or a portion of a parcel of real property for consideration (payment) after approval of the sale by the City Council.
Q. Which City department is authorized to sell city-owned real property?
A. The Department of General Services (GSD), through its Real Estate Division, is authorized to perform the functions of selling real property for City departments under the control of the City Council. All departments having jurisdiction and control of their own funds and has a division or section which performs for such department the functions of the DGS, such division or its Director or Chief shall perform the functions assigned to the Department of General Services or to the General Manager of the DGS.
Q. What clearances must a real property go through before the City Council determines that the property proposed for sale is no longer required for the use of the City and that public interest or necessity requires its sale?
A. The real property must go through several clearance and approval processes, including, but not limited to, the following:
· DGS determines whether the City owns the real property;
· DGS sends a written offer to sell the real property to other governmental entities;
· DGS appraises the real property at its fair market value and shall recommend a minimum sale price to the Council;
· Bureau of Engineering (BOE) approves legal description of the real property and recommends reservation, exception, easements, or rights that City must retain;
· BOE, Environmental Management Group, provides real estate disclosure statements or any required environmental site assessment reports;
· Planning Department considers the proposed sale and its effects upon community plans;
· In cases involving the direct sale, the City Administrative Officer (CAO) shall review the proposed direct sale and recommend to the Council upon its propriety.
Q. How can I find out what City real properties are available for sale?
A. The list of City-owned real property under the jurisdiction of GSD is currently available for review on the Intranet to other City departments. GSD's ultimate goal is to have GSD's database as well as the database of the proprietary departments available not only to other City departments but to the general public.
For information, the general public can call GSD Real Estate Division at (213) 922-8500. The interested party will be placed on the surplus property sales mailing or email list.
Q. My name is on your surplus property sales mailing list. How can I get notification of any scheduled auction?
A. GSD Real Estate Division attempts to have all auction notification brochures mailed or emailed out at least 30 calendar days before the scheduled auction. All persons on our mailing list will receive a copy of the auction brochure.
Q. How often do you have a surplus property sale auction?
A. At least once or twice during the fiscal year.
Q. What should I expect when I attend the sale auction?
A. To place an oral bid at the public auction, one must be a registered bidder. A registered bidder must fill out certain required bidder registration forms and application and must place a deposit in cash, cashier's check or certified check an amount that is at least 10% of the amount specified in the Notice of Sale as the minimum bid price or $10,000.00, whichever is less.
Q. Does the City provide financing on its real property auction?
A. No, the City does not provide any type of financing. Most public auction sales are cash sales.
Q. How long is the typical escrow on the sale of City real estate?
A. The typical escrow is two months (60 calendar days) from the date the successful bidder is notified by the DGS that the sale has been confirmed without penalty but up to three months (90 calendar days) subject to interest charged at one percent per month or fraction thereof for each month or fraction thereof in excess of two months.
Q. What happens if the successful high bidder fails to close escrow?
A. Should the successful high bidder not complete the purchase, the deposit shall be retained by the City as liquidated damages for the failure to complete the purchase.
Q. What is a Transfer of Jurisdiction and Control?
A. The internal process by which the City changes the department that has responsibility for a parcel of real property.
Q. Do transfer of properties between City departments involve fair market value transfers?
A. In most cases, transfer of properties between departments are fair market value transactions. Properties that are acquired or purchased by the City using special funds such as Gas Tax, Special Parking Revenue Trust Fund, etc. must be reimbursed when such property is either sold or transferred to another governmental agency or city department.
Information on this site is subject to change. The City of Los Angeles reserves the right to update, correct, and/or add/delete any information without prior public notice.
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