The Public Works Department manages a City-owned property at 1133 Hollenbeck Road that was donated to the City in calendar year 2000. Dorolou Swirsky donated the property to the City in order to provide future funding for disadvantaged youth programs. The property is 8,556 square feet and contains a 1,798 square foot, 3 bedroom, 2 bath, ranch-style house that was built in 1963.

For the past three years, this property has been leased at a rate of $2,650 per month while staff waited for an opportune time to sell the property.

Staff believes that current market conditions are optimal for the sale of this property. Interest rates on home mortgages are at their lowest point in 40 years. The demand for single-family homes has remained strong despite the general economic downturn in the Santa Clara Valley.

Based on discussions with a real estate broker and after evaluating market data internally, staff estimates the current market value of the property conservatively at $625,000.

City Council is being asked to instruct the City’s Property Manager to appraise and market the property at 1133 Hollenbeck Road in order to provide funding to the Youth Opportunity Fund. If a buyer is found that makes an offer equal to or greater than appraised value staff will come back to Council asking for approval of the sale.

In August of 1993, City Council accepted Dorolou Swirsky’s gift of an ongoing Youth Opportunity Fund specifically addressing sports, recreational, social, cultural, and educational activities for disadvantaged youth living in Sunnyvale in the form of a Trust Estate.

The Dorolou Swirsky estate was donated to the City in 2000. The estate consists of a single family home located at 1133 Hollenbeck Road. At the time of donation an appraisal was performed on the property, and the total value was estimated at $555,000. Following the donation, the City established the Swirsky Youth Opportunity Fund to account for the proceeds. Ms. Swirsky had taken a reverse mortgage on the property in the amount of $110,943, which the City paid using General Fund monies. This amount is recorded as a liability in the Fund pending disposition of the house. For fiscal Year 2002-2003, the Fund had $23,500 in rent revenues and $4,453 in expenses, for a net income of about $19,000.

Based on market research by staff, the current market value of the property is currently estimated to be $625,000. There are several other properties for sale in the area which are listed in the $700,000 range. If Council gives approval, the property will be reappraised to determine current market value and the property will be marketed on the Multiple Listing Service (MLS) available to California realtors. If an offer is received that is at or greater than the estimated market value, Council will be asked to approve the formal sale of the property. Every effort will be made to attract multiple offers so as to maximize the sales price.

If the property is sold, the General Fund loan must be prepaid first and other liabilities and expenses related to the sale of the house satisfied. The net amount remaining would then be available to fund sports, recreational, social, cultural and educational activities for disadvantaged youth living in Sunnyvale out of the Youth Opportunity Fund.

There is no fiscal impact associated with this Report to Council. If the City is successful in obtaining a buyer for 1133 Hollenbeck at or above appraised valuation, a follow-up RTC will be presented to Council asking to authorize the City Manager by resolution to execute all sales and escrow documents in order to complete the sale.

Public contact was made through posting of the Council agenda on the City’s official notice bulletin board, posting of the agenda and report on the City’s web page, publication of the Council agenda in the San Jose Mercury News, and the availability of the report in the Library and the City Clerk’s Office.

Staff recommends alternative #1.

Prepared by:
Michael A. Chan, 
Senior Administrator/Property Manager

Reviewed by:
Robert Walker
Director of Parks and Recreation

Mary J. Bradley
Director of Finance

Marvin A. Rose, 
Director of Public Works

Approved by:
Robert S. LaSala,
City Manager