South Lake Tahoe City Council is set to approve a contract with a Pasadena, California, company for development of a vacant lot at the corner of Ski Run Boulevard and U.S. Highway 50.

The potential development of what is known as the South West Corner is tied to a city project involving the purchase of the nearby Knights Inn.

“The City is under contract to purchase the Knights Inn parcel for environmental restoration,” wrote City Attorney Tom Watson in a staff report discussing agreements with Halferty. “As a part of that project, there will be developable land in an area of the City that commercial development is highly desirable. Halferty Development Company, LLC is under contract to purchase the South West Corner parcel, which is immediately adjacent to this property. Halferty has agreed to purchase the property [and some commodities] for the price of $4,000,000.00. Additionally, Halferty has agreed to allow the City to influence the development through a Commercial Disposition and Development Agreement.”

In February, the council authorized South Lake Tahoe’s city manager Nancy Kerry to enter the city into a $6 million agreement with Pradip Patel for the purchase of the Knights Inn and Mo’s Place.

A purchase and sale agreement and a commercial and development agreement with Halferty is on the council’s Tuesday, June 21, meeting agenda. The item is on the consent agenda, meaning it may be approved without discussion unless a council member or a member of the public requests to speak about it.

South Lake Tahoe City Council meets starting at 9 a.m. Tuesday, at Lake Tahoe Airport, located at 1901 Airport Road.