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HomeMy WebLinkAboutED Housing Development; Lennar ENRA; Executionn. I VO,06 Agenda Item No: 4. c Meeting Date: August 17, 2015 SAN RAFAEL CITY COUNCIL AGENDA REPORT Department: Economic Development Prepared by: Stephanie Lovette, Economic Development City Manager Approval: TOPIC: Negotiations regarding the sale of the air rights above the City garage on Third and Lootens to allow the construction of a mixed use housing development. SUBJECT: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL APPROVING AN EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT WITH LENNAR MULTIFAMILY COMMUNITIES REGARDING POTENTIAL REDEVELOPMENT OF 1001 FOURTH STREET, 926 THIRD STREET AND THE THIRD AND LOOTENS PARKING GARAGE RECOMMENDATION: Adopt Resolution approving an Exclusive Negotiating Rights Agreement. SUMMARY: Lennar Multifamily Communities ("Developer") has developed preliminary plans to redevelop the properties located at 1001 Fourth (current tenant is Body Kinetics Gym), 926 Third Street (current tenant is San Rafael Laundry and Cleaners) and the City's garage at Third and Lootens into a mixed-use housing development. The Developer proposes to rebuild the City's parking garage, at no expense to the City, in return for the air rights above the garage. The City Council discussed the Developer's proposal on July 20, 2015 and authorized staff to prepare an Exclusive Negotiating Rights Agreement (ENRA) for this project. If successful, this ENRA will lead to an Owner Participation and Disposition and Development Agreement ("OPDDA") for the sale of the garage parcel. BACKGROUND: The City adopted "Our Vision of Downtown" in 1993. The Downtown Vision provides direction to staff to promote a Downtown that is vibrant throughout the work week, is the cultural activity hub of Marin County, and is "Alive after Five" in the evening and on weekends. The Rafael Theatre, the San Rafael Corporate Center (Bio Marin) and Artworks Downtown are examples of projects that manifest the Downtown Vision. FOR CITY CLERK ONLY File No.: 12-21 Council Meeting: 08/17/2015 Disposition: Resolution 13994 SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2 Another goal of the Downtown Vision was to create more housing to support the retail businesses and to create twenty-four hour activity in the downtown area. General Plan policies and the technical support of staff resulted in the development of housing units at One H Street, Centertown, Lone Palm, Boyd Court and Artworks Downtown. One of the most important projects was the mixed-use development at Rafael Town Center located at Fourth and Court Street. The Town Center development includes 113 residential units. These catalyst developments all provide customers and vibrancy for the downtown. More recent examples of infill development within the Downtown include several housing developments under construction in the West End and the recently completed housing development at 1144 Mission Avenue. In addition to the Downtown Vision, the City policies to encourage housing developments which support Fourth Street include the City's Housing Element, the Downtown Station Area Plan, the City's Climate Change Action Plan and the City Council's Neighborhood and Economic Vitality and Quality of Life goals. ANALYSIS: The Developer approached the City with a proposal to build a mixed use development on 1001 Fourth Street, 926 Third Street and the City garage parcels located across from the existing Rafael Town Center. The initial proposal is to develop approximately 160 residential units with a building height of up to sixty-six feet, as allowed by City Code ("Project"). The two private parcels are not large enough to create a financially feasible development. Therefore, the Developer requested that the City grant the air rights to the Third and Lootens parking structure. The developer would replace the current 171 public parking spaces in addition to providing the required private parking spaces for the residential units. On July 20, 2015, the City Council authorized staff to negotiate an `Exclusive Negotiating Rights Agreement' ("ENRA") to allow the City garage to be included as part of this mixed-use development. Staff is now requesting City Council approval of the actual ENRA. If the ENRA is concluded successfully, staff would request City Council approval to enter into an Owner Participation and Disposition and Development Agreement ("OPDDA") that would grant air rights on the City garage for the Development, subject to all CEQA and other City discretionary approvals. The ENRA will allow the Developer and the City 90 days to determine what additional steps should be taken to: (1) enable the City to convey the Site to the Developer at an agreed-upon consideration; (2) evaluate the feasibility of constructing the public parking with the remainder of the Developer's proposed development; and (3) allow the City and the Developer to determine the financial feasibility of developing the Site, including a specific mix of market rate and affordable units. Staff has engaged Seifel Consulting to assist in evaluating the merits of the Developer's proposal. Seifel Consulting has extensive experience working with cities on development projects. At the request of City staff, Seifel Consulting prepared a summary of the City's key goals and how the proposed project meets those goals (Attachment B). This is information was shared with the Economic Development subcommittee. SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3 Staff has also engaged the services of Goldfarb and Lipman, counsel to the former Redevelopment Agency. Goldfarb and Lipman have extensive experience in public-private real estate transactions and assisted the Redevelopment Agency with the ENRA and OPDDA on the Corporate Center and the sale of the Agency property and ultimate development of the Rafael Theatre, the Rafael Town Center and Lone Palm. COMMUNITY OUTREACH: Staff presented the garage reuse and housing concept to the Citizens Advisory Committee on Economic Development and Affordable Housing ("CAC"). The CAC was supportive of the concept. The developer presented the conceptual plan to the Economic Vitality Committee of the San Rafael Chamber of Commerce ("EVC"). The EVC members were also supportive of the concept. The CAC and EVC felt that a market rate housing development would strengthen our Downtown and were happy about the proposed improvements to the parking facilities. Both groups requested that City staff negotiate for some additional affordable units but also felt that the project met numerous City goals and did not feel affordable housing should not be the main driver on this particular development. FISCAL IMPACT: At this time, the City is not committing any additional resources to this project other than staff and consultant time. As part of the ENRA negotiations the City and Developer will agree on the amount of reimbursement for City costs for the project, including the appraisal of the City's property. There are sufficient funds in the Department's current contractual services budget in the General Fund to support the initial consultant work of Seifel Consulting and Goldfarb and Lipman. OPTIONS: 1) Adopt the Resolution 2) Suggest changes to the proposed ENRA 3) Decline to adopt the Resolution ACTION REQUIRED: Adopt Resolution. ATTACHMENTS: A. Resolution B. ENRA C. Summary of the City's key goals RESOLUTION NO. 13994 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL APPROVING AN EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT WITH LENNAR MULTIFAMILY COMMUNITIES REGARDING POTENTIAL REDEVELOPMENT OF 1001 FOURTH STREET, 926 THIRD STREET AND THE THIRD AND LOOTENS PARKING GARAGE WHEREAS, the City of San Rafael ("City") owns the real property and parking garage known as the Third-Lootens Parking Garage ("City Parking Garage"); and WHEREAS, the City adopted a goal to "provide a vibrant Downtown" in "our Vision of Downtown" in 1993, which was later incorporated into the goals of the General Plan as Goal 6. General Plan Goal 6 includes the following implementation policies: NH 16 to substantially expand Downtown's economic success and increase opportunities for retail, office and residential development; NH 22 to create a popular and attractive residential environment that contributes to the activity and sense of community in Downtown; and NH 34 to encourage activities that will promote the Fourth Street Retail Core as being "Alive after Five"; and WHEREAS, one of the City Council goals is to provide neighborhood and economic vitality by supporting the development of key Downtown sites, and the City Council's Economic Development Committee has adopted "support development of key sites such as 1001-1009 Fourth Street" as one of its eight priorities"; and WHEREAS, Lennar Multifamily Communities ("Developer") has proposed redeveloping the City Parking Garage and adjoining privately -owned properties on which Developer holds an option to purchase, including the property located at 1001 Fourth Street and 926 Third Street, into a mixed-use development, including new multi- family housing and related amenities, private parking and replacement public parking ("Project"); and WHEREAS, staff engaged Seifel Consulting to evaluate the preliminary economic feasibility of the proposed Project and the preliminary analysis indicates that the current proposal provides adequate financial consideration for the City to consider further negotiations regarding the potential Project; and WHEREAS, funds have been appropriated in the Economic Development Department budget for the current Seifel Consulting contract; and WHEREAS, pursuant to direction from the City Council on July 20, 2015, staff has caused preparation of an Exclusive Negotiating Rights Agreement ("ENRA") between the City and the Developer for consideration by the City Council; and 1220\12\1740501.2 WHEREAS, this Resolution is not intended to and does not commit the City to grant any land use approvals for the Project or to approve any agreement with the Developer; and WHEREAS, the staff report accompanying this Resolution provides additional information about the potential project. NOW THEREFORE, BE IT RESOLVED by the City Council of the City of San Rafael as follows: 1. The City Council hereby finds and determines that the above recitals are true, correct and incorporated herein. 2. The City Council hereby approves the ENRA and authorizes the City Manager to execute on behalf of the City the ENRA in substantially the form submitted to the City Council in connection with the consideration of this Resolution, subject to such minor changes as the City Manager and City Attorney may approve, provided, however, that nothing in this Resolution, the preparation of the ENRA or the conduct of the negotiations pursuant to the ENRA commits the City to approve any land use approvals for the Project or to approve any agreement with the Developer. 3. The City Council authorizes and directs the City Manager and his designees to take such steps as are reasonable and necessary to performance of the City's obligations under the ENRA and to carry out the terms and conditions of the ENRA. 4. This Resolution shall take immediate effect upon adoption. I, ESTHER C. BEIRNE, Clerk of the City of San Rafael, herby certify that the foregoing resolution was duly and regularly introduced and adopted at a regular meeting of the City Council of the City of San Rafael held on the seventeenth day of August, 2015, by the following vote: AYES: COUNCILMEMBERS: Colin, Gamblin, McCullough & Mayor Phillips NOES: COUNCILMEMBERS: None ABSENT: COUNCILMEMBERS: Bushey ,-5 WJGE- ,a c ..e ESTHER C. BEIRNE, City Clerk 2 1220\12\1740501.2 EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT (Third & Lootens Parking Garage) This Exclusive Negotiating Rights Agreement (this "Agreement") is entered into as of August 18, 2015 (the "Effective Date") by and between the City of San Rafael, a charter city (the "City") and Lennar Multifamily Communities, LLC, a Delaware limited liability company (the "Developer"), on the basis of the following facts: RECITALS A. The City owns certain real property, described on the attached Exhibit A (the "Site") on which a 171 -space public parking garage is located (the "Garage"). B. The parties desire to negotiate an agreement under which the Developer would acquire the Site for fair market value consideration and develop the Site with an approximately 162 apartment homes, including 15% affordable units, with 3,200 square feet of ground floor retail and an approximately 210 of residential parking spaces and the replacement of approximately 171 public parking spaces in the Garage with new public parking to be dedicated to the City. The City acknowledges that Developer is not requiring any City financing with regard to the acquisition of the Site or the construction on the replacement public parking. C. The purpose of this Agreement is to determine what additional steps should be taken to: (1) enable the City to convey the Site to the Developer at an agreed-upon consideration; (2) evaluate the feasibility of constructing the public parking with the remainder of the Developer's proposed development; and (3) allow the City and the Developer to determine the financial feasibility of developing the Site. As more fully set forth in Section 3. 1, the Developer acknowledges and agrees that this Agreement in itself does not obligate any party to acquire or convey any property, does not grant the Developer the right to develop, and does not obligate the Developer to any activities or costs to develop, except for the preliminary analysis and negotiations contemplated by this Agreement. AGREEMENT NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein and for other valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties mutually agree as follows: ARTICLE 1. EXCLUSIVE NEGOTIATIONS RIGHT Section 1.1 Good Faith Negotiations. The City and the Developer shall negotiate diligently -and in good faith, during the Negotiating Period. During the Negotiating Period, the parties shall use good faith efforts to accomplish the respective tasks outlined in Article 2 to 141\01\1732744.4 facilitate the negotiation of a mutually satisfactory transfer and development documentation (the "TD Agreement"). Section 1.2 Ne otg iatin Pg eriod. (a) Subject to early termination in accordance with the provisions of subsection (b) below, the negotiating period (the "Negotiating Period") under this Agreement shall be ninety (90) days, commencing on the Effective Date, subject to extension by mutual agreement of the parties in writing. The Negotiating Period may be extended from time to time on the City's behalf by the City Manager if, in his or her judgment, sufficient progress toward mutually acceptable TD Agreement has been made during the initial ninety (90) day Negotiating Period (or previously extended Negotiating Period) to merit such extension. However, the extensions granted by the City Manager shall not cumulatively exceed one hundred eighty (180) days. (b) If mutually acceptable TD Agreement has not been executed by the City and the Developer by the expiration of the Negotiating Period (as the Negotiating Period may be extended by operation of subsection (a) above), then this Agreement shall terminate and neither party shall have any further rights or obligations under this Agreement except as set forth in Section 1.4 and except that the provisions of Sections 3.4, 3.5(d), 3.6 and 3.7 shall survive such termination. If a TD Agreement is executed by the City and the Developer then, upon such execution, this Agreement shall terminate, and all rights and obligations of the parties shall be as set forth in the executed TD Agreement. Section 1.3 Exclusive Negotiations. During the Negotiating Period (as such Negotiating Period may be extended by operation of Section 1.2(a)), the City shall not negotiate with any entity, other than the Developer, regarding the acquisition and development of the Site, or solicit or entertain bids or proposals to do so, except to the extent required by City municipal code provisions. The foregoing shall not prevent the City from providing information, if required by law, regarding the Site and development thereof to persons or entities other than Developer. ARTICLE 2. NEGOTIATION TASKS Section 2.1 Overview. To facilitate negotiation of the TD Agreement, the parties shall use reasonable good faith efforts to accomplish the tasks set forth in this Article 2 in a timeframe that will support negotiation and execution of a mutually acceptable TD Agreement prior to the expiration of the Negotiating Period. Any TD Agreement is subject to City Council approval pursuant to applicable City charter provisions and property disposition rules of the City. Section 2.2 City Costs Reimbursement. In consideration for this Agreement, the Developer and City will negotiate an agreement regarding the Developer's reimbursement, subject to a mutually agreeable cap, of the City's third party costs reasonably and necessarily 141\01\1732744.4 2 incurred in connection with this Agreement and the TD Agreement, such as without limitation, costs incurred for appraisers, consultants, and special counsel. The parties acknowledge and agree that the City will not reimburse the Developer for any costs whatsoever with regard to this Agreement, the TD Agreement, the Site or the development. Section 2.3 Appraisal. Within thirty (3 0) days following the Effective Date, the City shall commission a third -party appraisal of the Site, by a MAI appraiser mutually acceptable to the parties to this Agreement. The cost of the appraisal may be reimbursed by the Developer if covered by the agreement to be negotiated pursuant to Section 2.2 but otherwise will be borne by the City. Section 2.4 Reports. The Developer shall provide the City with copies of all reports, studies, analyses, correspondence, and similar documents, prepared or commissioned by the Developer with respect to this Agreement, promptly upon their completion. The City shall provide the Developer with copies of all reports, studies, analyses, correspondence, and similar documents prepared or commissioned by the City with respect to this Agreement, promptly upon their completion. Nothing in this Section 2.4 obligates the City to undertake any studies or analyses, other than an appraisal of the Property as described in Section 2.3. Section 2.5 Purchase Price or Other Consideration for the Site. The City and the Developer shall seek to agree upon the purchase price or other consideration for the Site. Section 2.6 Organizational Documents. Within thirty (30) days following the Effective Date, the Developer shall provide the City with copies of its organizational documents evidencing that the Developer exists, is qualified to conduct business in the State of California and is in good standing to perform its obligations hereunder along with a listing of its current member(s) and manager(s) and a copy of its published credit information that is provided to Dunn and Bradstreet. Section 2.7 Due Diligence. Within thirty (30) days following the Effective Date, the City shall use good faith efforts to provide Developer the information it has in its possession, related to the following items to the extent filed in a manner readily findable with the Site's property address, and thereafter the Developer shall, during the Negotiating Period, conduct the following due diligence activities: (a) Physical Adequacy Determination. The Developer shall determine whether the Site is suitable for development consistent with current zoning, taking into account the geotechnical and soils conditions, the presence or absence of toxic or other hazardous materials, the massing of the proposed improvements and the parking requirements imposed on developments of this type and the other environmental and regulatory factors that the Developer deems relevant. (b) Title Adequacy Determination. Within thirty (30) days following the Effective Date, the City shall cause a reputable title company to issue a Preliminary Title Report (the "PTR") on the Site to the Developer. Within thirty (30) days following receipt of the PTR, 141\01\1732744.4 3 Developer shall notify the City in writing of any title exceptions that Developer considers unacceptable. (c) Utilities. The Developer shall consult with the utility companies serving the Site to determine if existing utility facilities require expansion, relocation or undergrowiding in connection with the development of the Site. The City shall assist and cooperate with the Developer in such consultations. Section 2.8 Zoning Consistency. During the Negotiating Period, the Developer shall provide the City with a conceptual drawing, and sufficient details on a future project to determine its consistency with current zoning prior to the end of the Negotiating Period. Section 2.9 Financial Feasibility. Within forty-five (45) days following the Effective Date, the Developer shall provide the City with an updated detailed financial analysis for the proposed development on the Site containing, among other matters, a development budget proforma setting forth the costs and revenues associated with acquiring and developing the Site, including the replacement public parking and affordable residential units, taking into account all impact fees, construction costs, market conditions and financing. The detailed financial analysis to be submitted by the Developer will be used to evaluate the financial feasibility of the development on the Site prior to entry into the TD Agreement. Nothing in this Agreement commits any party to a particular purchase price or ground rent or any level of financial contribution for the development on the Site. Section 2.10 Schedule of Performance. Within sixty (60) days following the Effective Date, the Developer shall provide the City with a proposed detailed schedule of performance which shall include, but not be limited to: the proposed dates for conveyance of the Site, schedule for submission of all necessary applications for development of the Site, the proposed date for completion of working drawings, construction plans, and the proposed dates for the commencement and completion of construction of the Site improvements. Section 2.11 Planning and CEQA Review. Developer acknowledges that it may be necessary to undertake environmental review and that any sale or other disposition of the Site and development of the Site will need to comply with the California Environmental Quality Act ("CEQA"). The Developer will pay all costs charged by the City in conjunction with the applications for City permits and approvals including all costs associated with appropriate environmental review and documentation. Section 2.12 Tenant Commitments. As the Site improvements are better defined during the entitlement process, the Developer shall provide regular and at least quarterly status updates on retail prospective tenants. Section 2.13 Progress Reports. From time to time as reasonably agreed upon by the parties, the Developer shall make written progress reports advising the City on studies being made and matters being evaluated by the Developer with respect to this Agreement and the Site improvements. 4 141\01\1732744.4 ARTICLE 3. GENERAL PROVISIONS Section 3.1 Limitation on Effect of Agreement.' This Agreement (and any extension of the Negotiating Period) shall not obligate any of the City or the Developer to enter into any agreement or enter into an agreement containing any particular terms. By execution of this Agreement (and any extension of the Negotiating Period), the City is not committing itself to or agreeing to approve any land use entitlements, undertake disposition or lease of the Site or any part thereof, undertake construction or undertake any other acts or activities relating to the subsequent independent exercise of discretion by the City. Execution of this Agreement by the City is merely an agreement to conduct a period of negotiations in accordance with the terms hereof, reserving for subsequent City action the final discretion and approval regarding the execution of any -TD Agreement and all proceedings and decisions in connection therewith. Any TD Agreement resulting from negotiations pursuant to this Agreement shall become effective only if and after such TD Agreement has been considered and approved by the City Council, following conduct of all legally required procedures, and executed by duly authorized representatives of the City and the Developer. Until and unless the TD Agreement is signed by the Developer, approved by the City. Council, and executed by the City, no agreement drafts, actions, term sheets, outlines, deliverables, memoranda or communications arising from the performance of this Agreement shall impose any legally binding obligation on any party to enter into or support entering into any TD Agreement or be used as evidence of any oral or implied agreement by any party to enter into any other legally binding document. As such, the City retains the absolute discretion before the execution of all TD Agreement to determine not to proceed with the transfer or lease and any proposed development on the Site. Section 3.2 Notices. Formal notices, demands and communications between the City and the Developer shall be sufficiently given if, and shall not be deemed given unless, dispatched by certified mail, postage prepaid, return receipt requested, or sent by express delivery or overnight courier service, to the office of the parties shown as follows, or such other address as the parties may designate in writing from time to time: City: City of San Rafael 1400 Fifth Avenue, Room 203 PO Box 151560 San Rafael, CA 94915-1560 Attention: City Manager With a copy to: City Attorney City of San Rafael 1400 Fifth Avenue, Room 202 PO Box 151560 San Rafael, CA 94915-1560 141\01\1732744.4 5 Developer: Lennar Multifamily Communities, LLC 429 Ninth Street Suite 300 Oakland, Ca 94607 Attention: Alex Waterbury With copy to: Such written notices, demands and communications shall be effective on the date shown on the delivery receipt as the date delivered or the date on which delivery was refused. Section 3.3 Waiver of L....................................... dens. It is expressly understood and agreed by the parties that no lis pendens shall be leagainst any portion of the Site with respect to this Agreement or any dispute or act arising from it. Section 3.4 Right of Entry_. The Developer shall have the right to enter the Site during normal business hours to conduct investigations in accordance with this Agreement. In connection with such entry and investigation, the Developer shall: (a) give the City reasonable advance notice; (b) not interfere with the on-going parking operation of the Garage; (c) repair and restore any damage it or its agents may cause; (d) deliver to the City, within ten (10) days of receipt thereof, a complete copy of any investigation, test, report or study which the Developer conducts, or causes to be conducted, with respect to the Site; and (e) indemnify, defend and hold the City and its council members, officers, employees and agents harmless from any and all claims, liabilities, damages, losses, expenses, costs and fees (including attorneys' fees and costs) which may proximately arise out of the Developer's entry upon the Site or the investigation(s) and test(s) which the Developer may conduct; provided, however, that this indemnity shall not apply to matters arising from the results of the Developer's investigations, tests and inspections (e.g., this indemnity shall not apply to any diminution in value or remediation costs incurred by the City if the Developer's investigations were to discover an environmental condition that required remediation). Section 3.5 Costs and Expenses. Except as otherwise expressly provided in this Agreement or agreed to in the TD Agreement, each party shall be responsible for its owns costs and expenses in connection with any activities and negotiations undertaken in connection with this Agreement, and the performance of each party's obligations under this Agreement. 6 141\61\1732744.4 Section 3.6 No Commissions. Each parry represents and warrants that it has not entered into any agreement, and has no obligation, to pay any real estate commission in connection with the transaction contemplated by this Agreement and any resulting TD Agreement. If a real estate commission is claimed through either party in connection with the transaction contemplated by this Agreement or any resulting TD Agreement, then the parry through whom the commission is claimed shall indemnify, defend and hold the other parties harmless from any liability related to such commission. The provisions of this section shall survive termination of this Agreement. Section 3.7 - Defaults and Remedies. (a) Default. Failure by any party to negotiate in good faith as provided in this Agreement shall constitute an event of default hereunder. A non -defaulting party shall give written notice of a default to the defaulting party and the other party, specifying the nature of the default and the required action to cure the default. If a default remains uncured ten (10) days after receipt by the defaulting party of such notice, the non -defaulting party may exercise the remedies set forth in subsection (b). (b) Remedies. In the event of an uncured default by the City, the Developer's sole remedy shall be to terminate this Agreement in writing effective five (5) days after delivery, upon which termination no party shall have any fhrther right, remedy or obligation under this Agreement; provided, however, that the Developer's obligations pursuant to Sections 3.3, 3.4(d), 3.5, 3.6 and 3.9 shall survive such termination. In the event of an uncured default by the Developer, the City's sole remedy shall be to terminate this Agreement in writing effective five (5) days after delivery. Following such termination, no party shall have any further right, remedy or obligation under this Agreement; provided, however, that the Developer's obligations pursuant to Sections 3.3, 3.4(d), 3.5, 3.6 and 3.9 shall survive such termination. Except as expressly provided above, no party shall have any liability to the others for damages or otherwise for any default, nor shall any party have any other claims with respect to performance under this Agreement. Each party specifically waives and releases any such rights or claims they may otherwise have at law or in equity. Section 3.8 Attorneys'. In the event of any action or proceeding brought by any party against another party under this Agreement, the prevailing party shall be entitled to recover all costs and expenses including its attorneys' fees in such action or proceeding in such amount as the court may adjudge reasonable. Attorneys' fees for in-house City Attorney staff, if awarded, shall be calculated at the market rate. The provisions of this Section shall survive the termination of this Agreement. Venue shall be in the Superior Court of the County of Marin. Section 3.9 Confidentiality of Information. While desiring to preserve its rights with respect to treatment of certain information on a confidential or proprietary basis, the Developer acknowledges that the City will need sufficient, detailed information about the proposed development of the Site to make informed decisions about the content and approval of the TD 7 141\01\1732744.4 Agreement. The City will use its best efforts to maintain the confidentiality of proprietary information subject to the requirements imposed on the City by the Public Records Act (Govermnent Code Section 6253 et seq.). The Developer acknowledges that the City may share information provided by the Developer of a financial and potential proprietary nature with third party consultants who have been contractually engaged to advise the City concerning matters related to this Agreement and to City Council as part of the negotiation and decision making process. If this Agreement is terminated without the execution of TD Agreement, the City shall return to the Developer any confidential inforination submitted by the Developer under this Agreement. If any litigation is filed seeking to make public any information Developer submitted to the City in confidence, the City shall cooperate in defending the litigation. The Developer shall pay the City's reasonable costs of defending such litigation and shall indemnify the City against all costs and attorney's fees awarded to the plaintiff in any such litigation. Section 3.10 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. Section 3.11 Entire Agreement. This Agreement constitutes the entire agreement of the parties regarding the subject matters of this Agreement. Section 3.12 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same agreement. Section 3.13 Assignment. The Developer may not transfer or assign any or all of its rights or obligations under this Agreement except with the prior written consent of the City, which consent shall be granted or withheld in the City's sole discretion, and any such attempted transfer or assignment without the prior written consent of the City shall be void. Section 3.14 No Third Party Beneficiaries. This Agreement is made and entered into solely for the benefit of the City and the Developer and no other person shall have any right of action under or by reason of this Agreement. Section 3.15 Actions by the City. Whenever this Agreement calls for or permits the approval, consent, authorization or waiver of the City, the approval, consent, authorization, or waiver of the City Manager shall constitute the approval, consent, authorization or waiver of the City without further action of the City Council. Signatures on Following Page 141101\1732744.4 IN WITNESS WHEREOF, this Agreement has been executed, in triplicate, by the parties on the date first above written. APPROVED AS TO FORM: By: ........................... Lisa A. Goldfien Assista..t City Attorney 141\01\1732744.4 CITY: CITY OF SAN RAFAEL, a charter city and munlcinn] rmmr)rntinn LOIN RL-zX X2-" erg CLEi>r- . DEVELOPER: Lennar Multifamily Communities, LLC, a Delaware limited liability company In Name: Alex Waterbury V1 '&q- Its: President 0 SITE MAP A-1 141\01\1732744.4 PROFESSIONAL SERVICES AGREEMENT/CONTRACT COMPLETION CHECKLIST AND ROUTING SLIP Below is the process for getting your professional services agreements/contracts finalized and executed. Please attach this "Completion Checklist and Routing Slip" to the front of your contract as you circulate it for review and signatures. Please use this form for all professional services agreements/contracts (not just those requiring City Council approval). This process should occur in the order presented below. Step Responsible Description Completion Department Date 1 City Attorney Review, revise, and comment on draft agreement. 2 Contracting Department Forward final agreement to contractor for 1ps— their signature. Obtain at least two signed originals from contractor. 3 Contracting Department Agendize contractor -signed agreement for Council approval, if Council approval necessary (as defined by City Attorney/City Ordinance*). 4 City Attorney Review and approve form of agreement; bonds, and insurance certificates and endorsements. v,, ; �� "... 5 City Manager / Mayor / or Agreement executed by Council authorized Department Head official. 6 City Clerk City Clerk attests signatures, retains original agreement and forwards copies to the contracting department. To be completed by Contracting Department: Project Manager: e a. i e- I-OVeAe, Project Name: RA Z L&I n & r Agendized for City Council Meeting of (if necessary): FPPC: ❑ , check if required If you have questions on this process, please contact the City Attorney's Office at 485-3080. * Council approval is required if contract is over $20,000 on a cumulative basis. (Opees c4 c, re-elvieril 65 4 0 �- 6Z I - �� DRAMWO Uyjlf C tTW,,,OS 8,,, R,b,,AF.,,h.NftM M A— IBAIv ILI" 1 WS Q�TF- 10-15 PLO"U161 C-1. r -1 gg, . . . ........ .. r ..... ....... .... .. F 1 V) �N F C4 fn 0 n - my ALI �bL . ..... .... 'aU I'l 17M., 14 J1 u "A : AW I 149 cl I . . . ........ .. I. ...................... ..... ....... .... .. .J fn n - ALI . ..... .... .... .. ... . . . ............. lk t ;ma I in 9k 9 9� 9 ION m Attachment C Summary of How Lennar Proposal Meets Key City Goals City Goals Lennar Proposal Increase number of people living in Provides ability to achieve higher number of downtown San Rafael units with the combination of properties than the City garage site alone. (approximately 67 to 120 base units plus 35% density bonus) Provide more affordable housing Provides greater number of affordable housing opportunities for downtown workers units through larger site and use of State Density Bonus at affordability levels that do not exclude professional workers. Replace public parking with new, upgraded Developer replaces public parking (at its sole structure cost) if sufficient number of market rate housing units are provided to allow a financially viable project. Minimize City's investment in the garage No City funds potentially required to replace public parking Maintain control of public parking Shared ownership agreement in perpetuity (via contractual transfer of air rights that provides for 171 public parking spaces at grade and above grade within the new building) Ongoing high standard of public parking Reciprocal easement and operating agreement maintenance that provides for ongoing maintenance, shared among public and private parking spaces Maintain or expand revenues from public City would continue to control and receive all parking revenue from public parking Provide for long term upgrade and Ongoing contribution to replacement reserve by replacement of components private owners Make garage more efficient and accessible Expanded size of ground floor facilitates more efficient garage and improved access to both floors of public parking from Lootens Street Transform currently unproductive vertical Vertical air rights is allocated to residential units air rights to new housing via shared ownership agreement; "air lot parcels" are considered "real property" Seifel Consulting Inc. 8/5/2015 ROUTING SLIP / APPROVAL FORM INSTRUCTIONS: Use this cover sheet with each submittal of a staff report before approval by the City Council. Save staff report (including this cover sheet) along with all related attachments in the Team Drive (T:) 4 CITY COUNCIL AGENDA ITEMS 4 AGENDA ITEM APPROVAL PROCESS 4 [DEPT - AGENDA TOPIC] Agenda Item # ti , Date of Meeting: 8/17/2015 From: Stephanie Lovette Department: Economic Development Date: 8/7/2015 Topic: Sale of the air rights above the City garage on Third and Lootens to allow the construction of a mixed use housing development. Subject: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL APPROVING AN EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT WITH LENNAR MULTIFAMILY COMMUNITIES REGARDING POTENTIAL REDEVELOPMENT OF 1001 FOURTH STREET, 926 THIRD STREET AND THE THIRD AND LOOTENS PARKING GARAGE Type: ® Resolution ❑ Ordinance ❑ Professional Services Agreement ® Other: Staff Report APPROVALS ® Finance Director Remarks: MM - Approved 8/8/15 with minor changes to staff report tracked. ® City Attorney Remarks: LG -Approved 8/8/15 with minor changes shown. ❑ Author, review and accept City Attorney / Finance changes Remarks: ACity Manager Remarks: Changed tracked, would like to see it again before finalizing. FOR CITY CLERK ONLY File No.: Council Meeting: Disposition: ''- First Name Ame * TAst Name pex=l AdIvo 1 69 KnA I Romi Addmm 2 M3 San RaW Sue CA EP We 94W) t Mume Numki- 115-4565287 FumU Mims Send ernail to 0iclec.t one) AN Cay W&MM's Please enter your questions/comynents below Dcar C'ounn:Hnienibkn,s. RM. 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