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YMCA Option Agreement <br />November 3, 2015 <br />Page 2 <br />St. Joseph Health operating a wellness center onsite and Taller San Jose being a tenant of <br />the building, thereby providing a more secure venue than a speculative commercial <br />development. <br />The St. Joseph team proposing to complete the project within three years. <br />City staff and the developer have worked diligently over the past year to negotiate a strong <br />agreement that comprehensively takes into account all of the project deal points. There remain <br />three areas where additional work remains necessary including: 1) resolution of title issues <br />identified subsequent to the approval of the ENA; 2) resolution of easement issues associated <br />with the adjacent parking structure; and 3) environmental remediation of the building. Given the <br />progress that has occurred during the term of the ENA, staff is recommending that the City enter <br />into an option agreement to sell the former YMCA building to St. Joseph Health, subject to certain <br />conditions. It is anticipated that this option agreement will lead to a separate development <br />agreement being brought before the City Council for final consideration within one year's time. <br />It should also be noted that as a direct result of the St. Joseph team's environmental studies, staff <br />anticipates requesting separate City Council action in the near future to remediate the <br />environmental hazards present in the YMCA building. The Santa Ana Public Works Agency with <br />the assistace of an environmental consultant is in the process of determining the final scope of <br />the project and preparing the necessary documents. The YMCA environmental clean -up project <br />is expected to be sent out to bid in early 2016. <br />STRATEGIC PLAN ALIGNMENT <br />Approval of this item supports the City's efforts to meet Goal #3 Economic Development, <br />Objective #5 (Leverage private investment that results in tax base expansion and job creation <br />Citywide), Strategy A (Identify and market underutilized properties (City and non -City owned) for <br />new development that will create new jobs and expand the City's tax base). <br />FISCAL IMPACT <br />There is no fiscal impact associated with this action. <br />wi-,V <br />Kelly Reender <br />Executive Direc or <br />Community Development Agency <br />KR/SK/II <br />Exhibit: 1. Option Agreement <br />25A -2 <br />