HomeMy WebLinkAbout19E - ENA CARIBOU YMCAREQUEST FOR
COUNCIL ACTION
CITY COUNCIL MEETING DATE:
NOVEMBER 20, 2018
TITLE:
AUTHORIZATION TO NEGOTIATE AN
EXCLUSIVE NEGOTIATING AGREEMENT
WITH CARIBOU INDUSTRIES FOR
RENOVATION AND REUSE OF THE Y.M.C.A.
PROPERTY LOCATED AT 203-205 W. CIVIC
CENTER DRIVE
(STRATEGIC PLAN NO. 3,5A)
t
CI MANAGER
RECOMMENDED ACTION
CLERK OF COUNCIL USE ONLY:
APPROVED
❑ As Recommended
❑ As Amended
❑ Ordinance on 1� Reading
❑ Ordinance on 2nd Reading
❑ Implementing Resolution
❑ Set Public Hearing For_
CONTINUED TO
FILE NUMBER
Authorize the City Manager to negotiate an Exclusive Negotiating Agreement (ENA) for the reuse
of the YMCA property with Caribou Industries, subject to non -substantive changes approved by
the City Manager and City Attorney.
DISCUSSION
The YMCA building located at 203-205 West Civic Center Drive (Site) was purchased by the City
in 1992. The building has been vacant since that time and has been in serious disrepair due to
age and vandalism. Recent efforts have been taken to remediate several outstanding issues
such as asbestos clean-up and the placement of security cameras at the site. Over $1 million
dollars in funding was used to remediate these issues.
Over the years, the City has made several attempts to market/entertain proposals for the site but
the substantial City subsidy required by developers and end users has been an issue. To bring
the building up to current City codes, there would be an anticipated investment of up to $5 million
dollars for seismic retrofit, fire suppression, electrical/plumbing to current code, and other
structural improvements. In November 2015, the City Council approved an option agreement for
the sale and renovation of the YMCA with St. Joseph's Health System for the development of a
fitness center/community venue for the underserved population living near the downtown.
Unfortunately, citing ever-changing dynamics of health and fitness businesses in downtown and
an unforeseen project cost estimate over $5 million higher than anticipated, St. Joseph's Health
System requested to terminate the Agreement to purchase and rehabilitate the YMCA in
December 2017.
19E-1
ENA for YMCA
November 20, 2018
Page 2
In February 2018, the City released a Request for Qualifications and Development Concepts for
the renovation and reuse of the former YMCA Building. Four proposals were received in April,
2018 for this solicitation.
Evaluation of Proposals
Each proposal has been evaluated and additional information was requested from the developers
during the months that followed. All proposals were then evaluated by a selection panel which
included representatives from the Community Development Agency, Planning and Building
Agency, and the Public Works Agency. Criteria included experience of firm and key personnel;
financial capacity; development schedule, project concept and completeness of proposal
including organization and clarity.
As a final step in the evaluation process, all four proposers were invited to present their
development proposals to the Economic Development, Infrastructure, Budget and Technology
(EDIBT) Council Committee on August 20, 2018. The proposals represented a range of
development opportunities listed below. The selection panel completed the review of the
proposals and the rankings are as follows:
Proposer
1. Howard CDM/OCSA
Expansion of OCSA to include a new Design and Art Center
2. Caribou Industries
• Boutique hotel
3. Community Development Partners/City Fabrik
• Veteran's Hall project including residential
4. The Sound
• A community center/small business start-up incubator
Committee Direction
Score
86.25
MUM
66.75
At the September 10th regular EDIBT Council Committee meeting, the Committee directed staff to
take an extra step to reach out to the top two rated proposers (Howard CDM/OCSA and Caribou
Industries) to see if the two proposers could team up on pairing their proposal for resubmission to
the City. Staff reached out to both parties via telephone on Friday, September 14, 2018. After
discussing the potential of a joint proposal, both Howard CDM/OCSA and Caribou Industries
agreed that a deal would not work at this time.
At the October 8'h Special EDIBT Council Committee meeting, the Committee directed staff to
proceed with a recommendation to the full Council to enter into an exclusive negotiating
agreement with Caribou industries for the renovation and reuse of the YMCA building. Caribou's
project, which includes a hotel component, is expected to generate significant tax revenue for the
City. The Committee also requested that the Caribou proposal include substantial community
19E-2
ENA for YMCA
November 20, 2018
Page 3
benefits, citing examples such as a Sylvia Mendez Museum, a concept utilizing wine and spirits,
or shared space for local workers as part of the project. Caribou has also expressed interest in
leasing a portion of the YMCA to the Orange County High School of the Arts for their proposed
Design and Art Center project.
Upon City Council approval of this action, staff will begin the development of a draft Exclusive
Negotiating Agreement with Caribou Industries and will work to define the business terms of the
agreement for future City Council action.
STRATEGIC PLAN ALIGNMENT
Approval of this item allows the City to meet Goal #3 (Economic Development), Objective #5
(Leverage private investment that results in tax base expansion and job creation citywide),
Strategy A (Identify and market underutilized properties for new development that will create new
jobs and expand the City's tax base).
FISCAL IMPACT
There is no fiscal impact associated with this action.
Steven A. Mendoza
Executive Director
Community Development Agency
Exhibit: 1. Caribou Industries Proposal
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October 29, 2018
Marc Morley
City of Santa Ana
Economic Development Division
20 Civic Center Plaza (M-25)
PO Box 1988
Santa Ana, CA 92702
Re: YMCA Major Community Benefits
Dear Marc,
YMCA/Caribou Industries Incorporated
Historic Renovation, Wellness Center
Arts, Local Cultural Exhibit Hall
and Grand Plaza Hotel
As proposed previously, I plan to maintain the ultimate historic integrity of the YMCA and transition the building
to a more urban economical and feasible tax generating building for the city of Santa Ana. In keeping with the
philosophy of the YMCA as a center for the community, our proposal has a Wellness Center Health club facility
in the basement, art gallery to exhibit famous artist as well as local talent, Bistro Style Cafe, World Wine
Collection, Community Banquet Hall, Classrooms, tutoring center and office space. Another option would be to
include boutique style hotel rooms that would complement the proposed future Grand Plaza Hotel addition.
Basement:
Wellness Center Fleath Club is designed to be a membership facility for the civic center union groups as well as
employees of the city and county. My plan is to renovate the existing historic pool as well as adding state of the
art fitness equipment, cardio equipment, Pilates and fitness educational center. It will be a community retreat
center for health and fitness; morning, noon and evening.
First Floor:
The Main floor of the building will be the Grand Entrance Foyer for the building as well as the proposed future
hotel addition. The reception, reservations lobby will maintain the old-world charnn of the YMCA with its
massive wood burning fireplace and include a Bistro Cafe. I am working with a World Class Wine collector that
wishes to exhibit fine wines from around the world. The Art Gallery will be a public center for local artist as well
as artist like Sylvia Mendez. The gallery is designed for community out reach and a center for local residents to
engage in art education.
1103 North Broadway, Santa Ana, CA 1� tr—A 914) 543-9484 Fax: (714) 543-9972
The main floor will also have a Grand Ball Room/ Banquet Hall and Exhibition Center for community events and
conferences.
The Hall will be able to accommodate up to 300 people and will be equipped with state-of-the-art audio and visual
capabilities for presentations.
Second and Third Floor:
Depending on the economic climate, several options are available. Option One being creative and innovative
office space, wellness center and art display. Option two would have art education classrooms with a tutoring
and mentoring center. And Option Three would be boutique style hotel rooms to compliment the proposed
Grand Plaza Hotel expansion and convention center. The upper floors are flexible and can accommodate any of
the proposed options, or a mixture of matching other great creative urban life style solutions.
Marc, my plan is to create a world class artist themed center for all the community to enjoy and be proud of and
to bring their friends and family to showcase our beautiful city of Santa Ana. I take immense pride in being a
major developer helping transform our City and would take get pride in this renovation of the Historic YMCA.
This project would add to the historic collection of the other World Class renovations that I have very
successfully completed within the city of Santa Ana: 207 N Broadway, The Santora Building, 505 N Sycamore,
The Masonic Temple, 100 S Main, The United Auto Building 1914 Horseless Carriage Building, The Twist Bassler
House, which is now the Cabrillo Tennis Club, the 1922 Christian Science Church which Is now Michael F Harrah
Symphony Hall, 888 N Main adaptive reuse apartment homes, Security Pacific Building and several other Historic
Homes as well.
professional regards,
Harrah
President
Caribou Industries, Inc.
19E-19
19E-20