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HomeMy WebLinkAbout01/19/1982 '. fl. .. . 4. pi( MINUTES REGULAR MEETING COMMUNITY REDEVELOPMENT AGENCY SANTA ANA, CALIFORNIA JANUARY 19, 1982 The Regular Meeting of the Community Redevelopment Agency of the City of Santa Ana was called to order at 5:39 P.M., in the City Council Chambers, 22 civic Center Plaza, Santa Ana, California. After the Pledge to the Flag, and the Invocation given by Chairman Bricken, roll was called: PRESENT ABSENT John Acosta Gordon Br icken Daniel Gr iset Robert Luxembourger Patricia McGuigan J. Ogden Markel Al Serrato Others in Attendance: A. J. Wilson, City Manager Rex Swanson, Executive Director Edward J. Cooper, City Attorney David N. Ream, Community Development Director Thomas E. Hammill, Real Estate Officer Laura Juarez, Secretary CONSENT CALENDAR STAFF RECOMMENDATIONS APPROVED On the approved 7:0 motion of Mr. Luxembourger, seconded by Mrs. McGuigan, the Agency approved the recommendations of Staff on the following consent calendar items: MINUTES Approved Minutes 15,1981. LETTERS OF AND MARKEL Regular Meeting held on December of DISCLOSURE FROM AGENCY MEMBERS ACOSTA 1. Received and filed the letter dated December 1, 1981 from Agency member John Acosta disclosing interest in real property located at 1705 South Main Street, Santa Ana, California. 8- . . 2. Received and filed the letter dated December 28, 1981 from Agency member J. Ogden Markel disclosing interest in real property as follows: Lots 9 and 10 in Tract 827, and Lots 7,8, 9 and 10 in Tract 1265. DISPOSITION AND DEVELOPMENT AGREEMENT WITH CIVIC CENTER DEVELOPMENT Authorized continuation of the public hearing for the adoption of a Disposition and Development Agreement with Civic Center Development set for 5:30 P.M. on January 19,1982 until 5:30 P.M. on February 16,1982. D & B PLAZA DEVELOPMENT FOR OLD COURTHOUSE PROPOSAL Received and filed. * * * * * * * * * * CONSENT CALENDAR FINIS * * * * * * * * * MAJOR COMMERCIAL REHABILITATION STATUS REPORT The City Manager gave a brief presentation on the various developments that will occur within the downtown area during 1982. In addition, the City Manager narrated a brief slide presentation on the current status of the Major Commercial Rehabilitation Loan Program. A motion was made by Mr. Griset, seconded by Mrs. McGuigan and carried unanimously that the Major Commercial Rehabilitation Status Report be received and filed. DEVELOPER SELECTION FOR A-2 SITE (FORMERLY BURKES) Mr. Swanson reviewed for the Agency members the selection process utilized by the Staff and Commission in recommending Campeau Corporation/Goldrich, Kest and Stern as the developer for the A-2 Site. Mr. Robert Newcomb, Chairman of the Redevelopment Commission, briefed the Agency on the Commission's efforts in reviewing the proposals and why it recommended the Campeau Corporation/Goldrich, Kest and Stern as developer for the A-2 site and Ferrante/Walder for development of the B-1 site. Mr. Richard Botti, of Keyser Marston Associates, was present, and was asked to review his findings for the Agency. Mr. Botti stated that at the request of Staff, their firm reviewed the redevelopment proposals, and in so doing, they were concerned primarily with the economic aspects of the proposals and financial strength of the developers. Their analysis of the three proposals was focused on the following three major areas: -2- .' l. 2. 3. Land use/density considerations; Phasing of the project; and Project Financing and the financial capabilities of the developers. In addition, Mr. Botti stated that it would be appropriate for the developer and Agency to consider developing the site in one phase. This would avoid the phasing problem of the garage and on-site storage during the construction of a Phase II tower and the disruptions that would occur to the occupants of the Phase I building. With respect to land use and density considerations, it was their opinion that The Campeau proposal was slightly superior to the other proposals in that: . 1. Their Phase I commitment is within 13,000 square feet of the largest commitment (Essex), and is approximately 50% larger than IDM. They also are (1) providing excess parking in Phase I, which provides a slight inducement to proceed with Phase II, and (2) their plan allows for a Phase II development of a possible additional 90,000 square feet. 2. Their parking ratio in excess of 3.0 spaces per 1,000 square feet of gross floor area is closer to the estimated actual demand. 3. Their proposal calls for the development of Fourth Street retail, which is desirable for the development of the A-2 site. Mr. Botti stated that in terms of phasing, the Essex proposal was superior in that it will be built as one phase, although Phase I for both IDM and Campeau fulfills the Agency's stated minimum of 160,000 square feet for the site. The IDM proposal consists of two equal towers of approximately 200,000 square feet. Their proposal requires that all the parking for the second office tower be contained in a five story subterranean parking garage, which is not economically feasible. The last major concern - financial and capabilitites of the developers, the Agency is faced with somewhat a unique problem in that they have already assembled the site. The real issue is which of the developers can now move ahead. . Mr. Botti stated that the difficulties of raising the necessary funds in this period of economic uncertainty require that the selected developer have both the necessary financial resources and proven experience. -3- .-- . . Measuring a developer's financial capabilitites is very difficult at this stage of the disposition process. In the past, Keyser Marston Associates has used essentially two general criteria factors in measuring or ranking the financial capabilities of various developers. They are: 1. A ratio of the anticipated development costs to total assests of the developer. and 2. A ratio of anticipated development costs to the largest project previously undertaken by the developer or members of the development team. with respect to financial capabilities, Mr. Botti stated that the assets of the Campeau team members were conservatively estimated in excess of $1.0 billion and the project represented less than four percent (4%) of their assests. The IDM project and Essex development costs were far in excess of the total assets of the various principles. Mr. Swanson informed the Agency members that at 1:30 P.M. Essex had delivered to Staff an Amendment to their proposal. He also stated that the developers were present to give a ten (10) minute presentation. Chairman Bricken then invited Mr. Michael J. Maloney and Mr. Stern of Campeau Corporation to address the Agency. Mr. Maloney and Mr. Stern thanked the Agency for the opportunity to address the Agency and expressed their Company's gratitude for having been recommended by staff as the developer for the A-2 site. They added that their Company had worked very hard to put together a proposal which would merit the Commission and Agency's review and consideration. They also added that their Company felt that they had met the expectations and quality of development that the City of Santa Ana considers important to its long-term growth. Mr. Maloney and Mr. Stern then made a comprehensive slide presentation which showed many of the projects they have developed in Canada and throughout the United States. Chairman Bricken thanked Mr. Maloney and Mr. Stern for their presentation and then called upon Mr. David Ball of IDM Corporation. Mr. Ball reviewed the lending capabilitites of the IDM Corporation. He pointed out that Chase Manhattan, Union, Mitsui, Sumitomo and Imperial Bank, as well as California Federal Savings and Loan, have expressed interest in funding the IDM proposal for the A-2 site. Mr. Ball then made a comprehensive slide presentation which showed many of the projects they had developed. Chairman Bricken thanked Mr. Ball for his presentation and then called upon Mr. Christopher A. Wheeler of Essex. Mr. Wheeler pointed out that Essex was now working on two -4- --" .. . projects in Tulsa, Oklahoma and had numerous projects throughout the Southwest. He added that the difference in costs between the Southwest and Orange County should be taken into account (a 12 million dollar project in the Southwest would be a 20 million dollar project in Orange County) . Mr. Wheeler stated that Essex had all the tools necessary to do the job, and the fact that they were a Santa Ana based company and readily available for consultation would be of great value to the Agency. Chairman Bricken thanked Mr. Wheeler for his presentation. RECESS At 6:49 P.M., the Chairman recessed the meeting. At 7:01 P.M., the meeting was reconvened with the same members present. Chairman Bricken asked Staff if they comments. Mr. Swanson responded no. any further had After a lengthy discussion, a motion was made by Mr. Acosta, seconded Mr. Serrato and carried unanimously that the adoption of Resolution 82-1: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AUTHORIZING THE CHAIRMAN OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA TO EXECUTE AN EXCLUSIVE NEGOTIATION AGREEMENT WITH SANTA ANA PLAZA ASSOCIATES FOR PROPERTY KNOWN AS THE "A-2 SITE" be continued until February 11, 1982 at 5:30 P.M. RECESS At 8:19 P.M., the Chairman recessed the meeting. At 8:30 P.M., the meeting was reconvened with all members present, except Mr. Markel. DEVELOPER RECOMMENDATION FOR B-1 SITE (FORMERLY JONES) Mr. Swanson reported used for this site. follows: that Request For Proposals were also The results of the rating were as DEVELOPER SCORE AVERAGE 1. 2. 3. 4. Ferrante/Walder Company Forest City Dillon Insured Developers Ford/Emko Corporation 90.0 65.6 50.4 48.4 -5- - .. . Mr. Swanson advised that Mr. Jules Walder of Ferrante/Walder Company was present. Chairman Bricken then invited Mr. Walder to address the Agency. Mr. Walder said that he appreciated the work done by staff and the opportunity to address the Agency. He stated that Ferrante/Walder had been in business since 1969 and had, through these years of experience, assembled some of the best people in the field of consulting and independent contracting. He added that they had developed over $300 million of property in Southern California from Ventura County to San Diego County. Mr. Walder stated that Ferrante/Walder intended to move their corporate head- quarters to this site and were anxious to proceed with the project as soon as possible. He added that, as a part of his presentation, he had asked Mr. Peter Serdano, Vice President of Imperial Leasing and Senior Vice President of Imperial Bank Mortgage Company, to address the Agency as to his Company's point of view regarding the Ferrante/Walder proposal. Mr. Serdano said that his company was in the business of making real estate loans primarily and that they looked to the real estate for the ability to repay, not from the sale of the project, but from the viability of the project to service the loan. He added that if the first four-story phase would lease successfully then the developer could proceed to the second four-story building, and after leasing it proceed to the third phase. Mr. Jones addressed the Agency and said that they had attempted to design this project so that it would not intrude upon the surrounding residential areas. Chairman Bricken thanked Mr. Walder for his presentation and then invited Mr. John Webb of Forest City Dillon, Inc. to address the Agency. Mr. Webb said that, even though they had not been the number one choice on Site B-1, Forest City Dillon expected to participate on some other site within the project area and welcomed the opportunity to acquaint the Agency with their Company's potentials. Mr. Webb then outlined Forest City Dillon's corporate structure, experience in the field of real estate development and dollar volume of construction. After a lengthy discussion, it was moved by Mr. Griset, seconded by Mr. Luxembourger and carried by a 5:1 vote (Mr. Serrato casting the "NO" vote) to adopt Resolution 82-2: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AUTHORIZING THE CHAIRMAN OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA TO EXECUTE AN EXCLUSIVE NEGOTIATION AGREEMENT WITH ROBERT FERRANTE AND JULES WALDER FOR PROPERTY KNOWN AS THE "B-1 SITE;'. -6- . 81 --- DELEGATION OF CLAIMS PROCESSING PROCEDURE A motion was made by Mrs. McGuigan, seconded by Mr. Acosta and carried unanimously to adopt Resolution 82-3: A RESOLUTION OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA ANA AUTHORIZING THE CITY ATTORNEY OF THE CITY OF SANTA ANA TO PERFORM CLAIMS FUNCTIONS AS PERMITTED BY CALIFORNIA GOVERNMENT CODE SECTIONS 935.4 AND 949. ORAL COMMUNICATIONS- DEVELOPMENT ALLEN, 500 NORTH MAIN STREET RALPH Mr. Ralph Allen addressed the Agency to request approval to build a five foot extension to his building that was not included in his approved plans for the project. Mr. Allen stated that he understood that the five foot extension was not in his approved plans, however he hoped to convince the City Manager and Staff to permit the five foot extension at a later date. When the City Manager declined to support the change, Mr. Allen said that he had no recourse but to appeal directly to the Agency. After lengthy discussion, a motion was made by Mr. Acosta, seconded by Mr. Serrato and carried by the following roll call vote to direct Staff to prepare the necessary Amendment to the Disposition and Development Agreement with Ralph Allen Associates to provide for a five foot extension to the second floor of the building. In addition, Staff and Agency General Counsel were directed to investigate several legal and technical considerations involved in the proposed Amendment and report back to the Agency at the next possible opportunity. AYES: NOES: ABSENT: Acosta, Serrato, Luxembourger, McGuigan Griset, Bricken Markel ADJOURNMENT There being no further business before the Community Redevelopment Agency, the meeting was adjourned at 10:19 P.M. ,to February 11, 1982 at 5:30 P.M. Rer:fl~ ~~ Chairman Executive Director -7-