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HomeMy WebLinkAbout80A - JOINT - EXCLUSIVE NEGOTIATING AGMTREQUEST FOR COUNCIL/ HOUSING AUTHORITY r__ ACTION MEETING DATE: NOVEMBER 19, 2012 TITLE: EXCLUSIVE NEGOTIATING AGREEMENT FOR REGIONAL TRANSPORTATION CENTER AND HOUSING AUTHORITY PROPERTIES; AND CONTRACT AMENDMENT WITH KEYSER MARSTON ASSOCIATES 4J 1 4- _i f-- CITY MANAGER EXECUTIVE DIRECTOR RECOMMENDED ACTION CITY COUNCIL ACTION CLERK OF COUNCIL USE ONLY: APPROVED ? As Recommended ? As Amended ? Ordinance on 1st Reading ? Ordinance on 2nd Reading ? Implementing Resolution ? Hearing For Set Publlic i? CONTINUED TO -1 5) tACt_)/_`i - 9 FILE NUMBER Authorize the City Manager and Clerk of the Council to execute the attached Exclusive Negotiating Agreement between the City of Santa Ana, Housing Authority of the City of Santa Ana, and Santa Ana Station District, LLC for the Santa Ana Regional Transportation Center (SARTC) and related Authority property, subject to non-substantive changes approved by the Executive Director, City Manager and respective attorneys. 2. Authorize the City Manager and Clerk of the Council to execute the attached amended agreement with Keyser Marston Associates, for economic consulting services for the SARTC project in an additional amount of $25,000, for a total contract amount of $50,000, subject to non-substantive changes approved by the City Manager and City Attorney. HOUSING AUTHORITY ACTION Authorize the Executive Director and Recording Secretary to execute the attached Exclusive Negotiating Agreement between the City of Santa Ana, Housing Authority of the City of Santa Ana, and Santa Ana Station District, LLC for the Santa Ana Regional Transportation Center and related Authority property, subject to non-substantive changes approved by the Executive Director, City Manager and respective attorneys. 8OA-1 Exclusive Negotiating Agreement and Keyser Marston Amendment November 19, 2012 Page 2 COMMUNITY REDEVELOPMENT AND HOUSING COMMISSION RECOMMENDATION At its regular meeting of November 6, 2012, by a vote of 6:0, (Morfin absent), the Community Redevelopment and Housing Commission recommended that the Housing Authority authorize the Executive Director and Recording Secretary to execute the attached Exclusive Negotiating Agreement with the City of Santa Ana and Santa Ana Station District, LLC for the Santa Ana Regional Transportation Center and related Authority property, subject to non-substantive changes approved by the Executive Director, City Manager and respective attorneys. DISCUSSION On December 7, 2009, the Santa Ana Community Redevelopment Agency (Agency) and the City of Santa Ana entered into two Predevelopment Agreements (exclusive right to negotiate agreements) for the Station District with Related California/Griffin Realty Corporation (Santa Ana Station District, LLC), a development team selected after an extensive Request for Qualifications (RFQ) process. The Station District is 94-acre area anchored by the Santa Ana Regional Transportation Center (SARTC). One agreement was for the properties under development now (Station District three-phase affordable housing project), and the second for other properties in the area owned by the City and Agency at and near the SARTC (Exhibit 1-A). The two agreements were necessary given the differing time frames and particulars associated with these two areas of focus. On June 7, 2010, after a comprehensive public outreach effort for the Station District and Transit Zoning Code spearheaded by the developer in conjunction with the Agency/City, the City Council and Community Redevelopment Agency approved a number of actions in furtherance of the Station District affordable housing development, the subject of the first Predevelopment Agreement. In addition to approval of the Disposition and Development Agreement (DDA) with the developer, the Council/Agency took other actions, such as: approved the Transit Zoning Code (TZC); certified the Final Environmental Impact Report (FEIR) for the TZC and redevelopment project; authorized the initiation of efforts with the Santa Ana Unified School District (SAUSD) for the joint development of a community center at Garfield Elementary; and approved funds for the targeted Lacy residential loan program. The DDA itself also required the developer to incorporate child care, neighborhood retail and public art components into the project. Subsequently, on July 8, 2010, Friends of the Lacy Historic Neighborhood (FOL) filed a Petition for Writ of Mandamus against the City and Agency challenging the certification of the Final EIR, approval of the Transit Zoning Code, the Station District Project and the related purchase and demolition of certain structures in the Lacy Neighborhood. In April 2011, resolution was reached and a Settlement Agreement and associated amendment to the DDA were approved and executed. As part of the amended DDA and settlement, the Agency and developer agreed to certain modifications to the plan that resulted in changes to the number and location of rental versus for-sale units, as well as the retention and rehabilitation of certain existing structures versus new construction. This arduous legal process and resulting settlement along with the significant 8OA-2 Exclusive Negotiating Agreement and Keyser Marston Amendment November 19, 2012 Page 3 changes that occurred as a result could not have been accomplished without the assistance of the developer, and their willingness to assume the new obligations, while working with the Agency to keep the project within the original budget. To date, all requirements of the DDA as amended and Settlement are being implemented pursuant to the terms of said agreements. Construction of the new and rehabilitated rental units is underway, with a lottery held this month (November) for the first of the units to come on line. Plans for the for-sale units are being finalized with construction expected to commence early in 2013. As called for the in agreement, the developer has incorporated the child care and retail spaces, which are under construction in the 74-rental unit podium building. Additionally, staff facilitated a connection with the County's Child Care Coordinator, whom the developer has been working with on space design as well as identifying a provider. The developer is also working with staff to commence the marketing and outreach for the retail space. An ad hoc public art committee was established by the Agency with broad representation from the community involved in the Station District outreach effort (Lacy Neighborhood President, business community representative from Waterline Technologies, SACReD/Kennedy Commission representative, Santa Ana Council of Arts and Culture President, CSUF Grand Central Arts Center representative, a Community Redevelopment & Housing Commissioner, and a Planning Commissioner). The developer worked diligently with this committee to set criteria, issue an RFP and select an artist to design a sculpture to be installed at the northwest corner of Lacy and Sixth Streets, near the retail space and across from Garfield Elementary. At the committee's request, the developer made it a requirement for the selected artist (Jules Rochielle) to involve the Garfield school children in the process. The second predevelopment agreement focuses on planning and development of the SARTC and larger Station District area. Since execution of this agreement, several planning efforts have been undertaken in this regard which the developer has participated in, such as: the Transit Zoning Code, SARTC master vision plan (which included a financial contribution by the developer), the fixed guideway, and Santa Ana Boulevard grade separation studies. Thus, what remains to be accomplished is a more comprehensive master plan focusing on the SARTC area. Additionally, despite certain delays in implementation of this agreement due to the FOL lawsuit and being hindered by the dissolution of redevelopment, implementation of this agreement has continued, and specifically from City aspect since redevelopment dissolution. Staff and the developer have been in on-going discussions with the County staff over the last two years working toward a Memorandum of Understanding and an Exclusive Negotiating Agreement, which would include the County, for the joint planning and development of our respective properties. Although County staff notes the SARTC to be a "legacy project", they recently communicated a need to hold off on formalizing any partnership arrangements due to a focus on internal real estate priorities first, including developing a plan for the relocation of the Fruit Street Public Works operations located on the subject County property. However, a City/County working team will continue to discuss and explore options for a joint planning and development effort. Given that certain aspects of the original Predevelopment Agreement have changed since its execution, it is recommended that it be fully revised and restated as an "Exclusive Negotiating 8OA-3 Exclusive Negotiating Agreement and Keyser Marston Amendment November 19, 2012 Page 4 Agreement". Updates are being recommended due to the dissolution of redevelopment, and with respect to such items as planning efforts completed or underway, status of County involvement, and property ownership (former Agency parcel now owned by the Housing Authority), with the developer still responsible for funding the SARTC area master planning effort, at a minimum level of $35,000 in third party costs for the City properties and an additional $65,000 for the larger site, should that transpire. Additionally, the developer has agreed to the removal of a liquidated damages clause that was in the original agreement, which could have resulted in the City being responsible for reimbursement for those third party costs in an amount up to $100,000. The Agreement calls for completion of the Master Plan within 18 months, however, a six-month extension may be granted by mutual agreement if substantial progress is being made on the Master Plan and more time is needed to complete it. Additionally, if the County Parcels are ultimately incorporated, up to two additional six-month extensions can be granted in the same manner. The approval to extend is also conditioned upon Developer providing the City and Authority with an updated schedule, which is subject to the approval of the City Manager and Executive Director of the Authority. Additionally, upon completion and approval of the Master Plan by the governing bodies of the City and Authority, the parties would have a year (or greater if mutually agreed upon) to negotiate towards agreement(s) for disposition and/or development. It is recommended that Keyser Marston Associates (KMA) be hired to provide the necessary financial consulting services on an as-needed basis to assist in creating a financial and operational framework under which the City will pursue the development of the City Site, and potentially a larger site in conjunction with the County property. KMA, which has the requisite specialized skills and expertise, will be evaluating the master plan proposals and assisting the City in defining and analyzing the public revenues sources that may be generated by the proposed development, while balancing the City's goal to maximize the return on public investment with the City's transit goals and objectives. The City recently entered into an agreement with KMA dated October 1, 2012 in an amount not to exceed $25,000 with regard to two City-owned properties in the Downtown/Civic Center area, therefore an amendment to that agreement is now being recommended. With the Fixed Guideway project, which interconnects with the SARTC site, primed for funding, it is an opportune time for a more comprehensive master planning and development effort to proceed per the new agreement, including an analysis of the market and financial feasibility of development options. Once the County is in a position to be involved on a more formal basis, its property can be incorporated as applicable. ENVIRONMENTAL COMPLIANCE Developer negotiations and preparation of a conceptual master plan do not constitute a project under CEQA guidelines. Additionally, the above-described action of the City Council was evaluated under the California Environmental Quality Act (CEQA) as part of Environmental Impact Report (EIR) No. 2006-02, adopted by the City Council on June 7, 2010. 8OA-4 Exclusive Negotiating Agreement and Keyser Marston Amendment November 19, 2012 Page 5 FISCAL IMPACT Funds are available in the Community Activities Non-Departmental Contract Services account (no. 01105810-62300). APPROVED AS TO FUNDS AND ACCOUNTS: Ycitja_6do Nancy T. E ards Interim Executive Director Community Development Agency Francisco Gutierrez Executive Director Finance & Management Services Agency NTE/SG/kg Exhibit: 1. Agreement (Exclusive Negotiating Agreement) 2. Amendment (Keyser Marston Associates) 8OA-5 8OA-6 DRAFT December 19, 2012 EXCLUSIVE NEGOTIATING AGREEMENT This Exclusive Negotiating Agreement ("Agreement") is entered into as of , 2012 by and among the City of Santa Ana, a charter city and municipal corporation (the "City"), the Housing Authority of the City of Santa Ana, a public body, corporate and politic (the "Authority") and Santa Ana Station District, LLC, a California limited liability company (the "Developer") on the terms and provisions set forth below and with reference to the following. RECITALS A. The former Community Redevelopment Agency of the City of Santa Ana ("Agency"), the City and the Developer previously entered into the "Predevelopment Agreement - District Master Development Plan" (the "Predevelopment Agreement") dated December 9, 2009, after conducting an extensive Request for Proposals process. Developer was awarded the Predevelopment Agreement to assist in strategic planning and development with respect to approximately 94 acres known as the "Station District", which included City and Agency owned properties. The Predevelopment Agreement is superseded by the execution of this Exclusive Negotiating Agreement. B. The Agency and City were studying development and master planning of the "Station District" in conjunction with other studies being undertaken for new transportation projects in and around the City-owned Santa Ana Regional Transportation Center ("SARTC"). The Authority now owns one parcel within the Station District located at 1126-1146 E. Washington Ave. (APN #398-092-14) ("Housing Authority Parcel'), which was previously owned by the Agency and subject to the terms of the Predevelopment Agreement. The Housing Authority Parcel is hereby reaffirmed as being included under the terms of this Exclusive Negotiating Agreement, unless precluded or prohibited from including such parcel by direction or action of the State of California. The Station District including the SARTC and Housing Authority Parcel are depicted in Exhibit A hereto which is incorporated herein by this reference. C. Additionally, the County of Orange owns adjacent property within the Station District depicted on Exhibit A ("County Parcels") that has been the subject of discussions between the City and County with respect to joint planning and development opportunities. It is anticipated that a Joint Powers Agreement, Cooperative Agreement, or Memorandum of Understanding will be negotiated with the County for development of the City and County Parcels, and Developer agrees to fully cooperate with that potential negotiation process and agreement. Developer will ultimately be responsible for incorporating the County Parcels into the Master Plan if directed to do so by the City. The County is not a party to this Agreement and there is currently no contract or commitment from the County at this time to sell or develop its properties. EXHIBIT 1 8OA-7 DRAFT December 19, 2012 D. This Exclusive Negotiating Agreement sets forth the commitment of the City, Authority and Developer to continue to proceed with this planning and development effort specifically as it relates to certain properties within the Station District as shown on Exhibit A (referred to collectively as "City Parcels"), subject to contractual obligations and lease agreements at the SARTC Depot building, which can be entered into, extended or terminated at the sole discretion of the City. The City Parcels are sometimes referred to herein as the "Proposed Development Site" as shown on Exhibit A., which may ultimately be amended to include the County Parcels. E. The Developer, after being selected in 2009 through a competitive process by the City/Agency, has continued to participate in strategic planning for the Station District, including an initial master plan, a visioning document ("Initial Master Plan") for the SARTC, and for this reason, the parties continue to partner with the Developer for the preparation of a plan and to negotiate the potential disposition and/or development of the Proposed Development Site. F. Santa Ana Station District, LLC, is comprised of The Related Companies of California, LLC, and Griffin Realty Corporation, each a "Member" of Developer. G. Any disposition or sale of the City Parcels shall be performed in compliance with applicable local and State laws. Any public works project with respect to the Proposed Development Site will be performed in compliance with all applicable regulations and the requirements of any funding sources including, but not limited to, Federal, State, and local funds. NOW, THEREFORE, the City, Authority and the Developer hereby agree as follows: 1. City and Authority Planning Process. The City and Authority are undertaking a strategic transportation and land use planning process for the Proposed Development Site. The City has obtained funds and is proceeding with the planning for the proposed "Go Local" transportation project as approved by City Council ("Go Local Project"), the proposed Santa Ana Boulevard Grade Separation project under study ("Santa Ana Boulevard Grade Separation Project"); and has received funds for and completed the Initial Master Plan for SARTC, prepared by the consultant IBI, as approved by the City Council, which the Developer has participated in and has contributed financially to this effort. The City also funded the preparation of, and adopted the Transit Zoning Code encompassing, among other things, the Proposed Development Site. The City and Authority now wish to jointly plan the Proposed Development Site consistent with the City's and Agency's prior planning efforts. 2. Role of Developer. The Developer agrees to: EXHIBIT 1 2 8OA-8 DRAFT December 19, 2012 A. Conduct design and financial feasibility studies in conjunction with City and Authority to determine viable options for the development and enhancement of the Proposed Development Site, and as may be amended to include County Parcels, and potentially adjoining properties that may be impacted by the proposed Grade Separation in the context of the transportation plans to be developed. B. Organize and initiate all necessary community outreach effort as may be deemed appropriate by the parties, with input and support from City and Authority staff. C. Prepare a Master Plan, that builds upon the Initial Master Plan, and complies with the standards found within the Transit Zoning Code (SD 84). Said Master Plan shall include: a detailed project description including potential uses, approximate building square footages, parking, open space, and project amenities; and a conceptual site plan and at least two conceptual renderings. It is understood that the conceptual plan and conceptual renderings will not constitute a final project design and rather are being provided for illustrative purposes. The details of any final project design may be further refined through any subsequent process and subject to City standards and procedures. The Master Plan will be developed in furtherance of the following objectives: i. Enhance the Proposed Development Site by seeking to create a true sense of place and by providing a connection between the downtown and the growing transit corridor. ii. Create a sustainable mixed-use project that may include new transportation facilities (potentially City-owned), transit-related headquarters/offices, and depending upon the feasibility, adaptive reuse of the existing train station ("Depot"), residential components, ancillary retail/service commercial uses, additional office components, a child care component, public uses, and supportive parking so as to maximize transit and economic development opportunities on, and the value of, the Proposed Development Site, for the region as a whole. The Master Plan should also consider inclusion of the Fixed Guideway System and grade separation components, whose ultimate ownership and development may be retained by the City as public works projects. iii. Identify needed infrastructure. iv. Link neighborhoods and businesses with public transit. v. Enhance public spaces and streets. vi. Establish a viable implementation strategy, including a phasing schedule. EXHIBIT 1 3 8OA-9 DRAFT December 19, 2012 D. Cooperate with the City and Authority in the pursuit of grants and other funding opportunities. 3. Exclusive Negotiations During the term of this Agreement, the City and Authority agree that neither shall negotiate with any person or entity, exclusive of any other public entity, other than the Developer, regarding potential disposition and development of the Proposed Development Site. 4. Term The term of the Agreement shall be for a period of eighteen (18) months from the Effective Date of this Agreement (the "Initial Term"). During the Initial Term, the parties shall cooperate in the master planning process with the intent of producing a mutually agreeable and approved Master Plan, pursuant to the "Schedule" evidencing a timeline and milestones for work product attached hereto and incorporated herein as Exhibit B. Said Schedule is subject to change by mutual written agreement of the parties. If substantial progress is being made on the Master Plan and more time is needed to complete the Master Plan, by mutual agreement, this Initial Term may be extended for six months by the City Manager and Executive Director of the Housing Authority. If the City makes a decision to incorporate the County Parcels into the Master Plan during the Initial Term or optional six month extension if granted, up to two additional six-month extensions can be granted in the same manner. Said approval to extend is conditioned upon Developer providing the City and Authority with an updated Schedule, which shall also be subject to the approval of the City Manager and Executive Director of the Authority, which approval will not be unreasonably withheld. 5. Extended Term - Master Plan Approval If, at or before the end of the Initial term or any extensions granted pursuant to Section 4 above, the City, Authority and Developer complete the Master Plan which is approved by the governing bodies of the City and Authority, the term of this Agreement shall be extended for one (1) year or a greater period mutually agreeable to the parties (the "Extended Term"), during which time the parties will negotiate towards agreement(s) for disposition and/or development of the Proposed Development Site not otherwise retained by the City and Authority, as applicable, in accordance with the terms hereof, and/or unpermitted due to funding sources. 6. Environmental Requirements Prior to entering into any final agreement(s) with the Developer, the City and Authority must approve any and all NEPA and/or CEQA documents that may be applicable to any development and that nothing in this Agreement in any way constitutes nor shall it be interpreted to be a contractual obligation committing the City EXHIBIT 1 4 8OA-10 DRAFT December 19, 2012 and Authority to undertake the disposition and/or development of the Proposed Development Site. 7. Master Plan Costs Developer shall be responsible for all costs associated with development of the Master Plan. Developer agrees to expend a minimum amount of Thirty Five Thousand Dollars ($35,000) in "Third Party Costs" for the Master Plan services performed hereunder for the City Parcels, and an additional minimum amount of Sixty Five Thousand ($65,000) in "Third Party Costs" for the Master Plan services performed hereunder for the County Parcels, for a total minimum of One Hundred Thousand Dollars ($100,000.00) in "Third Party Costs" for the Master Plan ("Total Amount") if the County Parcels are incorporated. Third Party Costs shall mean those amounts actually paid or obligations incurred for work actually done by those consultants, contractors and advisors of the Developer. 8. Ownership of Materials, Supplies, Drawings, Specifications, Programs or Systems Any and all records, papers, drawings, specifications, programs, systems and other materials prepared by Developer or its agents pursuant to this Agreement shall, without further consideration, be the property of the City or Authority as applicable to the City Parcels or Authority Parcel. Said work product shall be submitted in hard copy and produced in a form compatible with the City's computer system, as agreed between the City's Project Manager and Developer. Developer agrees to provide City and Authority with any such materials whenever requested to do so. 9. No Development Commitment Made By the Parties A. By its execution of this Agreement, the City, Authority, and Developer are not committing themselves to or agreeing to undertake: (a) financing or disposition and/or acquisition and development of Proposed Development Site; or (b) any other acts or activities requiring the subsequent independent exercise of discretion by the City and/or Authority or any agency or department of either, and/or Developer, and the City and Authority, and Developer have no reasonable expectation that such commitments will be made in the future. EXHIBIT 1 8OA-11 DRAFT December 19, 2012 B. This Agreement does not constitute a disposition of property by the City and/or Authority and does not require a public hearing. Execution of this Agreement by the City and Authority is merely an agreement to enter into a period of negotiations according to the terms hereof, reserving final discretion and approval by the City and Authority as to any disposition and development of the Proposed Development Site and all permits, approvals, decisions and/or proceedings in connection therewith. 10. Non-Assignability/No Removals or Substitutions The qualifications and identity of the Developer is a critical element of the City's and Authority's willingness to enter into this Exclusive Negotiating Agreement. Therefore any attempted partial or full assignment, or the removal of any Member of Developer without the prior approval of the City and Authority which may be granted or withheld in the sole and absolute discretion of the City Manager and Executive Director of the Housing Authority, or their designee, shall be a material breach by the Developer entitling the City and/or Authority to terminate this Agreement. Further, within thirty (30) days of execution of this Agreement, Developer shall submit its list of Third Party consultants for review and approval by the City Manager and Executive Director of the Housing Authority, or their designees, and such approval shall not be unreasonably withheld. Developer reserves the right to modify the list from time to time, subject to the aforementioned approval process. 11. Default. (a) Failure or delay by either Party to perform any material term or provision of this Agreement shall constitute a default under this Agreement. The Party claiming that a default has occurred shall give written notice of default to the Party claimed to be in default, specifying the alleged default. Delay in giving such notice shall not constitute a waiver of any default nor shall it change the time of default. If the Party who is claimed to be in default by the other Party cures, corrects or remedies the alleged default within thirty (30) calendar days after receipt of written notice specifying such default, such Party shall not be in default under this Agreement. (b) If the nature of the alleged default is such that it cannot reasonably be expected to be cured within a thirty (30) day cure period as provided above, the Party shall not be in default if such Party promptly commences to cure the alleged default, diligently pursues the completion of such cure, and completes the cure as soon as practicable thereafter. However, the injured Party shall have no right to exercise any remedy for a default under this Agreement, without first delivering written notice of the default. (c) If a default of either Party remains uncured for more than thirty (30) calendar days following receipt of written notice of such default, a "breach" of this EXHIBIT 1 6 8OA-12 DRAFT December 19, 2012 Agreement by the defaulting Party shall be deemed to have occurred. In the event of a breach of this Agreement, the sole and exclusive remedy of the Party who is not in default shall be to terminate this Agreement by serving written notice of termination on the Party in breach. (d) No waiver of any breach of any term or condition contained in this Agreement shall be deemed a waiver of any preceding or succeeding breach of such term or condition, or of any other term or condition contained in this Agreement. No extension of time for performance of any obligation or act, no waiver of any term or condition of this Agreement, nor any modification of this Agreement shall be enforceable against the City, Authority or Developer, unless made in writing and executed by all parties. 12. Non-Discrimination. The Developer shall not discriminate against nor segregate any person, or group of persons on account of race, color, creed, religion, sex, marital status, handicap, national origin or ancestry in undertaking its obligations under this Agreement. 13. Miscellaneous A. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which, when taken together, shall constitute one and the same instrument. B. This Agreement shall be governed by, and construed in accordance with, the laws of the State of California, with venue in Orange County. C. Each of the undersigned represents and warrants that by its signature hereinbelow each such signatory has the power, authority and right to execute this Agreement. D. All Exhibits referenced herein and attached hereto shall be incorporated as if fully set forth in the body of this Agreement. EXHIBIT 1 7 8OA-13 DRAFT December 19, 2012 IN WITNESS WHEREOF, the parties hereto have executed this Exclusive Negotiating Agreement as of the date set forth hereinabove. ATTEST: THE CITY OF SANTA ANA Maria D. Huizar Paul Walters Clerk of the Council City Manager APPROVED AS TO FORM: SONIA R. CARVALHO City Attorney Lisa E. Storck Assistant City Attorney HOUSING AUTHORITY OF THE CITY OF SANTA ANA ATTEST: Maria D. Huizar Recording Secretary APPROVED AS TO FORM: Sonia R. Carvalho Housing Authority General Counsel By: Lisa E. Storck, Asst. Counsel Nancy T. Edwards Interim Executive Director EXHIBIT 1 8 8OA-14 DRAFT December 19, 2012 DEVELOPER Santa Ana Station District, LLC, A California limited liability company The Related Companies of California, LLC A California limited liability company, its member By: William A. Witte, President Griffin Realty Corporation, A California Corporation, its member By: Roger N. Torriero, President EXHIBIT 1 9 8OA-15 i = 1?5? I 3?ti 1 ?} C 1 - Afa #e: -11, r e a 1, # ,•. d 9 xM :'. E ? g ! add: r` ?'?&? ?+.1? t tyt }? ? il•, e ? hlY%% .?eV?''?, A"? "f r? 4' ,st ?i^z Arl:i qy a?,4h ,s.?z v . ^s ! ! F I}4 ! qc : r ', ?? • of i ??f 3 ?? i!llK a' °1,. y .? ry.I ? y ?,,±_#?I?. • ,'A a .?T".SL : #x . ?qt] t 'I ? AIT la l 77( '. IA ''? „ d? x? " i g ? v 1n p RD , I l ! ?- y, n Cp x,. a E !ks 't i?.i? T F ? ; 'ee iT t .r 3k a,7r F:i R: h ' oi? 8 I a. 1 $ ` 1 ? l k iz i `• " a, b 'a M1 ?"? r x k E l Tr t i y®i t k ?? k P. l,k ;e. ? f 1 ! 1 I S D G','.!: ",s -r ' x" _ ``1713 /` Exhibit A 8OA-16 DRAFT November 8, 2012 EXHIBIT B SCHEDULE OF PERFORMANCE/MILESTONES FUNCTION Due Diligence/Site Information City to provide all site investigations, surveys and key property information conducted and assembled to date to Developer Developer Review of Due Diligence Documents Provided by City Development of Master Plan Developer's Selection of Planner/Architect ("Third Parties") Developer and Developer's Third Parties Review Transit Zoning Code & Meet with City staff to establish parameters Developer conducts Market Research/preliminary financial feasibility for potential uses & conducts additional studies as deemed necessary Developer submits Preliminary Master Plan City review & comment to Preliminary Master Plan Developer submits Final Master Plan for City review & comment City review & comment to Final Master Plan Developer submits any necessary revisions to Master Plan TIME OF PERFORMANCE Within 30 days of Effective Date Within 45 days of receipt from City 30 days following Effective Date 30 days following final Third Party selections and approval by the City 120 days following Effective Date 180 days following final Planner/Architect Selection 60 days following Developer submission of Preliminary Master Plan 120 days following completion of City review & comment to Preliminary Master Plan 45 days following Developer submission of Final Master Plan 45 days following completion of City review & comment to Final Master 8OA-17 DRAFT November 8, 2012 Presentation of Master Plan to City Council/Housing Authority for consideration of approval DDA negotiations formally commence Plan Within 60 days following Developer's submission of any necessary revisions to Final Master Plan. Upon approval by the City Council/Housing Authority of the Final Master Plan Non-substantive modifications to this Schedule of Performance may be made at any time by mutual agreement of the Developer, the Executive Director of the Community Development Agency, and the Executive Director of the Housing Authority, subject to the time frames specified in the Agreement. Per Sections 4 and 5 of this Agreement, the term of this Agreement may be extended. In that event, the Developer, Executive Director of the Community Development Agency and the Executive Director of the Housing Authority shall mutually agree to a revision(s) of this Schedule of Performance to reflect the extension(s). 8OA-18 AMENDMENT TO CONSULTANT AGREEMENT THIS AMENDMENT TO CONSULTANT AGREEMENT, is made and entered into this 19th day of November, 2012, by and between Keyser Marston Associates (hereinafter "Consultant") and the City of Santa Ana, a charter city and municipal corporation (hereinafter "City"). RECITALS A. The City of Santa Ana ("City") entered into a Consultant Agreement with Consultant dated October 1, 2012 (Agreement #N-2012- referred to as "said Agreement"), to retain a professional firm having special skill and knowledge in the field of financial consultation and development with regard to two specific City-owned properties. B. The parties desire to amend said Agreement to expand the Scope of Work, add to the Compensation and extend the Term thereof. NOW THEREFORE, in consideration of the mutual and respective promises, and subject to the terms and conditions hereinafter set forth, the parties agree as follows: 1. Section 1 of the Agreement, "Scope of Work", shall be amended to expand the Scope of Services to include as-needed services related to the proposed development of property owned by the City and Housing Authority, and potentially other properties in the vicinity of the Santa Ana Regional Transportation Center, as set forth in the Proposal dated October 31, 2012, attached hereto and incorporated herein as Exhibit A. These services include, but are not limited to: providing assistance to the City in evaluating the Master Plan proposals as they are created, assisting to define and analyze the public revenue sources that may be generated by the proposed development, balancing the City's goal to maximize the return on public investment with the City's transit goals and objectives, and analyzing the market and financial feasibility of the development proposals that are submitted for the proposed development site. 2. Section 3 of the Agreement, "Compensation", shall be amended to increase the Compensation with an additional Twenty Five Thousand Dollars ($25,000) for a total not to exceed amount of Fifty Thousand Dollars ($50,000) for professional services rendered to the City. When specific tasks are identified by the City, Consultant shall provide a fee estimate for City authorization prior to commencement of work. The hourly billing rate schedule for services rendered hereunder are as follows: Managing Principals $280, Senior Principals $270, Senior Associates $187.50, and Administrative Staff $80. 3. Section 4 of the Agreement, "Term", shall be amended to extend the term through December 31, 2015 in order to perform the services as amended and expanded. The term of said Agreement may be extended upon a writing executed by the City Manager, the Consultant and the City Attorney. 4. All other terms and conditions included in said Agreement shall have the same force and effect. EXHIBIT 2 8OA-19 IN WITNESS WHEREOF, the parties hereto have executed this Amendment the date and year first above written. ATTEST: Maria D. Huizar Clerk of the Council APPROVED AS TO FORM: SONIA R. CARVALHO City Attorney By: Lisa Storck Assistant City Attorney CITY OF SANTA ANA Paul Walters City Manager CONSULTANT Keyser Marston Associates, Inc. By: Kathleen Head Title: Managing Principal 80A-20 KEYSER MARSTON ASSOCIATES ADVISORS IN PUBLIC/PRIVATE REAL ESTATE DEVELOPMENT October 31, 2012 EXHIBIT A (SCOPE) AI WII(.IR.. IN RI I Sandi Gottlieb RI DIVI I 01'W N N I AII(IRDAMI. HI)II)ING Project Manager ECc1NU,mlc DI Vllt lp.MI NI City of Santa Ana t All I V %14C I>, ` 20 Civic Center Plaza A. IIRm, Kr l's I:R y ' Santa Ana California 92701 IIMtII I D C. KI ITY , KAII SARI I FUNK DI:BBII M. KII:N Dear Sandi: RI I I) I KALE} TIARA DAVID DIIVIM.4 101 A,61I I, Keyser Marston Associates, Inc. (KMA) is pleased to submit the following proposal to K.AIIIIIIN IL IIIAD provide selective financial consulting services to the City of Santa Ana (City) IAMI? A. RABI GR ook,, D. Soo Hoo . Specifically, KMA is proposing to provide as-needed services related to the proposed KI VIN E. ENC.IRom development of approximately nine acres of property, owned by the City and the Housing Authority of the City of Santa Ana (collectively referred to as the "City Site"), in the vicinity of the Santa Ana Regional Transportation Center (SARTC). At a future date, GIRAID M. TRIMBIt PAI,I C „ARRA the County of Orange (County) may agree to combine 11.5 acres of County owned land (County Site) with the City Site to create a consolidated development site. The following proposal is organized as follows: KMA's understanding of the assignment is described. 2. A summary of KMA relevant qualifications is provided. 3. The scope of services being proposed by KMA is identified. 4. Timing and budget estimates for the proposed scope of services is provided. BACKGROUND STATEMENT Over the past several years, the City has undertaken transportation planning and master planning studies for the 94-acre Station District, which includes the City Site, including the SARTC. These studies provide conceptual visions for the mix of commercial development that could potentially be undertaken in the general area. 500 SOUTH GRAND AVENUE, SUITE 1480 > LOS ANGELES, CALIFORNIA 90071 > PHONE 213 622 8095 > FAX 213 622 5204 W W W. KEYS E RMARSTON.COM KMA Proposal 10-31-12; KMA:KHH 99900.900 8OA-21 Sandi Gottlieb October 31, 2012 City of Santa Ana Page 2 In 2009, after a competitive process, the former Santa Ana Community Redevelopment Agency entered into predevelopment agreements with Santa Ana Station District, LLC (Developer). The Developer is currently constructing an affordable housing project in the Station District. It is anticipated that the City and the Developer will enter into an "Exclusive Negotiating Agreement" related to the creation and implementation of a master plan for the development of the City Site. The Developer's role in the process is to assist in the development of such a plan for the City Site in coordination with other land use and transportation planning efforts in and around the SARTC. It should also be noted that at a later date the County may also enter into agreements with the City and the Developer related to the including the County Site in the master planning and development process. The City is requesting that KMA provide financial consulting services on an as-needed basis to assist in creating a financial and operational framework under which the City will pursue the development of the City Site, and potentially a larger site in conjunction with the County Site (Proposed Development Site) . These services include, but are not limited to: 1. Providing assistance to the City in evaluating the Master Plan proposals for the City Site/Proposed Development Site as they are being created; 2. Assisting the City in defining and analyzing the public revenues sources that may be generated by the proposed development; Balancing the City's goal to maximize the return on public investment with the City's transit goals and objectives; and 4. Analyzing the market and financial feasibility of the development proposals that are ultimately submitted for the City Site/Proposed Development Site. STATEMENT OF QUALIFICATIONS Firm Identification KMA is a full service real estate, financial, and economic consulting firm. Founded in 1973, KMA is a privately held California corporation with three offices located in Los Angeles, San Diego and San Francisco. Our diverse staff includes approximately 33 members. KMA's unique strength is the depth, continuity and availability of our principals who average more than 25 years of practical experience working with our public sector and KMA Proposal 10-31-12; KMA:KHH 99900.900 8OA-22 Sandi Gottlieb October 31, 2012 City of Santa Ana Page 3 institutional clients. All work assignments are directly supervised by a principal, and it is the personal involvement of our principals that contribute to the firm's ongoing success. KMA's principals are frequent speakers to such industry groups as the Urban Land Institute, the International Council of Shopping Centers, the League of Cities, the California Redevelopment Association and similar organizations. KMA's advisory practice is well grounded in policies and practices pertaining to local governments. Our technical skills are based on a fundamental understanding of real estate markets, valuations, financing and investment parameters. The firm specializes in structuring public/private partnerships while designing effective development policies and strategies. KMA serves clients throughout the western United States, including nearly every major municipality in California, several joint-powers authorities and a mix of clients such as transit agencies, port authorities, base closure authorities, county and special districts, school districts, colleges and universities, hospitals, Indian tribes and other large property owners. KMA has cultivated specializations within the firm in order to provide the highest level of expertise across a broad range of services. KMA is able to draw on our internal expertise in all the major land uses with specific emphasis on economic analysis, market analysis, fiscal impact analysis, public finance, public facilities financing plans, affordable housing, and nexus analyses. Depth of Experience KMA is known for its full range of real estate services that are provided to its public sector clients. One of KMA's strengths is the use of market demand analyses together with economic analyses to evaluate the financial feasibility of a wide range of projects. These analyses are typically utilized to assist clients in understanding the economics presented by private sector developers and then identifying and quantifying the amount and source of potential public investment in such projects. Descriptions of KMA's experience directly related to the proposed engagement follow: Real Estate Services Disposition Consultinq KMA's disposition services include assisting clients with the preparation of developer solicitation documentation, analysis of development proposals, developer selection, participation in negotiations, and analysis and advice regarding pending agreements. If requested, KMA takes an active role in the negotiation process, a role which has lead to literally hundreds of land disposition transactions. KMA Proposal 10-31-12; KMA:KHH 99900.900 8OA-23 Sandi Gottlieb City of Santa Ana October 31, 2012 Page 4 An engagement that is particularly pertinent to this proposed assignment is KMA's financial consulting services to the Grand Avenue joint-powers authority comprised of the Los Angeles Community Redevelopment Agency (CRA/LA) and the County of Los Angeles. The Grand Avenue project includes properties owned by County and the CRA/LA. KMA assisted in the developer solicitation and selection process, and participated in the negotiations for the implementation of this major mixed-use project. Market Feasibility Assessment KMA undertakes real estate feasibility studies to help clients identify the demand for a variety of land uses. These analyses represent an essential component in a client's strategic land planning process. Specifically, the Los Angeles office has prepared numerous commercial, industrial, retail and housing market opportunity assessments, and has assisted public agencies in the identification and implementation of mid- to long- term implementation strategies. Many of these analyses have been conducted in support of specific plan activities. Project Financial Evaluation KMA's expertise in pro forma analysis has been employed by clients to evaluate the financial feasibility of a wide range of projects. Financial feasibility analysis provides clients with a clear perspective on private sector development economics for proposed projects. This service is a key factor in identifying the need for, and extent of, public investment. Land uses within our expertise include a variety of transit-oriented regional and local uses, as well as hotels, office, retail, industrial, market rate and affordable residential, and entertainment-oriented sports and convention centers. KMA advises clients regarding financial structuring utilizing its expertise in the deployment of public revenue funding sources. These sources include Mello Roos financing, parking revenue bonds, Certificates of Participation, Section 108 loans, Brownfield Economic Development Initiative (BEDI) and other grants and loans, including the use of developer advances. Fiscal Analysis Fiscal Impact Analysis KMA has developed extensive experience in fiscal/economic impact analysis, specifically in the assessment of revenue and cost impacts to public entities as a result of proposed development or implementation plans. KMA's analyses evaluate both annual and capital public revenues and compare them with the service cost impacts. KMA Proposal 10-31-12; KMA:KHH 99900.900 8OA-24 Sandi Gottlieb October 31, 2012 City of Santa Ana Page 5 KMA has completed a number of assignments evaluating the financial consequences of public vs. private ownership of public facilities and other infrastructure improvements. Economic Benefits Analysis KMA's panoply of services includes assessment of site-specific public revenues that can also include evaluations of population, employment and income effects. KMA has provided site-specific revenue analyses for projects ranging from small infill developments to major catalytic mixed-use projects. Strategic Plans for Retail, Commercial and Industrial Uses KMA's economic development services include identifying the optimal mix of retail, commercial and industrial uses. KMA advised the City of Long Beach on the conversion of a 260-acre manufacturing facility to modern commercial uses (Douglas Park), and worked with the City of Los Angeles to preserve and retain its industrial economic base. KMA's services have assisted public sector clients in formulating policies that maximize future public revenue potential while maintaining an appropriate land use balance. Business Incentive Programs KMA has evaluated various business retention mechanisms, including sales tax rebate, property tax rebate, utility tax discounts, and direct financial assistance. KMA also advises Business Improvement Districts (BIDs) on commercial revitalization programs through the design of positioning and repositioning strategies, through the identification of market potential and niche opportunities, and how to retain and attract specific tenants. We assist in negotiations with property owners, brokers, prospective retailers, and local officials, as well as assisting with the structuring of funding programs. PROPOSED SCOPE OF SERVICES At this point in the process, it is difficult to identify the precise mix of services that will ultimately be required to meet the City's needs. The mix of services that KMA can provide to assist the City in this process can be summarized as follows: 1. Assist the City in evaluating the Master Plan alternatives that are created; 2. Consult, assist and advise the City with respect to disposition strategies for the City Site/Potential Development Site, including market, financial and implementation issues; 3. Undertake financial testing of land use and development concepts, including estimated development costs, income and investment parameters; KMA Proposal 10-31-12; KMA:KHH 99900.900 8OA-25 Sandi Gottlieb October 31, 2012 City of Santa Ana Page 6 4. Structure options for land disposition business terms with the developer(s) selected to undertake the projects; 5. Advise on alternative financing options for a public private partnership, including funding of public improvements and private investments; 6. Provide technical support to the City's legal counsel in drafting the financial terms of the proposed transaction; 7. Assess the fiscal impact of the proposed projects on the City's General Fund; 8. Analyze the economic impact of the projects to the City; 9. Assist the City in creating an equitable transaction structure to guide the disposition of the City and County owned properties if the County chooses to participate in the process; 10. Participate in formal and informal discussions and public presentations; and 11. Assist as needed with other issues identified by the City. TIMING / BUDGET KMA proposes to undertake the proposed scope of services on an as-needed basis at the City's direction. It is our assumption that KMA will be asked to provide services at staggered intervals over time. Given that the scope of services that will ultimately be requested by the City cannot be clearly defined at this time, it is not possible to provide a fixed-fee quote for this engagement. For budgetary purposes, KMA proposes to set the total fee for services at a not-to-exceed amount of $25,000. When specific tasks are identified by the City, KMA will provide a fee estimate for City authorization prior to the commencement of work. If at any time KMA believes that the $25,000 budget cap could be exceeded, we will contact the City immediately for further direction. The hourly billing rate schedule that will apply to this engagement is presented below: Managing Principals $280.00 Senior Principals $270.00 Senior Associates $187.50 Administrative Staff $80.00 KMA Proposal 10-31-12; KMA:KHH 99900.900 8OA-26 Sandi Gottlieb City of Santa Ana October 31, 2012 Page 7 KMA appreciates the opportunity to present this proposal. If there are any modifications that will make the proposal more responsive to your needs, or if you require any additional information, please do not hesitate to call us. Sincerely, KEYSER MARSTON ASSOCIATES, INC. Kathleen Head KMA Proposal 10-31-12; KMA:KHH 99900.900 8OA-27 8OA-28