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CITY OF SAN BERNARDINO REQUEST FOR COUNCIL ACTION
Date: June 30, 20 II
Subject: A Resolution of the City of San
Bernardino approving an amendment to
Development Agreement No. 91-01 between the
City of San Bernardino and the developer of the
Inland Center Mall. The project site is located at
500 South Inland Center Drive. (DA No. 08-01)
From: M. Margo Wheeler, Director
Dept: Community Development
MCC Date: July 18, 2011
Synopsis of Previous Council Action:
April I, 1996 - The Mayor and Common Council approved Development Agreement No. 91-01
(Resolution No. 96-84) and certified an Environmental Impact Report (SCH #94032045) which
granted the developer the right to expand the Inland Center Mall.
November 3, 1997 - The Mayor and Common Council upheld the Planning Commission's denial
of an appeal of the approval of Development Permit 2 No. 97-13 to initiate Phase I of the
expansion of the Inland Center Mall.
Recommended Motion:
Tho< ,"0 h~,j"" '" d,""', "od fuo< "id ""I,,,," ho 'd'P:!( WJ
~ M. Margo Wheeler, AICP
Contact Person: Aron Liang, Senior Planner
Phone: 3332
Supporting data attached:
StafT Report
Ward(s): 3
FUNDING REQUIREMENTS:
Amount: N/A
Source:
Acct. Description:
Finance:
Council Notes:
Agenda Item No. ::5"3
()1-/~-~I/
iltpl1UlJM~f Pay
CITY OF SAN BERNARDINO REOUEST FOR COUNCIL ACTION
STAFF REPORT
Subject: A Reso]ution of the City of San Bernardino approving an amendment to Deve]opment
Agreement No. 91-0] between the City of San Bernardino and the developer of the In]and Center
Mall. The project site is located at 500 South In]and Center Drive. (Development Agreement
Amendment No. 08-0])
Applicant:
WM Inland LP
C/O: Arun Parmar
500 Inland Center Drive
San Bernardino, CA 92408
Representative:
Gresham Savage No]an & Ti]den
C/O: Mark Ostoich
550 East Hospitality Lane, Suite 300
San Bernardino, CA 92408
Background: On June 22, 20]], the Planning Commission recommended that the Mayor and
Common Council approve Deve]opment Agreement Amendment (DA) No. 08-0] to extend and
amend the Deve]opment Agreement enacted on April ], 1996, for a phased expansion of the
Inland Center Mall, requiring completion of Phase] in 2026 and commencement of the final
Phase II by 2031. Proposed amendments include substitution of current Deve]opment Code
parking standards for the more stringent requirement in the existing Agreement, and
incorporation of minor modifications to the project site caused by the recent widening of 1-215.
The subject site is a 61-acre regional mall located at 500 South Inland Center Drive in the CR-],
Commercial Regional Malls land use district.
The applicant/representative requests that the Mayor and Common Council approve
Development Agreement Amendment No. 08-01 as recommended by the Planning Commission
at their meeting of June 22, 20]]. The Planning Commission voted unanimously in favor of the
proposed development agreement amendment. Commissioners Eble, Heasley, Jimenez, Machen,
Mulvihill and Rawls voted in favor of the motion and Commissioners Coute and Durr were
absent.
Due to current economic conditions, expansion for the Mall as anticipated in Development
Agreement No. 9]-0] has been challenging. The applicant/representative requests that the
completion dates for Phases I and II be extended and that minor clarification and updates be
added to simplify certain sections of the agreement, to enhance processing of further expansion
of the Mall. The Planning Commission staff report (Attachment 1) contains a more detailed
analysis of DA 08-0 I.
California Environmental Quality Act (CEQA) Compliance:
An Environmental Impact Report (SCH #94032045) was prepared to analyze all potentia]
impacts related to approval of Development Agreement No 91-0] in compliance with CEQA
requirements and Section ]9.20.030 (6) of the Deve]opment Code. Findings of Fact and a
Statement of Overriding Considerations were adopted in accordance with guidelines for the
implementation of CEQA. All future development described in the subject agreement will be
required to incorporate applicable mitigation measures from the EIR.
2
Financial Impact:
None.
Recommendation:
That the hearing be closed and that the resolution be adopted.
Attachment I: Planning Commission Staff Report Dated June 22, 20 II
Resolution
3
ATTACHMENT 1
PLANNING COMMISSION STAFF REPORT
CITY OF SAN BERNARDINO PLANNING DIVISION
CASE:
AGENDA ITEM:
HEARING DATE:
WARD:
Development Agreement Amendment No. 08-01
I
June 22, 20 II
3
OWNER:
WM Inland Investors IV, LLC
401 Wilshire Blvd. No. 700
Santa Monica, CA 90401
APPLICANT:
Arun Parmar
500 Inland Center Drive
San Bernardino, CA 92408
REPRESENTATIVE:
Gresham Savage Nolan & Tilden
C/O: Mark Ostoich
550 East Hospitality Lane, Ste. 300
San Bernardino, CA 92408
REQUEST/LOCATION:
A request to extend and amend the Development Agreement enacted on April I, 1996, for a
phased expansion of the Inland Center Mall, requiring completion of Phase I in 2026 and
commencement of the final Phase II by 2031. Proposed amendments include substitution of
current Development Code parking standards for a more stringent requirement in the
Agreement, and incorporation of minor modifications to the project site caused by the recent
widening of 1-215. The subject site is a 61-acre regional mall located at 500 South Inland
Center Drive in the CR-I, Commercial Regional Malls land use district.
Project Assessor Parcel Number(s): 0136-531-01-02, 07-09
CONSTRAINTS/OVERLAYS:
Freeway Corridor Overlay District
ENVIRONMENTAL FINDINGS:
o Not Applicable
. Previous EIR, SCH #94032045
o No Significant Effects
o Potential Effects, Mitigated Negative Declaration and Mitigation Monitoring and Reporting
Program
STAFF RECOMMENDATION:
Iii Recommend Mayor and Council Approval
o Approval/Conditions
o Denial
o Not Applicable
DA 08-01
June 22, 2011
Page 2
PROJECT DESCRIPTION
The applicant requests approval of a Development Agreement Amendment under the authority of
Development Code Section 19.40.040 and California Government Code Section 65868 to extend
the completion dates from May I, 2006 and May I, 2011 to May I, 2026 and May 1,2031 for
Phases I and II and amend parking standards for the previously approved Development
Agreement No. 91-0 I between the City of San Bernardino and the developer of the Inland Center
Mall. The project site is located at 500 Inland Center Drive in the CR-I, Commercial Regional
Malls land use district (Attachment A).
Chapter 19.40, Development Agreement and California Government Code Section 65864 et seq
allows the City to enter into development agreements with private developers. Pursuant to
Government Code Section 65868, a development agreement can be amended or canceled in
whole or in part. The procedures for amending or canceling any provision or provisions of a
development agreement are the same procedures as required for initial approval of a
development agreement.
SETTING/SITE CHARACTERISTICS
The project site is the Inland Center Mall located at 500 South Inland Center Drive in the CR-I,
Commercial Regional Malls land use district.
LOCATION
Site
North
South
East
West
LAND USE
Inland Center Mall
Retail multi-tenant commercial
Floor Control Channel
Floor Control Channel
Interstate 215 Freeway
GENERAL PLAN
CR-I, Commercial Regional Mall
CG-I, Commercial General
PFC, Public Facility Control
PFC, Public Facility Control
CALTRANS
CALIFORNIA ENVIRONMENTAL OUALITY ACT (CEOA)
An Environmental Impact Report (SCH #94032045) was prepared and fully analyzed all potential
impacts related to approval of Development Agreement No 09-01 in compliance with CEQA
requirements and Section 19.20.030 (6) of the Development Code. Findings of Fact and
Statement of Overriding Considerations were adopted in accordance with guidelines for the
implementation of CEQA. Since the total buildable area described in the subject agreement area
had been previously analyzed as part of original Development Agreement No. 91-01, no
additional environmental review is required. All future development described in the subject
agreement will be required to incorporate applicable mitigation measures from the original EIR.
BACKGROUND
. April I, 1996 - The Mayor and Common Council approved Development
Agreement No. 91-01 by Resolution No. 96-84 and certified an Environmental
Impact Report (SCH #94032045) which granted the developer of the Inland Center
DA 08-01
June 22, 2011
Page 3
Mall the right to expand the Inland Center Mall and develop the project site
pursuant to the provisions established in the Development Agreement No. 91-0 I.
. September 10, 1997 - Development Services Director approved Minor
Modification No. 97-004 to modify the gross floor area for anchor stores I and 2
from 160,000 sq.ft. to 165,000 sq.ft. and 140,000 sq.ft. to 135,000 sq. ft. not to
exceed the aggregate of 540,000 sq.ft.
. September II, 1997 - The Development/Environmental Review Committee
(D/ERe) approved Development Permit Type 2 (DP2) No. 97-13 to initiaie the
construction of Phase I.
. September 25, 1997 - Central City Company (Carousel Mall) filed an appeal ofthe
D/ERC's approval ofDP2 No. 97-13.
. The October 7,1997 - The Planning Commission upheld the D/ERC's approval
ofDP2 No. 97-13.
. October 21, 1997 - Central City Company (Carousel Mall) filed an appeal of the
Planning Commission's action.
. November 3, 1997 - The Mayor and Common Council upheld the Planning
Commission's action.
. January 23,2008 - Development Agreement Amendment No. 08-01 was filed.
. Draft Agreement held in abeyance pending completion of 1-215 widening.
PROPOSED AMENDMENT
In order to facilitate the expansion of the Inland Center Mall, the City approved a 20-year
Development Agreement with the developer of the Inland Center Mall on April I, 1996. The
Development Agreement has granted the developer vested right to expand the Inland Center Mall
in two (2) Phases and established the terms under which the development will occur.
A portion of Phase I has been completed to include a 165,000 sq.ft., 2-level, anchor department
store currently occupied by Macy's and a 4-level parking structure abutting Macy's to the south.
Other improvements and upgrades have also been added to the first level retail shopping mall.
Due to current economic conditions, expansion for the Mall as anticipated in the Development
Agreement No. 91-01 has been challenging. The applicant requests that the completion dates for
Phases I and II be extended and that minor clarification and updates be added to simplify certain
sections of the agreement as to enhance processing of further expansion of the Mall. Attachment
B provides a detailed analysis of the proposed development agreement amendment. The following
are key points:
. Extends the completion dates to allow the Developer to complete Phases I and II.
. Extends Phase I expected completion date from May 1,2006 to May 1,2026.
. Extends Phase II expected completion date from May 1,2011 to May I, 2031.
. Simplifies parking standard to comply with current code requirement with no
parking surplus.
. Excess Caltrans right-of-way of 2.6 acres added to the project site shall
automatically be annexed in the Development Agreement.
DA 08-01
June 22, 2011
Page 4
Additionally, the result of Caltrans' acquisition of property from the Inland Center Mall for
widening of the Interstate 215 Freeway may have reduced/eliminated the Developer's ability to
construct and/or maintain a landscape buffer between the subject site and the 1-215, pursuant to
the Freeway Corridor Overlay District Section 19.14.030 (I), Landscape Setback Buffer.
Furthermore, such acquisition by Caltrans may make the subject site non-conforming or increase
an existing non-conforming situation. A City-initiated Development Code Amendment No. 11-07
is currently to modify Section 19.14.030 of the Freeway Corridor Overlay District. The proposed
code amendment would resolve the non-conforming condition on the Inland Center property, as
well as numerous other parcels affected by the freeway widening, without sacrificing aesthetic
values.
Due to its size, the original Development Agreement has been provided on disk for reference.
RECOMMENDA nON
Staff recommends that the Planning Commission recommend approval of Development
Agreement Amendment No. 08-01 to the Mayor and Common Council.
R'A;_s:r
Aron Liang !
Senior Planner
A~1)(~iWti" ·
M. f::, Wh"!,,, Ale'
Attachment A
Attachment B
Attachment C
Attachment D
Location Map
Site Plan
Analysis of Development Agreement Amendment
First Amendment to Development Agreement
Original Development Agreement on disk
ATTACHMENT A
CITY OF SAN BERNARDINO
PLANNING DIVISION
PROJECT: Development Agreement 08-01
LOCATION MAP
HEARING DATE: 6/22/2011
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ATTACHMENT A
CITY OF SAN BERNARDINO
PLANNING DIVISION
PROJECT: Development Agreement 08-01
LOCATION MAP
HEARING DATE: 6/22/2011
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ATTACHMENT C
GRESHAM I SAVAGE
,
),-'1>ic':"'''', ,C\ 1 -\'il
M.lrkJJstl1iclw"Cresh,lmS<1Vage.com . San Bernardino Office
(909) 8904499 . .!;IX (909) 890-9890
February 11, 2011
[D)~@~OW@f[)'
~ FEB!" 2011 LY)
HAND DELIVERED
CITY OF SAN dEI-iNAROINO
COMMUr\ITY r:JEVELOPMENT
OEP.\HTMENT
Ms. Margo Wheeler, Director
Community Development Department
City of San Bernardino
300 N. "0" Street, 3rd Floor
San Bernardino, California 92418
Re: Inland Center
Dear Margo:
Thank you for meeting with us Wednesday. We are in the process of thinking through
potential, additional uses/development envelopes that may be incorporated into
Inland Center and will let you know if we think additional changes in the
Development Agreement are necessary.
Enclosed is a copy of the May 1, 1996 Development Agreement for your information.
Enclosed also is the draft Amendment we intend to file in the near future.
Following are the changes/confirmations proposed by the Amendment:
Existing Development Agreement First Amendment to
Development Agreement
2.(f) Certificate of Occupancy for Phase 1 1.(a) Extend date to 5/1/2026.
improvements by 2006
2.(f) Building Permit for Phase II improvements 1.(a) Extend date to 5/1/2031.
required to be obtained by 5/1/2011
6.(b) Contemplates release of 2.6 acres of land from 3. On acquisition of the 2.6
Caltrans right-of-way and provides that the City acres by Developer, the 2.6
will assist the Developer in securing title to the acres will automatically be
2.6 acres. annexed in the Development
Agreement.
6(g) Complex parking analysis. 2. Simplified reaffirmation of
applicable parking standard.
In addition, following is a summary of a few important activities that have occurred
since the date of the existing Development Agreement:
. .
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H :;: '--'l: 3750 University i'l,\fenUe, Suite 250 River'sije, C.'lilfarnJa 92501
-->! ~,iJ :'j,.,i.:-:r!, 550 East Hosoitaiity Lane, Suite 300 San Bernardino, Caiifornia 92408
Gresi~a mSi'l1i aqe.com
\\/990-000 -- ('~39~71
Ms. Margo Wheeler
February 11, 2011
Page 2
Provision in Existing Development Agreement Intervening Activities
2.(h) Parties acknowledge that landscaping and Developer proposed amendments
signage at the Mall on the Effective Date of the to Chapters 19.22 and Sections
Development Agreement may not be consistent 19.14.020 and 19.14.030(6) and (7),
with Development Code. Developer shall to allow larger and taller signage.
amend Sections 19.14 (Fwy Corridor Overlay City approved amendments as
District), 19.22 (Sign Regulations) and 19.28 Ordinance MC-1057 on
(Landscape Standards) to achieve consistency September 7, 1999.
and ensure that the existing and proposed
landscaping and signage at the Mall is legal and
conforming. For specific details regarding code
provisions to be amended, see Exhibit "H".
Exhibit "H" Freeway Overlay District,
Pending widening of the 1-215, the landscape Chapter 19.14.030, requires all
areas adjacent to the Freeway are deemed to non-residential land use districts
satisfy Chapter 19.28 of the Code. When the within 500' of the 1-215 to provide
Freeway is widened, to ensure a landscape buffer a 25' landscape setback and a 50'
between the 1-215 and the Mall, landscaping will building setback along the
be replaced between the ring road and the freeway. Per letter from V. Ross
parking area as agreed to by the City, Caltrans dated 4/22/2009, if Caltrans
and Developer. acquires property that
. To the extent possible, the ring road will be "encroaches" into the freeway
retained as part of the redesign concept. corridor setback, Caltrans is not
required to replace the setback
. If relocating the landscape would reduce area. However, such acquisition
the parking spaces below the minimum may make property non-
number required in the Development conforming or increase an
Code, City will not unreasonably withhold existing non-conforming
locating part of landscape buffer on the situation. Now that the Caltrans
public ROW of the 1-215. improvements have been
. The landscape buffer will be installed no completed, to prevent the Mall
later than 1 year after completion of the from being deemed non-
1-215 widening. conforming for failure to provide
the required 25' landscape
setback, Developer intends to
propose a variance from Chapter
19.14.030.
6(a) If the Caltrans freeway widening results in a After the Caltrans widening,
reduction in parking spaces at the Mall, City parking counts confirm 4,434
will not require the replacement of those lost existing parking spaces at the
parking spaces, provided the number of parking Mall, which exceeds the number
spaces lost does not result in a reduction of of parking spaces required by the
spaces below the minimum number required by Development Code.
the Development Code.
\\., ".:";.'."1
Ms. Margo Wheeler
February 11, 2011
Page 3
Hopefully, this letter and the enclosures will provide useful background on the
Development Agreement. Of course, I would be happy to meet with you at your
convenience to further discuss the Development Agreement.
Very truly yours,
~ rJlu-,~
Mark A. Ostoich, of
GRESHAM SA V AGE
NOLAN & TILDEN,
A Professional Corporation
MAO/pmj
Enclosure
cc: Overton Kuhn
Arun Parmar
\\,),<,.,.",,'
GRESHAM I SAVAGE
Mark.OstoichCii)GreshamSavage.com . San Bernardino Office
(909) 890-4499 . fax (909) 890-9690
ATTORNEYS AT LAW
~~
March 7, 2011
HAND DELIVERED
Mr. Aron Liang
City of San Bernardino
300 North "0" Street
San Bernardino, California 92418-000 I
Re: Proposed First Amendment to Inland Center Mall Development Agreement
Activity No. DA08-0I
Dear Mr. Liang:
On January 23, 2008, Gresham Savage submitted an application on behalf of Inland
Center to amend the Development Agreement with the City of San Bernardino. As
you may recall, at a follow up meeting, the City asked for additional information
regarding the Caltrans freeway improvements, their impact on the then existing
landscaped freeway buffer, and the parking spaces at Inland Center Mall.
The following information is submitted in response to that request:
1. The reconstructed ring road - When Caltrans widened the 1-215 freeway at
Inland Center Drive, Caltrans reconfigured the off-ramp that serves Inland
Center and added a second frontage road to carry traffic from the bridge over
the freeway at Orange Show Road to Mill Street. The addition of the second
frontage road, and the reconfiguration of the Inland Center Drive off-ramp
interfered with the ring road that circles Inland Center. To accommodate the
freeway expansion, Caltrans moved the ring road closer to the mall buildings.
. The width of the 'ring road' in its new location varies, but the minimum
width is 28.87'.
. For a depiction of the interface between the ring road, and the Inland
Center Drive off-ramp, see the cross sections on page X-ll of the
Caltrans plans. Exhibit X-II depicts the ring road either below grade or
near grade with the off-ramp.
. Note, on both sides of the Inland Center Drive off-ramp, a concrete
barrier protects motorists.
RIVERSIDE 3750 University Avenue, Suite 250 . Riverside, California 92501
SAN BERNARDINO 550 East Hospitality Lane, Suite 300 San Bernardino, California 92408
GreshamSavage,com
'W'Y90..(JOO n5~5626,2
Mr. Aron Liang
March 7, 2011
Page 2
2. Loss of landscape setback between the off-ramp and the Ring Road: Section
6(f) of the Development Agreement provides for a 15' landscaped buffer
between the 1-215 freeway and Inland Center, rather than a 25' wide
landscaped buffer as required by the Municipal Code (Chapter 19.14). The
Development Agreement also acknowledges as follows: "In the event that
Caltrans expands the 1-215 freeway, nothing in this Agreement will be deemed
to alter the Developer's continuing obligation to maintain at least a 15'
landscape buffer between the Inland Center Mall and the 1-215 freeway."
However, as a result of the freeway expansion, the reconfiguration of the
Inland Center Drive off-ramp, and the addition of the second frontage road, the
landscape buffer between the Ring Road and the 1-215 freeway has been
eliminated. To replace the landscaped buffer would eliminate required
parking spaces.
Because the Freeway Overlay Zone requires a 25' landscaped buffer between
the 1-215 freeway and the ring road, Inland Center is requesting a variance to
excuse the missing landscaping. See the proposed Variance Findings, enclosed.
3. Size of the condemnation parcel for freeway improvements: Caltrans
condemned 1.8 acres of Inland Center's property to obtain the right of way to
expand the 1-215.
4. Parking spaces lost due the condemnation and reconstruction of the ring
road: The Caltrans improvements and the relocation of the ring road
eliminated 207 parking spaces.
5. Existing vs. Approved Gross Leasable Area ("GLA"): The existing GLA and
existing parking spaces are listed below, followed by the approved GLA and
approved parking spaces pursuant to the Development Agreement. Note, the
parking calculations below do not include the outparcels and parking spaces
located east of the Flood Control Channel.
Parking Spaces:
Terri Rahhal asked for a calculation of the existing gross leaseable at Inland Center,
and the number of parking spaces remaining after the Caltrans expansion. The chart
below provides that information, and confirms that the existing parking spaces at
Inland Center comply with the Development Code.
2
\\199i)-(I('O--545626.2
A
Inland Center
Mall [Existin9 as
of A rll '996
Mr. Aron Liang
March 7, 2011
Page 3
Existina GLA and Parkina SummarY -- as af SeDtember 2010
Total Existing Total Parking Required
TOTAL SF parking1 (4 spacesJ1,OOO SF)
Anchors
Sears
[including Tire Battery & Automotive] 264.682 1507 1058.7
Macys [aka Phase 2 - Anchor 3J 165,000 0 660
Vacant Anchor [aka Gottschalks) 204,178 1394' 816.7
Forever 21 (utilizing 94,011SF)
[aka Broadway, including TBA, totals
149.814SFJ 149.814 800 599.2
Sub-Total 783,674 3134.7
Mall 230.583 670 922.3
4,371 4,057
TOTAL SF 1.014.257 4.31/1.000 sq fI 4.00/1.000 sq 11
According to the Development Agreement, Inland Center contained 985,829 square
feet of floor area and 4,400 parking spaces in 1996, when the City approved the
Development Agreement. (Development Agreement at section 6(g).) The
Development Code requires 4 parking spaces per 1,000 square feet for retail
commercial uses, or 3,944 parking spaces. The Development Agreement provides for
456 more parking spaces than are required by the Development Code.
At build-out, the Development Agreement provides for the addition of 770,995 square
feet of floor area and 3,020 additional parking spaces for a total of 7,420 parking
spaces. (Development Agreement, Section 2(c)(vi).) At 4 parking spaces per 1,000
square feet, the Development Code requires 7,194 parking spaces. The Development
Agreement provides for 226 more parking spaces than are required by the
Development Code.
reement - A ril1996
Total SF
Additional
Lower Level
Mall s ace
"Non-retail" Approved
im rovements Parkin
Additional
First Level
Mall s ace
Anchors
98S,829
4,400
3,943
I Number of Spaces in Parking Structure = 1009
3
W991).(1('0--545626.2
Mr. Aron Liang
March 7, 2011
Page 4
Aooroved GLA and oarkina soaces oursuant to the Develooment Aareement. Aoril1996
Additional
Additional Additional Second Required
Lower Level First Level Level Mall "Non-retail" Approved Parking
Total SF Anchors Mall SDace Mall soace space imorovements Parklnn 1411,000 SFl
DA PHASE ONE
fAnchors 1 & 2" 530,825 300,000 3,700 7,400 142,505 75,000 2,220 2,123
~A PH~E TWO
Anchor 3 281 ,BOO 240,000 16,000 25000 800 1,127
Sub-Totals Q'\1.. l,,".s 540,000 3,700 7,400 158,505 100,000
APPROVED
MALL SF 1,798,454 7,420 7,194
Please let me know what additional information is required to schedule the First
Amendment to the Development Agreement for consideration by the Planning
Commission.
Very truly yours,
~~
Mark A. Ostoich, of
GRESHAM SAVAGE
NOLAN & TILDEN,
A Professional Corporation
MAO/pmj
Enclosure
cc: Arun Parmar
Overton Kuhn
4
'N990_0(JO__54S626.2
ATTACHMENT 0
RECORDING REQUESTED BY:
GRESHAM SAVAGE NOLAN & TILDEN
AND WHEN RECORDED, MAIL TO:
Gresham Savage Nolan & Tilden
550 East Hospitality Lane, Suite 300
San Bernardino, CA 92408
Attn: Mark A. Ostoich, Esq.
(THIS SPACE FOR RECORDER'S USE ONLY)
FIRST AMENDMENT TO DEVELOPMENT AGREEMENT
Between
THE CITY OF SAN BERNARDINO,
a Municipal Corporation
and
WM INLAND INVESTORS IV, LLC,
a Limited Liability Company
Firsl Amendment 10 Development Agreement 05 to 04
W9()l).(IC'O C.n))4.1
FIRST AMENDMENT TO DEVELOPMENT AGREEMENT
This First Amendment to Development Agreement ("First Amendment") is entered into
effective , 20_, between the City of San Bernardino, a municipal
corporation ("City") and WM Inland Investors IV, LLC, a Delaware limited liability company,
doing business as Inland Center ("Developer").
A. Effective May I, 1996, City and Developer's predecessor-in-interest, Mano
Management Company, Inc., a Delaware corporation ("Mano"), entered into a Development
Agreement regarding anticipated development at the Inland Center Mall ("Development
Agreement"). The Development Agreement was enacted on April I, 1996, by Resolution No.
96-84.
B. Developer is the successor-in-interest of Mano and has received from Mano the
transfer of all ofMano's rights and obligations under the Development Agreement.
C. Since 1996, market conditions have adversely affected regional malls throughout
the United States. Such market conditions include, without limitation, the consolidation of major
tenants, leading to the departure of traditional major tenants from the marketplace and changing
consumer patterns, leading to a preference for life-style oriented developments that combine
retail, restaurant and entertainment uses. Despite reasonable efforts, such market conditions
have prevented Mano and Developer from meeting certain milestone dates for development, as
envisioned by City and Developer at the time the Development Agreement was enacted.
D. In addition, the California Department of Transportation ("CaItrans") recently
widened Interstate 215 by constructing two additional lanes immediately adjacent to the Inland
Center Mall ("Interstate 215 hnprovements"), on property previously containing a 15' landscape
buffer immediately adjacent to the freeway, and parking spaces in the parking lot. Construction
of the Interstate 215 Improvements prevents Developer's ability to comply with certain
provisions of the Development Agreement related to landscape buffering adjacent to the
Interstate 215, and with the 25' landscape buffer required by the Freeway Overlay zone for
properties adjacent to the freeway.
E. Developer continues to desire to carry out the intent of the Development
Agreement in a manner which is responsive to market conditions as they exist from time to time.
To that end, Developer has requested certain amendments to the Development Agreement, as
more particularly set forth in this First Amendment, and the City is agreeable to the same.
F. On , 20_, the City Council adopted Resolution No.
("Enacting Resolution"), which enacted this First Amendment and the
Enacting Resolution became effective on the date of its adoption.
G. By adopting the Enacting Resolution, the City Council reaffirms the Development
Agreement as amended by this First Amendment. Hereafter, each reference to the Development
Agreement shall be deemed to be a reference to the Development Agreement, as amended by this
First Amendment.
I
First Amendment to Development Agreement-OS to 04
\\"NI)-O(,n ,)n334,1
IN CONSIDERATION of the mutual covenants and conditions contained in this First
Amendment, the parties agree as follows:
I. Phasing.
OPERATIVE PROVISIONS
(a) Paragraph 2(f) of the Development Agreement is deleted in its entirety and
the following is substituted in its place:
"Developer intends that the Development of the Inland Center Mall will
be phased as follows:
Phase
II
Improvements
I
Construct New Anchor 1 with approximately 140,000
square feet of gross building area. Construct New Anchor 2
with approximately 160,000 square feet of gross building
area. Construct additional lower level retail shopping mall
improvements with approximately 3,700 square feet of
gross building area, additional first level retail shopping
mall improvements with approximately 7,400 square feet of
gross building area. Construct additional second level retail
shopping mall improvements with approximately 142,505
square feet of gross building area. Construct new non-retail
improvements with approximately 75,000 square feet of
gross building area. Construct three adjacent parking
structures accommodating approximately 2,220 autos.
Construct New Anchor 3, with approximately 240,000
square feet of gross building area. Construct additional
second level retail shopping mall improvements with
approximately 16,000 square feet of gross building area.
Construct new non-retail improvements with approximately
25,000 square feet of gross building area. Construct an
adjacent parking structure accommodating approximately
800 autos. From time to time, and as circumstances
warrant, Developer intends to update the description of
Phase II to account for market demand, subject to approval
requirements stated in "Operative Provisions" in
subparagraph 3(a) of the Development Agreement.
Notwithstanding the foregoing, if by May 1, 2026, Developer fails to
obtain a certificate of occupancy from the City (or the equivalent approval
by the City, if the City no longer issues certificates of occupancy at that
time), with respect to the construction of the improvements in Phase I or if
by May I, 2031, Developer fails to obtain a building permit with respect
First Amendment to Development Agreement-05 to 04
W01r)-(J(lO_.67S~J4,1
2
to the improvements in Phase II, then at the election of the City, the City
may require Developer to agree to an amendment of this Agreement to
provide that, during the remainder of the term of this Agreement, the
Development of the Inland Center Mall will be governed by the land use
provisions of the City's Development Code (Title 19 of the Municipal
Code), as they exist at the time of actual Development."
(b) Notwithstanding any contrary provision in the Development Agreement,
including in Exhibit "D" of the Development Agreement, Developer may phase the
Development of the Inland Center Mall in a manner that, in Developer's sole discretion,
responds to applicable market conditions.
2. Parking. Paragraph 6(g) of the Development Agreement is deleted in its entirety
and the following is substituted in its place:
"Developer will be required to provide onsite parking at a ratio of 4 parking
spaces for each 1,000 square feet of gross leaseable area which is occupied from
time to time in the buildings, in connection with Developer's use of the Inland
Center Mall as contemplated in the Development Agreement."
3. Annexation. In the event Developer acquires the land which is depicted as "2.6
acres" in Exhibit "J" of the Development Agreement, such land will, as of the date of
Developer's acquisition (as documented by recordation of a deed conveying title to such land to
Developer), automatically be deemed annexed into the Development Agreement and, from and
after such date, will be subject to all of the provisions of the Development Agreement.
4. No Default.
Developer acknowledge and
Development Agreement.
As of the Effective Date of this First Amendment, City and
agree that neither party is in default of any provision of the
5. Unnecessary Provisions. Paragraphs 35 and 36 of the Development Agreement
are no longer necessary and are deleted in their entirety.
6. Defined Terms. Except as otherwise defined in this First Amendment, all
capitalized terms in this First Amendment will have the same meanings as are ascribed to those
terms in the Development Agreement.
7. Address for Notices and Other Communications to Developer. Developer's
address for notice under the Development Agreement is changed to the following:
WM Inland Investors IV, LLC
c/o Macerich Company
401 Wilshire Boulevard, Suite 700
Santa Monica, California 90401
Attn: Chief Legal Officer
8. Incorporation of Recitals. The Recitals in this First Amendment are material and
are incorporated herein by reference.
3
First Amendment to Development Agreement-OS to 04
W9')O.(I(fU-(!7,,)~41
9. Development Agreement Continues in Full Force and Effect. In any case where a
specific section in the Development Agreement is amended by this First Amendment, the parties
intend to also amend any other provision in the Development Agreement which is related to the
same subject matter. Accordingly, in the event of any conflict between any provision of this
First Amendment and any provision in the Development Agreement, the conflicting provision in
this First Amendment shall supersede and control. Except as amended by this First Amendment,
all of the provisions of the Development Agreement will continue in full force and effect.
[SIGNATURES FOLLOW]
4
First Amendment to Development Agreement-OS to 04
W')<)I).(I(I(1__6783341
CITY
City of San Bernardino, a municipal corporation
By:
Its:
ATTEST:
By:
City Clerk
APPROVED AS TO FORM AND
LEGAL CONTENT:
By:
City Attorney
[ADDITIONAL SIGNATURE FOLLOW]
5
First Amendment to Development Agreement-OS to 04
W9'll).(l(l(l ,,7S3341
DEVELOPER
WM INLAND INVESTORS IV, L.L.C.,
a Delaware limited liability company
By: WM Inland, L.L.C.,
a Delaware limited liability company,
its sole member
By: Walton Inland Holdings IV, L.L.c.,
a Delaware limited liability company,
its managing member
By: Walton REIT Holdings IV, L.L.C.,
a Delaware limited liability company,
its sole member
By: Walton REIT IV, L.L.c.,
a Delaware limited liability company,
its managing member
By: Walton Street Real Estate Fund IV, L.P.,
a Delaware limited partnership,
its sole member
By: Walton Street Managers IV, L.P.,
a Delaware limited partnership,
its general partner
By: WSC Managers IV, Inc.,
a Delaware corporation,
its general partner
By:
Name:
Its:
By: Macerich Inland LLC,
a Delaware limited liability company,
a member
By: The Macerich Partnership, L.P.,
a Delaware limited partnership,
its sole member
By: The Macerich Company,
a Maryland corporation,
its sole general partner
By:
Name:
Its:
6
First Amendment to Development Agreement-OS to 04
W9'l!)-()(I(I.-67S3~4_1
COUNTY OF
)
)
)
STATE OF
On , 20_, before me, , !!
Notary Public, in and for said County and State, personally appeared
, who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in
hislherltheir authorized capacity(ies), and that by hislher/their signature(s) on the instrument
the person(s), or entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California, that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
(Seal)
Notary Public
COUNTY OF
)
)
)
STATE OF
On , 20_, before me, , !!
Notary Public, in and for said County and State, personally appeared
, who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in
hislher/their authorized capacity(ies), and that by hislher/their signature(s) on the instrument
the person(s), or entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California, that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
(Seal)
Notary Public
First Amendment to Development Agreement 05 10 04
\V9;;O.,I}OO-.67S334,1