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HomeMy WebLinkAbout1991-5287 1'''''''''''"' - 1 RESOLUTION NO. 5287 2 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN BERNARDINO APPROVING AN AGREEMENT TO NEGOTIATE EXCLUSIVELY BETWEEN THE DEVELOPMENT DEPARTMENT AND COUSSOULIS DEVELOPMENT COMPANY (CENTRAL CITY PROJECT AREA). 3 4 5 WHEREAS, the Redevelopment Agency of the City of San 6 Bernardino and Coussoulis Development Company ("Coussoulis") 7 entered into an Agreement to Negotiate Exclusively ("previous 8 Agreement") on August 6, 1990 relating to certain property 9 located at the Southeast Corner of 2nd and "D" Streets in the 10 City of San Bernardino ("previous property"), and "'-' 11 WHEREAS, due to circumstances beyond the control of 12 Coussoulis said previous property was not appropriate or 13 available for the development intended by Coussoulis, and 14 WHEREAS, the Development Department of the City of San 15 Bernardino ("Department") and Coussoulis now wish to replace said 16 previous Agreement with a new Agreement to Negotiate Exclusively 17 covering separate property, 20 19 COMMISSION OF THE CITY OF SAN BERNARDINO AS FOLLOWS: 18 NOW, THEREFORE, BE IT RESOLVED BY THE COMMUNITY DEVELOPMENT SECTION 1. The Agreement to Negotiate Exclusively by and 21 between the Development Department of the City of San Bernardino 22 and Coussoulis Development Company relating to property in the 23 Central City Project Area (Central City South Study Area) 24 therein more particularly described, said Agreement as shown in 25 Exhibit A attached hereto and incorporated herein, is hereby 26 approved and the Chairman of the Commission is authorized and .,o;fi-, 27 ......... 28 changes as may be approved by Counsel to the Department. directed to execute said Agreement with such non-substantive DABjsesjCen-Cit2.res May 15, 1991 1 ~~ "- , .....- '- 1 RESOLUTION...BETWEEN THE DEVELOPMENT DEPARTMENT AND COUSSOULIS DEVELOPMENT COMPANY (CENTRAL CITY PROJECT AREA). 2 3 I HEREBY CERTIFY that the foregoing resolution was duly 4 adopted by the Community Development Commission of the City of 19 20 21 22 23 24 25 '-' ~ 27 26 28 5 San Bernardino at a 6 20th day of May 7 Commission Members: 8 ESTRADA 9 REILLY 10 FLORES 11 MAUDSLEY 12 MINOR 13 POPE-LUDLAM 14 MILLER 15 16 17 meeting thereof, held on the Regular , 1991, by the following vote, to wit: AYES NAYS ABSTAIN y y ^ y y x x day of The foregoing resolution is hereby approved this 20th , 1991. 18 Mav Approved as to form and legal content: BY:~ /Agency nse1 DABjsesjCen-Cit2.res May 15, 1991 2 -- AGREEMENT TO NEGOTIATE EXCLUSIVELY by and between the DEVELOPMENT DEPARTMENT OF THE CITY OF SAN BERNARDINO, ("Department") and c COUSSOULIS DEVELOPMENT COMPANY ("DEVELOPER") CENTRAL CITY PROJECT AREA Dated as of , 1991 ;1"".... "- f;)( h.\ b ~ t ~ TABLE OF CONTENTS r '- I. [~lOO] NEGOTIATIONS C. [~lOl] [~l02] [~l03] [Sl04] Good Faith Negotiations A. B. Required Actions Negotiation Period D. Deposit II. [S200] DEVELOPMENT CONCEPT A. [S20l] [~202] Scope of Development B. Developer's Findings, Determinations, Studies and Reports ,".' ", I III. [~300] PURCHASE PRICE AND/OR OTHER CONSIDERATION ,-. IV. [~400] THE DEVELOPER A. [S40l] Nature of the Developer B. (S402] Office of the Developer C. (S403] The Developer's Consultants and Professionals D. [~404] Assignment E. [~405] Full Disclosure V. [~500] THE DEVELOPER'S FINANCIAL CAPACITY A. [~50l] Financial Ability B. (S502] Construction Financing C. [S503] Long-Term Development Financing I""-' i [S504] Bank and Other Financial References ''''"''' D. E. (S505] Full Disclosure 2 VI. [~600] COMMISSION'S RESPONSIBILITIES r- '- B. [~601] [~602] Redevelopment Plan A. Public Hearing VII. U700] SPECIAL PROVISIONS A. [~701] Real Estate Commission B. [~702] Press Releases C. U703] Nondiscrimination D. U704] Notice E. U705] Other Agreements - F. U706] Warranty of Signa tors . VIII. [~800] LIMITATIONS OF THIS AGREEMENT c EXHIBITS Exhibit A Site Map r- ~ 3 AGREEMENT TO NEGOTIATE EXCLUSIVELY r- "- THIS AGREEMENT TO NEGOTIATE EXCLUSIVELY (the "Agreement") is entered into this _____ day of , 19_, by and between the DEVELOPMENT DEPARTMENT OF THE CITY OF SAN BERNARDINO, a public body, corporate and politic (the "Department"), and COUSSOULIS DEVELOPMENT COMPANY (the "Developer"), on the terms and provisions set forth below. THE DEPARTMENT AND THE DEVELOPER HEREBY AGREE AS FOLLOWS: 1. [S100] NEGOTIATIONS A. [~101] Good Faith Ne~otiations The Development Department and the Developer agree for the Negotiation Period set forth below to negotiate diligently and in good faith to prepare a Disposition and Development Agreement (the "DDA") to be considered for execution between the Development Department and the r ~ Developer, in the manner set forth herein, with respect to the development of certain real property (the "Site") located within the boundaries of the CENTRAL CITY Redevelopment Project (the "Project"). The Site is shown on the "Site Map," attached hereto as Exhibit A and incorporated herein by reference. The site is owned by the Redevelopment Agency of the City of San Bernardino. The Department agrees, during the Negotiation Period, as hereinafter defined, and provided that this Agreement remains in effect, not to enter into an agreement that does not include the participation of the Developer regarding the development of the Site without the consent of Developer; provided, that the foregoing shall not be deemed to prevent the Department from furnishing to anyone public records pertaining to the proposed development. Notwithstanding the foregoing, the Developer .r' ~ acknowledges that its rights hereunder are subject to the Department's 4 obligations under State law and the Redevelopment Plan for the Project (the ~ "Plan"), inclUding, but not limited to the conduct or disposition of any .'-' proceedings which require notice and a public hearing, the California Environmental Quality Control Act, and the requirements for the Developer and/or the Department to obtain certain approvals from other public entities. The Obligation to negotiate in good faith requires that Developer communicate with Department with respect to those issues for which agreement has not been reached, and in such communication to follow reasonable negotiation procedures inCluding meetings, telephone conversations and correspondence. It is understood by the parties that final accord on those issues may not be reached. B. [S102] Reauired Actions. (1) Not later than ninety (90) days from the date of this Agreement, and subject to the provisions of Section 800, the developer r \...... shall submit to the Department a "Development Concept Package". The Development Concept Package shall include the fOllowing: (a) a detailed description of the proposed development, including uses, approximate square footage of buildings, tentative designation of parking and landscaped areas, users/tenants (if known) for the Site; (b) marketing reports describing and substantiating (on a preliminary basis) the undertakings proposed by the Developer; (c) estimate of development costs with supporting data with respect to the Site; (d) key assumptions as to economic feasibility, such as development timing, and any commitments expected from the Department; I~ ~ development; (e) the proposed scheduling of the proposed 5 (f) the proposed source and method of financing; l"" ''-"' (g) detailed biographical and background description of the proposed Contractor/Developer (and all principals in the proposed development entity), including such matters as (i) prior record with respect to the completion of projects, particularly those of a scale comparable to that proposed herein; (ii) record of timely performance reflecting minimal litigation and/or disputes concerning the payment of joint venturers, contractors, suppliers, or taxing authorities and (iii) record of satisfactory operation of analagous projects. It is understood that the Department may take appropriate steps to verify such matters, and the Developer agrees to cooperate in furnishing such information to the Department; (h) access to audited financial statements for guarantors (the Developer acknowledges that personal guarantees may be \ '*-'" required with respect to obligations of the Developer in the event the Developer does business in a corporate or partnership form) so long as these are not to become a matter of public record; and (2) Promptly upon receipt of the Development Concept Package, the Department shall review the development concept proposed by the Developer, together with the remainder of the Development Concept Package, and may either reasonably approve it, request modifications or reject it. If any such items are rejected, the Department shall provide a list of deficiencies to the Developer, and if these deficiencies are not corrected to the satisfaction of the Department within thirty (30) days of such rejection, this Agreement shall automatically terminate unless it is extended by the mutual written agreement of the Department and the Developer. - 6 (3) If the Department approves the Development Concept Package, <:: then, the Department and the Developer shall continue to negotiate toward the execution of a Disposition and Development Agreement (the "DDA") with respect to the development (the "Development"). During this negotiation period, the Developer shall prepare and submit an architectural concept of the proposed Development. If a DDA has not been entered into on or before one hundred-eighty (180) days from the date of this Agreement, which may be extended by mutual agreement for not to exceed ninety (90) additional days, this Agreement shall be automatically terminated unless it has been earlier terminated. If a DDA is signed, it shall supersede this Exclusive Negotiation Agreement. C. [5103] Ne~otiation Period The duration of this Agreement (the "Negotiation Period") shall be one hundred-eighty (180) days from the date of execution of this I"""'~ .~ Agreement by the Department, unless sooner terminated pursuant to the provisions of this Agreement. D. [5104] DeDosi t Prior to the execution of this Agreement by the Department, the Developer shall submit to the Department a good faith deposit (the "Deposit") in the amount of FIFTEEN THOUSAND DOLLARS ($15,000.00) in the form of either cash or an irrevocable letter of credit that is satisfactory to the Department's legal counsel to ensure that the Developer will proceed diligently and in good faith to negotiate and perform all of the Developer's obligations under this Agreement. If the Deposit is in the form of an irrevocable letter of credit, the Developer shall maintain such letter of credit in full force and effect for the entire Negotiation Period A"~ hereunder, and shall extend the letter of credit to the extent this '--" 7 Agreement or various time periods hereunder are extended. The Department <:: shall nave no obligation to earn interest on the Deposit. Any interest earned on the Deposit shall be the sole property of the Department. In the event the Developer has not continued to negotiate diligently and in good faith or has failed to timely discharge its responsibilities pursuant to Section 102 of this Agreement, the Department shall give written notice thereof to the Developer who shall then have ten (10) working days to commence negotiating diligently and in good faith or, with respect to a failure pursuant to Section 102 of this Agreement, thirty (30) days to cure irrespective of the good faith of the Developer. Following the receipt of such notice and the failure of the Developer to thereafter commence negotiating in good faith within such ten (10) working days or to cure a failure pursuant to Section 102 within thirty (30) calendar days, this Agreement may be terminated by the Department. In the ~ ~ event of such termination by the Department for a reason other than the failure of the Developer to negotiate in good faith, the Deposit shall be returned to the Developer and neither party shall have any further rights against or liability to the other under this Agreement. THE PARTIES AGREE THAT IN THE EVENT THE DEVELOPER FAILS TO NEGOTIATE DILIGENTLY AND IN GOOD FAITH AND THIS AGREEMENT IS TERMINATED ON THAT BASIS, THE DEPARTMENT WOULD SUSTAIN LOSSES WHICH WOULD BE UNCERTAIN. SUCH LOSSES WOULD INCLUDE COSTS PAYABLE TO ADVISERS AND STAFF TIME ALLOCATED TO THE PREPARATION OF THIS AGREEMENT AND ITS IMPLEMENTATION, AND SUCH VARIABLE FACTORS AS THE LOSS OF OTHER POTENTIAL DEVELOPMENT OPPORTUNITIES WITH RESPECT TO THE SITE, FRUSTRATING AND DELAYING THE IMPLEMENTATION OF THE REDEVELOPMENT PLAN AND FOREGOING MAXIMIZING EFFORTS TOWARD INCREASING TAX r '-' INCREMENT REVENUES, PROVIDING EMPLOYMENT, INCREASING PRIVATE INVESTMENT, AND THE ATTAINMENT OF OTHER OBJECTIVES OF THE REDEVELOPMENT PLAN. IT IS 8 IMPRACTICABLE AND EXTREMELY DIFFICULT TO FIX THE AMOUNT OF SUCH DAMAGES TO C THE DEPARTMENT, BUT THE PARTIES ARE OF THE OPINION, UPON THE BASIS OF ALL INFORMATION AVAILABLE TO THEM, THAT SUCH DAMAGES WOULD APPROXIMATELY EQUAL THE AMOUNT OF THE DEPOSIT (WITH ANY INTEREST EARNED THEREON), AND SUCH AMOUNT SHALL BE RETAINED BY THE DEPARTMENT IN THE EVENT THIS AGREEMENT IS TERMINATED BY THE DEPARTMENT FOR THE CAUSE SET FORTH IN THIS PARAGRAPH. THE DEVELOPER AND THE DEPARTMENT SPECIFICALLY ACKNOWLEDGE THIS LIQUIDATED DAMAGES PROVISION BY THEIR SIGNATURE BELOW: IJf!A Developer Initial Here Department Initial Here In the event the Department fails to negotiate diligently and in good faith, the Developer shall give written notice thereof to the C Department which shall then have ten (IO) working days to commence negotiating in good faith. Following the receipt of such notice and the failure of the Department to thereafter commence negotiating in good faith within such ten (IO) working days, this Agreement may be terminated by the Developer. In the event of such termination by the Developer, the Department shall return the Deposit (with any interest earned thereon) to the Developer, and neither party shall have any further rights against or liability to the other under this Agreement. Upon automatic termination of this Agreement at the expiration of the Negotiation Period or such extension thereof, or upon execution by the Commission and the Developer of a DDA, then concurrently therewith, the Deposit hereunder shall be returned to the Developer and neither party I'f'" ""-' shall have any further rights against or liability to the other under this Agreement. If a DDA has been executed by the Department and the Developer, 9 the DDA shall thereafter govern the rights and obligations of the parties <:: with respect to the development of the Site. II. [5200] DEVELOPMENT CONCEPT A. [5201] ScoDe of DeveloDment The negotiations hereunder shall be based on a development concept which shall include the development of a commercial office building(s), and related landscape and streetscape improvements, and a parking facility. Design and architecture will be developed during the negotiation of the DDA. The Department and the Developer mutually acknowledge that the principal component of this proposed project is an office building(s) intended to house offices of the Department of Transportation of the State of California. B. [5202] DeveloDer's Findinas, Determinations. Studies and ReDorts c Upon reasonable notice, as from time to time requested by the Department, the Developer agrees to make oral and written progress reports advising the Department on all matters and all studies being made by the Developer. Further, at thirty (30) day intervals from the date of execution of this Agreement by the Department, the Developer shall provide a written report to the Department concerning its progress in preparing site plans, floor plans, elevations and time schedules for development of the Site. III. [5300] PURCHASE PRICE AND/OR OTHER CONSIDERATION The purchase price and/or other consideration to be paid by the Developer under the DDA will be established by the Department after negotiation with the Developer. Such purChase price and/or other consideration will be based upon such factors as market conditions, density ~. .~ of development, costs of development, risks of the Department, risks of the 10 Developer, estimated or actual Developer profit, public purpose and/or fair c:: value for the uses permitted to be developed and financial requirements of the Department, and will be subject to approval by the Department and by the Common Council of San Bernardino after public hearings as required by law. IV. [5400] THE DEVELOPER A. [5401] Nature of the Develooer The Developer is a CALIFORNIA CORPORATION - ( \...... B. [5402] Office of the Develooer The principal office of the Developer is: 341 West Second Street Suite 1 San Bernardino, California 92401 C. [S403] The Develooer's Consultants and Professionals The Developer's architect with regard to preliminary work on this project is C. William Davis The Developer's engineer with regard to preliminary work on this project is Joseph E. Bonadiman and Associates. The Developer's attorney will be: Cary D. Lowe, Vice President and General Counsel; Gresham, Varner, Savage, Nolan & Tilden, Special Counsel. These consultants and professionals have been engaged in preliminary work for development and are subject to change at the option of the Developer. D. [5404] Assi,mment This Agreement shall not be assigned by the Developer r ~ without prior written approval of the Department, which the Department 11 .1"'- '-' ",'H'" '- ~ '-' shall grant or refuse at its sole discretion; provided that assignments proposed with financial institutions for financing purposes shall be subject to reasonable review and approval of the Department. E. [S40S] Full Disclosure The Developer is required to make full disclosure to the Department of its principals, officers, major stockholders, major partners, joint venturers, key managerial employees and other associates, and all other material information concerning the Developer and its associates. Any significant change in the principals, associates, partners, joint venturers, negotiators, development manager, consultants, professionals and directly involved managerial employees of the Developer is subject to the approval of the Department. v. [SSOO] THE DEVELOPER'S FINANCIAL CAPACITY A. [ SSOl] Financial Abilitv Prior to execution of the DDA, the Developer shall submit to the Department satisfactory evidence of its ability to finance and complete the development. B. [SS02] Construction FinancinR The Developer's proposed method of obtaining construction financing for the development of the Site shall be submitted to the Department concurrently with execution and delivery by the Developer of a DDA to the Department for approval. C. [SS03] LOnR-Term DeveloDment FinancinR The Developer's proposed method of obtaining long-term development financing shall be submitted to the Department concurrently with execution and delivery by the Developer of a DDA to the Department for approval. 12 r '- c '-' D. [5504] Bank and Other Financial References The Developer's bank is Wells Fargo Bank. E. [5505] Full Disclosure The Developer will be required to make and maintain full disclosure to the Department of its methods of financing to be used in the development of the Site. VI. [5600] Commission's ResDonsibilities A. [5601] RedeveloDment Plan This Agreement and the DDA are subject to the provision of the Redevelopment Plan for the CENTRAL CITY Redevelopment Project which was approved and adopted by the Mayor Common Council of the City of San Bernardino by Ordinance No. 2649 on February 23, 1965, as amended by Ordinance(s) No. 3059 on March 16, 1970, Ordinance No. 3683, on November 7, 1977, Ordinance No. MC-558, on December 8, 1986, Ordinance No. MC-559, on December 8, 1986, and Ordinance No. MC-723, on April 2, 1990. B. [5602] Public HeariIa A DDA resulting from the negotiations hereunder shall become effective only after and if the DDA has been considered and approved by the Communi ty Development Commission and by the Mayor and Common Council of San Bernardino at pUblic hearings called for such purpose. VII. [5700] SPECIAL PROVISIONS A. [5701] Real Estate Commission The Department shall not be liable for any real estate commission or brokerage fees which may arise herefrom. The Department represents that it has engaged no broker, agent or finder in connection with this transaction, and the Developer agrees to hold the Department harmless from any claim by any broker, agent or finder retained by the Developer. 13 B. [5702] Press Releases. I"""" 1 '- The Developer agrees to discuss any press releases with a designated Department representative prior to disclosure in order to assure accuracy and consistency of the information. C. [5703] Nondiscrimination. With respect to Developer's obligations and performance hereunder, the Developer shall not discriminate in any matter on the basis of race, creed, color, religion, gender, marital status, national origin or ancestry. D. [5704] Notice. All notices given or required to be given hereunder shall be in writing and addressed to the parties as set out below, or to such other address as may be noticed under and pursuant to this paragraph. Any such notice shall be considered served when actually received by the party intended, whether personally served or sent postage prepaid by registered 1"'.... ~ or certified mail, return receipt requested. Department: Development Department of the City of San Bernardino 300 North "D" Street, Fourth Floor San Bernardino, CA 92418 Attn: Executive Director Developer: COUSSOULIS DEVELOPMENT COMPANY 341 West Second Street Suite 1 San Bernardino, California 92401 Attn: Cary D. Lowe E. [5705] Other Aareements. This Agreement supersedes any previous agreements entered into between the Developer and the Department or any discussions or understandings between the Developer and the Department with respect to the Site. ft#I'';~~ "'-' 14 - F. [S706] Warranty of Sianators c The signatories to this Agreement represent and warrant that they have the authority to execute this Agreement on behalf of the principals they purport to represent. VIII. [S800] LIMITATIONS OF THIS AGREEMENT By its execution of this Agreement, the Department is not committing itself to or agreeing to undertake (a) disposition of land to the Developer; or (b) any other acts or activities requiring the subsequent independent exercise of discretion by the Department, the City or any agency or department thereof. This Agreement does not constitute a disposition of property or exercise of control over property by the Department or the City and does not require a public hearing. Execution of this Agreement by the Department is merely an agreement to enter into a period of exclusive <::. negotiations according to the terms hereof, reserving final discretion and approval by the Department and the City as to any Disposition and Development Agreement and all proceedings and decisions in connection therewith. The parties understand and agree that the project contemplated by this Agreement is subject to Developer reaChing agreement with the State of California, Department of Transportation (Caltrans) for occupancy of the proposed office building(s) pursuant to a lease or other agreement, and acquisition of several additional, privately owned parcels of land by the Developer, necessary for development of the facilities expected to be required by Caltrans, and should such agreement be delayed or not obtained at all, all deadlines and dates contained in this Agreement shall be r' ~ reasonably extended, provided that in no event shall the negotiation periOd outlined in Section 102(3) be extended without the written agreement of the 15 Department. In addition it is understood and agreed that the determination c:: of good faith as outlined in Section 104 shall be made with reference to the need for a Caltrans agreement, and acquisition of the necessary additional land parcels by Developer. IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective as of the date of approval of the Department's governing board which is the date first set forth in this Agreement. DEVELOPER By Cary D. Lowe, Vice President DEVELOPMENT DEPARTMENT OF THE CITY OF SAN BERNARDINO By Exeeut~~ COUSSOULIS DEVELOPMENT COMPANY c APPROVED AS TO FORM AND LEGAL CONTENT: ~.J APPROVED AS TO PROGRAM: <::) ~^.- By --C~: ~ cr----- Development Manager 3725H ,~ '-" 16 c DEVELOPMENTD:gPARTMENT an OF SAN o8ERNARDOO /l,,,~ro ~I~I'- ~, I-J. LOCATION & ..~ . .~ .J I , , I I I . . .... i c I"""'" \.-. WARD ! PROJECT ce . I. -:' I , ... " ... EXHIBIT A