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Home My WebLink About08- Economica Development DEVELOPMENT DEPARTMENT OF THE CITY OF SAN BERNARDINO ECONOMIC DEVELOPMENT AGENCY REQUEST FOR COMMISSION/COUNCH,ACTION FROM: KENNETH J.HENDERSON SUBJECT: FEDERAL BANIQIUPTCY Executive Director COURT RETENTION-YMCA PARE]NG LOT DATE: April 13,1994 ------------------------------------' ------- ------------------------------- Synoosis of Previous Commission/Council/Committee Action(s): On May 10, 1993,the Community Development Commission considered a motion to conceptually approve ground Wainga vacant JolAxim the YMCA constructing paddag Jut improvements thexconata cas10f$2&WW(plus monthly maintenance expenses)and subleasing the parking lot to the Banlmiptcy Court's landlord;the item was continued to May 24, 1994,but,due to a subsequent reordering of priorities,has not been reconsidered since the May 10, 1993 meeting. Recommended Motion(s): (Community Development Commission) MOTION A: That the Community Development Commission approve the construction of parking lot improvements on a vacant parcel owned by the YMCA at an estimated cost of$280,000;father,that the Economic Development Agency budget be increased by$280,000 plus monthly ground lease costs. MOTION B: That the Community Development Commission authorize staff to negotiate an agreement whereby the YMCA would install parldng lot improvements on the vacant land parcel. MOTION C: That the Community Development Commission approve a ground lease from the YMCA to the Redevelopment Agency,as well as a lease of the completed parking lot from the Redevelopment A—geenncj1yy ttoolt\hee B-anlmtptcy Court's landlord. Anmmistrator IKENNETIIJ.HENDPSON Executive Director Contact Person(s): Kenneth J.Henderson/John Wood Phone: 5081 Project Area(s): Central City(CC) Ward(s): One (I) Supporting Data Attached: Staff RrpW- Site Plan FUNDING REQUIREMENTS: Amount $280.00 Plus Source: Bond Proceeds Lease Expenses Budget Authority: Requested Commission/Council Notes: KJH:Imp:prklotcdc COMMISSION MEETING AGENDA MEETING DATE: 04/18/1994 Agenda Item Number. r, O DEVELOPMENT DEPARTMENT STAFF REPORT ----------------------------------------------------------------------------------------------------------------- FEDERAL BANKRUPTCY COURT RETENTION-YMCA PARKING LOT In connection with our Federal Bankruptcy Court retention efforts, the local YMCA has offered to lease a vacant lot which it owns to the Redevelopment Agency. This offer is important because one of the chief complaints of the judges about the Court's current location is a shortage of adequate, secure parking. The subject parcel is located on the east side of Arrowhead Avenue, between Sixth and Seventh Streets, and is situated a short distance south of the building occupied by the Bankruptcy Court at 699 North Arrowhead Avenue. Former Councilman Maudsley and staff met with representatives of the YMCA on Friday, April 30, 1993, and proposed a ground lease to the Agency for ten(10)years with two (2)five(5)year extensions. The rent would be$1,000 per month for the fast five(5)years, $1,200 for the second five(5)years, $1,450 for the third five(5)years and $1,850 for the final five(5)year period. Under this scenario, the Agency would be responsible for constructing the parking lot improvements, maintaining same and, at the end of the twenty(20)year lease term, would deed the improvements over to the YMCA for$1.00. The YMCA has indicated that it would like a higher ground rent, but no firm counter proposal has as yet been tendered. Staff has also worked with the Department of Public Works to arrive at a reasonably dependable estimate of parking lot construction costs for the subject property. The estimate assumes a fairly high grade of improvements including a short block wall with wrought iron fencing around the perimeter of the property and a security control access gate, and totals approximately$280,000 or $7.00 per square foot. This figure would probably set the lower limit of construction costs, given the level of amenities that the judges are likely to expect. If a still higher grade of improvements is desired including additional landscaping and higher candlepower lighting, such options could drive the per square foot cost to $9.00 or $10.00. A meeting with the Bankruptcy Court will be held shortly to ascertain the specific level of amenities to be included. Beyond the expenses of ground leasing and construction of parking lot improvements, there are also maintenance expenses to consider. City Facilities Management has estimated the annual cost of maintaining a facility of this size at approximately $10,000 or $833 per month. Staff will negotiate to have the YMCA bear this expense. City Risk Manager Victor Lorch has informed staff that there would be no new, ongoing expense for liability insurance, as the lot could simply be added to the list of other Agency-owned parking lots and vacant land at no additional cost. KJH:lmp:prklot.cdc CONIMISSION MEETING AGENDA MEETING DATE: 04/18/1994 Agenda Item Number: Y DEVELOPMENT DEPARTMENT STAFF REPORT YMCA PARKING LOT April 13, 1994 Page Number-2- For purposes of subleasing the completed parking lot to the owners of the building in which the Bankruptcy Court is located, in staffs opinion the Agency should receive an eight percent(8%) return on its invested capital. Using the earlier construction estimate of$280,000,this would equate to an annual rental of$22,400 or$1,867 per month. Passing though the Agency's estimated land rental expense of$1,000, and adding the investment return for parking lot construction of$1,867 results in a recommended base monthly rental amount of$2,867. In reality, however, the building owners can be expected to argue that, since the rental amount in their lease to the Bankruptcy Court is fixed, they can afford topay little or nothing for rental of the subject parking lot. Because of this, the Agency may have to consider these expenses as a contribution to the efforts to retain the Bankruptcy Court in downtown San Bernardino. Under an alternative scenario, the YMCA feels that there is a good chance that, through donated labor and materials and an exemption from prevailing wage requirements, it could construct the parking lot improvements for somewhat less than $280,000. It would then lease the lot to the Redevelopment Agency, which would in turn sublease it to the Bankruptcy Court's landlord. After meeting with the Bankruptcy Court,the YMCA will determine at what cost it could deliver the finished parking lot and the rental it would want to receive from the Agency. Form motions "A", "B" and "C", if adopted, will provide staff the greatest degree of flexibility in accomplishing the Commission's goal of retaining the Federal Bankruptcy Court in San Bernardino by providing the budget authority for Agency staff to coordinate installation of the required improvements and the authority to negotiate with the YMCA, the Court and the Court's landlord relative to respective ground leases and reduced improvement costs. Attached for your reference is a site plan showing the location and configuration of the subject property. Staff recommends adoption of form motions "A", "B" and "C". U 4444 1l KENNETH J. EWNDERSON, Executive Director Development Department KJH:lmp:prklot.cdc COMMISSION MEETING AGENDA MEETING DATE: 04/18/19994 99 Agenda Item Number: G EXISTING BANKRUPTCY COURT BLDG. PARKING LOT L 7TH STREET 6 15 5 7 8 9 12 13 14 LLI 16 W m 4 17 z 11 z L 3 18 > Q 2 10 19 Q 1 20 `351031 � Q W _ WACAHT SUBJEC'T 22 ~Lu EXISTING YMCA PARKING LOT ' 250• 6TH STREET � - - - - mi 1 I TOTAL PARCEL AREA 75,000 SO. FT. �L - - - - J VACANT SUBJECT AREA 39,500 SO. FT. dW NORTH Not to Scale