HomeMy WebLinkAboutR34-Economic Development Agency
ECONOMIC DEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
FROM:
Ann Harris, Director
Business Retention, Recruitment and Revitalization
SUBJECT:
EXCLUSIVE RIGHT TO
NEGOTIATE WITH ESSEX TO
DEVELOP AN INDUSTRIAL
PROJECT ON ARROWHEAD
AND ORANGE SHOW ROAD
DATE:
January 15, 2002
OR' 1"\ I ~ !~L
i \on Ii Vi-'
Svnopsis of Previous Commission/Council/Committee Action!s):
On December 20,2001 the Redevelopment Committee recommended that Staff prepare an Exclusive Right to Negotiate
Agreement between the Redevelopment Agency and Essex Realty Management Inc., for consideration by the
Community Development Commission.
________________.._..__n____________________.__._u_____________________.___._____+___________________."."..n__.______________________._n_________________________________."._._.+d________
Recommended Motion!s):
!Communitv Develoument Commission)
MOTION:
RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY
OF SAN BERNARDINO, AS THE GOVERNING BODY OF THE REDEVELOPMENT
AGENCY OF THE CITY OF SAN BERNARDINO, APPROVING THAT CERTAIN
EXCLUSIVE RIGHT TO NEGOTIATE FOR PROPERTY ACQUISITION AND
REDEVELOPMENT ASSISTANCE (ESSEX REALTY MANAGEMENT, INe.) BY AND
BETWEEN THE REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
AND ESSEX REALTY MANAGEMENT, INC., ON THE TERMS SET FORTH IN SUCH
AGREEMENT
-.-----------------------.-------------------------..----.....-----------------.---.-----------------------.-.---....---.-------------.-.--.---.----..-..------------------------------.-
Contact Person(s): Gary Van Osdel/Ann Harris
Project Area(s) Central City South (CCS)
Phone:
663-1044
One (1)
Ward(s):
Supporting Data Attached: 0 Staff Report 0 Resolution(s) 0 Agreement(s)/Contract(s) 0 Map(s) 0 LetterlMemo
FUNDING REQUIREMENTS Amount: $
N/A
Source:
N/A
N/A
~~~
Retention, Recruitment & Revitalization
SIGNATURE:
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Commission/Council Notes:
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GVO:MP:sj:I-22-02 Essex-Arrowhead and Orange Show RoadEssex COMMISSION MEETING AGENDA
Meeting Date: 02/04/2002
Agenda Item Number: I? ~
ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
--------------------~------------------------------------------------------------------------------------------------
Exclusive Ril!ht To Nel!otiate With Essex To DeveloD An Industrial Proiect On Arrowhead
And Oranl!e Show Road
BACKGROUND
In 1991, the Redevelopment Agency (the "Agency") purchased the 15.26 acres of property
located at the northeast comer of Arrowhead and Orange Show Road (the "Site") from the City's
Water Department for a total purchase price of $4,936,000 ($7.43 a square foot) which
represented fair market value at that time. In recent years the Agency, from time to time, has
received offers to purchase the property. However, all such offers have been for the current
market value at the time the offer was made, which in all cases was well below the original
purchase price for the Site. According to the Agency's most recent appraisal, the market value
ofthe property in year 2000 was $1,063,561 ($1.60 a square foot).
In July 2001, the Essex Realty Management, Inc., a real estate development and management
company, approached the Agency with an offer to purchase the Site for $1.60 square foot for
development of light industrial uses. Essex Realty Management, Inc. ("Essex") was founded in
1987 with a purpose to develop, acquire and manage real estate assets. Essex has developed a
100,000 square foot industrial development project in Riverside, a 225,000 square foot mixed
use retail and industrial project located in Redlands, a 95,000 square foot corporate headquarters
facility located in Irvine, an 81,000 square foot industrial project in Carlsbad, and an 82,000
square foot neighborhood retail center in San Diego. After advising the principals of Essex of the
Agency's original investment in the Site and of the Agency's reluctance to sell the property at
such a loss, both sides agreed that a light industrial project would not be economically feasible at
such high land costs. As a consequence, Essex withdrew their offer.
In August 2001, Essex returned to the Agency with a suggestion that a joint venture approach to
the development of the Site might give the Agency an opportunity to recoup most of its
investment in the site, while at the same time helping to address the limited supply of industrial
buildings in the City that seriously impedes economic growth in our coOmmunity.
CURRENT ISSUE
At the Redevelopment Committee Meeting of December 6, 2001, Staff queried the Committee
Members if they would consider a joint venture concept as a means for disposing of and
developing the Site. The Redevelopment Committee requested that Staff provide information
regarding such a concept at their Meeting of December 20,2001.
GVO:MP:sj:1-22-02 Essex-Arrowhead and Orange Show RoadEssex
COMMISSION MEETING AGENDA
Meeting Date: 02/04/2002
Agenda Item Number: R.3Y
Economic Development Agency Staff Report
Exclusive Right to Negotiate - Essex
January 15,2002
Page Number -2-
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During the Redevelopment Committee Meeting of December 20,2001, representatives of Essex
gave a presentation of the proposed joint venture concept for consideration. Subsequent to the
presentation and discussions with Essex and Staff regarding said concept, the Redevelopment
Committee recommended that Staff prepare an agreement between the Agency and Essex, for
consideration by the Community Development Commission, that would provide a 180 day
exclusive right to negotiate the possible disposition and development of the Site.
Pursuant to the proposed joint venture concept, the Agency would only be required to contribute
its land (15.26 acres) to the venture. The value of the land contribution would be set at $2.00 per
square foot. The developer would be required to provide any necessary cash equity and obtain
the financing for construction of up to 230,000 square feet oflight industrial space spread within
two to ten buildings. The Agency would not be a signatory to nor obligated by any such loans.
Upon completion, the project would be sold at market value ($55 to $60 a square foot) to one or
more end users. Upon this occurrence the Agency would receive payment for the value of its
land contribution, payment of a 52% share of a "preferred return" to equity contributors and a
26% share of net proceeds. In addition the Agency would receive upwards of $135,000 per year
resulting from the placement of this property back on the tax rolls. The City's benefit from the
project would include the receipt of development fees, business license and sales tax revenues,
and approximately 450 job opportunities. The Exclusive Right to Negotiate will enable Essex
and Staff to refine the numbers, evaluate feasibility and explore possible users to determine
maximum density for the site. Ifnegotiations are successful, staff will return to the Community
Development Commission with a Disposition and Development Agreement.
ENVIRONMENTAL IMPACT
Under the California Environmental Quality Act (CEQA), no CEQA action is required for an
Exclusive Right to Negotiate.
FISCAL IMP ACT
The Exclusive Right to Negotiate Agreement will not require the Agency to expend any financial
resources other than Staff time.
RECOMMENDATION
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Business Retention, Recruitment and Revitalization
GVO:MP:sj:I-22-02 Essex-Arrowhead and Orange Show RoadEssex
COMMISSION MEETING AGENDA
Meeting Date: 02/04/2002
Agenda Item Nnmber: lli--
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RESOLUTION NO.
A RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE
CITY OF SAN BERNARDINO, AS THE GOVERNING BODY OF THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO,
APPROVING THAT CERTAIN EXCLUSIVE RIGHT TO NEGOTIATE FOR
PROPERTY ACQUISITION AND REDEVELOPMENT ASSISTANCE (ESSEX
REALTY MANAGEMENT, INC.) BY AND BETWEEN THE REDEVELOPMENT
AGENCY OF THE CITY OF SAN BERNARDINO AND ESSEX REALTY
MANAGEMENT, INC., ON THE TERMS SET FORTH IN SUCH AGREEMENT
WHEREAS, the Redevelopment Agency of the City of San Bernardino (the "Agency")
owns certain real property situated in the Central City South Redevelopment Project Area of
the Agency and consisting of approximately 15.26 acres, generalIy located at the intersection
of Orange Show and Arrowhead in the City of San Bernardino and more specifically
described in the legal description and vicinity map attached hereto as Exhibit "A" and
incorporated herein by this reference (the "Property"); and
WHEREAS, Essex Realty Management, Inc. (the "Developer") is interested in
determining the feasibility of acquiring the Property for redevelopment with commercial and
industrial uses and developing a specific description of such uses in the form of a single
master development plan (the "Project"); and
WHEREAS, the Agency, currently, deems the disposition and redevelopment of the
Property to be integral to the implementation of the Central City South Redevelopment Plan
and the Developer appears to the Agency to be welI qualified to undertake the task of
planning the details of the acquisition of the Property by the Developer from the Agency and
the redevelopment of the Project on the Property in a manner compatible with the objectives
of the Implementation Plan for the Agency's Central City South Redevelopment Project Area;
and
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WHEREAS, the Agency staff prepared a proposed Exclusive Right to Negotiate for
Property Acquisition and Redevelopment Assistance (Essex Realty Management, Inc.) by and
between the Agency and the Developer (the "Agreement") to provide an exclusive period for
the Developer to assess the feasibility of developing the Project on the Property and, possibly,
negotiate a Disposition and Development Agreement with the Agency for acquisition of the
Property; and
WHEREAS, it is appropriate for the Commission to take action with respect to the
Agreement, as set forth in this Resolution.
NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION, AS
THE GOVERNING BODY OF THE REDEVELOPMENT AGENCY OF THE CITY OF
SAN BERNARDINO, DOES HEREBY RESOLVE, DETERMINE AND ORDER AS
FOLLOWS:
Section 1.
On February 4, 2002, the Commission considered the Agreement at
regular, open, public meeting of the Commission. The minutes of the Agency Secretary for th
February 4, 2002 regular meeting of the Commission shall include a record of all documents an
communication submitted to the Commission by interested persons relating to the consideratio
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Section 2.
A copy of the Agreement in the form submitted at the February 4, 2002
meeting is on file with the Agency Secretary.
Section 3. The Commission hereby finds and determines that no change in the use 0
the Property or any activities on the Property will occur, under the terms and conditions of th
Agreement and that the planning and negotiating activities to occur under the Agreement presen
no potential significant effect on the environment. The Agreement merely provides for a
exclusivity period for gathering information, analysis of information and potential negotiation
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The Agreement does not constitute a "Project" within the provisions of the califOmij
Environmental Quality Act ("CEQA"), as amended, and no environmental review is required i
3 association with approval of the Agreement.
Section 4.
The Commission hereby approves the Agreement as submitted at th
February 4, 2002, meeting. The Executive Director is hereby authorized and directed to execut
the Agreement on behalf of the Agency together with such technical and conforming changes a
may be approved by the Executive Director and Agency Special Counsel. If the Agreement i
not fully executed by the parties for any reason within ninety (90) days following the date 0
adoption of this Resolution, the authorization granted herein to the Executive Director to execut
the Agreement on behalf of the Agency shall be of no further force or effect.
Section 5.
Provided that the Agreement is fully executed by the parties within th
period of time set forth in Section 4 of this Resolution, the Executive Director of the Agency i
hereby authorized and directed to take all actions set forth in the Agreement on behalf of th
Agency.
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A RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE
CITY OF SAN BERNARDINO, AS THE GOVERNING BODY OF THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO,
APPROVING THAT CERTAIN EXCLUSIVE RIGHT TO NEGOTIATE FOR
PROPERTY ACQUISITION AND REDEVELOPMENT ASSISTANCE (ESSEX
REALTY MANAGEMENT, INC,) BY AND BETWEEN THE REDEVELOPMENT
AGENCY OF THE CITY OF SAN BERNARDINO AND ESSEX REALTY
MANAGEMENT, INC., ON THE TERMS SET FORTH IN SUCH AGREEMENT
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6 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Communit
7 Development Commission of the City of San Bernardino at a
meeting thereof, held
8 on the
day of
, 2002, by the following vote to wit:
9
10 Commission Members:
Navs
Abstain
Absent
Aves
II
ESTRADA
LIEN
MCGINNIS
SCHNETZ
SUAREZ
ANDERSON
MC CAMMACK
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Secretary
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The foregoing resolution is hereby approved this
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Judith Valles, Chairperson
Community Development Commission
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Approved a
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THE REDEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
EXCLUSIVE RIGHT TO NEGOTIATE FOR PROPERTY
ACQUISITION AND REDEVELOPMENT ASSISTANCE
(ESSEX REALTY MANAGEMENT, INC.)
THIS EXCLUSIVE RIGHT TO NEGOTIATE FOR PROPERTY
ACQUISITION AND REDEVELOPMENT ASSISTANCE is dated as of January _,
2002 (this "Agreement") and is entered into by and between ESSEX REALTY
MANAGEMENT, INC., a California corporation (the "Developer"), and the
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO, a public body
corporate and politic, pursuant to Health and Safety Code Sections 33000, et seq. (the
"Agency"), to coordinate mutual feasibility assessment, development planning and
consideration of the sale, acquisition and redevelopment by the Developer of certain real
property presently owned by the Agency, situated in the Central City South
Redevelopment Project Area ofthe Agency and consisting of approximately 15.26 acres,
generally located at the intersection of Orange Show Road and Arrowhead Avenue in the
City of San Bernardino and more specifically described in the legal description and
vicinity map attached hereto as Exhibit "A" and incorporated herein by this reference (the
"Property").
NOW THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS
AND PROMISES SET FORTH HEREIN, THE DEVELOPER AND THE AGENCY
HEREBY AGREE, AS FOLLOWS:
1. Developer Acknowledgments.
a. The Developer hereby acknowledges and agrees that no provision
of this Agreement shall be deemed to be an offer by the Agency nor an acceptance by the
Agency of any offer or proposal from the Developer to convey any interest in the
Property to the Developer. Any studies relating to the Property or the Proj ect (as defined
herein) that may be undertaken by the Developer, in its discretion shall be the sole
responsibility of the Developer and shall not be deemed to be undertaken for the benefit
of the Agency.
b. Restrictions Against Change in Ownership. Management and
Control of Developer and Assigmnent of Agreement.
(I) The qualifications and identity of the Developer and its
principals are of particular concern to the Agency. The Agency relied on these
qualifications and identity in entering into this Agreement with the Developer. During
the term of this Agreement, no voluntary or involuntary successor-in-interest of the
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S8200 I :38405.1
Developer shall acquire any rights or powers under this Agreement. The Developer shall
not assign all or any part of this Agreement or any rights hereunder, without the prior
written approval of the Agency Executive Director, which the Agency Executive Director
may grant or refuse in his or her sole and absolute discretion.
(2) The Developer shall promptly notify the Agency in writing
of any and all changes whatsoever in the identity of the business entities and individuals
either comprising or in control of the Developer, as well as any and all changes in the
interest or the degree of control ofthe Developer by any such party, of which information
the Developer or any of its partners or officers have been notified or may otherwise have
knowledge or information. Upon the occurrence of any significant or material change,
whether voluntary or involuntary, in membership, ownership, management or control of
the Developer (other than such changes occasioned by the death or incapacity of any
individual) that has not been approved in writing by the Agency Executive Director, prior
to the time of such change, the Agency may terminate this Agreement by serving written
notice of such termination, referencing this section, on the Developer.
2. Term of Agreement. The rights and duties ofthe parties established by
this Agreement shall commence on the seventh (7th) calendar day following both the
approval of this Agreement by the governing body of the Agency and the acceptance of
this Agreement by the Developer, as provided in Section 21 (the "Effective Date"). This
Agreement will continue in effect for a maximum time period not to exceed one hundred
eighty (180) days, in accordance with the following activities to be completed by the
Developer:
a. The following work shall be completed by the Developer, within
the first two (2) weeks following the Effective Date:
(1) Development of a financial feasibility study/analysis for the
development of the Project (as defined herein) on the Property, including an estimate of
project costs, project income and a proforma statement of Project capital return including,
without limitation, the following:
(a) projections of Project income and operating
expenses;
(b) projections of debt and equity that can be drawn
from the Project;
(c) Project cash flow projections;
(d) projections of public (City, State and Federal)
financial assistance anticipated for the Project;
(e) projections of overall Project value, revenue, sales
and property taxes;
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S82001 :38405.1
(f) projections ofthe costs and benefits to the City and
the Agency for all construction, maintenance and
operations of all proposed public improvements, the
costs of additional or increased levels of public
services and any new public revenues anticipated to
be generated by the Project, by phase, if applicable,
and upon completion of the Project.
(2) Development of the conceptual site planning and imaging
for the Project.
b. The following additional work shall be completed by the
Developer, within the first six (6) weeks following the Effective Date:
(I) Development of tenant marketing materials and contracts,
including, without limitation, the following:
(a) Demographic and economic data.
(b) Vicinity and area maps (to include completion
maps);
(2) a proposed conceptual development plan for the Project on
the Property, including, without limitation:
(a) proposed land use categories on a parcel-by-parcel
basis, including any proposed zoning and General
Plan changes, if any, necessary to accommodate the
Project;
(b) a proposed time schedule and cost estimates for the
development of proposed public and private
infrastructure upgrades, development of parking
spaces, development of other proposed publicly
owned facilities, public improvements, public
infrastructure and private development; and
(c) a proposed financing plan identifying financing
sources for all private and public improvements
proposed in the Project, by phase, if appropriate;
(3) a list of potential users or tenants and anticipated lease rates and
resale land prices, including, without limitation, initial tenant contracts, if applicable;
c. The Developer shall determine whether the Project is feasible for
the Developer within the first two (2) months following the Effective Date. If the
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SB2001 :38405.1
Developer determines the Project is feasible, it shall so inform the Agency Executive
Director in writing before the expiration ofthe first ten (10) weeks following the
Effective Date. Thereafter, the Developer and the Agency may proceed to negotiate the
final form of a Disposition and Development Agreement with respect to the Property (the
"Property DDA").
d. The Developer shall submit each of the items of information
described in this section to the Agency Executive Director, within the time periods set
forth above. Within ten (10) days of receipt of any such information, the Agency
Executive Director shall determine whether such information is satisfactory, in the
Agency Executive Director's sole and absolute discretion. If the specific item of
information is satisfactory to the Agency Executive Director, he or she shall notify the
Developer in writing that this Agreement shall continue in effect, until the deadline for
the submission of the next item of information, as set forth above. If the specific item of
information is unsatisfactory to the Agency Executive Director, he or she shall notify the
Developer in writing of the reason(s) that the information is unsatisfactory and that this
Agreement is suspended, until the Developer re-submits the information in a satisfactory
form and receives the written approval of the Agency Executive Director. If the Agency
Executive Director does not make a determination regarding any item of information
submitted by the Developer under this Section 2, within ten (10) days of receipt of such
information, the information shall be deemed approved. Ifthe Developer fails to timely
submit any of the information set forth above, this Agency may elect, in its sole and
absolute discretion, to terminate this Agreement by serving written notice of such
termination, referencing this section, on the Developer. The approvals to be issued by the
Agency Executive Director under this subsection only relate to the continuance,
suspension or termination of the term of this Agreement and in no way bind or constitute
the approval of the Agency regarding, without limitation, plans, specification,
engineering, architecture, uses, tenants, sale prices, rental rates, the Project or the
Property DDA.
e. This Agreement shall automatically terminate, without further
notice or action, and be of no further force or effect at the end of the sixth (6th) month
following the Effective Date, unless prior to that time:
(I) the parties execute the Property DDA for a specific
program of disposition and redevelopment of the Property
to be undertaken by the Developer, other relevant
community redevelopment covenants acceptable to the
Agency and such other terms and conditions mutually
acceptable to the parties, in which case this Agreement will
terminate on the effective date of the Property DDA; or
(2) the parties each agree to extend the term ofthis Agreement
to a specific date, subject to the Agency first making a
finding that satisfactory progress is being made to complete
the activities to be performed by the Developer set forth in
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SB2001 :38405.1
Section 2, as determined in the sole and absolute discretion
of the Agency Executive Director; or
(3) the Agency terminates this Agreement under subsection d,
above.
h. The initial term of this Agreement (and all extensions of time
approved by the Agency) is referred to in this Agreement as the "Negotiation Period".
3. The Proiect. The Developer shall take all reasonable actions required or
necessary for determining the feasibility ofthe redevelopment ofthe Property for the
development of commercial and industrial uses on the Property and development of a
specific description of such uses in the form of a single master development plan, at the
Developer's sole cost and expense (the "Project").
4. Obligations ofthe Developer. During the Negotiation Period, the
Developer shall proceed diligently and in good faith to:
a. Review and provide legitimate comments on draft versions of the
Property DDA and, if acceptable to the Developer, submit an executed copy of the final
form of the Property DDA to the Agency Executive Director by a date no later than six
(6) months following the Effective Date (or such later date corresponding to an
authorized extension of the Negotiation Period).
b. Keep the Agency advised on the progress of the Developer in
completing its obligations under this Agreement, on a regular basis or as requested by
Agency staff.
c. Pay all fees and expenses for engineers, architects, financial
consultants, attorneys, planning and other consultants and contractors as required for the
Developer to perform the Developer's obligations under this Agreement. The Agency
shall not be obligated to payor reimburse any costs or fees incurred by the Developer to
perform the Developer's obligations under this Agreement, whether or not this
Agreement is terminated early or extended through its potential term.
5. AgencvNot To Negotiate With Others.
a. The Agency, currently, deems the disposition and redevelopment
of the Property to be necessary and the Developer appears to be well qualified to
undertake the task of planning the details of the sale of the Property by the Agency to the
Developer and the redevelopment ofthe Project on the Property in a manner compatible
with the objectives of the Agency's Central City South Redevelopment Plan.
b. During the Negotiation Period, the Agency shall not negotiate with
any other person or entity regarding either the disposition ofthe Property or the
redevelopment of the Project on the Property. The term "negotiate", as used herein, shall
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882001,38405.1
be deemed to preclude the Agency from accepting any other offer or proposal from a
third party to either acquire any interest in the Property (in whole or in part) or redevelop
the Property, and from discussing other redevelopment proposals for the Property with
third persons or entities; provided, however, any person may submit and the Agency may
consider any proposal for the disposition and/or redevelopment of any lands adjacent to
the Property.
c. Notwithstanding any other provision ofthis Agreement, during the
Negotiation Period, the Agency shall not be precluded from furnishing to persons or
entities umelated to the Developer information in the possession of the Agency relating
to the redevelopment of any other land owned or controlled by the Agency in close
proximity to the Property and related to the implementation of the Central City South
Redevelopment Plan. Implementation of the Central City South Redevelopment Plan
shall remain in the sole and exclusive purview of the Agency. The Agency may also
provide any other information in its possession that would customarily be furnished to
persons requesting information from the Agency concerning its activities, goals, and
matters of a similar nature or as required by law to be disclosed, upon request.
6. Agencv Cooperation. During the Negotiation Period, the Agency shall use
its best efforts to:
a. Assemble, at the request and sole expense of the Developer,
written materials and documents relating to the Property that are in the possession of the
Agency. The Agency shall also provide appropriate comment to the Developer with
respect to one or more conceptual development plans, as may be proposed by the
Developer for the Project, and the redevelopment of the Property, including, but not
limited to, conceptual plans or studies of vacation, realigmnent or abandonment of public
property and facilities, the installation and improvement of public improvements and
environmental evaluation of the Project.
b. Provide the Developer with limited access to the Property, during
the Negotiation Period, for the purpose of conducting customary due diligence
investigations thereon, including environmental investigations of the subsurface or any
structure thereon, subject to the terms and conditions of a separate environmental
investigation and inspection license agreement to be agreed upon by the Agency and the
Developer, at some later date, if applicable.
7. Negotiation of Pro pert v DDA. During the Negotiation Period, the Agency
and the Developer shall negotiate diligently and in good faith to prepare and enter into
the Property DDA. Both of the parties shall exercise best efforts to complete discussions
relating to the final terms and conditions ofthe Property DDA and such other matters, as
may be mutually acceptable to the parties for the redevelopment of the Project on the
Property, prior to the expiration of the Negotiation Period.
8. Consideration for this Agreement and Reservation of Rights. In
consideration for the Agency's entering into this Agreement, the Developer will
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undertake its obligations under this Agreement and provide the Agency with copies of all
studies and reports and other information generated by the Developer or its consultants
regarding the Project or the Property. The parties agree that, if this Agreement terminates
for any reason, the Agency fails to extend the Negotiation Period, or the Property DDA is
not finally approved by the Agency, for any reason, neither party shall be under any
further obligation to the other regarding the disposition, acquisition, reuse, redevelopment
or development of the Project or the Property.
9. Planning and Design - Related Acknowledgments of the Parties. Certain
development standards and design controls for the Project may be established between
the Developer and the Agency in negotiation of or in the final form of the Property DDA,
but it is understood by both parties that the Project and the redevelopment of the Property
must conform to City of San Bernardino development, design and architectural standards.
The Agency shall fully cooperate with the Developer's professional associates in
providing information and assistance in connection with the Developer's preparation of
drawings, plans and specifications. Nothing in this Agreement shall be considered
approval of any plans or specifications for the Project or the Project itself by either the
Agency or the City.
10. Developer Financial Disclosures. The Developer acknowledges that it
may be requested to make certain confidential financial disclosures to the Agency, its
staff or legal counsel, as part of the financial due diligence investigations of the Agency
relating to the potential disposition of the Property to the Developer. The parties
recognize that such financial disclosures may contain sensitive information relating to
other business transactions of the Developer, that the disclosure of such information to
third parties could impose commercially unreasonable and/or anti-competitive burdens on
the Developer and, correspondingly, diminish the value or fiscal benefit that may accrue
to the Agency upon the disposition of the Property to the Developer, if terms for such
disposition are mutually agreed upon. Accordingly, the Agency agrees to maintain the
confidentiality of any business records described in Government Code Section 6254.15,
as may be provided by the Developer to the Agency or its consultants, to the maximum
extent permitted by law. The Agency shall not provide a copy of any business record
protected from disclosure under Government Code Section 6254.15 to a third party,
unless the Developer first consents to such disclosure in writing or, unless a court of
competent jurisdiction compels disclosure.
11. Developer Acquires No Interest in Real Propertv or in the Propertv from
the Agencv. The Developer hereby acknowledges that it has not acquired and will not
acquire, by virtue of the terms of this Agreement, any legal or equitable interest in real or
personal property from the Agency.
12. Nondiscrimination. The Developer shall not discriminate against nor
segregate any person or group of persons on account ofrace, color, creed, religion, sex,
marital status, handicap, national origin or ancestry in undertaking its obligations under
this Agreement.
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13. Compliance with Law. The Developer acknowledges that the Property
DDA, if mutually agreeable terms are established, is likely to require the Developer
(among other things) to carry out the construction of certain improvements in conformity
with all applicable laws, including all applicable planning and zoning laws,
environmental planning and safety laws and federal and state labor and wage laws.
14. Required Approvals. No Property DDA between the parties shall have
any force or effect nor shall the Agency be deemed to be a party to any agreement for the
disposition of real or personal property to the Developer, until the terms and conditions of
the Property DDA are considered and approved by the governing body of the Agency,
following the conclusion of a public hearing, as required by law.
15. Press Releases. The Developer agrees to discuss any press releases it may
propose relating to the Property with the Agency Executive Director or hislher designee,
prior to publication, to assure accuracy and consistency of the information.
16. Notices. All notices required hereunder shall be presented in person or
delivered by a nationally recognized overnight courier or shall be sent by FAX or by first
class United States mail, postage prepaid, return receipt requested. Each such notice shall
be deemed received and effective (i) ifby personal delivery or delivery by overnight
courier, upon such delivery; (ii) if given by FAX, when such FAX is transmitted to the
FAX number specified below; and (iii) if given by mail, 72 hours after deposit thereof in
the United States mail addressed as set forth below. Either party may change its address
for receipt of notice by notifying the other party in writing.
TO DEVELOPER:
Essex Realty Management, Inc.
Attn: Burrell Magnusson
Telephone: (714) 540-5188
FAX: (714) 540-3741
TO AGENCY:
Redevelopment Agency ofthe
City of San Bernardino
201 North "E" Street, Suite 301
San Bernardino, California 92401
Attn: Gary Van Osdel, Executive Director
Telephone: (909) 663-1044
FAX: (909) 888-9413
17. Acceptance of Agreement bv the Developer. The Developer shall
acknowledge its acceptance of this Agreement by delivering two (2) counterpart executed
copies of this Agreement signed by at least two (2) authorized officers of the Developer,
on or before the seventh (7th) calendar day following the approval of this Agreement by
the governing body ofthe Agency.
8
SB200138405.1
18. Authoritv. Each signatory to this Agreement represents and warrants that
he or she has the authority to execute this Agreement on behalf of the principal whom he
or she purports to represent.
19. Disputes. If a dispute arises between the parties to this Agreement, the
parties hereto agree to use the following procedure to resolve such dispute, prior to
pursuing other legal remedies:
a. A meeting shall be held promptly between the parties that will be
attended by executive-level individuals representing each of the parties hereto, who will
attempt in good faith to negotiate a resolution of the dispute.
b. If the parties are unsuccessful in resolving the dispute under
subsection a, above, they may:
(1) agree to submit the matter to mediation or binding arbitration or a private
adjudicator (if both the Developer and the Agency so
agree); or
(2) initiate litigation upon forty five (45) days prior written notice to the other
party.
c. If any party should bring an action against the other(s) to enforce
the terms of this Agreement, the prevailing party shall be entitled to recover its
reasonable attorneys' fees and costs, as determined by a court of competent jurisdiction in
said proceeding. The costs, salary and expenses of the City Attorney and members of his
Office in enforcing this Agreement on behalf of the Agency shall be considered as
"attorney's fees" for the purpose of the paragraph.
20. Default. If a party fails to fulfill any material obligation of this
Agreement, the other party may give written notice to that party of such failure and, if
that party fails to remedy such failure within ten (10) calendar days of receipt of such
notice, the notifying party may terminate this Agreement by a second written notice
and/or pursue whatever other legal or equitable remedies are available.
21. Governing Law: Venue. The parties hereto acknowledge that this
Agreement has been negotiated and entered into in California. The parties hereto
expressly agree that this Agreement shall be governed by, interpreted under, and
construed and enforced in accordance with the laws of the State of California. Further,
the parties to this Agreement hereby agree that any legal actions arising from this
Agreement shall be filed in California Superior Court, in the Court of San Bernardino,
Central District.
22. Partial Invaliditv. If any term, provision or portion of this Agreement or
the application thereof to any person or circumstance shall, to any extent, be invalid or
unenforceable, the remainder of this Agreement, or the application of such term or
provision or portion thereof to persons or circumstances other than those as to which it is
9
S8200 I :38405.1
held invalid or unenforceable, shall not be affected thereby, and each such term and
provision of this Agreement shall be valid and enforced to the fullest extent permitted by
law.
23. No Intent to Create Third Partv Beneficiaries. The parties intend that the
rights and obligations under this Agreement shall benefit and burden only the parties
hereto, and do not intend to create any rights in, or right of action to or for the use or
benefit of any third party, including any governmental agency, who is not one of the
parties to this Agreement.
24. Waivers. No waiver of any breach of any covenant or provision herein
contained shall be deemed a waiver of any preceding or succeeding breach thereof, or of
any other covenant or provision herein contained. No extension of the time for
performance of any obligation or act to be performed herein shall not be deemed to be an
extension of the time for performance of any other obligation or act to be performed
under this Agreement.
25. Entire Agreement. This Agreement (including all Exhibits attached
hereto) is the final expression of, and contains the entire agreement between, the parties
with respect to the subject matter hereof and supersedes all prior understandings with
respect thereto. This Agreement may not be modified, changed, supplemented or
terminated, nor may any obligations hereunder be waived, except by written instrument
signed by the party to be charged or by its agent duly authorized in writing or as
otherwise expressly permitted herein. This Agreement may be executed in one or more
counterparts, each of which shall be an original, and all of which together shall constitute
a single instrument.
26. Time of Essence. Time is strictly ofthe essence with respect to each and
every term, condition, obligation and provision hereof and that failure to timely perform
any of the terms, conditions, obligations or provisions hereof by either party shall
constitute a material breach of and a non-curable (but waivable) default under this
Agreement by the party so failing to perform.
27. Construction. Headings at the beginning of each section, paragraph and
subparagraph are solely for the convenience of the parties and are not a part of this
Agreement. Whenever required by the context of this Agreement, the singular shall
include the plural and the masculine shall include the feminine and vice versa. This
Agreement shall not be construed as ifit had been prepared by one of the parties, but
rather as ifboth parties had prepared the same. Unless otherwise indicated, all references
to sections are to this Agreement. All exhibits referred to in this Agreement are attached
hereto and incorporated herein by this reference.
10
S8200 1:38405.1
IN WITNESS WHEREOF, Essex Realty Management, Inc. and the
Redevelopment Agency of the City of San Bernardino execute this Exclusive Right to
Negotiate for Property Acquisition and Redevelopment Assistance on the dates indicated
next to each ofthe signatures of their authorized representatives as appear below.
DEVELOPER
Essex Realty Management, Inc.,
a California corporation
Dated:
By:
Burrell Magnusson
Its
AGENCY
Redevelopment Agency ofthe
City of San Bernardino
Date:
By:
Gary Van Osdel
Executive Director
APPROVED AS TO FORM:
Agency Special Counsel
11
SB2001:38405.1
EXHIBIT "A"
Legal Description of the Property
12
SB2001 :38405.1
.
"
** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT **
RESOLUTION AGENDA ITEM TRACKING FORM
Meeting Date (Date Adopted): d -A ~6 J. Item #
Vote: Ayes I~S.I <5 - 'I Nays h
Change to motion to amend original documents:
~-Yl
Abstain
Reso. # On Attachments: ~ Contract term: ~
Note on Resolution of Attachment stored separately: -=--
Direct City Clerk to (circle I): PUBLISH, POST, RECORD W/COUNTY
Date Sent to Mayor: ;) -G,~O ::J-
Date of Mayor's Signature: c9- "'-0.;2.
Date ofClerk/CDC Signature: :> .'(" - '-';)...
Date Memo/Letter Sent for Signature:
60 Day Reminder Letter Sent on 30th day:
90 Day Reminder Letter Sent on 45th day:
See Attached:
See Attached:
See Attached:
Request for Council Action & Staff Report Attached:
Updated Prior Resolutions (Other Than Below):
Updated CITY Personnel Folders (6413, 6429, 6433, 10584, 10585, 12634):
Updated CDC Personnel Folders (5557):
Updated Traffic Folders (~85, 8234,655,92-389):
Copies Distribnted to:
City Attorney Code Compliance
Dev. Services
Parks & Rec.
Police
Public Services
. Water
Notes:
Resolution # err 12m2 - g
,
.4 Absent 4
NulINoid After: Cic Oil '1" } '1- '" -0 ;)
,
By: -
Reso, Log Updated: V
Seal Impressed: ~
Date Returned: ;; -.;l.;). '0 :L
Yes 1 No By
Yes No --L... By
Yes No -L By
Yes No / By
Yes No/
EDA ~
MIS
Finance
Others:
BEFORE FILING. REVIEW FORM TO ENSURE ANY NOTATIONS MADE HERE ARE TRANSFERRED TO THE
YEARLY RESOLUTION CHRONOLOGICAL LOG FOR FUTURE REFERENCE (Contract Term, etc.)
Ready to File: {"'rrf
Date: ,} -oj J - -(J~
Revised 01/12/01