J-14 STAFF REPORT MEETING 922 Machin Avenue DATE: January 15, 2019 Novato, CA 94945 (415) 899-8900 FAX (415) 899-8213 TO: City Council www.novato.org FROM: Scott Ward, Director of Hamilton Base Reuse Peggy Flynn, Assistant City Manager SUBJECT: CONSIDERATION AND RECEIPT OF PUBLIC INPUT ON PROPOSALS RECEIVED IN RESPONSE TO THE REQUEST FOR PROPOSALS RELATED TO THE CITY-OWNED HAMILTON COMMISSARY SITE AT 802 STATE ACCESS ROAD, APN 157-970-03, AND CHRISTMAS TREE HILL, APN 157-720-02, AND CONSIDERATION OF DIRECTION TO STAFF TO EXECUTE AN EXCLUSIVE RIGHT TO NEGOTIATE WITH ONE TEAM. ______________________________________________________________________________ REQUEST Consider and receive public input on proposals received in response to the request for proposals related to the city-owned Hamilton commissary site at 802 state access road, APN 157-970-03, and Christmas Tree Hill, APN 157-720-02, and direct staff to execute an exclusive right to negotiate with one team, approved as to form and content by the City Attorney and City Manager. DISCUSSION Per direction from City Council provided on February 27, 2018, Staff issued a Request for Proposals (“RFP”) for the Hamilton Commissary and Christmas Tree Hill Parcels (APNs 157-970-03 & 157-720-02, respectively) on May 15, 2018 and began evaluating proposals received on August 13, 2018. Four proposals were received and made available to the Hamilton community at a workshop in the Hamilton Community Center on October 13, 2018. At this workshop, the attendees were given access to the proposals as well as summary presentation boards provided by each proposer. Attendees were also encouraged to provide written input on each of the proposals. An online survey was also created that also provided access to each of the proposals and gave participants the opportunity to comment. An invitation to participate in this survey was broadly distributed via the City’s communication channels. Each proposal and the feedback received from the online survey and workshop are described in the attached exhibits. All four proposals were then presented by each of the proposing teams in an open session of the City Council on October 30, 2018. During this meeting, Council directed staff to schedule a second public meeting to again present and review the City Ventures and EAH proposals. Each Proposer will present their proposal to Council, followed by a question and answer period in order to fully communicate their proposal to the Council and the community. The City will also take public comment on the proposals. cc19-004 1 At the time of the writing of this staff report, the key components of the proposals are as identified below, however these may be subject to change as the proposers refine their submittals prior to the City Council meeting. Proposals: 1. Proposer: City Ventures, LLC – City Ventures is a Los Angeles based privately held real estate developer and builder specializing in residential development. They currently own and control over 8,000 lots in California. https://www.cityventures.com/ a. Use: ~3 acres of residential townhomes + 1-acre community park, estimated 81 units to be constructed, 20% affordable b. Disposition: Purchase/Sale c. Payment: $6,156,000 d. Completeness: Proposer has provided documentation that satisfies the RFP requirements. 2. Proposer: EAH Housing – EAH is a 501(c)(3) nonprofit public benefit corporation established in 1968 and specializing in the development and management of affordable and mixed income housing. They manage over 100 properties in California and Hawaii. http://www.eahhousing.org/ a. Use: 124 rental units. 20% affordable (low and very low income), 80% “Workforce” (below 130% area median income) offered to public employees on a first preference basis. b. Disposition: 50-year ground lease c. Payment: 20% of residual receipts (cash net of expenses). Their proposal indicates an estimated Net Present Value to the City of approximately $23M d. Completeness: Proposer has provided documentation that satisfies the RFP requirements. FISCAL IMPACT Each proposal has the potential to bring needed housing for our community and revenue for Citywide services and community amenities. PUBLIC OUTREACH As mentioned above, extensive public outreach was conducted over the course of this project. In September and October 2018, e-notifications from the City’s website reaching over 1,600 individuals. Notifications were also posted on Facebook which has a following of 4,276; the information was also posted on Facebook pages managed by Sustainability, Public Works and Parks, Recreation and Community Services which dramatically increased our reach. NextDoor has also proven effective in reaching the community and two posts on NextDoor reached nearly 20,000 people each time information was posted. Throughout the project, the website established for the RFP has been updated as new information was received. To note, www.novato.org/hamiltonrfp was the second most popular page on our website the week the information was posted for the Open House. The full proposals were posted on the website for those who were unable to attend the Open House. An Open Novato survey was opened on Wednesday, October 10, 2018 for those who were unable to attend the workshop. To date, 132 people have viewed the survey and 18 have responded which at 3 minutes per response, equates to nearly an hour of public comment. The public workshop included over 50 community members and members of the Novato City cc19-004 2 Council. Workshop attendees were given access to hard copies of the proposals as well as summary presentation boards provided by each proposer. Attendees were encouraged to ask clarifying questions of the staff, provide feedback on a paper survey that was then incorporated into the Open Novato survey and react to what they liked and what they thought was missing from each of the proposals. A document detailing their feedback is listed in Attachment 4 of this staff report. All four proposals submitted in response to the Hamilton Commissary RFP were also presented by their respective teams in an open Council Session on October 30, 2018. NEXT STEPS Following the Council’s selection of a team, staff will prepare an Exclusive Right to Negotiate agreement and after execution of said agreement, staff will negotiate the appropriate document (e.g. Purchase and Sale Agreement, Ground Lease, etc.) with the selected team. The negotiated document will be brought to Council in open session for approval. The project would then go through the City entitlement process as outlined in detail in the November 28, 2017 staff report. While proposers may elect to provide additional public outreach during this process, a minimum of five public workshops and hearings are mandated during which the Hamilton community can provide feedback. These would include one initial neighborhood meeting, a minimum of two hearings with the Design Review Commission, one with the Planning Commission and one City Council meeting to approve the entitlements. RECOMMENDATION Consider and receive public input on proposals received in response to the request for proposals related to the city-owned Hamilton commissary site at 802 state access road, APN 157-970-03, and Christmas Tree Hill, APN 157-720-02, and direct staff to execute an exclusive right to negotiate with one team, approved as to form and content by the City Attorney and City Manager. ATTACHMENTS 1. Commissary Request for Proposals 2. City Ventures Proposal 3. EAH Proposal 4. Workshop & Survey Feedback cc19-004 3 Attachment 1 J-14.1 REQUEST FOR PROPOSALS COMMISSARY PARCEL May 2018 4 EXECUTIVE SUMMARY Opportunity Buy or lease a 4.7 acre parcel in the historic Hamilton neighborhood of Novato. Location 802 State Access Road, Novato, CA, 94949. APN157-970-03. Preferred Uses Responders may propose any use compatible with the Hamilton neighborhood. Financial Requirements Fair market value, as evidenced by a preliminary residual land value analysis, and demonstrated financial capacity to complete the proposed redevelopment of the parcel. Selection Process Proposals will be evaluated based on their satisfaction of stated selection criteria and on community input. Complete proposals received by August 13, 2018 will be given first consideration. Proposals will be welcomed after that date until the property is successfully sold or leased. Conveyance The City will consider any conveyance, Proposals will be including purchase, ground lease or use agreement. evaluated based Initial Deposit Required Refundable earnest money deposit of $5,000 due at time of proposal submittal. on their satisfaction Additional Payment Required Additional $25,000 non-refundable of stated selection fee required for proposals selected for exclusive negotiations. Pre-Submittal Meeting & Site Tour The City will offer site criteria and on tours in June and July 2018. A schedule of tour dates will be posted on the City of Novato website. Additional relevant community input. information can be found at: novato.org/hamiltonrfp Contact The City of Novato, 922 Machin Avenue Novato, CA 94945, (415) 899-8900 [email protected] novato.org/hamiltonrfp REQUEST FOR PROPOSALS: Commissary Parcel — MAY 2018 5 1 OPPORTUNITY The City of Novato (“City”) is offering 4.7 acres of vacant land in the historic Hamilton Army Airfield for purchase, lease, or use agreement. The parcel on offer, also known as the “Commissary Parcel”, APN157-970-03, is located at 802 State Access Road and provides easy access to Highway 101 and ample nearby retail and recreation opportunities. The City encourages proposals for any use responders feel complements the Hamilton neighborhood. Optional Parcel: Responders may also include in their proposals the adjacent parcel also known as “Christmas Tree Hill” (APN157- 720-02). This 2.48-acre parcel contains a large rock outcropping, interposed between Highway 101 and the Commissary Parcel. Per the City’s Hillside Ordinance, the outcropping cannot be graded, however, the City is open to creative reuses of the site that will benefit the redeveloped Commissary Parcel and the community at large.