AB 5444 BUSINESS OF THE CITY COUNCIL July 17, 2018 CITY OF MERCER ISLAND, WA Study Session REVIEW RFQ CRITERIA FOR TRANSIT Action: Discussion Only COMMUTER PARKING AND A PUBLIC- Review proposed RFQ criteria and Action Needed: PRIVATE, MIXED-USE DEVELOPMENT selection process. Motion Ordinance PROJECT ON THE TULLY’S/PARCEL 12 Resolution SITE DEPARTMENT OF City Manager (Julie Underwood) COUNCIL LIAISON n/a EXHIBITS 1. Request For Qualifications (RFQ) - Mercer Island Commuter Parking & Town Center Mixed-Use Project 2018-2019 CITY COUNCIL GOAL 1. Prepare for Light Rail/Improve Mobility APPROVED BY CITY MANAGER AMOUNT OF EXPENDITURE $ n/a AMOUNT BUDGETED $ n/a APPROPRIATION REQUIRED $ n/a SUMMARY At its meeting on June 5, the City Council authorized the City Manager to execute a Purchase and Sale Agreement with the Parkway Management Group, et al. to acquire the former Tully’s property, located at 7810 SE 27th Street (see AB 5434). This property will be combined with a portion of adjacent land the City already owns at Sunset Highway, known as Parcel 12. These properties could be developed through a public-private partnership to build an underground, transit commuter parking facility and potential mixed-use development (see AB 5418). The April 2018 Citizen Survey (see AB 5440) showed that 59% of respondents were unsatisfied with the availability of commuter parking, and the majority of respondents selected commuter parking as their top transportation priority. This public-private partnership presents an opportunity to provide much-needed commuter parking in Town Center, while significantly reducing the City’s contribution of funds (other than the Sound Transit contribution) by utilizing City-owned land in a key geographic location near the future East Link light rail station. There will be many opportunities for the public to be informed and provide comment as Council considers each phase as a project develops. A public-private partnership agreement will be a future agenda item subject to Council approval. Also, any future project permit applications resulting from a public-private partnership will have additional opportunity for public engagement, including public comment through the permitting process, following Council authorization of the public-private partnership agreement. Page 1 FUTURE PARKING FACILITY REQUEST FOR QUALIFICATIONS (RFQ) The City plans to construct an underground, transit commuter parking facility with approximately 100 or more parking spaces, which is estimated in today’s construction dollars to cost approximately $85,000 per parking space. A draft Request for Qualifications (RFQ) has been developed to solicit and identify interested, experienced, and capable developers to form a public-private partnership (P3) whereby the City leverages its current land on Sunset Highway, future acquisition of the Tully’s property, and offers the development rights on these combined parcels to a private developer. Through a P3, the City’s goal is to reduce its cash contribution that would otherwise be required to support transit commuter parking construction costs in excess of the City’s land contribution and Sound Transit’s funding contribution. For example, the City contemplates owning the underground parking spaces to be built by a developer, and the developer would own and operate the above-ground, mixed-use development based on the City’s Town Center vision and regulations and public input. Note that a RFQ process differs from a Request for Proposals (RFP) process insofar as the substantial focus is on the qualifications of the potential developers, not on the developer’s detailed proposal or price. Following the selection of a developer, the City will then negotiate with that firm. Going forward, the City will be soliciting public input to encourage the highest and best use of the site and to provide much-needed, additional parking and to ensure the site, as developed, will be an integrated gateway connection between the City’s Town Center and the new light rail station’s east entrance off 80th Avenue SE. RFQ CRITERIA AND EVALUATION METHOD Staff is recommending the following criteria and evaluation method for the RFQ (see Exhibit 1, pages 12- 14): Team Qualifications/Experience Includes the team member’s experience and qualifications and example projects in which the team or key team members have been involved: • Demonstrate financial capacity of developer and development partners, including guarantors. • Describe the developer’s relevant project experience for up to three (3) current or recently completed projects (must illustrate developer’s experience with construction projects similar in scope and size), including any relevant experience redeveloping a contaminated site. Project Vision/Preliminary Concept Proposal Includes providing a concept or vision for the site, including details on parking, use mix, preliminary ideas on building scale and massing, and development cost and feasibility: • Approach to developing this project including all of its components (e.g. commuter parking, retail, residential, office) including the estimate of the approximate amount of square footage for each component and the number of stories anticipated. • Discussion of phasing and a general timeline for full build-out of the project. • A conceptual site plan showing the location of key project elements and preliminary building footprints. • Preliminary estimated number of commuter parking spaces. • Information about the respondent’s overall financial position, past history of raising capital, and potential resources available to complete this project. • Pedestrian circulation and access to the future light rail station and surrounding community. Page 2 Preferences Respondents demonstrate how their proposal will address each of the objectives below in their written and graphic materials: • Community Benefit – Projects that leverage limited public resources to achieve long-term measurable community benefits, significant levels of private sector investment and are based in the realities of the market. • Impactful Projects – Proposals that will have a lasting positive impact on nearby properties and the entire downtown, as well as considers how technological advances in transportation can be incorporated into the design. • High Quality Design – Proposals that are extraordinarily well designed, sensitive to the surrounding context and use timeless, durable and high-quality materials. • Timeliness – Projects that are positioned to move forward in the near term and commit to significant milestones. • Partnership – Respondents with a demonstrated capacity to partner with the City and a proven ability to develop high quality projects. Evaluation Method Evaluation of RFQ responses will be based upon the following (a total of 100 points are possible): 1. Team Qualifications and Experience (60 points possible): • Success in developing similar projects, including redeveloping contaminated sites. • Quality of representative projects. • Qualifications of project team and key project managers. • Financial capacity. • A track record of successful public-private development partnerships. • Meeting major project milestones on-schedule on similar projects. 2. Project Vision/Preliminary Concept Proposal and Preferences (40 points possible): • Degree to which the preliminary development concept proposal meets the RFQ requirements and preferences. • Preliminary estimate of commuter parking spaces provided. • Demonstrated market viability. It is worth noting that when the City Manager presented the proposed Comprehensive Plan Amendment and Rezone to the Planning Commission on June 20, 2018, the Commissioners provided helpful feedback for consideration in the RFQ. First, they were supportive of the Council actively planning and moving forward on a project to provide transit commuter parking (the more the better). Commissioners were also pleased with the location of the project. In fact, one Commissioner noted that the current Park & Ride facility is exactly 90 steps to the future station, and the Tully’s site is also 90 steps to the station. Moreover, additional feedback included: · Master plan the site with many opportunities for public input · Incorporate how the site will integrate and connect with the station, bus turn-around, the entire Town Center area, and the adjacent properties · Pay close attention to the egress and ingress of the parking garage · Consider workforce housing on the site · For parking specifically: ensure parking equity (e.g., working parents who have to use transit later due to childcare drop-off); how parking will change and/or can be converted in the future (e.g., more drop-off zones versus all-day parking, autonomous vehicles, etc.); integrate bike storage or other last-first mile solutions; provide predictability (e.g., consider a tech solution or app to reserve a parking spot); and provide free parking or have parity with Sound Transit parking lots. Page 3 SELECTION PROCESS For prospective partners to learn more about the proposed project and the City’s requirements, staff will be hosting two pre-submission conferences at the Tully’s/Parcel 12 site. Upon receipt of submissions, the following selection process is recommended: 1. Staff will evaluate each RFQ using the adopted criteria and will narrow the list of qualified developers to three or four. 2. These semi-finalists will be interviewed by staff and one will be recommended to the City Council. Staff would like to invite a Design Commission and Planning Commission member