Recommendation to adopt Specifications No. RFP EP16-130 for the purchase and development opportunity at 200-232 Long Beach Boulevard, Assessor Parcel Numbers 7281-017-902, -903 and a portion of -900 (Subject Property); Declare the City-owned Subject Property as surplus; Authorize City Manager, or designee, to execute any and all necessary documents, including a Purchase and Sale Agreement with Broadway Block, LLC, a California limited liability company, or affiliate, for the sale of the Subject Property in the amount of $7,850,000; and Accept Categorical Exemption CE 16-159. (District 2)
Okay. Motion carries. Thank you. Item ten. Item ten. Item ten. A report from Economic and Property Development Services and Development Services. Recommendation to adopt specifications for the Purchase and Development Opportunity at 203 232 Long Beach Boulevard. Declare the city owned property as surplus and execute all necessary documents with broad Broadway block for the sale of the property in the amount of 7.8 million District two. Thank you. There's a moment in a second. Mr. West? Yes? I have a quick staff report. Our Economic and Property Development Director Mike Conway, and our Deputy City Attorney, Rich Anthony. Mayor Garcia, members of the city council, the city and the redevelopment agency were the owners of the entire Broadway block, bounded by Third Street on the North Broadway on the South Long Beach Boulevard on the West and Elm Avenue on the East. The block was aggregated into four sites site A, which includes acres of books and the vacant land to the north. Site B, the subject of tonight's agenda item, which includes the half block along Long Beach Boulevard, south of the acres of book site site C, which includes the art exchange building and the parking lot immediately to the south and site D, which includes the remainder of the half block along Elm Street Avenue to the south. Prior to the approval of Longridge Property Management Plan on October 21st, 2014, City Council authorized the sale of city owned land within site D to City Ventures for the development and construction of 40 residential units. After approval of the Long Range Property Management Plan on June eight and on June 23, 2015, successor agency authorized the sale of the remainder of Site D to City Ventures to complete its proposed residential project. On November 3rd, 2015, City Council authorized the sale of sites A and C to Reykjavik Properties for development of construction of a mixed use project and preservation and restoration of the art exchange on the acres of books buildings. The remaining property within the Broadway block is site B. Site B is categorized as future development in the long range property management plan, which was approved by the state on March 10th of 2015. Future development properties are disposed through a request for proposals process with selection based on best value to the city rather than on the highest purchase price. On April 8th, 2016, an RFP was released seeking proposals for a development concept. On site B, site B is a vacant lot containing 50,000 square feet and is being temporarily used as a parking lot. On June 17th, 2016, five proposals were received. A selection panel consisting of representatives from the Departments of Development, Services and Economic and Property Development and the city's real estate economics consultant Kaiser Marson Associates reviewed reviewed the five proposals and the five proposals offered a variety of development concepts, some of which were included partnering with Cal State University's Graduate School of Fine Arts and providing affordable housing to students and teachers along with creative office space and Programable outdoor courtyard space. The review panel preferred the development concept proposed by Broadway BLOCK LLC and recommended Broadway BLOCK LLC as the buyer of Site B. Broadway BLOCK LLC consists of the same entities that now control site A and site C, which are joined the subject property to the north and includes the acres of books building selecting Broadway BLOCK LLC as the buyer would result in a desirable assembly of a half a block of land promoting enhanced synergistic and thoughtful development opportunities. Land, assembly and preference to adjoining landowners are goals promoted in the long range property management plan. The development concept, proposed by the buyer for Site B, envisions a seven story structure containing 141 residential units, including studios , one bedrooms and two bedrooms. Additionally, the concept includes 12,285 square feet of commercial space, including 3200 square feet of multipurpose space for the university, 5200 square feet of retail space, and 3800 square feet of flex space. The concept also includes 6200 square feet of outdoor courtyard, networking and meeting space. The parking requirement for the development concept is 190 parking spaces, and the development concept assumes 10% of the units would be set aside as affordable. The buyer's development concept for Site B integrates with buyers development concept for its northerly adjoining property. Insight A The concept for a site A includes a 21 storey 234 unit market rate, residential tower and 21,459 square feet of commercial space, which includes repurposing the acres of books. Building the concept includes parcels and courtyards to connect site A and site B, further activating the public space and building on the synergy and energy of each site. And the parking requirement for this development concept is 321 parking spaces. The combined combined development concept for sites A and B envisions 375 residential units, of which 14 are set aside as affordable 5700 square feet of creative office space, 3800 square feet of flex space. 19,587 square feet of retail space. 6000 square feet of loft space. 1300 square feet of art exchange space and 3200 square feet of university space. The parking requirement for the combined concept is 511 parking spaces. The buyer's development concept identifies 524 parking spaces, which are 13 spaces more than what would be required by code as conceived. Onsite parking exceeds code required parking. The buyer proposes to purchase the property for $7,850,000, which is the highest price offered for the property. The development. Concept also identifies a total development cost of $154 million, which includes the adjoining site A, which is the highest development investment as well, together with the affordable component and the creative synergy achieved through assembly and joint development. The review panel believes the proposal submitted by Broadway BLOCK LLC offers the best value for the city after execution of a purchase and sale agreement. Due diligence is anticipated. Take 90 days. Entitlement and secret clearance is anticipated to take a year with close of escrow, not more than 18 months from the opening of escrow. After issuance of building permits, Buyer anticipates 24 months to complete project construction. And as these timelines are estimates, staff requests some flexibility for unanticipated delay delays. It is important to note that the project, as previously described, is a proposal only and that tonight's action does not in any way constitute city's approval or entitlement of the proposed project. Tonight's action does not commit the city to close the sale of the property until the Sequa process is completed, including the potential imposition of mitigation measures and alternative uses of the property. And with that staff request that City Council adopt specifications number RFP Pep 16 Dash 130 declared the city owned property has surplus authorized city manager and designee to execute all documents necessary with Broadway BLOCK LLC for the sale of the subject property and accept categorical exemption. CD 16 Dash 159 And this concludes my staff report. To Vice Mayor Lowenthal. Thank you, Mr. Mayor, and thank you, Mr. Conway. I wanted to thank you and the team for the time that you spent vetting this property and the right developer. This parcel is very near and dear to many of us in Long Beach, and it's important to sell to a developer that appreciates the need to include this creative space, the pedestrian nooks and outdoor activation in this mixed use property. I want to thank the team for giving me a walk through today of the art exchange process and the art exchange project for being extremely patient. Those of you who are involved in art exchange from the beginning, this dates back 16, 17 years of being very patient and diligent while we worked through this very long process. So while this may not be something that a lot of people remember, I know the original proponent, Steve Elicker especially, has been waiting for the city of Long Beach to be able to partner and bring this project forward of this type of a project for nearly 17 years. And so I want to thank you for that. The visit today was great. I can see the potential through all of what seems like it's broken in those buildings, in those adjacent buildings. But I know that there is something down the road that will be absolutely beautiful. So I'm happy to see this project moving forward and hope that my colleagues are, too. Thank you. Thank you. And there's a second by Councilman Gonzalez. Is there any councilman are you do you want to go any public comment on this project? Please come forward. If you're going to speak, you've got to get lined up right now and we're going to go to the vote. Larry, good to clear as the address, if this is. Such a fantastic project. I would think that you would have here an endorsement by the city auditor if if there is not one. May I suggest you postpone this until such time as that auditor is? The auditor makes their her professional analysis of it. Unless. Unless there's something you're trying to hide. A process, a project this long in the making and this long that it will. Certainly they're not going to break ground today or tomorrow or within the next month. The auditor should be able to come back and give you the report that you need and really should have. Thank you. Thank you. Next speaker, please. Hi. Good evening, counsel. My name is Jenna Kincaid. I'm a law student from UC Berkeley. I wasn't planning to speak tonight, but I saw this on the agenda. And I wanted to specifically ask the city attorney if you're aware of whether this complies with the California Surplus Land Act. This is a California statute that requires that any land owned by a city or government agency before being sold must first be offered to affordable housing developers for the purpose of affordable housing, as well as for the development of parks and other recreational spaces. This right here doesn't appear to comply with that. It looks like you went through an RFP process, but unless you specifically offered it to for affordable housing developers first. It would not comply with this act just given the turn around. I'm not sure if that was the case. And if not, like this is this would be an illegal landfill. So you're declaring it a surplus property. That means it falls within the scope of the act. And so the requirements of the act. I started off notes for you, but yeah. So first it's making, making these offers are going through this RFP process and then any developer, assuming that no affordable housing developer comes first and they are given priority. So if someone puts in a competitive an affordable housing plan, they should be given priority over any developer. And that's the developer that offers the most affordable units at the deepest level of affordability. If that's not the case, then you do sell it for market rate development. There's a requirement that 15% of any units developed for housing must be affordable to like low for low income housing. I'd like to see that presented here as part of this plan. If there are plans to do this that, you know, please share that. But by any means, that's like the catch. All right. That that's only if. An affordable housing developer hasn't already come forward with a plan. So, like, show me the plan. Show me the fix you sent to the affordable housing developers. This doesn't look like it complies with the Surplus Land Act. Thank you. Thank you. And we're going to go ahead and go to a vote. I don't know if you want to comment on that quickly. I'd be happy to comment. When the long range property management plan was approved by the state of California. All of the properties were processed through the Surplus Land Act to ensure that we would be able to proceed with these sales. Okay. Thank you. There's a motion and a second. Please cast your votes. Motion carries. Okay. Thank you. Next step is we're going to do item number, is it that was 16. So I could do item 16. We'll try to get through these as expeditiously as possible. And there's going to be a a motion that's ready to go here.