MOTION NO. M Beacon Hill Station TOD Property Final Transaction Agreements PROPOSED ACTION
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1 MOTION NO. M Beacn Hill Statin TOD Prperty Final Transactin Agreements MEETING: DATE: TYPE OF ACTION: STAFF CONTACT: Bard 12/20/2018 Final Actin Dn Billen, Executive Directr, PEPD Brke Belman, Directr f Land Use and Develpment Thatcher Imbden, TOD Manager Edward Butterfield, Senir TOD Prject Manager PROPOSED ACTION (1) Declares that an apprximately 2,256 square ft parcel wned by Sund Transit adjacent t the Beacn Hill Link Statin facilities at apprximately 17th Avenue and Lander Street in Seattle is suitable fr develpment as husing; (2) apprves the key business terms f a Purchase and Sale Agreement with Pacific Husing Nrthwest, LLC fr the sale f the Purchase Parcel, which will be cmbined with the Develper s adjacent 6,431 square ft parcel t facilitate a mixed-use transit riented develpment; and (3) delegates t the chief executive fficer the authrity t execute and subsequently amend as necessary a Purchase and Sale Agreement and assciated dcuments, all subject t the Bard-apprved key business terms. KEY FEATURES SUMMARY This actin declares that a parcel wned by Sund Transit adjacent t the Beacn Hill Link Statin is suitable fr develpment as husing and apprves key business terms with Pacific Husing Nrthwest, LLC (the Develper ). Sund Transit received an unslicited prpsal in August 2017 thrugh Sund Transit s unslicited prpsal prcess, as gverned by the agency s Prcurement and Cntract Administratin Manual, frm the Develper t acquire the parcel at apprximately 17th Avenue and Lander Street in Seattle (the Purchase Parcel ). After a frmal evaluatin f the Develper s prpsal and qualificatins by a Sund Transit interagency panel, Sund Transit advertised the receipt f the unslicited prpsal and ffered the pprtunity fr ther prpsals t be submitted, with pririty given t any prpsals frm Qualified Entities (nn-prfit develpers, husing authrities r lcal jurisdictins) fr develpment as affrdable husing. N frmal respnses were received expressing interest in the Purchase Parcel fr affrdable husing. Sund Transit determined the Purchase Parcel is nt required fr the peratins f the Beacn Hill Link Statin and has n future prject purpses and cmpleted the unslicited bid prpsal prcess. Sund Transit and the Develper will enter int a Purchase and Sale Agreement with the fllwing key business terms: Sale Price: $260,000, which is the appraised fair market value f the Purchase Parcel. Reserved Tunnel Easement: Sund Transit will reserve an easement fr its Link light rail tunnel running underneath the Purchase Parcel. Imprvements t Alley/Parking Stalls: Sund Transit may request that the Develper pave an existing alley and parking stalls serving Sund Transit s Beacn Hill Link
2 Statin facilities. If this ccurs, a prtin f the sale price will be held in escrw, t be released t the Develper upn acceptance f imprvements by Sund Transit. N-Build, Access, and Related Easements: Sund Transit will grant the Develper tw N-Build easements, an access easement, and related easements n prtins f Sund Transit s retained prperty t ptimize use and functinality f the retained prperty and t cmply with Seattle City Cde requirements. The preliminary TOD Prject cncept will evlve as the Develper advances the cncept t reflect mre detailed design cnsideratins, alignment with financing requirements, nnhusing space market cnsideratins, and ther custmary prject refinements. Sund Transit and the Develper are engaging in a multi-phase design and develpment review prcess t ensure the interface between the Beacn Hill Link Statin and the TOD Prject are cmplimentary and that Sund Transit is able t maintain its facilities and maintain the safety f its custmers. The transactin is structured as a fee simple sale that is subject t cvenants fr transit peratin and transit-riented develpment. Sund Transit will reserve a tunnel easement fr the prtin f its Link light rail tunnel under the Purchase Parcel. Fllwing apprval f this actin, Sund Transit will seek frmal apprval frm the Federal Transit Administratin (FTA) n the dispsitin prir t executing the Purchase and Sale Agreement. N further Bard actin is anticipated. Assuming apprval frm the FTA, cnstructin f the prpsed TOD Prject is planned t begin in July 2019 with cmpletin in September BACKGROUND Sund Transit adpted a TOD Prgram Strategic Plan in 2010, and adpted a TOD Plicy in December 2012 thrugh Reslutin N. R Sund Transit updated its TOD strategic plan in 2014 t reflect the 2012 TOD Plicy. The plicy and strategic plan prvided the fundatin fr hw the agency apprached integrating transit infrastructure and lcal and reginal land use develpment. In 2015, the state legislature amended the agency s enabling legislatin, directing the agency t advance equitable TOD gals, setting frth specific financial and prcedural requirements, and giving new tls t the agency t advance equitable develpment thrugh priritizing affrdable husing in surplus prperty dispsitin. Thse statute changes tk effect upn the Nvember 2016 vter-apprved Sund Transit 3 (ST3) Reginal Transit System Plan. Sund Transit adpted an Equitable TOD Plicy in April 2018 thrugh Reslutin N. R , which superseded the previus TOD Plicy. This actin is cnsistent with R Prperty The Purchase Parcel cnsists f an apprximately 2,256 square feet and is part f a larger Sund Transit parcel at 17th Avenue and Lander Street with a ttal parcel size f apprximately 7,975 square feet. The larger parcel was btained as part f the Central Link Extensin prject in 2003 fr the Beacn Hill Link Statin and cnstructin staging. The larger parcel nw includes facilities that supprt the adjacent Beacn Hill Link Statin, including a head huse and emergency vent shaft. The remaining balance f the larger parcel, nt utilized fr statin facilities, was left unimprved upn cmpletin f cnstructin f the Beacn Hill Link Statin. The Purchase Parcel encmpasses the unimprved sectin f the larger Sund Transit parcel. Mtin N. M Page 2 f 5 Staff Reprt
3 Sund Transit and the Develper have applied fr a Lt Bundary Adjustment with the City f Seattle Department f Cnstructin and Inspectins t segregate the Purchase Parcel frm the larger Sund Transit parcel and t annex it t the Develper s adjacent parcel. Once apprved, the Lt Bundary Adjustment will nt be recrded unless and until the parties clse n the prperty transactin. The CEO has declared the Purchase Parcel t be surplus prperty, and a reslutin apprving that declaratin was apprved by the Capital Cmmittee at its December 13, 2018 meeting (R ). Suitability fr Husing RCW directs the agency t determine whether surplus prperty is suitable fr develpment as husing. Staff cmpleted an evaluatin and recmmend that the Purchase Parcel is suitable fr develpment as husing. The fllwing summarizes the suitability findings: Threshld evaluatin cnsideratins: Husing is a permitted use within the Purchase Parcel s zning district; The size and shape f the Purchase Parcel meet the zning cde s minimum requirement fr cnstructing husing; and The knwn envirnmental cnditins f the Purchase Parcel are nt expected t act as a barrier t cnstructing husing. Other evaluatin cnsideratins: Lcal land use plans supprt husing n the Purchase Parcel; The size and lcatin f the Purchase Parcel are less cnducive fr ther uses; and There is a real estate market fr husing in the lcal trade area. Transactin Agreements The key business terms negtiated as a part f the Purchase and Sale Agreement include the fllwing: Categry Agreement Sale price Unpaved alley and parking imprvements Sustainability Reserved Tunnel Easement Develpment Prgram $260,000, which is the appraised fair market value There is an unpaved alley with adjacent parking stalls between the Beacn Hill Link Statin and the Purchase Parcel that is used by Sund Transit maintenance and peratins vehicles. Sund Transit may request the Develper t pave the Sund Transit prtin f the alley and parking stalls when it paves the Develper s prtin ff the alley. Shuld Sund Transit elect t have the Develper pave Sund Transit s prtin f the unpaved areas, a hldback agreement will be used t escrw a prtin f the purchase price at clsing, t be released back t the Develper nce the imprvements have been made and accepted by Sund Transit. An Independent Cst Estimate prepared by Sund Transit estimates the value f the imprvements at apprximately $43,302. The TOD Prject shall be designed t meet r exceed the Leadership in Energy and Envirnmental Design (LEED) Silver standard. Sund Transit will reserve an easement fr its Link light rail tunnel running underneath the Purchase Parcel. The Develper will cnstruct a minimum f 125 residential units. Mtin N. M Page 3 f 5 Staff Reprt
4 N-Build, Access, and Related Easements Sund Transit will grant the Develper tw permanent N Build easements n Sund Transit-wned adjacent parcels t meet setback requirements in the Seattle City Cde. The larger N Build easement will be n the nrth and east sides f the Purchase Parcel and cnsists f apprximately 1,302 square feet. The smaller N Build easement cnsists f apprximately 378 square feet and is lcated directly east f the Beacn Hill Link Statin. Sund Transit will grant a permanent access easement and related easements t access the Purchase Parcel frm Lander Street and the adjacent alley and t ptimize use and functinality f the retained prperty. Federal Interest The Purchase Parcel was acquired in part with FTA funding with FTA interest at percent. Fllwing apprval f this actin, Sund Transit will fllw FTA s dispsitin prcedures and will btain frmal FTA apprval prir t executing the Purchase and Sale Agreement. Future Bard Invlvement N further Bard actin is anticipated relating t the Purchase Parcel r the TOD Prject. Any material changes t the key business terms will be brught t the Bard fr apprval. PROCUREMENT INFORMATION Sund Transit received an unslicited prpsal in August 2017 frm the Develper t buy the Purchase Parcel t incrprate it int the Develper s TOD Prject n the adjacent lt. The prpsed develpment scpe encmpasses the cnstructin f tw separate buildings with grund level retail and a cmbined 136 residential units. Sund Transit can receive unslicited prpsals fr the purchase r lease f Sund Transit prperty as part f Sund Transit s apprved Unslicited Prpsal Plicy and Prcedures. After a frmal evaluatin f the Develper s prpsal and qualificatins, Sund Transit advertised the receipt f the unslicited prpsal and ffered the pprtunity fr ther prpsals t be submitted, with pririty given t any prpsals frm Qualified Entities (nn-prfit develpers, husing authrities r lcal jurisdictins) fr develpment as affrdable husing, per RCW N respnses were received frm Qualified Entities expressing interest in the prperty fr affrdable husing. The cnclusin f the unslicited prpsal review prcess was authrizatin frm the Sund Transit s CEO t have staff negtiate the terms and cnditins fr a purchase and sale agreement between Sund Transit and the Develper subject t final apprval by the Sund Transit Bard and FTA. Sund Transit issued a Predictive Cntrl Letter t the Develper in February 2018, allwing the Develper t begin the permitting prcess with the City f Seattle at the Develper s risk. FISCAL INFORMATION The current fair market value f the Purchase Parcel is $260,000 fr unrestricted use. Mtin N. M Page 4 f 5 Staff Reprt
5 PUBLIC INVOLVEMENT Staff has crdinated with the Develper n public utreach effrts including Early Design Guidance meetings with the City f Seattle and cmmunity members n the TOD Prject. TIME CONSTRAINTS A ne mnth delay wuld nt create a significant impact n the TOD Prject s timeline. PRIOR BOARD/COMMITTEE ACTIONS Reslutin N. R : Apprved the CEO s declaratin that certain real prperty acquired fr the Central Link Extensin light rail prject is surplus and is n lnger needed fr a transit purpse. ENVIRONMENTAL REVIEW KH 12/10/18 LEGAL REVIEW NM 12/14/18 Mtin N. M Page 5 f 5 Staff Reprt
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