COMMUNITY REDEVELOPMENT AGENCY Agenda Cover Memorandum

Transcription

1 Originating Department: Mayor/Admin (MA) Subject: COMMUNITY REDEVELOPMENT AGENCY Agenda Cover Memorandum Meeting Type: Regular Agenda Date: 06/05/2017 Advertised: Required?: Yes No CRA#: 1473 Presentation of three (3) concepts for the redevelopment of the Anchor Site in Northwood Village and confirmation of Staff's recommendations for project negotiations. Ordinance/Resolution: Staff Recommended Motion: Approve of staff's recommendation of TBCG Capital as the bidder will provide the best value to the CRA for the Anchor Site redevelopment project and direct staff to begin negotiations with TBCG Capital to develop Agreement(s) for the project which will be brought to the Board for final approval. Background: The Agency received three (3) proposals in response to ITN No (ITN), to redevelop the Anchor Site on the western end of Northwood Village on Agency-owned property. The proposers are Northwood Village Lofts, Housing Trust Group and TBCG Capital. On May 19, 2017, all three (3) proposers made presentations to a selection committee consisting of CRAAB board members Linda Casey and Earl Gardner, Jr. and CRA project manager Nguyen Tran. Each team had thirty minutes to present with fifteen minutes for project description and fifteen minutes for questions and answers from the committee. The evaluation criteria is found on pages of the ITN. CRA staffers Jon Ward and Allison Justice served as technical advisors to the committee and the session was administered by Josephine Grosch of the Procurement Department with an observer from the County Inspector General's office present to assure compliance. An executive summary of the three (3) proposals is attached below. (Staff will provide the complete application packages for all three (3) proposals to the Board under separate cover.) The selection committee ranked the three (3) proposals with TBCG Capital being favored as the distinct preference and recommendation of the committee. Staff agrees and supports the

2 AGENDA COVER MEMORANDUM Page 2 C.M. # Date: committee's recommendation and requests that the CRA Board confirm the recommendation of TBCG Capital as the bid provides the best value to the CRA and direct staff to begin negotiations with TBCG Capital to develop Agreement(s) for the project, which will be brought to the CRA Board for final approval. Fiscal Note Current Year: Annualized: Budgeted: Unbudgeted: Funding Source: Comment: Fiscal impact to be determined by the contract negotiations. Electronic Attachments: Click here for assistance with naming convention. > AnchorSite_Memo.doc Is this ACM related to a Grant/CRA? Yes No 05/25/2017 Finance Department/Grants Review Originating Department: Approved by: Jon Ward on 05/25/2017 No Fiscal Impact : City Attorney > CRA Executive Director 05/30/2017 City Attorney's Department 05/30/2017 CRA Executive Director

3 MEMORANDUM Date: May 24, 2017 To: From: Subject: Jon Ward, Executive Director Allison Justice, Senior Project Manager Nguyen Tran, Project Manager Executive Summary of Anchor Site Proposals Background: The West Palm Beach Community Redevelopment Agency ("CRA") issued an Invitation to Negotiate (ITN # ) for the purchase or lease and development of a CRA owned properties prominently located in the Northwood Village area of the City of West Palm Beach. The parcels, (commonly referred to as the Anchor Site ) have been assembled for the purpose of selecting a Developer to design and construct a mixed-use development of significant impact and prominence. The development will be a catalyst for additional development and will provide a central location for pedestrian activity and create a Village Square. The solicitation was due on April 12, 2007 with the receipt of three (3) Proposals. A Selection Committee was formed consisting of two members from the CRA Advisory Board and one CRA staff member to evaluate and rank the Proposals received. The Selection Committee met on Friday, May 19, 2017 where presentations were given by all three Proposers. The table below is a comparison summary of each development proposal. Dale Matteson Housing Trust Group TBCG Capital Group Team Members Number of Units Presenter: Dale Matteson Developer: Dale Matteson Architect: Stephen Boruff, AIA Contractor: Conkling & Lewis Dev. Analyst: Sean McKissick 30 Live/Work Units; 6 flats (Market Rate; Fee simple) Presenter: Matthew Rieger/Troy McGhee Developer: Housing Trust Group Dev. Consultant: Mosnar Group Architect: Torti Gallas & Partners Engineer: WGI Wantman Group Green Consultant: Abney&Abney 149 Affordable Residential Units Option to add 20 Market Rate Artist Lofts Presenter: Mario Caprini/Tony Brown Developer: TBCG Capital Group Architect: REG Architects Contractor: Kaufman Lynn Comm. Outreach: Mosaic Group Parking: Walker Parking Consult. Property Manager: Prestige 201 Mixed Income Units (Affordable and Market Rate) Use / Size For Sale 2,000 sq. ft. shells Entrances open to 21 ceilings Recessed 2 nd floor living space Rooftop access Rental Apartments 1/1-720 sq. ft. 2/2 1,080 sq. ft. 3/2 1,300 sq. ft. Bldg. A: 73 Micro Apartments, Office Tower & Retail. Bldg. B: 80 Market rate housing units consisting of 1, 2 & 3 bedrooms & Retail. Bldg. C: Office, Retail & Restaurant. Bldg. D: Townhomes, Apartment units & Retail. Bldg. E: 26 Workforce housing 1

4 units; 1 & 2 bedroom units; 600-1,200 sq. ft. Retail/Commercial 22,450 sq. ft. retail space 6,640 sq. ft. restaurant space 22,000 sq. ft. retail space 86,000 sq. ft. office 70,000 sq. ft. retail Open Space/public space Parking Stories 14,000 sq. ft. Civic Space for pedestrian activity; 10,000 sq. ft. of Public Art Space 4 level- 200 space garage 74 space surface parking 4 level parking garage 3 level residential buildings 2 Internal Courtyards 2 Pedestrian Plazas 2 Public Park space Park and Park Pavillion with water features for kids and outdoor movie theater screen; urban farm type grocery store 218 space garage 351 space garage (Bldg A) 209 space garage (Bldg B) 3 level parking garage 4 and 5 level residential buildings Project Cost $35.3 Million Option 1: $28.6 Million Option 2: $37.2 Million Option 3: $6.2 Million additional depending on which Option Financing Plan Project Terms Estimated Tax Increase 30% of project budget secured through private investment; Developer seeking Meridian Capital for construction loan. Land to be donated; City/CRA to underwrite the garage. 4% Low Income Housing Tax Credit or 9 % Low Income Housing Tax Credit Land Lease or Purchase of Land; $500,000 Guarantee land payment Capitalized payment up to 1,000,000 if Tax Credits return to $1.15/credit range. Bldg A: 8-story, 5 level parking Bldg B: 8-story, 4 level parking Bldg C: 2-story Bldg D: 4-story Bldg E: 3-story $70 Million $750,000/ year $119,000 / year $698,767/year Estimated Jobs 345 jobs 177 local jobs (112 construction/42 ongoing) New Markets Tax Credits 4% Low Income Housing Tax Credits, TIF Pledge & Construction/Perm Loan Land Lease for 99 $1.00/yr with option to purchase at Fair Market; Intend to purchase within 10 years. 295 construction jobs 652 permanent jobs Presentation/Project Summary: All three firms were allotted a total of 30 minutes each for presentations with questions and answers. Below is a synopsis of each presentation in the order of which they were presented: Team Matteson The project proposed is a low scale, low density, mixed use development containing 36 units of artist style lofts and 22,000 sq. ft. of retail/commercial space. It was described as a Village concept and the residential lofts will be sold at market rate. Design and function within the garage was very complimentary and well liked. Since the units will be sold as loft style units, to be occupied by artists, this portion of the development proposal will not likely become much of a destination. The garage may draw visitors to the area by virtue of its design and proposed shared use as an event space; however, the overall development may be the least impactful of the three proposals received. Developer requested that the land be donated and the City/CRA underwrite the Garage. Some questions were raised on the accuracy of the estimated TIF revenue for such a low density, low scale project. The response was that the $750,000/year estimate was based upon leasable square footage. With only 22,000 sq. ft. of retail/commercials space and a 6,640 sq. ft. of restaurant space, this figure seems very 2

5 inflated. Due to the low number of residential units, a question was raised on how much economic impact this development would have on the existing merchants in the Northwood Village area with only 36 new roof tops. Housing Trust Group The project proposed is a mix use development containing 149 residential units and 22,000 sq. ft. of retail/commercial space. Developer gave three (3) development options, all of which would depend on successful award of either a 4% Low Income Housing Tax Credit or 9% Low Income Housing Tax Credit (LIHTC) allocation from Florida Housing Finance Corporation. In either case, the proposed residential units will be 100% affordable and will serve individuals or families making up to 60% of Area Median Income; AMI for Palm Beach/Boca Raton MSA is $67,200. Developer guaranteed a land payment of $500,000 and up to $1,000,000 should the capitalized payment is $1.15 per tax credit. Some questions were raised on the short term and long term impacts of a tax credit development. Depending on where the sources of funding came from (4% LIHTC or 9% LIHTC), the residential units will be income restricted for a period of up to 40 years. Some concerns were raised as to whether the families of tax credit developments will have any disposable income to help support the existing merchants within Northwood Village. Option 3 of the development proposal did provide 20 additional market rate units; however, should this option be selected then there would not be a land payment. TBCG Capital Group The project proposed is a mixed use, mixed income development containing 201 residential units, 86,000 sq. ft. of office space, 70,000 sq. ft. of retail commercial space in five separate building ranging from 2- stories to 8-stories. It is an estimated $70 Million dollar project with a civic square and urban style grocer on the ground floor of one of the buildings. The financing plan involves various sources of funding to include: New Markets Tax Credits, 4 % Low Income Housing Tax Credits, Conventional Construction/Permanent Loan and TIF Pledge. The terms of the development is a 99 year lease at $1.00 per year with the option to purchase at Fair Market Value and the Developer intends to purchase within 10 years. There seems to be consensus that of the three proposals received, this proposal from TBCG Capital Group would have the most economic impact to the area and existing merchants within Northwood Village. Some questions were raised on the utilization of New Markets Tax Credit financing and if any restrictions are included with this funding source. Mr. Tony Brown responded that there would be a requirement that 20% of the residential units be set aside as affordable units. When a question was asked about how many units will be market rate units as compared to income restricted affordable units, an exact amount was not known/and or given. Committee Rankings The Selection Committee discussed all three proposals after presentations and ranked TBCG Capital Group the highest, followed by Housing Trust Group and Dale Matteson. A recommendation was made that all three Proposers have an opportunity to present to the CRA Board. Recommendation: CRA Staff recommends the Approval of the rankings by the Selection Committee and Authorization to begin Negotiations on a Development Agreement with the highest ranked firm. 3