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HomeMy WebLinkAboutCommittee of the Whole Packet for 02/12/2018 AGENDA Committee of the Whole Meeting 5:30 PM - Monday, February 12, 2018 7th Floor, Council Chambers, 7th Floor, City Hall – 1055 S. Grady Way 1. 200 Mill Proposals a) Presentation b) Staff Report 2. Facility Condition Assessment a) Presentation AGENDA ITEM #1. 2 AGENDA ITEM #1. 3 o At the location is an underutilized City-owned property with 1960’s era seen-story office building o Existing office building is aging and in need of upgrades o 3.79 acre site o Close to beautiful assets o Cedar River o Renton Library o Liberty Park AGENDA ITEM #1. 4 o In late 2016-17 the City completed an RFP process that did not yield a successful development option. o In October 2017, the City initiated a second RFP solicitation process to again entertain proposals to acquire the 200 Mill Ave. building and surrounding property. o The Request for Interest (RFI) was published in August 2017 and received several expressions of interest. o From the response list, three firms were invited to submit development proposals. o The City ultimately received two proposals by its January 3 deadline. AGENDA ITEM #1. 5 Internal Review Team : Facilities Finance Legal Economic Development Planning Councilmembers Corman and Pavone Consultant: Michelle Morlan,Lotus Development AGENDA ITEM #1. 6 Evaluation Factors: •Responsiveness to City Objectives •Qualifications and Capacity of Teams •Site Tours of Completed Projects •Proposed Development Concept •Proposed Purchase Offer •In addition: •Preliminary financial feasibility review •Two -hour interview AGENDA ITEM #1. 7 o Return an underutilized site to private use that fosters the image and function of Community Plan’s civic node concept and the Center Downtown Zone o Provide enhanced access, visibility, and connections to surrounding civic, natural, and cultural amenities and Downtown business District o Achieve superior 360-degree building and site design that does not turn its back on surrounding uses o Maximize site’s appeal, bringing more intensive round-the-clock activity and energy to the area AGENDA ITEM #1. 8 o Retain parking for public library o Provide public benefits & amenities that enhance the nature and character of site and surrounding uses and exceeds the City’s minimum standards o Provide fair market return to the city in the disposition of its property AGENDA ITEM #1. 9 o Both respondents delivered very high quality and thoughtful proposals for a development that would intensify and energize this important location. o Both assembled very impressive teams and clearly demonstrated the capacity to carry out such a complex development plan. o The two proposals offer a vision to bring high quality residential development at urban densities to the site, coupled with some level of quality private and public amenities to enhance the resident experience.AGENDA ITEM #1. 10 The proposals primarily differ in their approach to utilizing the site to meet a broader array of important community interests;and maximizing the development potential of the shoreline as a public asset with the participation and collaboration of the City to realize that vision.AGENDA ITEM #1. AGENDA ITEM #1. 12 Team Firms: o Cosmos o Charter Construction o Jackson|Main Architects o DCI Engineers o Watershed Company o Brumbaugh Landscapes o Heffron Transportation AGENDA ITEM #1. 13AGENDA ITEM #1. 14AGENDA ITEM #1. 15AGENDA ITEM #1. 16 o Approximately 450 units of rental housing, done in two phases o Three buildings, 5 to 8 stories in Phase I, up to 12 stories in Phase 3 AGENDA ITEM #1. 17 o Approximately 30,700 SF of ground level retail storefront space is proposed within two buildings o Office/ educational component of approximately 35,000 SF AGENDA ITEM #1. 18 •Demolition as part of Phase 2 •Replaced by a waterfront park AGENDA ITEM #1. 19 •Approximately 500 spaces in a structured parking garage •One level for retail, library and office patrons •Two levels for residents AGENDA ITEM #1. 20 Public-Private Partnership New 2.1 acre parcel that would include the library parking and would restore public open space along the Cedar river AGENDA ITEM #1. 21 o Full price offer of $7.3 million o Additional contribution of $2 million towards the new Cedar River Waterfront Park o Parcel A would be dedicated back to the City at no cost upon completion AGENDA ITEM #1. 22 o Acquisition of full site at full BOV; plus $2M o Total of 450 DUs in 3 buildings; significant retail and school space; 503 structured parking spaces; o Riverfront Park privately improved and dedicated to City at completion o Phase 1 construction of full below and above grade parking garage and podium and buildings A (8 stories) and B (6 stories) (includes approx. 170 DUs; 30,700SF of retail; and 35,000SF of space for school/office use o Phase 2 demolition of existing office building (upon expiration of leases); development of waterfront park open space amenities; o Phase 3 construction of building C (12 stories) (approx. 280 DUs); full lease-up of retail space from Buildings A & B AGENDA ITEM #1. 23AGENDA ITEM #1. 24AGENDA ITEM #1. 25AGENDA ITEM #1. 26AGENDA ITEM #1. AGENDA ITEM #1. 28 Team Firms: o LMC a Lennar Co o Encore Architects o Weisman Design Group o KPFF AGENDA ITEM #1. 29AGENDA ITEM #1. 30AGENDA ITEM #1. 31AGENDA ITEM #1. 32 o Approximately 321 residential units, ranging from studios to loft 2-bedroom units o A single U-shaped building and a single phase of development AGENDA ITEM #1. 33 o Approximately 8,700 SF o Additional live/work units o Coffee shops, walk -in medical clinic, service- oriented uses AGENDA ITEM #1. 34 •Two scenarios proposed: •One: Light refurbishment of building to be retained for office use. •Two: Demolish the building and restore shoreline landscaping. Demolition cost deducted from purchase offer. •Preference is to remove building AGENDA ITEM #1. 35 o Approximately 350 parking spaces in the three-level, structured parking garage o No disturbance of Library parking AGENDA ITEM #1. 36 o Pocket Park o Public pedestrian connector (the Art Walk)AGENDA ITEM #1. 37 o Proposed purchase price of $2,655,000 o Counting risks/costs of demolition and public infrastructure, estimated total combined value to the City of just under $5.2 million AGENDA ITEM #1. 38AGENDA ITEM #1. 39AGENDA ITEM #1. 40AGENDA ITEM #1. 41AGENDA ITEM #1. AGENDA ITEM #1. 43 Category LMC Cosmos Total Possible Team Qualifications and Individual Commitments 31.7 35.5 30 pts Proposed Development Concept 25.2 26.6 40 pts Additional Submittal Items 13.8 14.7 15 pts Operating Pro-Forma,Project Sources & Uses 17.0 18.0 20 pts Schedule 8.8 8.7 10 pts Proposed Purchase Price 4.8 9.8 10 pts Interview 16.2 18.8 25 pts TOTALS 117.5 132.1 150 AGENDA ITEM #1. 44 o The Review Committee was impressed with caliber of both teams and proposals and believe either would bring greater density and energize downtown o Both development teams have a demonstrated track record and capacity to deliver o The LMC proposal shows a high quality residential development that would be a valuable asset nearly anywhere in Downtown Renton. o Cosmos Development Team proposed a more diverse array of uses that would serve to energize the site and create a sense of place and destination here for a variety of sectors of the community o Cosmos proposal also anticipated and added value to the river frontage as an asset to be preserved and brought into more accessible use as a public amenity. o Significantly improves on the execution and delivery of this concept over the previous Cosmos concept, and shows a willingness to provide the necessary returns to the City while engaging the City as a development partner.AGENDA ITEM #1. 45 •Project phasing and realization of full build-out is market- dependent. o The retail lease-up schedule anticipates significant delay due to the construction timeline and the impacts for construction on retail. o These schedule concerns and expectations for performance should be addressed in any development agreement. o The details of public participation and roles/responsibilities and cost burden must be clearly established as part of development agreement.AGENDA ITEM #1. 46 Next Steps Timeline Council approves selection of Development Team/Authorizes Execution of ENA Current Developer provides earnest money deposit By March 2018 Due diligence and feasibility analysis period April thru September 2018Negotiate terms of and draft Disposition and Development Agreement (DDA) Deliver Draft Development Agreement to Council for Review / Approval October/November 2018 Execution of Development Agreement, Disposition of Property December 2018 AGENDA ITEM #1. 47 Recommended Action by Council: Staff recommends Council concur with the recommendations of the review committee and directs the Administration to execute an Exclusive Negotiating Agreement with Cosmos Development Group for the redevelopment of the City-owned parcel at 200 Mill Avenue South. AGENDA ITEM #1. 48 Questions?AGENDA ITEM #1. DEPARTMENT OF COMMUNITY & ECONOMIC DEVELOPMENT M E M O R A N D U M DATE: February 9, 2018 TO: Ed Prince, Council President Members of Renton City Council VIA: Denis Law, Mayor FROM: C.E. “Chip” Vincent, CED Administrator STAFF CONTACT: Cliff Long, Economic Development Director SUBJECT: Evaluation of 200 Mill Avenue Development Proposals I Background The City-owned site at 200 Mill Avenue sits in the heart of what has been identified as the civic node – a confluence of major civic, recreational and cultural amenities within Renton’s downtown. It is a centrally-located but underutilized 3.79 acre property improved with a seven-story office building built in 1969 (former Renton City Hall) and a large surface parking lot. The site is located adjacent to the Renton Library, across the Cedar River from Liberty Park, and within a few blocks of key downtown services and landmarks. With a long linear frontage on the Cedar River, the property presents both a challenge and a tremendous opportunity for development that will require a thoughtful approach to maximize its potential public and economic development benefits. The former City Hall building is approximately 72% occupied with a mix of public, nonprofit and private tenants, a majority of which pay market lease rates currently. Despite this, building operations have run at a deficit in the past several years, which has required the City to support maintenance and upgrades from the City’s general fund. Between 2013 and 2016, the City invested approximately $1.8 million in building improvements, partially through a loan that requires annual payments of $175,000 beginning in 2016. The building is in an aging condition that will require increased ongoing maintenance and significant upgrades to bring the building up to a level that would improve operating performance and marketability. A 2009 building study estimated this cost at more than $10 million. Recent property valuation reports suggest it is unlikely that such expenses would be recovered by significantly increased lease income based on relatively weak demand for office space in the south end market. AGENDA ITEM #1. Ed Prince, Council President Page 2 of 11 February 9, 2018 In late 2016-17 the City completed a Request for Proposals (RFP) process that did not yield a successful development option. In October 2017, the City initiated a second RFP solicitation process to again entertain proposals to acquire the 200 Mill Avenue building and surrounding property with the purpose of repositioning or redeveloping the site in a manner consistent with the City’s goals and objectives. The Request for Interest (RFI) was published in August 2017 and received several expressions of interest. From the response list, three firms were invited to submit development proposals. The City ultimately received two proposals by its January 3, 2018 deadline. The RFP Review Committee, consisting of City staff (representing departments with expertise in different areas of review, including: Facilities, Finance, Legal, Economic Development, and Planning) and Council representatives evaluated each proposal based on its responsiveness to the City’s stated objectives; the qualifications and capacity of the development team members, including site tours and review of similar completed projects; the proposed development concept; and the purchase offer and its ability to achieve the City’s financial objectives as stated in the RFP. Additionally, a preliminary financial feasibility analysis of each proposal was conducted and each team was required to demonstrate its financial capacity to carry out its respective development concept. Finally, each team participated in a two-hour interview with the Review Committee where each was invited to make a presentation and respond to interview questions, specific to its proposal. II Summary of Development Proposals As in the earlier RFP process, both respondents delivered very high quality and thoughtful proposals for a development that would intensify and energize this important location. Both assembled very impressive teams and clearly demonstrated the capacity to carry out such a complex development plan. The two proposals summarized below both offer a vision to bring high quality residential development at urban densities to the site, coupled with some level of quality private and public amenities to enhance the resident experience. The proposals primarily differ in their approach to utilizing the site to meet a broader array of important community interests; and maximizing the development potential of the shoreline as a public asset with the participation and collaboration of the City to realize that vision. See associated presentation for proposal drawings. Cosmos Proposal Led by Cosmos Development Company, a Bellevue-based developer/owner with a 35-year history in the region, the Cosmos team includes Seattle-based Jackson Main Architecture, Charter Construction, DCI Engineers (civil and structural), The Watershed Company (environmental consultant), Brumbaugh & Associates (landscape architects), and Heffron Transportation. Cosmos recently developed The Lofts at Second and Main in Downtown Renton (completed in 2017); and recently finished Lake Hills Mixed Use Center in east Bellevue and Redmond Square in Redmond. The firm has two other large-scale development projects in AGENDA ITEM #1. Ed Prince, Council President Page 3 of 11 February 9, 2018 progress in Lynnwood and Redmond. Each of the team members has collaborated with Cosmos on other projects and most have worked with each other. Highlights of work experience showed a capability to do complex multifamily mixed-use developments of a similar scale to the 200 Mill site proposal, with a particular emphasis on public-private collaboration to create a sense of place and destination. As a prime example, the Lake Hills Center in Bellevue created a mixed-use destination that includes multifamily residential, extensive retail, a public library and offices for several nonprofit and other users. The development involved an extensive community collaboration process to realize the neighborhood’s planning vision. For the 200 Mill site, the team similarly proposed a joint and coordinated Public Private Partnership with the City, wherein Cosmos would acquire the entire site and contribute additional funds to the City for development of public amenity improvements along the river; while retaining the library parking and developing an intensive mixed-use development with underground parking on the balance of the site. Cosmos proposed to dedicate or otherwise contribute the improved riverfront amenities back to the City for public use in perpetuity. Private Development Portion: Residential Component: The development of approximately 450 units of rental housing, done in two phases. The development concept envisions three buildings, varying in height from 5 to 8 stories in Phase 1 (buildings A and B) and up to 12 stories in Phase 3 (building C) to create variation in the skyline and break up massing. A mix of studio, open one, and one-bedroom units are contemplated, as supported by market demand. The potential for ground floor live- work units is envisioned as part of Building C along Houser. The timing for Building C would be dependent on market demand, absorption of the previous phases, the presence of the other uses to energize the space, and the completion of the public amenity improvements to serve as a draw for this destination. Retail/Office/Education: Approximately 30,700 square feet of ground level retail storefront space is proposed within two buildings, with a public pedestrian walkway (Mews) providing internal site access to the some of the retail space and connecting Mill Avenue with the riverfront public amenities. These retail uses would primarily support the new residential units and immediate surrounding area. Additionally, Cosmos proposes an office/educational component of approximately 35,000SF that could potentially accommodate an expanded Renton Preparatory school home on this site. The developer has held preliminary meetings with the school to discuss the potential consolidation of school functions and the school’s desire to remain in downtown Renton. Treatment of Former City Hall building: Cosmos proposed the acquisition of the office building and demolition as part of Phase 2 (once all the building lease terms had expired). This demolition was incorporated into the cost of the overall development (not a cost to the City). The proposed demolition would also be timed to facilitate the smooth transition of the Renton AGENDA ITEM #1. Ed Prince, Council President Page 4 of 11 February 9, 2018 Prepatory School into a new completed space in Building B, based on preliminary conceptual discussions. Shared Parking: Approximately 500 spaces in a structured parking garage (one full level at grade for retail, library and office patrons, and two below-grade levels for residents and office users). The at-grade level would be wrapped by the buildings, with an elevated park/common area on top. Full build out of the parking structure would be done in Phase 1 to accommodate the needs of the residential, retail and other uses. Due to this early investment, ahead of full residential build out, the garage would have ample public parking for other uses in the area, ahead of the full build out of the site. No fees are contemplated for parking. Public Amenities / Public-Private Partnership: Phase 2 would include demolition of the existing office building (at the completion of the existing tenant lease terms) and development of the public riverfront park or access trail, improvements to the library parking lot (provision of existing parking and additional in garage) and public access areas connecting from Mill Avenue to the waterfront. The public amenity component envisions a new 2.1 acre parcel that would include the library parking and would restore public open space along the Cedar River through a continuous waterfront trail that would also connect through the site to Mill Avenue. The proposal envisions the City leading the community input and visioning process to develop the plan for the restored shoreline access with development implemented by the private development team, followed by dedication of the improved amenities to the City at completion and at no cost. Cosmos proposes making a $2 Million additional investment towards the public amenity space, in addition to providing development capacity to complete the improvements. The private development component is contingent on the City making the commitment to move forward in a public-private partnership to plan and develop the public improvements in conjunction with the private development. In particular, the timing and success of the third building would depend on this amenity being placed into service. The overall project schedule envisioned a phased development over the next three to seven years, subject to timing of City improvements as well as market conditions. Purchase Offer: Proposing a full price offer of $7.3 Million based on City’s stated Broker Opinion of Value for the site and existing office building. Additionally proposing contribution of $2 Million towards the improvements to the new Cedar River Waterfront Park. Developer would reconfigure parcel boundaries to create a 1.07 acre Parcel A, which would be dedicated back to the City at no cost upon completion of the park improvements. The remaining 2.72 acre parcel (Parcel B) would be retained for development. LMC Proposal The LMC team is headed by Lennar Multifamily Communities (LMC), a Charlotte, N.C.-based national developer of multifamily communities established in 2011 as a subsidiary of Lennar AGENDA ITEM #1. Ed Prince, Council President Page 5 of 11 February 9, 2018 Homes, one of the largest home builders in the U.S. Lennar is a publicly traded corporation established in 1954, with a market capitalization of approximately $12 Billion. Its subsidiary, LMC operates as an independent locally based Regional division in Seattle, with a total of eleven developments acquired, completed or under development in the local market since its inception (72 nationally). LMC approaches development of its multifamily communities as a vertically integrated entity, providing development, construction, marketing and property/asset management functions in-house. The team also includes locally based architect Encore Architects, Weisman Design Group (landscape architect) and KPFF (civil engineer). All of these team members have worked with LMC and most have worked with each other on multiple projects. The review committee toured three of LMC’s most recent developments: Twenty 20 Mad (on Capitol Hill in Seattle), the Atlas (in Issaquah) and the Whittaker (in West Seattle). Each of these communities offers high end luxury apartment living in a full-service community, most with retail, and various residential amenities including rooftop entertainment areas, fitness rooms, community meeting rooms and other amenities. The developments typically provided a superior, transit-adjacent location within urban settings. LMC’s Northwest Region currently has three other projects under construction and four others in predevelopment or planning stages in Seattle, Portland and on the east side. LMC proposes a similar style of development on this site, focusing on the surface parking lot as the development site. A single U-shaped building of five stories of residential, above ground- floor retail with a single level of below-grade parking and two levels of above grade parking that would be topped by a common green/outdoor courtyard. The above-grade parking would be wrapped on three sides by the building at the retail level. The proposed alternative would not emphasize any improvements along the riverfront – rather restoration of the river’s buffer is emphasized, along with maintaining the existing parking area within the shoreline buffer zone. In this way, the concept proposes to capitalize on and provide connections for the array of existing neighborhood amenities and bring a denser residential development into this context. Residential Component: Approximately 321 residential units, ranging from studios to loft 2- bedroom units would be built in a single U-shaped building and a single phase of development. The building faces would wrap the site along Mill Avenue and Houser Way, as well as the Center River/Liberty Park facing side, with open connection to the library site. Potential live/work units were proposed along Houser Way, with high-bay ceiling heights to accommodate the transition to commercial. To break up massing along the long continuous building exposures, LMC would provide for horizontal and vertical building modulation and accent points at key locations. A roof-top terrace with outdoor amenity space for residents would also be included, similar to other LMC developments. In addition to the community, fitness and rooftop entertainment spaces, proposed residential amenities would include a ground level “bicycle lounge” for residents to store and repair bicycles. AGENDA ITEM #1. Ed Prince, Council President Page 6 of 11 February 9, 2018 Retail Component: A minimal amount of service retail is proposed (approximately 8,700 square feet), although additional live/work units were proposed along Houser Way that were not counted in the total retail figure. Anticipated retail concepts would include coffee shops, walk- in medical clinic, service-oriented uses that would support the residents living above. Treatment of Former City Hall building: The submitted proposal contemplated two scenarios, one of which would retain the building as-is with a light refurbishment and re-purposing as office space, the other would be to demolish the building. This option was not addressed in the pricing or schedule portion of the proposal. The submitted design concept did not show the demolition and landscape restoration scenario; however this was identified as the preferred alternative by the team for the interview phase. LMC did price the demolition as a charge against (deduct from) the proposed purchase offer. The LMC proposal also indicated a desire to buy out leases early to facilitate development. Public Amenities: The development concept proposed creating two key public amenities, in addition to landscaping the demolished office building site: a “pocket park” at the corner of Mill Avenue and Houser Way that would serve as a focal point and gateway to the development; and a public pedestrian connector (the Art Walk) linking 2nd Avenue to the Library bridge and Liberty Park beyond. These amenities were valued as part of the purchase offer as public benefit contributions. Shared Parking: The development proposes approximately 350 parking spaces in the three- level structured parking garage. Only one level would be below grade, with the others above grade and wrapped by the first floor (high bay) retail space and live/work lofts. Connections from the back of retail into the garage would likely be contemplated. No disturbance of library parking was contemplated. Purchase Offer: LMC proposed a purchase price of $2,655,000 in recognition of the risks and cost associated with demolishing the former City Hall and provision of public amenities and infrastructure upgrades. These risks/costs were estimated for a total combined value to the City of just under $5.2 Million. III Review Committee Summary The City intends that proposed development of the 200 Mill site will achieve certain City objectives. Both teams presented development concepts that address most of these objectives with a higher intensity development plan that brings a variety of different uses to the site and creates a more urban center feel. Both proposals would increase the round the clock utilization of the site with a more intense residential development supported by a mix of public and private amenities. The Cosmos proposal included a more intensive array of public amenities and mix of uses to create a destination development, and relied on a Public-Private partnership AGENDA ITEM #1. Ed Prince, Council President Page 7 of 11 February 9, 2018 with the City to achieve these objectives; while the LMC team proposed a production-oriented delivery of high end multifamily development enhanced by its central location and the existing amenities that surround it. Other distinctions between the two proposals are noted in more detail below. City Objectives Cosmos LMC a. Private use that complements image and function of civic node concept and Center Downtown Zone – both of which call for higher intensity development with a variety and mix of land uses that are indicative of an urban center High density residential with significant space for retail and significant space to retain the School or other office use; access to parking as a community amenity during the build-out period. More emphasis on high density residential (though less density than Cosmos), with significantly less retail and no long-term inclusion of the school or other office uses b. Enhance access and visibility with better connections to other amenities and business district Public access through site’s new private development; significant improvements to river front park/trail; Mixed building heights break up massing and provide for view corridors Public access through site’s new private development (Art Walk) with gateway at Mill/Houser c. Superior building w/ 360-degree site design Three buildings with varying heights to break up massing, provide street edge development along Mill and Houser. Good building façade design along Mill and Houser with retention of significant trees and proposed live/work units with stoops along Houser Single building with long continuous building frontages, significant repetition of window layout created a potentially imposing building massing. Storefront retail at ground level with sufficient glazing and transparency (to read as commercial) d. More intensive use and round-the clock activity/energy Significant mix of uses (residential, educational, retail, civic) would energize site. Public riverfront park amenity would provide Much heavier emphasis on residential with only minimal (8,700SF) retail use. No other use types contemplated. Could potentially lead to less AGENDA ITEM #1. Ed Prince, Council President Page 8 of 11 February 9, 2018 increased foot traffic and round the clock activity. activity outside of building than typical urban mixed use development. e. Retain library parking per agreement with King County Library District Would provide enhancements to parking lot and dedicate back to City for continued operation as Library parking. Did not specifically address library parking but does not propose to disturb or develop library parking. f. Provide public benefits/amenities that enhance site (exceeding minimum standards required by Design Guidelines) Superior array of public amenities including riverfront park (funded with developer contribution of $2M and developed privately with dedication at no cost back to City for operation); public access pedestrian connectors through site (mews); to create connectivity and sense of place/ destination. Proposal seeks some potential offsets in terms of tax deferral or fee waiver consideration. Proposed pocket park and infrastructure improvements (Art Walk) connector through site – anticipated to be privately maintained but open to the public; Did not provide detail or specify riverfront improvements or restoration or potential amenities there. LMC offered potential for more enhanced landscaping in exchange for park impact fee waivers. g. Provide fair market return to City in disposition (both the building and land were to be valued at Fair Market Value). Full price offer Additional $2M cash contribution for public participation Private development capacity working in partnership with City to complete public improvements adds significant return Significantly lower offer (2.65M) with cost of demolition, infrastructure improvements and pocket park valued as in- kind contributions (approx. $2.5M) Potential Financial Impact of Proposals Benefits: Cash purchase: $7.3M Additional cash: $2M Benefits: Cash purchase: $2.65M AGENDA ITEM #1. Ed Prince, Council President Page 9 of 11 February 9, 2018 Contribution of improved public park parcel & improved library parking area; City led planning process for park; retention / expansion space for Renton Preparatory School Costs: Any excess cost for park development beyond proceeds of sale and cash; Maintenance of Park Improvements ongoing Completed pocket park and pedestrian connector through site Landscaping improvements on former City Hall site (undefined) Costs: Minimal public improvements proposed along riverfront (shoreline to remain undisturbed); no space to retain school as part of development The two proposals were rated by the Review Committee based on the scoring criteria in the RFP, providing a total of 150 possible points. The breakdown of team scores was determined to be: Category Cosmos LMC Total possible Team Qualifications & Individual Commitment 35.5 31.7 40 Proposed Development Concept 26.6 25.2 35 Additional Submittal Items 14.7 13.8 15 Financial Feasibility (Pro Forma) 18.0 17.0 20 Proposed Project Schedule 8.7 8.8 10 Purchase Offer 9.8 4.8 10 Interview 18.0 16.2 20 TOTALS 131.3 117.5 150 V Conclusions / Recommendations The Review Committee was impressed with the caliber of both development teams and the thoughtful approach each took to delivering a high-quality development proposal to intensify and energize this important location. Both proposals, if fully completed, would bring greater density to the area and catalyze a vibrant urban development pattern to this end of Downtown Renton. Both development teams have a demonstrated track record and capacity to deliver on the concepts they propose. The LMC proposal shows a high quality residential development that would be a valuable asset nearly anywhere in Downtown Renton. However, the Cosmos Development Team proposed a more diverse array of uses that would serve to energize the site and create a sense of place and destination here for a variety of sectors of the community, whereas the LMC proposal was AGENDA ITEM #1. Ed Prince, Council President Page 10 of 11 February 9, 2018 focused more heavily on capitalizing on existing amenities to enhance its proposed residential development. The Cosmos proposal also anticipated and added value to the river frontage as an asset to be preserved and brought into more accessible use as a public amenity. This proposal appeared to significantly improve on the execution and delivery of this concept over the previous Cosmos concept, and showed a willingness to provide the necessary returns to the City while engaging the City as a development partner. This approach could ultimately yield greater community participation in the planning of the riverfront improvements while giving the City control of the property upon completion. The Review Committee is recommending moving forward with the Cosmos proposal and working to effect a true Public-Private Partnership to achieve its emphasis on the broader array of uses to realize the City’s overall vision and objectives for this site and its importance to Downtown. Potential Concerns to be addressed: The overall project phasing and realization of full build-out is market-dependent. A 12-story building would only be possible when the market matures and the overall site is energized with other uses; this risk to reaching the long-term vision is largely borne by the developer, given the significant up front investments they will make in parking and public amenities. The retail lease-up schedule anticipates significant delay due to the construction timeline and the impacts for construction on retail. These schedule concerns and expectations for performance should be addressed in any development agreement. The details of public participation and roles/responsibilities and cost burden must be clearly established as part of development agreement. VI Next Steps – ENA and DDA Processes and Timeline The RFP process describes that the next step upon recommendation by the Review Committee is for Council to authorize the City to enter into an Exclusive Negotiating Agreement (ENA) with the selected team, which would establish a scope and timeline in which both parties would conduct initial feasibility analysis and due diligence activities sufficient to arrive at a mutually acceptable Disposition and Development plan and define the roles and responsibilities associated with any City participation. The ENA is anticipated to be executed immediately following selection. Upon execution of this Agreement, the selected team would provide an earnest money deposit to hold its right to exclusively negotiate the terms of development with the City. The Development Agreement would address all key details associated with the agreed upon development plan including, but not limited to, terms for the disposition of land, timing of predevelopment activities including entitlements, community engagement, design development, preliminary budgeting, permitting, participation commitments, financial commitments, and phasing of construction. A six (6) month initial negotiating period is AGENDA ITEM #1. Ed Prince, Council President Page 11 of 11 February 9, 2018 recommended for completing the necessary due diligence and exploration to arrive at a draft Development Agreement. AGENDA ITEM #1. FACILITIESGETTING AHEAD OF THE CURVEPARADIGMS, STRATEGIES, PROCESSES AND TOOLSAGENDA ITEM #2. OVERVIEW OF PRESENTATION•History and Facts•Guiding Facilities Paradigms•Facilities is a Business•What is a Facilities Condition Assessment (FCA)?•What does our FCA tell us?•Implemented Strategies and Acquired Tools•Next Steps to Establish a Component Replacement PlanAGENDA ITEM #2. HISTORICAL INFORMATION•In 2018, Facilities division is responsible for 869,634 square feet•66 structures (City Hall to park restrooms)•Current Facilities Staff is 28 FTE’s•2009 Facilities reduced staff by 25% due to economic downturn•From 2009 to 2016 seven buildings added (+259,000 square feet)AGENDA ITEM #2. WE HAVE A CLEAR VISION!COMMITTED,COMPETENT,COURAGEAGENDA ITEM #2. PEOPLEPLACEPROCESSESINTEGRATED BUSINESS MODELAGENDA ITEM #2. We needed a Tool Box with Tools!SmartphonesLaptopsAlternative SchedulesWork Order SystemOrganization RestructureBuilding-based BudgetsEnergy AuditsFacilities Condition AssessmentAGENDA ITEM #2. WHAT IS A FACILITIES CONDITION ASSESSMENT (FCA)?•A multi-disciplinary review of the various systems of a facility.•A technical investigation of assets/components or systems to provide findings and recommendations.•The current condition of the assets/components expressed as a statement of deferred maintenance ("Catch-up" Costs).•An estimation of the costs to correct the backlog of deferred maintenance. •An analysis of an asset or system described in terms of a Facility Condition Index (FCI).•An evaluation of the effective age of the assets and estimation of the remaining useful life of the assets.•Forecasts of future lifecycle renewal of the assets/component as they reach the end of their useful service lives.AGENDA ITEM #2. WHAT DID THE FCA PROVIDE?•Assess and plan for building Component Replacement (CR) needs•Short and long-range component replacement cost analysis•Inventory of equipment and systems•Design for an optimum, proactive maintenance program•Ability to target the most urgent needs•Identify O&M needs and capital planning initiatives•Plan to prevent adverse impacts to the City’s budget and building functionAGENDA ITEM #2. WHAT ARE THE KEY NUMBERS IN THE FCA?•64 Structures•730,812 Square Feet•1705 Components Assessed•$41,895, 702 Estimated Net Present Value (NPV) for 64 Structures•$5,791,583 Estimated Cost of Component Replacement (CR) First Years•$13,502,265 Estimated Cost of CR First 5 Years•$26,796,363 Estimated Cost of CR over15 YearsAGENDA ITEM #2. PROVIDE PROJECT & FUNDING OPTIONSPrioritize•Remaining Life•Asset Condition•Impact to Operations•Available Funds•Risk/Liability•Time/DurationAGENDA ITEM #2. ENERGY AUDIT OPPORTUNITIESEnergy and Water Savings ($$$)AGENDA ITEM #2. ACTIONS TAKEN BY FACILITIES……..•Added a Facilities Maintenance Supervisor•Moved 3 FTE’s from Custodian Group to Maintenance Group•Implementing Work Management System•Implementing Preventative Maintenance Program•Increased mobile capabilities by moving to smartphones•Implemented a 24 hour Maintenance on-call program•Increase Maintenance Tech coverage from 9 to 14 hours daily Mon-Fri•Training Maintenance Custodians to take on more maintenance tasksAGENDA ITEM #2. NEXT STEPS•Evaluate the Energy Audit and potential implementation strategies•Facilities to review FCA findings and present prioritize projects (Component Replacement Plan) with available funding•Consult with Finance as we develop the 2019 – 2020 budget proposalsAGENDA ITEM #2. PRESENTATION SUMMARY……•History and Facts…..We are at-risk and vulnerable•Guiding Facilities Paradigms…..Clear Vision, and Integrated Business•Facilities is a Business…..People, Processes, Place•What is a Facilities Condition Assessment (FCA)?....Strategic Tool•What does our FCA tell us?....Our risk and business interruption•Implemented Strategies and Acquired Tools….Proactive and addressing issues •Next Steps to Establish a CR Plan….Finding funding sourcesAGENDA ITEM #2. QUESTIONS?AGENDA ITEM #2.