HomeMy WebLinkAboutReso 1987-13011 amended with rider attached
RESOLUTION NO. 13011
RESOLUTION OF THE CITY COUNCIL nF THE CITY DF CHULA VISTA
APPROVING A gIgPOSITION AND DEVELOPMEHT AGREEMENT WITH
HOMART DEVELOPMENT COMPANY FOR THE EXPANSION AND RENOVATION
OF THE CHULA VISTA SHOPPING CENTER WITHIN THE TOWN CENTRE II
REDEVELOPMENT PROJECT AREA INCLUDING THE DISPOSITION OF
CERTAIN REAL PROPERTY WHICH MAY BE ACQUIRED WITH TAX INCREMENT
FUNDS BY THE REDEVELOPMENT AGENCY OF THE CITY OF CHULA VISTA IN
ORDER TO ASSIST IN FINANCING THE PROJECT
The City Council of the City of Chula Vista (Council) does hereby resolve
as follows:
I~!HEREAS, the Town Centre II Redevelopment Plan, as approved by the City
Council calls for the expansion and renovation of Chula Vista Shoppin~ Center
(project); and,
WHEREAS, the Homart Development Company has proposed to expand and
renovate the Chula Vista Shopping Center in accordance with the development
of plans to be approved by the Redevelopment Agency of the City of Chula
Vista (Anency); and,
WHEREAS, a disoosition and development agreement has been oronosed
between the Agency and the Homart Development Company for the project; and,
WHEREAS, the disposition and development aQreement includes a financing
plan which calls for the leasing of certain property within the project site
by the Redevelopment Aqency to the City for the purpose of assistinq in the
financinq of the project; and,
WHEREAS, the Redevelopment Agency proposes to use tax increment funds to
finance, in part, the cost of the acquisition of the property proposed to be
leased to the City subject to approval of an amendment to the Town Centre II
Redevelopment Plan authorizing the Aqencv to collect tax increments; and,
WHEREAS, California Community Redevelonment Law, Section 33433, reauires
that Council approval be given prior to the disposition and Agency property
which was acquired with the use of tax increment funds.
NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Chula
Vista hereby approves the Disposition and Development aqreement with the
Homart Development Company for expansion and renovation of the Chula Vista
Shopping Center including the provision for the disposition of certain real
property which may be acquired by the Redevelopment Agency using tax increment
funds in order to assist in financing the project, said agreement attached
hereto as though fully set forth herein.
BE IT FURTHER RESOLVED that the use of tax increment funds as described
above is subject to approval of the proposed amendment to the Town Centre II
Redevelopment Plan authorizinq the Redevelopment Aaency to receive tax
increments.
Present ~'6~ _ Approved ~s to form by
Paul G. Desrochers ~TJ~o~as J. Har~o~
Community Development Director Agency Attorne~
ADOPTED AND APPROVED BY 'FHE CITY COUNCIL OF THE CITY OF
CHULA VISTA, CALIFORNIA, this 28th d~y of April
19 ~7 , by the following vole, to--wit:
AYES: Councilmembers co×, Moore, Nader, Halcolm, HcCandllss
NAYES: Counci 1 members NoDe
ABSTAIN: Councilmembers NoDe
ABSENT: Counci] members NoDe
~yO~f the City of Chum Vista
~' -~ City ClerK'
~ FATE OF CALIFORNIA )
COUNTY OF SAN DIEGO ) ss.
CITY OF CHULA VISTA )
I, JENNIE M FULASZ, CMC, CITY CLERK of the City of Chum Vista, California,
DO HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of
RESOLUTION NO, 13011
,and that the same has not been amended or repealed.
DATED!~-'~
CI'IY OF
CHULA VISI'A
CC-660
CFI~ OF
CHULA VISTA
NOTE: For copy of Disposition & Development
Agreement see Redevelopment Agency
Resolution 806
RIDER TO
TOWN CENTRE II
DISPOSITION AND DEVELOPMENT AGREEMENT
IMPLEMENTING CITY/AGENCY RESOLUTIONS
DATED APRIL 29, 1987
1. As provided in Attachment 13, the Agency is to choose
by May 5, 1987 between (a) a $500,000 contribution to
be made by Redeveloper, or (b) the City/Agency's
retaining the Boys Club.
2. Under Attachment 14, the Agency elects Alternative A
(cash or credit in the amount of $750,000).
Alternative B is of no further force or effect.
In addition, Redeveloper hereby agrees that it
will spend or invest at least $35,000,000 in the
Project, or allocate any shortfall between the Agency
and Redeveloper, as follows:
(a) Redeveloper shall submit to the Agency, as
soon as reasonably possible, a written statement from
Redeveloper's independent certified public accountants
(the "Independent CPA's Statement"), based upon
generally accepted accounting principles and, as
applicable, Urban Land Institute standards for the
regional shopping center industry, setting forth the
amount of Redeveloper's expenditures and investments in
the Project for the period ending two (2) years after
the date on which the City issues its notice of
completion of the construction of all improvements
required by this Agreement (that is, the final notice
issued in connection with the City's inspection of such
construction, as distinguished from theCertificate' ' of
Completion referred to elsewhere in this Agreement).
(b) If the Independent CPA's Statement shows that
less than $42,150,000 (the sum of Redeveloper's
commitment of at least $35,000,000 to the Project, and
the Agency's commitment of $7,150,000 to the Project)
has been spent or invested in the Project for the
period described in Paragraph (a) above (the "Initial
Accounting Period"), it shall be accompanied by a
written statement from Redeveloper (an "Investment
Program Statement"), committing funds to a reserve
account determined in good £aith by Redeveloper to be
necessary or appropriate for additional expenditures or
investments in the Project during the two (2) year
period immediately following the Initial Accounting
Period. Such additional expenditures or investments
may include, by way of example and without limitation,
funds for anticipated tenant improvement allowances,
tenant inducements, capital improvements to the common
areas of the Project, and inducements for a fourth
major department store. Thereafter, Redeveloper shall
submit to the Agency, as soon as reasonably possible,
another written statement from Redeveloper's
independent certified public accountants (the "Second
Independent CPA's Statement"), based upon the same
accounting principles and standards, setting forth the
amount of Redeveloper's expenditures and investments in
the Project for the period ending two (2) years after
the Initial Accounting Period.
(c) If the Second Independent CPA's Statement
shows that less than $42,150,000 has been spent or
invested in the Project for the period described in
Paragraph (b) above, then it shall also calculate the
amount of the shortfall. The shortfall shall be split
between the Agency and the Redeveloper, with the Agency
to r~ceive 20% thereof, and the Redeveloper to receive
80% thereof. The Agency's share of any such shortfall
shall be paid by Redeveloper to the Agency concurrently
with the delivery of the Second Independent CPA's
Statement to the Agency.
3. The bed of 5th Avenue will be conveyed from (a) HUD to
the City, (b) the City to the Agency, and (c) the
Agency to Homart, at the close of the First Escrow.
Concurrently with their approval of this Agreement, the
City and the Agency will adopt appropriate resolutions
authorizing their respective acquisitions and
conveyances of those properties. By letter agreement
with HUD, the parties recognize that HUD will appraise
the bed of 5th Avenue and is to receive consideration
for it. HUD has represented to the City Attorney and
has confirmed in writing that the price "should be
determined on the basis of its present use as a public
street." The appraisal costs and the price payable to
HUD as a result of the appraisal shall be borne as
follows: The City and Agency shall be responsible for
the first $10,000 of such costs and payment, in such
manner as they may determine between them; Redeveloper,
on the one hand, and the City and Agency, in such
manner as they may determine between them,
on the other hand, shall share the excess, if any,
half-and-half.
4. The rules in the Agreement regarding Relocated Tenants
fall into two categories:
(a) A prohibition against leasing more than 20%
of the additional leasable floor area to Relocated
Tenants (Section 506-1); and
(b) In relation to Redeveloper's sales tax
guarantee, denying credit for any sales taxes generated
by such a Relocated Tenant (Section 506-2).
Category (a) above (the prohibition) is
hereby deleted from this transaction.
Category (b) above (the sales tax guarantee
calculation) remains a part of this transaction,
clarified and supplemented as follows:
(1) The rules regarding Category (b) shall
terminate and be of no further force or effect
five (5) years after the close of the First
Escrow; and
(2) If Redeveloper obtains a written
representation from a prospective lessee or
sub-lessee of retail space within the Chula Vista
Shopping Center, that it has no other pre-existing
retail business within the City, or that it has
such a business but has no plan or intent to
transfer, relocate or close that business, then
Redeveloper may rely on that written
representation, and the lessee or sub-lessee
making that representation shall not under any
circumstances be considered a Relocated Tenant,
provided that Redeveloper submits to the Agency
(a) an original or certified copy of the
representation made by the lessee or sub-lessee,
and (b) a written representation by Redeveloper,
and its real estate broker, if any, certifying
that Redeveloper, and its real estate broker, if
any, have no actual knowledge that the
representation made by the lessee or sub-lessee is
false.
5. The Deposit from Redeveloper in the amount of
$11,000,000.00 in cash, cashier's check or letter of
credit (Section 110) is deleted. No such deposit shall
be required. Redeveloper shall, however, deliver the
Guaranty of Completion to the Agency (Attachment No.
11) on or before the close of the First Escrow.
6. If for any reason the Site Lease, Agency/City Lease and
Operating Lease are not approved concurrently with this
Agreement, that circumstance shall not constitute a
breach of the Financing Plan (Attachment No. 5). The
Agency and the City agree, however, that they are bound
by the economic terms set forth in the Financing Plan
other than the requirement that the leases be approved
concurrently, and that they have enforceably committed
by this Agreement to take such actions, by leases or
other means, as shall result in Redeveloper's practical
realization of the economic benefits described in the
Financing Plan.
7. In the Scope of Development (Attachment No. 6), the
140,000 square feet refers to newly constructed
additional gross leasable mall area. Some outbuildings
may be demolished and the leasable area lost by such
demolition is not to be "netted" against the new
construction.
8. The fees, charges and costs paid into escrow by
Redeveloper (Section 302-3) in fact shall be borne
half-and-half by Redeveloper and the Agency. The
Agency portion shall be advanced by the Redeveloper
under Section 302-3, but will be applied against the
$750,000 cash or credit to which the Agency is entitled
under Paragraph 2 of this Rider.
9. The City's obligations to the Redeveloper in relation
to this Agreement will be reduced to a City/Redeveloper
Business Points Letter, which shall be approved by the
City and signed by the City and Redeveloper on or
before the close of the First Escrow. In that
City/Redeveloper Business Points Letter, among its
other provisions, the City will acknowledge that the
conditions precedent to the vacation of 5th Avenue
(including without limitation the Fig Avenue and DDA
conditions) will be deemed satisfied and removed,
effective on the close of the First Escrow (through
which the bed of 5th Avenue is conveyed to the
Redeveloper).
10. Regarding the mitigation items required by Section 3.1
of the EIR (Section 409-3 and the Scope of
Development), Redeveloper shall be responsible for
construction and installation at the specific
intersections described in the text of Section 3.1, and
not for any consequential work (such as traffic light
synchronization), or other construction or installation
at any more remote intersections.
11. The specific dollar amount and the reference to "best
efforts" in Section 409-6(b) are deleted. Redeveloper
agrees to actively encourage and cooperate in the
upgrading of the exteriors and interiors of the
Broadway and Sears stores, including using good faith
efforts and good faith inducements, consistent with
prudent business practices and Redeveloper's obligation
to actively encourage and cooperate.
12. The $5,000,000 insurance requirement of Section 412 may
be met by certificates of insurance, or by a program of
self-insurance naming the Agency, the City, their
respective officers, etc. in the same way that a
certificate of insurance would name them.
13. In the Grant Deeds (Attachment No. 8) and Agreement
Containing Covenants (Attachment No. 10), the covenants
to be recorded (a) will be revised to conform to this
Rider (as appropriate), and (b) as to covenants that
will survive the issuance of the Certificate of
Completion, will be screened so as to contain only
those covenants that are necessary in order to satisfy
the Agency's statutory legal requirements. For
example, if an absolute obligation to rebuild after
total uninsured earthquake destruction is not
statutorily required, or if "freezing" the exterior
look of the shopping center for the next 25 years is
not statutorily required, those covenants should not be
included.
With respect to the covenants removed from the
Grant Deeds and Agreement Containing Covenants, the
business issues addressed by those Attachments are
hereby referred to the Agency staff, for their good
faith determination of the proper scope and extent of
the protections reasonably needed by the Agency in
relation to those issues, consistent with the
requirements of the Town Centre II Plan and the
issuance of any Certificates of Participation, to be
reduced to a letter agreement or other non-recordable
form of agreement between the Agency and Redeveloper.
Redeveloper agrees to cooperate with the Agency staff
to resolve such issues in a good faith and fair manner.
14. The Agency is satisfied with the assurances referred to
in Sections 300-5(c) and 422 regarding:
(a) Redeveloper's ability to complete the
improvements;
(b) Redeveloper's evidence of equity capital and
financing; and
(c) The Sears and Broadway participation as
evidenced by their letters.
The financial information submitted to the Agency by
Redeveloper will be kept confidential in strict
accordance with the covering letter accompanying it,
which will be signed and delivered to the Redeveloper
by each person who is allowed to review it prior to his
or her review.
15. Redeveloper shall bear the risk of increased project
costs and obtain the benefit of project savings after
the execution of this Agreement. Changes to the Basic
Concept Plans and subsequent drawings and plans which
have an effect on the cost of the project shall be
handled as follows:
(a) Redeveloper shall bear the cost of changes
which are consistent with the logical evolution of the
Basic Concept Plans and Scope of Development as set
forth in this Agreement;
(b) Redeveloper shall bear the cost of changes
required as a part of the City's review of plans and
11
specifications for compliance with building codes and
other such statutory obligations;
(c) Redeveloper shall be subject to the Agency's
Design Review Process. The Agency agrees that the
Design Review Process will be implemented in good
faith, and that any changes required as a result of
that Process will be reasonable and non-arbitrary.
16. The standard for intra-corporate transfers at any time
by Redeveloper shall be the standard stated in Section
418, and not the standard of "approval not unreasonably
withheld" as erroneously stated in Section 109-2.
17. With respect to sales, transfer, etc. under Section
418, contracts to sell, transfer, etc. that cannot
close by their terms until after the issuance of a
Certificate of Completion are not prohibited.
18. If requested by Redeveloper, the Agency and the City
may permit Parcels 1, 5 and 6 to close other than
concurrently, so long as Parcel 1 has closed on or
before the close on Parcel 6. Where applicable, the
phrase "close of the First Escrow" will continue to
mean the close of escrow on Parcel 6.
12
19. The Agency's review and approval of the Design
Development Documents under Section 403 and the
Schedule of Performance (Attachment No. 7) is limited
to review of such documents at the stage of evolution
· that they are required to be in, in connection with
their design review, after input has been given by the
Design Review Committee. Later logical evolutions of
those documents, including by way of example and
without limitation, working drawings, detailed plans
and specifications, are not required to be submitted to
or approved by the Agency. The foregoing sentence
applies only to logical evolutions of approved
documents; it does not apply to changes of the kind
that this Agreement requires to be submitted to the
Agency.
20. The bonds referred to in Sections 408-1 and 408-2 are
to be construction bonds covering the performance of
construction work by Redeveloper's general contractor,
not bonds covering performance by Redeveloper under
this Agreement.
21. The texts of the Site Lease, Agency/City Lease and
Operating Lease will be amended to include references
to the Recognition and Attornment Agreement (which
13
shall survive the issuance of Certificates of
Participation). The texts of the Site Lease,
Agency/City Lease and Operating Lease will also be
amended to include customary provisions allowing
leasehold loans and related lender protection
provisions (subject to any requirements later imposed
in order to facilitate the issuance of Certificates of
Participation). The Recognition and Attornment
Agreement described in the Financing Plan (Attachment
No. 5) will be executed and recorded concurrently with
the foregoing leases.
22. The Agency will deliver title to Parcel 6 (5th Avenue
and the fillets) to Redeveloper at the close of the
First Escrow, free and clear of Exception Nos. 54, 56,
57 and 58 attached to this Rider (except that as to
Exception No. 58, matters disclosed on the ALTA Survey
may be shown).
23. The Agency will deliver title to Parcel 4 (Boys Club)
to Redeveloper at the close of its escrow (if
Paragraph A is elected under Attachment 13), free and
clear of Exception No. 85 (except that matters
disclosed on the ALTA Survey may be shown).
STATE OF ILLINOIS)
County of Cook )
BEFORE ME~ a notary public in and for said County and State~ personally
appeared Mark L. Yates and Renee Kessel, known to me to be the individuals
described in and who executed the foregoing instrument as Vice President and
Assistant Secretary of Homart Development Co.~ a Delaware corporation~ and
acknowledged to and before me that they executed such instrument as Vice
President and Assistant Secretary of said corporation and that said instrument is
the free act and deed of said corporation.
WITNESS my hand and o£ficial seal this a~ day of July~ 1987.
My Commission Expires: 6-//- ff~ NOTARY PUBLIC d
(Corporano.t TICOR TITLE INSURANCE
~, On Au~tust 18, 1987 before
~" ~7~ said State, personally appeared Thomaf j. Harron me, the undersigned, a Notary Public in and for
It-i? personally known to me j0.~EX~.~}lXt)~tt,~°
· ,~ wltuln ms=ument as the Agency Attorney
~and~ev of Chnla V~a Redev~-
~_~e~so~a~y known to me ~ ...::::::::::::::
t~ P~g~a%~cute t -e w;t' id ~nstrument~s the Mary Elaine Chave
~ttornoy ~f the Corporation
that executed the within instrument and acknowledged san DIEGO COUNty
to me that such corporation executed the within instru- ~_. ~l C0mmfssi0n Exolres Mat. 1, 1991t
merit pursuant to its by-laws or a resolution of its
board of directors. ~ ~
WITNESS my hand and official seal.
~ ~ (This area for offici~ notari~
(Corporation) ~ TITk
STATE OF CALIFORNIA
COUNTY OF San Dtego } ~.
On August 19, 1987 before
said State pe~onal y appeared John D. Goss me, the undersigned, a Notary Public in and for
personally known to me
~R& to be the person who executed
the within ins~ument as the C~ ~xr ~n.~ ~
~, and., - .......................
.............. personally known to me Of
, ~proved to me on the basis of satisfactory e~dence to be
~ , .
the person who executed the within instrument as the Mary ElalneChavez
_ - ~ ~ of the Corporauon
that executed the within instrument and acknowledged S~N mmo eo~tv , ,
to me that such corporation executed the within instru- L ~0~flmh~
ment pursuant to its by-laws or a resolution of its
WITNESS my hand and official seal.
Signature ~5~~
~- - (This area for offici~ notarial seal)
TO 1945 CA
(Corporation)
STATE OF CALIFORNIA ~ TICOR TITLE INSURANCE
COUNTYOF S~ Diego ~} ~.
said State, pe~onally appeared n_ . -- before me, the undersi ned a -
personally kno ......... ~Doe~.~-_ g , Notary Public
the person who executed rhe within insrrUmenr as the
'~at executed the within instrume Mary ElaineChavez~
WITNESS my hand and official seal. ~--:~*':
Signature '~ ,~
' ~ : 5T~is area for
notarial scad
CAT, NO. NN00737
TO 1945 CA (8--84)
(Corporation) ~ TICOR TITLE INSURANCE
STATE OF CALIFORNIA
COUNTY OF San D±e~o ~
On August 25, 1981 before me, the undersigned, a Notary Public in and for
said State, personaiiy appeared Gregory R. Cox
personally known to me
_ _ to be the person who executed
the within instrument as the Cha±rman ~,~.,
~ of the Redeve±opment
A_~mney personally known to me or
proved to me on the basis of satisfactory evidence to be
the person who executed the within instrument as the
ment pursuant to its bydaws or a resolution of its
board of directors.
WITNESS my hand and official s?L
}ignature (This area for official notarial seal,
TME fOLLOWING ITEMS AFFECT DARCFL 4:
83. The Lien of Supplemental Taxes, if any, assessed pursuant to the
provisions of Chapter ~.5 (commencing with Section 75) of the Revenue and
Taxation Code of the State of Cal~fornia.
B4. An easement or right of way for the construction and maintenance of
flumes, canals or aqueducts, conveyed to the Kimball Brothers Water Company,
by deed dated June 9, 1869, and recorded in Book 7, Page 124 of Deeds.
85. Matters which may be disclosed by an ~nspection or by a survey of said
land that ~s satisfactory to this Company, or by inquiry of the part~es ~n
possession thereof.
T~E FOLLOb'INO Illin! ~ PARCEL 6:
52° The Lien of Supplmntal Taxes, if any~ assess~ pursuant co
provisions of ~spter 3.5 (coa~nc~ng ~Ch ~eCion 75) of the ~venue and
Taxa:ion Code of the State of ~lifo~ia.
53. ~ e*se~nt or right of ~y for th~ construction and ~intensnce of
fl~e,, canals or aqueducts, conveyed co the ~uba11 Brothers ~ater Co~any~
by deed dated ~e ~, 1869, and recorded in ~ok 7, Page 124 of ~eds.
5~* ~ easeMnc for the purpose sho~ ~low a~ rights incidental there~o as
set forth In a docent
Granted to: ~e ~ity of ~ula Vista
~pose:
A sidevalk, together ~ch t~ right Co enter upon and
paso and repass
bcorded: ~y 20, 1966 as File No. 8~72~, ~ficial bcords
~fecCo: ~e route thereof affects a portion of said Parcel ~A as
~re fully described In said d~nc
55. ~sCricCions ~ the use, by ~he o~ers of said la~, of the easeeenc area
as sec ouC in c~ easement docu~nc
~corded: ~y 20~ 19~ as File No. 8~729~ ~ficial ~cords
5~. ~ o~eeen~ for the purpose sho~ balmy and rights incidental thereto as
sec forth In a dot.enO
~anced co: C~Cy of ~a Vista
(No ~presenCaCton is nde as co the present o~ership of
said easeuent)
~ome: Sidevalk
~corded: ~y 20, 1966 as File No, ~730, ~ficia1 ~corde
~fects: ~aC port~ou of ~ 5 ~n ~arter ~ction 1~8 o~ ~ula
Vista, according Co ~p No. 505, filed in the ~fice of
the ~unty Recorder of Sn ~efo ~uncy, State of
~lifo~ia, described as
~fiuni~ at the Northeasterly corner o~ said ~t 5; the~ ~uth 19' 07' 10'
~oc, aloha the hoterly line of said ~t, S,~ feet; thence South 70* 57' 00"
~est, parallel ~th and 5 ~eeC Southerly o~ the Northerly line of said LoC,
1217.91 ~eet to the befinniu~ of a tangent 20 foot radius curve to the le~t;
thence ~emCerly alo~ the IFC O~ said cu~e chrouKh a central angle of 89* ~9'
50" a distance of 31.~1 ~eeC co a ps,nC on the ~oCeFly l~ne Of ma~d
thence North 19' 02' 50" ~e8t, along said ~eoterly ll~, 2a.99 feet ~o the
Northwesterly co.er o~ said loc; thence North 70° 57e 00' ~oc~ alon~ the
Northerly li~ of oa~d ~C 5o 1237,9 ~eeC Co the Ps,nC o~
AFfects: ~rcel 1
57. ~e rights of the public Co use any portion lying ~c~in Sth Aven~.
5~. ~laC~ers v~tch nay ~e disclosed by an inspection or by a survey o~ said
land ~hat is satisfactory to ~his ~any, or by inquiry of the ~rties
24. In the event of any inconsistency between this Rider
and the Agreement, this Rider shall prevail.
Dated: April 29, 1987
REDEVELOPM~NT AGENCY OF THE
CITY OFa iC~.i S~
hers B?: '~h rego~y x
~R~O~ED AS To
~ho~as H~, A~e~c3 ~tto~e3
istant Secretary
~PROVED:
CITY
~y Manager, John Goss
APP~,~ED AS TO FORM:
T'~omas Ha~'r~, Agency Attorney