HomeMy WebLinkAboutRDA Packet 1995/05/23
Tuesday, May 23, 1995 Council Chambers
6:00 p.m. Public Services Building
(immediately following the City Council meeting)
Special Meetin2 of the RedeveloDment A2encv of the CitY of Chula Vista
CALL TO ORDER
1. ROLL CALL: Members Alevy -, Moot -, Padilla -' Rindone -, and
Chairman Horton -
2. APPROVAL OF MINUTES:
BUSINESS
3, WRITTEN COMMUNICATIONS:
4. REPORT RESULTS OF REQUEST FOR PROPOSALS (RFP) FOR THE SALE OF
EL DORADO PLAZA BUILDING AT 315 FOURTH AVENUE UNDER
THE OWNERSHIP OF THE REDEVELOPMENT AGENCY - The
Agency directed staff to issue an RFP for the sale of the El Dorado Plaza
Building. Three proposals were received by staff and are described in the
report. Staff recommends that the Agency reject all proposals received and
direct staff to explore one of the alternatives discussed in the report.
(Community Development Director)
5, RESOLUTION 1454 APPROPRIATING FUNDS, ACCEPTING BIDS, AND AWARDING
CONTRACT FOR DEMOLITION AND SITE CLEARANCE OF
EXISTING BUILDINGS AT THE FULLER FORD SITE AT 760
BROADWAY IN THE CITY OFCHULA VISTA, CALIFORNIA (RD-133)-
-The work includes removal of buildings and disposal of existing improvements,
excavation, grading, and other miscellaneous work. The clearance of the site
is being done to facilitate the construction of the Broadway Business Homes
project. Staff recommends approval of the resolution. (Community
Development Director! Director of Public Works)
ORAL COMMUNICATIONS
This is an opportunity for the general public to address the RedevelopT1U!Rt Agency on any subject matter within
the Agency's jurisdiction that is not an item on this agenda. (State low, however, generally prohibits the
Redevelopment Agency from taking action on any issues not included on the posted agenda.) If you wish to
uddress the Council on such a subject, please complete the yellow "Request to Speak Under Oral Communications
Form" available in the lobby and submit it to the Secretary to the Redevelopment Agency or City Clerk prior to
the meeting. Those who wish to speak, please give your name and address for record purposes and follow up
action. Your time is limited to three minutes per speaker. ...
"I c'ec'~r~ lIm'er pen-It" of perjvry that I am
em-,Io' e : ~, "¡:",;'~b,'"V,o'Dinthe
COInmu"l] :, :.:O,:;:",n, D('::û,'"",'nt and that I posted
this Age,,':a!.èo,icG en ti',~ Bul!et-n Doard at the
Public Serv¡'ces Build;n~ ~CitY Hall, I
DAT[~( r '7fsIGN /! c.C¿¿; Q-/f/f
Agenda -2- May 23, 1995
OTHER BUSINESS
6. DIRECTOR'S REPORT(S)
7. CHAIRMAN'S REPORTIS)
8. MEMBER COMMENTS
ADJOURNMENT
The meeting will adjourn to the Regular Redevelopment Agency Meeting on June 6, 1995 at 4:00 p.m., immediately
following the City Council meeting, in the City Council Chambers.
......
COMPLIANCE WITH THE AMERICANS WITH DISABILITIES ACT
The City of Chula Vista, in complying with the Americans With Disabilities ACI (ADA), request
individuals who require special accommodations to access, attend, and!or participate in a City
meeting, activity, or service request such accommodation at least forty-eight hours in advance for
meetings and five days for scheduled services and activities. Please contact the Secretary to the
Redevelopment Agency for specific information at 619.691.5047 or Telecommunications Devices
for the Deaf (TDD) at 619.585.5647. California Relay Service is also available for the hearing
impaired.
[C:I WP51 IAGENCYIAGENDASIO5-23,95 ,AGD]
REDEVELOPMENT AGENCY AGENDA STATEMENT
Item L
Meeting Date 5/23/95
ITEM TITLE: ReDort Results of Request for Proposals for the sale of El Dorado
Plaza Building at 315 Fourth Avenue
SUBMITTED BY: Community Development Director ~~.
REVIEWED BY: Executive Director?
(4/5ths Vote: Yes - No..x.)
Council Referral Number: N/A
BACKGROUND:
At its meeting of March 7, 1995, the Redevelopment Agency directed staff to issue a Request For
Proposals (RFP) for the sale of the El Dorado Plaza Building located at 315 Fourth Avenue. The
Agency purchased this building out-right in 1990. The Agency is interested in selling the building to
convert real assets into a more liquid form in order to address the budgetary constraints it is currently
facing.
Staff issued the RFP on March 17, 1995. The deadline for prospective buyers to submit proposals was
Friday, April 28, 1995. Three proposals were received by staff and are described in this report. Staff
is presenting a recommendation concerning the offers received and the following alternatives for the
Agency for the sale of the building:
a) Agency maintaining ownership of the El Dorado Plaza Building.
b) City of Chula Vista purchase building using Development Impact Fees (mF).
c) Agency hiring a specialized broker to market the building.
These alternatives will be described in detail in this report.
RECOMMENDATION:
That the Agency reject all proposals received and direct staff to prepare a project for Council/Agency
review and approval involving the sale of the building to the City pursuant to the terms outlined in this
report.
BOARDS/COMMISSIONS RECOMMENDATION: N/A
DISCUSSION:
Staff issued the RFP for the sale of the El Dorado Plaza Building on March 17, 1995. A list of
approximately 115 brokers and real estate agents from the San Diego region was compiled and a copy
of the RFP was mailed to each of the individuals on the list. Notices were placed in the San Diego
Business Journal, the San Diego Daily Transcript, and the Chula Vista Star News.
The deadline for submittal of bids was April 28, 1995, allowing prospective bidders 45 days to respond.
An open house was also held on April 1, 1995 for prospective bidders to inspect the building. Two
people attended the open house. By the deadline, three bids were received. These bids are summarized
below (see attachments for copy of bid packets). ,tf-I
Page .,L, Itemts
Meeting Date: 5/23 95
Bidder's Name Bid Offered Terms
South Bay Community $1,055,000 $540,000 Private Loan
Services
$250,000 City or
Agency Loan
$265,000 CDBG-1O8
Loan
Mr. William D. Lynch $1,000,000 Cash Payment
Mr. Frank Real $800,000 Cash Payment
After reviewing the bids, staff's opinion is that all three are too low and unacceptable. In 1990, the
Redevelopment Agency purchased the building for $1,720,000 which was considered the market value
of the building. Since that time, real estate values have declined significantly. However, staff concludes
that the prices offered by the three bidders are too low relative to the current estimated value of the
building and anticipated rental income. An "Opinion of Value" requested by staff from a local appraiser
and dated July 11, 1994 supports staff's conclusions. It indicates that the property could command a
value of $1,400,000. The appraiser bases his "opinion" on full occupancy and rental rates between
$0.90 and $1.10 per square foot. (The building houses approximately 16,000 usable square feet.) His
observation was that "demand for this type of building is currently being driven by owner-users or
partnerships of users."
Currently, tenants that occupy the building include four private businesses, three city offices, the Otay
Ranch Planning Team office, and South Bay Community Services (SBCS) , a publicly funded social
service agency. SBCS occupies approximately one third of the building, but does not currently pay
rent. Current net revenues (gross revenues minus expenses) are approximately $6,700 per month or
$80,400 per year. If SBCS were requested to pay rent at a rate comparable to the other businesses and
city offices now in the building, net revenues would increase to approximately $12,000 per month or
$144,000 per year. Capitalizing this amount at a rate of 9% per year, the value of the building would
be approximately $1,600,000. (This estimation assumes that SBCS pays rent and that vacancy rates
remain at the current rate of 4.8%.)
Based on the above discussion, staff believes that the bids received do not represent the potential value
of the property. The Agency or the City would obtain more benefits by maintaining the building under
public ownership. These include:
. Control of the site for future redevelopment.
. Interim use of building to accommodate office expansion until civic center expansion is
completed.
. Source of income through rental of office space not needed for City use.
. Use of development impact fees. to purchase building from the Agency.
The advantages and/or disadvantages of Agency/City ownership are further discussed hereto:
~-JJ
Page ...1.., Item-ii
Meeting Date: 5/23/ 5
Agency maintaining ownership of the EI Dorado Plaza Building
Advantages:
As indicated above, the building currently generates $80,400 in net annual revenues and it could
potentially generate approximately $144,000 in net revenues per year. However, for the building to
generate that income South Bay Community Service will have to pay full rent for the space it occupies.
(Staff will be bringing forward a consideration to the City Council to use CDBG funds to pay for
SBCS's rent for the use of its space at the EI Dorado Plaza Building.) In addition, if the Agency retains
ownership, staff will be returning with a recommendation that the Agency also hire a professional
company to manage the building in a professional and comprehensive manner.
Disadvantages:
While having this cash flow is attractive, it does not resolve the Agency's need to convert real assets
into a more liquid fonn in order to cover the current deficit. In addition, it is questionable whether the
Redevelopment Agency should continue to be involved in the long-tenn operation of property.
Redevelopment law allows the Agency to acquire property for the purpose of redevelopment, which was
the Agency's purpose for acquiring this property in 1990. The intent was to acquire this property to
consolidate it with the adjacent shopping center property. The larger parcel would then be better able
to support a new and more substantial development. Subsequently, however, the Agency approved
plans for the remodeling of the shopping center building which has postponed the comprehensive
redevelopment of the site for about 15 years. Staff does not believe that the long-tenn investtnent would
serve the Town Centre I redevelopment effort as well as would the sale of the property.
City of Chula Vista purchase building using Development Impact Fees (DIF)
Purchase of the building by the City accomplishes several objectives. First, City purchase of the
building releases the Agency from the responsibility of managing property that cannot be redeveloped
in the short-run. Second, it provides a cash infusion to the Redevelopment Agency at a time when it
is most needed. Third, it keeps the building under public ownership so that future redevelopment of
the site is not precluded. Fourth, it provides City control to accommodate interim space needs for staff
and special projects. Finally, it provides a source of income to the City which is needed to help balance
its budget through the private lease of office space that is not currently needed for public use.
Using DIF funds from the Civic Center Expansion Fund would provide the money to purchase the
building from the Agency without impacting the General Fund. Further, the payment arrangement
could be as follows: Based on the analysis provided and the opinion of value of the EI Dorado Plaza
Building, the purchase price should be $1,400,000; the purchase could be undertaken in two
installments. First installment could be made by using $650,000 from the Civic Center Expansion DIF
Fund for the current fiscal year (1994-95). The second installment for $650,000 could be made during
Fiscal Year 1995-96 from the anticipated revenues to the DIF fund. The remaining $100,000 could be
written off from the existing Agency debt to the City's General Fund.
The Civic Center Development Impact Fee program calls for construction of a 23,000 square foot Civic
Center Annex on the current site of the Police parking lot, Community Development Building, and the
;f-3
Page ...1..., Irem-.!i
Meeting Dare: 5/23/95
Legislative Building. Purchase of the El Dorado Plaza building would provide an interim option to this
Annex. It would also take advantage of a depressed real estate market to acquire an asset which could
later be sold at a profit to help finance the final construction. If Council opts to pursue this option.
appropriate notice and a public hearing would be required to amend the Civic Center DIF program.
Agency hiring a specialized broker to market the building
If outside sale of the building is still desired, a better price offer may be obtainable by waiting for
market conditions to improve and marketing the property through a specialized agent/broker. Market
conditions are expected to improve over the next few years and this might offer the opportunity to
obtain a better price for the building. The advantage of contracting with a specialized broker is that
brokers have access to information about the market and access to clients normally not available to
people outside the real estate field. Contracting with a broker would also be advantageous because the
broker can seek the high bids and screen out low ones.
FISCAL IMPACT: Rejecting the bids and having the City purchase the building from the Agency
would have the following impacts on the Agency and City, respectively.
For the Agency:
. It would generate a cash infusion of $1 ,400,000; $650,000 during the current year and $650,000
during FY 1995-96; $100,000 would be written off from existing Agency debt to the General
Fund.
. Disposition of the building by the Agency would forgo a current income stream of $80,400 per
year and a potential income stream of approximarely $144,000 if SBCS pays rent on its space
at the building.
For City:
. Payment to the Agency would require the use of $650,000 in the current fiscal year's
Development Impact Fees Fund for the expansion of the Civic Center; $650,000 from the
anticipated DIF revenues for FY 1995-96 for the same purpose; and writing off $100,000 of
Agency debt to the General Fund.
. City purchase of the building would accommodate the staged implementation of the Civic Center
Expansion by providing interim office space needed by City.
. Purchase of the building by the City could provide rental income of approximately $80,400 per
year or approximately $144,000 per year if SBCS pays rent. The amount of revenues will
depend on how much space not used by the City is rented out.
¥-1
315 4th Avenue, Suite E . Chula Vista. CA 91910 . (619) 420-3620/9790/5051
April 19, 1995
Mr. Miguel Z. Tapia, Community Development Specialist
City of Chula Vista, Community Development Department
276 Fourth Avenue
Chula Vista, CA 91910
Dear Miguel:
South Bay Community Services is interested maintaining its office
space at 315 Fourth Avenue. Our preference would be to continue our
current leasing arrangement'with the City of Chula Vista. If this is
not possible, and the City is going to sell the building, SBCS hopes
to be the purchaser so we can continue effectively serving lower
income Chula Vista youth and families.
Financing for SBCS' potential purchase would be a mixture of private
and government funds. We propose a purchase price of $1,055,000
derived from a $540,000 private loan; a $250,000 long term, deferred
interest loan from the Redevelopment Agency or other City resource;
and $265,000 of CDBG-Section 108 financing.
There are a number of advantages to the ,City. First, the Agency would
get an immediate cash infusion of over'one million dollars. The City
would hold the $200,000 loan as a second trust deed and recover this
amount, plus interest if SBCS ever sold the property. The $275,000
CDBG-Section 108 loan is much less than the present value of many
years of CDBG dollars SBCS would request to cover its rent payments
to a private landlord. SBCS would enter into a long-term lease with
the City for its current spacE:, plus other space as it becomes vacant.
There is local precedent for SBCS' proposal. The City of National
City recently funded MAAC Project's purchase of an office building
under a similar financing structure utilizing CDBG funds.
Let me restate that SBCS only wishes Community Development staff to
entertain this proposal if they decide to definitely sell the
property. SBCS would prefer to continue our current relationship.
, - -\
S~n*,ely,
"---~.l -
J//;/,
/Kathryn Lembo
~n~~Executive Director FrJNDED 1jj~
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COUNTY OF BAN 01"00
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Voir
Commercial Brokerage April 10, 1995
One of The Voit Compania, Miguel Z. Tapia, Community Development Specialist
Community Development Department
276 Fourth Avenue
660 Bay Boulevacd Chula Vista, CA 91910
Suite210
Chula ViS1a, Call1,,"ia
91910 RE: PROPOSAL TO PURCHASE
Tel (6191498-4560 315 FOURTH AVENUE, CHULA VISTA, CA
Fax (6191498,4567
Dear Mr. Tapia:
On behalf of my client, William D. Lynch, or assignee, I am pleased to
present this proposai to purchase the above referenced property on the
following terms and conditions:
1. PURCHASE PRICE: $1,000,000.00, Cash.
2. TERMS: Down payment of $300,000.00; new loan of
$700,000.00.
3. INITIAL DEPOSIT: $10,000,00 upon opening of escrow,
applicable to the purchase price,
4, SECOND DEPOSIT: Additional $10,000.00 also applicable to the
purchase price shall be placed into escrow upon written release
of all contingencies ninty (90) days after opening of escrow. At
this time the total deposits of $20,000.00 shall become non-
refundable, released to Seller, and constitute liquidated damages
should Buyer fail to close escrow.
5. FEASIBILITY STUDY/CONTINGENCY PERIOD: Purchaser shall
have ninty (90) days from opening of escrow to study the
feasibility of this purchase, including, but not limited to the
investigation of existing leases, financing, preliminary title report
and hazardous materials. Should purchaser find this property
suitable for its purposes, Purchaser shall indicate so in writing on
or before the ninty (90) days after opening of escrow.
q- 7
wpdataltcI315-4TH.PTP
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+
Miguel Z. Tapia
April 10, 1995
Page 2
6. FUTURE PLANS FOR PROPERTY: Buyer's plans for the property are to
upgrade (where necessary), manage, and maintain a first class office building.
Buyer's most recent Chula Vista project was the purchase and rehab of the
former Holiday Honda property at 360-366 Broadway.
7. ENVIRONMENTAL ASSESSMENT REPORT: Seller, at Seller's expense, to
provide an environmental assessment report within thirty (30) days of opening
date of escrow including any findings regarding asbestos or any other
hazardous materials effecting subject property. In the event the subject
property is found to contain any hazardous material, Seller, at Seller's expense,
shall be responsible for any such hazardous cleanup.
8. CLOSE OF ESCROW: On or before thirty (30) days after release of Buyer's
contingencies.
Approval of the above conditions and contingencies are solely at the discretion
of Buyer and shall be approved by written notice no later than the time limits
stated in each paragraph. If any items subject to approval by Buyer are not
approved, this Contract may. at the option of the Buyer. be deemed terminated
without liability to the Buyer, and funds will be returned to the respective
parties who deposited same,
9. BROKERAGE: Buyer is represented by Voit Commercial Brokerage. Seller
represents itself. Seller agrees to pay a five percent (5%) sales commission to
Broker upon close of escrow.
10. NON-BINDING: The purpose of this proposal is to outline general certain
terms as the basis on which a proposed purchase contract agreement between
Seller and Buyer may be prepared. Neither Buyer nor Seller intends to be
bound by this proposal. and either party may cancel this proposal at any time
prior to execution of purchase contract agreement. If a purchase contract
agreement between Seller and Buyer is ultimately entered into, Seller and
Buyer intend the purchase contract agreement to be the entire agreement
between them, and the terms of this proposal shall not be used to construe or
interpret any such document.
If this proposal meets your approval as the basis upon which to prepare a draft
purchase contract agreement. then please sign the proposal and return a copy to me,
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von CHULA VISTA TEL:1-619-498-4567 Apr 10,95 13:39 No.003 P.04
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Miguel Z. Tapia
April 10, 1995
Page 3
Seller and Buyer acknowledge that Volt CommercIal Brokerage and Its brokers,
agents, employees and representatives make no representation or warranty that
either Buyer'. or Sell.,... .Ignlng this proposal or continuing negotiation of a
propo8ed purchase (whether Dr not negotlatlon8 are based on this proposal) wIll
ensure or result In a Sale for the Premises being exeGuted and completed.
Mr, Tapia, I have enclosed herewith a personal resume for Mr. Lynch and a financial
statement. Please let me know If you have any questions conceming this proposal or
require any additional Information. I look forward to hearing from you.
Respectfully.
VOlT COMMERCIAL BROKERAGE
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Tracy ~
Vice Preslden
TCC/tSr
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By:
AGREED TO ACCEPTED THIS - DAY OF 1995.
SELLER:
By:
Ita:
SELLER, BY ITS SIGNATURE ABOVE, HEREBY ACKNOWLEDGES RECEIPT OF A
COpy OF THIS PROPOSAL.
wpdata\lC\315-4111,PTP
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THE WILLIAM D. LYNCH
FOUNDATION FOR CHILDREN
SCO'IT B.HlMELSTEIN
EXECUl'IVE DIRECTOR
William D. Lynch
Founder
William D. Lynch Foundation for Children
Date of Birth - September 8, 1942
Education - B.B.A. - State University of Iowa
Residence - 16 years Rancho Santa Fe, California
Married - Two Sons, Two Grandchildren
Occupation: Businessman - Owns and operates, Beauty
Boutique, Inc. (Cosmetology Schools), Dining Yachts,
Apartment Units, Commercial Real Estate, MLV, Inc.
(Laundromats), Iowa Farms and several other holdings and
ventures.
Current Organizations and Affiliations: Board of Directors
City Club of San Diego, Board of Directors Reading Recovery
Council of North America, S.D.S.U. Presidents Council,
C.A.R.E.S. Executive Board, Lincoln Club of San Diego
County, Fairbanks Country Club, Rancho Santa Fe Country
Club, KPBS Producers Club.
Recent Awards and Recognitions: International Reading
Association and Greater San Diego Reading Association's
Celebrate Literacy Award; SANDAPP-Collaborative Spirits
Award; Children's Hospital and San Diego County Office of
Education - Champion for Children Award; Sand Diego County
SER/Jobs for Progress and the Amigos de Ser Advisory Group
Award; Soviet-American Forum for Life with Human Rights;
University of Iowa College of Business Administration
Special Support Award; poway Unified School District -
Reading Recovery Award; San Diego County Sheriff's
Certificate of Appreciation.
Attached: Brief description of Lynch Foundation's major
programs.
4- -II
~~ ~~~ 04~- -"'~-~ 000-' -- ~, ...--" --.. -" - '^ --' "-Mn_--M
WILLIAM D. LYNCH, Rancho Santa Fe, California. President of the
WILLIAM D. LYNCH FOUNDATION FOR CHILDREN. The Foundation
underwri tes research and funding for children's causes in San Diego
County. Current projects include:
1) San Dieoo Coalition for School Aoe Mothers
The Foundation provides a building, van and
technical/staff support.
2) Even Start - The Lynch Foundation is the
recipient of matching funds for the largest
Even Start Program in the State of California
- a 4 year Sl.5 million project.
3) Readino Recoverv Fund - The Foundation has
pledged S50,000.00 per year for 10 years to
supporting San Diego County Office of
Education, and the 43 Districts of San Diego
County in an attempt to fully implement
Reading Recovery in San Diego County.
Mr. Lynch is a businessman. His holdings include Commercial Dining
Yachts, Cosmotology Schools, Coin Laundries, Apartment Houses,
Commerical Real Estate and Iowa Farms.
'-/ -I:¿
CASHILIQUID ASSETS:
In Banks ." ..
WedbushSecurities (WDL)
WedbushSecurities- WDL Company
OPERATING COMPANIES:
MLV Coin Laundries (59.40%)
Beauty Colleges (50%)
SAN DIEGO REAL ESTATE:
Home
Morena Assoc. (42.5%)
Morena.Investors (17%)
Massachusetts Building (50%)
CV Shopping Center
YACHTS:
Renown 345,422
High Spirits 850.000 1,195,422
5.996.651
Minor
Assets Equitv
Hall Promissory Note 150,000
Smarcal, Ine. 25,000
H & H Farms (Iowa) 150,000
Gm. MIn. Bank Stock (Iowa) 50,000
D & B, Ine. (Iowa) 140,000
M W& W (Iowa) 50,000
Marshalltown Farmland (Iowa) 70,000 635,000
$
Equitv
725,568
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",. AP,R 28 '95 13:,~9 PAGE.0BI
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Aprl126, 1995' ..
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Miguel Z. TipJa VIAFAX:47c¡.;5jl0 "
Community. .Development Department ORIGINAL MAn.BD: +:27-9S ' "
CITY OF CHULA VISTA
276 Fourth Avenue' ,
CbulaVüta,. CA91910'
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" , : 47 ..- - OIS FOUJmI A VENDIO car'"' VISTA ,.\~:':'
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',',:"" On~~øY_EiailkReal(Buyer).IamlUbmittingthlsletunvl¡tøh.haa~~~:"" , '
to I'urcbase;. bY tbc,~refènmœd Buyer or Nol1ÙnOO. :fur the propI!rty ~ above, fÌ'OÇ1'tbe'
CityOf~"V~(~er)onthetermsandCOnditionssetfurthbc:fow:' '" , ,
1. 1'II'&PROnitTV: SeRer hc:rcby agrees to Se1l to Buyer, ai1d Buyei ~~.:ïO' "
. . ~'Ji'oID;,sÇIIer, that certain Iåù property located lit 31s.Fourtb Aveoue. ChuIìL,V~:"
. . , ~.öf~15.743I11 U11R1filetofDetleasabløo~ç..pac.. ".:,
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'," 2:' ...-rrRm.tO .'pRrt:=I!:: Tho purcbaee price fòr the ptOpetty 8haI1 be,fbe IIID1 ot~OÎJ(J;: ":.'.,
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4" BUYER'S DEPOsIT: UponopeoiDsofesc:row, Buyersballdeposinrithesaowllolder;: """
SJ!lÎÐ8:MåuøIaiD"~, twenty thousaod 8Dd NOI100 Dollars ($20.000.00). 'JfSoJief,~:,,- '..
':-) to pettbnD,"11dIfå'.:tbe term& and cxmditions orthe Purchase ~ ~ ~~-~ ,,~, ' ' :
to prOdieeIl W!ditbis tQDsactÏOD during tho ag¡œd CoDCiIIgem:yPeriocl, t!Ien tile eIItire deprisir'
iaw,~re1iJi!dcIdtotbeBuyerwil:hontoffiJet.. '", ' "",," :
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5. R1i!Ì B.cœÓF BtMtlt'S DEPOSm IntbceveotBuyer bas ~ all ~ ~
" bas~ to"hIs 1llltÏs6lcti0D, aJlpertlœatdoc:umimtsfdataOI1:thopropCrty. eøc:rowhol,dcr" ' ,," , '
",- sbaU i'e1eIisolbe,~.OOO deposit to Seller providing Seller has cIear,tI'IUISfinb1e title"to,tIIe
'¡", ~'. ~aid,~,OOO shall be applicable to purçIwe price. , ' ',,' '
6. cmri1NGttNCY PERIOD: The Buyer's obligation to JIIÙcbasc.- ~ comiiúi:nia1""
~",:, upon~lI-~on and/or approval ofeach of1he tò~widù1145'days orOpeiW¡g ,
of e8C1'QWi :, ' ' ,,' ,
A.' , ," ~O1:a ~ 1hIe report and oopies of all ~ of~ ~"~~f ',,:
, ' I;JI,nd~~all Commerola! Propertm - Salea & Leasing I PtQPeI'ty Management Q ',,' ";" .. -.-
.., 2320 Paseo de !as Arneriœa, # 200, Otay Meea, CA 92173, (619) 66'~1; 'FAX. (819) 861 ~ : "
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APR 26 '95 13:50 PAGE.002
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"(20)daysdrrec:eipt. Buycrsha1l reviewaBIeases. útloinfOmiatioa. C'C'&R't,1IPd'atty,
and an eUcumbmDœs of tho property. ' ' ,
... B. BityeI:'~,~ oftbe property base4 upon a wa1k:-through inspection withB~1i :
, gcœralëonttactor. ' " ..
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c. "':~,,~~tbe~tothoBuycrforBuyet'~,~,wj1hin.t.ea<lO)~ot ':,
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.::".."'.:yøø:'.ø:BcknltaXretumwbichliststbeexpeøsesmidd~~ ." '. ... .
~~;: ,~OIlS IUIIi warraøtie& whiah shall surviw 1he cJose,of.eaçrow ~a'futm .
". ':~lIItIsðu:tmytoOOllD8ll11brBu,e.-. . .'..,'.' :,.. ,
,."';:',' ',,~: CopiøsofBDyexistiøøaportsœ1aliaatot,lds~. '
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('t: ,,' D. ,~,IDII reaewaI of1easel wI1h die aty otChulà V'JSIa ais,We1i" U'IIDÝ~\ "" - '¡..'
.:~~. . , '.. ~~wbichBu,ercleemBDllœ888lJ1o1icllibde:fþe. 1'!D~n""r."'Y~:~ ...:" .
,," , , ..::~,,~ 8Dd ~ only" an other itaDs ~ ~by tile- BUY*'" ..
7. ~~.:;~"sa1c sbaII bo COJI8UJIII118te tbruugh Spriøs MDUaaain Bsçrow, . The~~"
", date,,~~"r: shall be sixty (60) days ftom tbe date otøØeøiøg escrow. . ..: .."
"'" "8. ~Aim~.ltJNSURANCE: A1tbeolosoof~,;"sd1cf",~d!fiver~~..::"". .:';,,'
,t; " by Gmat ~~a"- timpIe interest in tbe Property fteo and - of I!Il : idç~cm.:. ~" " \
~! þ-~~",,:ipproved by Buyer in wñtiøg. Also at WI ë1ose of .crow;BuYet - "
" ~14 ~S' expeose. III1 ALTA OWDCt's Po1ioy of Titlo ~ issuc4 ~ 1Iip.t." ,,"
":",, ' ~"'r"*'.subject only to die title esœpdoøs pnMousIy""ap¡,rcmñb.Y"Buyc£. ~fi'st" "
:: ,'g, " ~::-.::="'--"'~"--." ' ,"
A.~Uver'-1I ClMÍI1IJ ('not~. Buyer shIIJ1 pay one-baIf' of aD'~ 1bs;~ ~ s "
"B.~,:1":~~:=~::aydcosts~~of~~'a1L' .:;:
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. I~ imøsfer taxes, tbo GOSt of a policy of title ~, onHøIf thë~ ' :'
-..:aàIëi'~...wn and the usual Seller's ~ drafliø& ~ tecordin& cbaiges.: ,
C.' ~,~ a-- diIIIrict and nma sbaD.bc proI1II:ed !It 1bc close of csc:roW; Au,
':.. :: 5§~~j~...,;
'>;, ~~ s.1)Q p.m. on May IS. 1995. and IIId1 ~~to'~,öt ':-: : :.; '¡-
=a=~=~~£~-"¡t .
otber ~ ~ propcltics. Anotht:c issue whk:h we fitotoréd ÚItO our ~ - Wst' '
tbe aty ~ ~ is tile renovation of tile boiJ!IÎIIg as p!aImed by 1he BuYer.', This reœY:atiJn. '
, piau 1øduiIâi~ tho ~ tbmush P!ÙIJtÌIIg. - tiJe, ~ eab,~ ~
hup.v.~, ~lot ~ ctc. '1'bc iÐIaior wJI1 be nûIrbishcd when ~:~~: :" ',',-'
Should. ¥'t,:,RbQ~.~ be acccpted. iI is his,iateatioa. to nII8iD my Fitœ to.Ieue~ ~~,~..: :, '~;.
buIIdIag. ~:we ~ tho City wou1d 8ppI'fICiaIc th!s ... ,1ÎIIœ 1bic ~ ~ ,\tr. : '
1be~'~ IIIIþaDce 118 apptIIII1IIDIlDd opcradøs IUCCeIIL 18vi18 you1o Y¥' øriÿ óhtre ' ,
Ities'M~!v.tichtotalSOO.OOO filetofrcata1 " ',:"'" : ", '
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= ~.~~ International Real Estate / " ,~
. A Division off.RE Enterprises, Inc. .1
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I
Redevelopment Agency - Agenda Item #5
This letter was faxed to staff after the Agenda
May 19, 1995 packet was delivered.
Chris Salornone Via Fax #476-3310
Community Development Director Original Mailed: 05/19/95
CITY OF CHULA VISTA
276 Fourth Avenue
Chula Vista, CA 91910
RE: FORMER FULLER FORD SITE
Dear Chris:
This letter will confirm Mr. Courtney's desire to purchase the former Fuller Ford site on the west side
of Broadway in Chula VISta. We understood that this site consists of approximately 110,250 square
feet of commercially zoned land and approximately 33,000 square feet of automotive use buildings,
Based on Mr. Courtney's intimate knowledge of the property and the neighborhood, he is prepared
to offer the City $700,000 cash for this site subject to standard contingencies. This Offer is based
upon the buildings I1Q1 being razed and an escrow period of not more than 90 days.
Mr. Courtney's acquisition of this property would be in addition to the South Bay Chevrolet site and
would be financed through private sources.
We look forward to working with the City on this transaction,
Sincerely,
INTERNATIONAL REAL ESTATE
~
Michael A. Vogt
MA V:sks
cc: Jim Courtney
C,1WP6' MKE\CLlBNTSICOURTN1IJ"-'1ALL'"
0 Industrial! Commercial Properties - Sales & Leasing! Property Management 0
2320 Paseo de las Americas, # 200, Otay Mesa, CA 92173, (619) 661-6681, FAX (619) 661-6685
REDEVELOPMENT AGENCY AGENDA STATEMENT
Itemí
Meeting Date OS/23/95
ITEM TITLE: Resolution 1454 Appropriating funds. accepting bids. and awarding
contract for "Demolition and Site Clearance of Existing Buildings at the
Fuller Ford Site at 760 Broadway in the City of Chula Vista, California
(RD-133)"
SUBMITTED BY: Director of Community Development (,t;
Director of Public Works
REVIEWED BY: Executive Director ê 14/5ths Vote: Yes.1LNo-->
BACKGROUND: At 2:00 p.m. on May 3, 1995, in Conference Rooms 2 & 3 of the Public
Services Building, the Director of Public Works received bids for "Demolition and Site
Clearance of Existing Buildings at the Fuller Ford Site at 760 Broadway in the City of Chula
Vista, California IRD-133)." This work includes the removal of buildings, removal and
disposal of existing improvements, excavation and grading and other miscellaneous work
required by the specifications. The clearance of this site is being done to facilitate the
construction of the Broadway Business Homes project recently reviewed by the Agency.
RECOMMENDATION: That the Agency: 1) appropriate $107,000 from the anticipated surplus
revenues in the Otay Valley Road Project Area Fund to RD 133; and 2) accept bids and award
contract for "Demolition and Site Clearance of Existing Buildings at the Fuller Ford Site at 760
Broadway in the City of Chula Vista, California (RD-133)" to Watkins Contracting, Inc. - San
Diego in the amount of $89,417.
BOARDS/COMMISSIONS RECOMMENDATION: Not applicable.
DISCUSSION:
At the meeting of May 2, 1995, the Agency reviewed plans and issues related to the
Broadway Business Home Project and directed staff to expeditiously process the project
including demolition on the Broadway site.
Funds for this project were included in the Fiscal Year 1994-95 CIP budget (See Exhibit A).
However, the funds are not sufficient to do the demolition work. Staff proposed to include
the additional funding in the 1995-96 CIP budget. However, because of the urgency of the
Broadway Business Homes project, and the need to demolish the existing structures at the
Fuller Ford site, staff bid this project prior to the approval of next year's budget so that the
demolition work could proceed as expeditiously as possible.
The Agency approved a Semi-Exclusive Negotiating Agreement with the developers of the
Business Homes Project in July 1994. The Project will be reviewed by staff and the Design
Review Committee this May/June. It is scheduled to go before the Planning Commission for
a required zoning change on June 14, and to the Agency for final approvals on July 11, 1995.
In order for the project to be under construction late this summer, site clearance must begin
now.
s-/
Page 2, Item 5
Meeting Date OS/23/95
Since the Business Homes project has not as yet been approved by the Agency, there is some
risk that demolition of potentially reusable structures may be premature. However, the
structures are old, have been stripped of valuable materials and have been considerably
damaged by vandals since they were vacated last November. Any future reuse of existing
buildings would most likely mean continuance of auto related land uses. The Business Homes
project promises a departure from those uses and the beginning of redevelopment efforts
along Broadway.
Normally, demolition would not proceed until the project was approved and a Disposition and
Development Agreement authorized. However, this is not scheduled to occur until July 11,
1995 which would delay the start of demolition for almost two months. The demolition
contractor has 30 working days (approximately six weeks) to complete demolition work. If
demolition work starts by June 1, the site should be cleared and available by mid July to
coincide with Agency approval of the project. If the demolition work starts in late July, the
site will not be available until mid September.
The Developers are planning to construct model units this summer as well as begin
construction of Phase I for sale in the fall. It is generally more difficult to market residential
properties in the late fall and winter seasons.
Staff is demonstrating the "business friendly" environment in Chula Vista and is trying to
facilitate a development proposal which has very recently been strongly supported by the
Agency. The Developers are serious in their efforts and intent to purchase the property, and
have already invested over $150,000 of their own funds in this project.
Since your last review of this proposal, Courtney Tires has reexpressed their interest in
purchasing the Ford site in addition to the former South Bay Chevrolet property, including the
Fuller Ford improvements. This prospective sale could be $2-3 a square foot higher than what
could be secured through the Business Homes project. This information has been transmitted
verbally to staff by their broker. A written offer is expected by Tuesday, May 23.
Bids were received from six contractors as follows:
Contractor Bid Amount
1. Watkins Contracting, Inc. - San Diego $ 89,417.00
2. Cement Cutting, Inc. - San Diego 94,747.00
3. Cin-Mar Industries, Inc. - San Pedro 97,500.00
4. Roberts Engineering Contractors - Escondido 117,200.00
5. Mark McDowell Corporation - San Diego 128,667.00
6. Rutledge Gradalls - Jamul 135,957.00
The low bid by Watkins Contracting, Inc. is below the Engineer's estimate of $100,000 by
$10,583 or 10.6%.
Shortly after receiving bids, the City received a fax letter (Exhibit B) from the second apparent
low bidder (Cement Cutting, Inc) Questioning the Qualifications of the apparent low bidder,
Watkins Contracting, Inc. to perform the work.
5-2.
Page 3, Item~
Meeting Date 05/23/95
Staff has reviewed Watkins Contracting, Inc. references and determined that the contractor
has the required license, the relevant experience and resources to carry out the work
necessary for the demolition and related work associated with the Fuller Ford Project. We,
therefore, recommend the contract be awarded to Watkins Contracting, Inc.
Disclosure Statement
Attached is a copy of the contractor's disclosure statement (Exhibit C).
Environmental Status
The City Environmental Review Coordinator has reviewed the work involved on the project
and determined that the project is exempt from CECA under Section 15061 (b) (3), the
"general rule" that CECA applies only to projects which have the potential for causing a
significant effort on the environment. Where it can be seen with certainty that there is no
possibility that the activity in question may have a significant effect on the environment, the
activity is not subject to CECA.
Prevailino Waoe Statement
The source of funding for this project is redevelopment funds. The prevailing wage scales are
those determined by the Director of Industrial Relations, State of California, and were
determined to be applicable to the work to be done. No special minority or women owned
business requirements were necessary as part of the bid documents. Disadvantaged
Businesses were encouraged to bid through the sending of the "Notice to Contractors" to
various minority trade publications.
Soils Testino
Current information indicates that the Fuller Ford site is free from soil contamination.
However, since hydraulic lifts are located on the site, it is possible that some seepage at the
base of the lifts has occurred. Agency staff is currently contracting for soils tests in these
areas to determine if there is any subsurface contaminations.
Financial Statements
Funds Required for Construction
A. Contract Amount $89,417.00
B. Staff (Design and Inspection) $8,683.00
C. Contingencies (approximately 10%) $8,900.00
TOTAL FUNDS REQUIRED FOR CONSTRUCTION $107,000.00
Funds Available for Construction
A. Autopark Fund RD133 +$47,650.86
B. Appropriation of Funds from Unappropriated balance of $107,000.00
Otay Valley Road Redevelopment Fund to Autopark - Fund
RD133. (Require a loan from the General Fund.)
TOTAL FUNDS AVAILABLE FOR CONSTRUCTION $154,650.86
+ Approximately $10,000 has been committed to complete slope improvement work
on the Autopark site and an additional $10,000 is needed to undertake soils testings
5~.3
Page 4, Item~
Meeting Date OS/23/95
on the demolition site. The remaining $27,650 will be needed to complete the work
at the Autopark site plus pay for change orders needed for additional work on
Broadway in connection with the Broadway Business Homes development on the Fuller
Ford Site.
FISCAL IMPACT: Funds from the sales of the South Bay Chevrolet parcel will be deposited
in the Otay Valley Road Fund and the anticipated surplus revenues above $1.15 million are
sufficient to cover demolition costs. Sale of the Chevrolet site is expected to occur in July,
and can be accrued as revenue for FY 94-95.
Exhibit A - Capital Improvement Program Detail for Autopark Project
Exhibit B - Letter from Second Apparent Lot Bidder
Exhibit C - Contractor Disclosure Statement
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5 ~fo
.-J5 WED 16: 00 CEMENT CUrTI NG FAX NO, 6182385725
P,02
£)lH-II'biT "ß"
~--------CEMENT CUTTING INC ...---------
.. - - - - - - --- . , .8.- - - -.. - -.-.,
A~~N~ ',p\1Al-~ HAtv' $0 1'/
April 3, 1995
City of Chula Vista
Department of Public Works
Engineering Division
Attn: Roberto Saucedo
Re: Demolition and site clearance
Fuller Ford Site
760 Broadway
City of chula Vista
(RD-113)
De~r Mr. Saucedo:
The apparent low bidder for the above referenced project was
Watkins Contracting.
Demolition is not by any means this firm's strong suit. They
are licensed A, B, and asbestos removal. They do not have a
C-21 license (demolition/house moving) and as far as I know,
do not own any equipment to do the demolition of the structures
at the Fuller Ford site. This leads me to my next point. The
only subs listed were for temporary fence, so how does Watkins
intend to remove the structures? AS part of the specifications
all the subs are to be listed.
It would be in the best interest of the City of chula Vista
to disqualify Watkins Contracting.
Please let this letter serve as Ii formal protest.
Respectfully submitted,
<5~J "^ '\.Á OÇY -Z ~
steve Morgan
5'-7
"-,,..~ ,~." ".....I".f'I r. Q?11l 1619) 231-1735.IN SAN PŒGOCOUt-'TY 1-800-5b4-173~' FAX (619)238-5725
-,
This page blank!
S~!'
£1- t"11 ß ì T "c"
THE CITY OF CHULA VISTA DISCLOSURE STATEMENT
You are required to file a Statement of Disclosure of certain ownership or financial interests, payments, or campaign contributions,
on all matters which will require discrelionary action on the part of the City Council, PlalliÙng Commission, and all other official
hodies. The following information must be disclosed:
I. List the names of all persons having a financial illlerest ill the p"'peny which is the suhject of the application", the Contract,
e.g., owner. applicant. Contractor, subcontractor, material supplier.
iJ.¡J{Aé"":,J
2. If any person" identified pursuant 10 (1) above is a corporation or partnership, list tbe names of all individuals owning more
than 10% of the shares in the corporation or owning any partnership interest in the partnership.
riA
3. If any person" identified pursuant 10 (1) above is non.profit organization or a trust, list the names of any person serving as
director of the non-profit organization or as trustee or beneficiary or trustor of the trust.
/lfÆ
4. Have you had more than $250 worth of business transacted with any member of the City stAff, Boards, Commissions,
Committees, and Council within the past twelve month? Yes - No i- If yes, please indicate person(s):
5. Please identify each and every person, including any agents, employees, consultants, or independent Contractors who you
have assigned to represent you before the City in this matter.
~4
6. Have you and/or your officers or agents, in the aggregate, contributed more than $1,000 to a Council member in the current
or preceding election period? Yes - No .x If yes, state which Council members(s):
Date: ~.~~ç
ignature of Contractor/Applicant
~ (.AJ~ :,.,¡.s I~ .
Print or type ruune of Contnlctor/Applicant
" Pt'r.l'O" is defilled as: "Any individual, firm, co-partnership, joint venture, association, .<ocial club, fraternal organization,
corporatio", estate, tru.'t, ,eceiver, syndicate, thi.' and any other county, city or country, city municipality, district, or other political
sulldirisioll, 0' allY other group or comhi"mioll acting as a u"it. 5 - <1
13
-.
This page blank!
S _/ð
RESOLUTION NO. /1~f
RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE
CITY OF CHULA VISTA APPROPRIATING FUNDS,
ACCEPTING BIDS, AND AWARDING CONTRACT FOR
"DEMOLITION AND SITE CLEARANCE OF EXISTING
BUILDINGS AT THE FULLER FORD SITE AT 760
BROADWAY IN THE CITY OF CHULA VISTA,
CALIFORNIA
WHEREAS, the Redevelopment Agency of the City of Chula
vista has received the following six sealed bids at 2:00 p.m. on
May 3, 1995 in Conference Rooms 2 and 3 of the Public Services
Building for "Demolition and site Clearance of Existing Buildings
at the Fuller Ford site at 760 Broadway in the City of Chula vista
California:
Contractor Bid Amount
1. Watkins Contracting, Inc. - San Diego $ 89,417.00
2. Cement Cutting, Inc. - San Diego 94,747.00
3. Cin-Mar Industries, Inc. - San Pedro 97,500.00
4. Roberts Engineering Contractors - Escondido 117,200.00
5. Mark McDowell Corporation - San Diego 128,667.00
6. Rutledge Gradalls - Jamul 135,957.00
WHEREAS, the low bid by Watkins Contracting, Inc. is
below the Engineer's estimate of $100,000 by $10,583 or 10.6%; and
WHEREAS, shortly after receiving bids, the city received
a fax letter from the second apparent low bidder (Cement Cutting,
Inc) questioning the qualifications of the apparent low bidder,
Watkins Contracting, Inc. to perform the work; and
WHEREAS, staff has reviewed Watkins Contracting, Inc.
references and determined that the contractor has the required
license, the relevant experience and resources to carry out the
work necessary for the demolition and related work associated with
the Fuller Ford Project and, therefore, recommends the contract be
awarded to Watkins Contracting, Inc.; and
WHEREAS, the City Environmental Review Coordinator has
reviewed the work involved on the project and determined that the
project is exempt from CEQA under section 15061 (b) (3), the
"general rule" that CEQA applies only to projects which have the
potential for causing a significant effort on the environment; and
WHEREAS, where it can be seen with certainty that there
is no possibility that the activity in question may have a
¿-- -/1
significant effect on the environment, thè activity is not subject
to CEQA¡ and
WHEREAS, the source of funding for this project is
redevelopment funds and the prevailing wage scales are those
determined by the Director of Industrial Relations, State of
California, and were determined to be applicable to the work to be
done¡ and
WHEREAS, no special minority or women owned business
requirements were necessary as part of the bid documents and
disadvantaged businesses were encouraged to bid through the sending
of the "Notice to Contractors" to various minority trade
publications.
NOW, THEREFORE, THE REDEVELOPMENT AGENCY OF THE CITY OF
CHULA VISTA DOES HEREBY FIND, DETERMINE, ORDER AND RESOLVE AS
FOLLOWS:
section 1. The Redevelopment Agency of the City of Chula
vista has determined that the project is exempt from CEQA under
section 15061 (b) (3).
section 2. That the Redevelopment Agency does hereby
accept the bid of Watkins Contracting, Inc. as responsive.
section 3. The Redevelopment Agency awards the contract
for the demolition and site clearance of existing buildings at the
Fuller Ford site at 760 Broadway in the City of Chula Vista,
California in the amount of $89,417 to Watkins contracting, Inc.,
the lowest responsible bidder which submitted a responsive bid to
the approved specifications.
section 4. The Chairman of the Redevelopment Agency is
hereby authorized and directed to execute said contract for and on
behalf of the Redevelopment Agency.
Presented by Approved as to form by
(:Ui\~
John P. Lippitt, Director of Bruce M. Boogaard, Agency
Public Works ~eY~J
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