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HomeMy WebLinkAbout10/17/2001 - STAFF REPORTS (4) DATE: OCTOBER 17, 2001 TO: COMMUNITY REDEVELOPMENT AGENCY FROM: REDEVELOPMENT DIRECTOR APPROVAL OF AN AGREEMENT WITH KEYSER MARSTON ASSOCIATES, INC. FOR PRO FORMA ANALYSIS ON VARIOUS HOTEL-, RETAIL-, AND ENTERTAINMENT- CENTER RELATED DEVELOPMENTS SEEKING AGENCY ASSISTANCE RECOMMENDATION: It is recommended that the Agency approve a Contractual Services Agreement with Keyser Marston Associates, Inc., in an amount not to exceed $20,000, to conduct pro forma analysis of various development proposals seeking Agency assistance. BACKGROUND: Over the past year, the Community Redevelopment Agency has received several requests for City/Agency assistance from developers of various projects within the City, including the Desert Fashion Plaza project, a proposed hotel on the Prairie Schooner site, and the Star Canyon Resort on South Palm Canyon Drive. Typically, Agency staff conducts a preliminary analysis of the project need, and then hires an experienced Redevelopment public finance consultant to write their estimate of "warranted assistance," (if there is any) on the project. In the past several years this work has been done by Keyser Marston Associates on a project-by-project basis, with the most recent contract approved by the City Council in September, 2000 for$20,000 to cover a variety of projects. Last year's contract covered the analysis of the Prairie Schooner proposal, the Star Canyon Resort, the ACDA's offer on the Desert Fashion Plaza and, most recently, the Canyon Vista project. At this point the funds have been expended and staff is proposing another contract with Keyser Marston in the amount of $20,000 that should provide service through the current fiscal year. There will be a considerable amount of work in the upcoming year with the Desert Fashion Plaza and several other redevelopment projects. Funds are available forthis contract in accounts 81 1-8 1 91-43200 and 812-8192-43200, "Contractual Services." IJOHN . RAYMbN \,Rede lopment Dir ctor —� APP OR VED::;:Zz�l Executive Dlrec of ATTACHMENTS: 1. Resolution 2. Agreement REVIEWED BY DEPT.OF FINANCE e4h b - A CONTRACT SERVICES AGREEMENT FOR ECONOMIC ANALYSIS OF RESORT HOTEL, RETAIL, AND DOWNTOWN RETAIL/ENTERTAINMENT CENTER PROJECTS IN PALM SPRINGS THIS CONTRACT SERVICES AGREEMENT (herein "Agreement"), is made and entered into this _ day of , 2001, by and between the COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, (herein "Agency," a municipal corporation) and Keyser Marston Associates, Inc. a real estate and redevelopment firm (herein "Contractor"). The parties hereto agree as follows: 1.0 SERVICES OF CONTRACTOR 1.1 Scope of Services. In compliance with all terms and conditions of this Agreement, the Contractor shall provide those services specified in the "Scope of Services" attached hereto as Exhibit "A" and incorporated herein by this reference, which services may be referred to herein as the "services" or"work" hereunder. Contractor warrants that all services will be performed in a competent, professional and satisfactory manner in accordance with the standards prevalent in the industry, and all materials will be of good quality, fit for the purpose intended. 1.2 Contractor's Proposal. The Scope of Services shall include the Contractor's proposal or bid which shall be incorporated herein by this reference as though fully set forth herein. In the event of any inconsistency between the terms of such proposal and this Agreement, the terms of this Agreement shall govern. 1.3 Compliance with Law. All services rendered hereunder shall be provided in accordance with all ordinances, resolutions, statutes, rules, and regulations of the Agency and any Federal, State or local governmental agency having jurisdiction in effect at the time service is rendered. 1.4 Licenses, Permits Fees and Assessments. Contractor shall obtain at its sole cost and expense such licenses, permits and approvals as may be required by law for the performance of the services required by this Agreement. Contractor shall have the sole obligation to pay for any fees, assessments and taxes, plus applicable penalties and interest, which may be imposed by law and arise from or are necessary for the Contractor's performance of the services required by this Agreement, and shall indemnify, defend and hold harmless Agency against any such fees, assessments, taxes penalties or interest levied, assessed or imposed against Agency hereunder. 1.5 Familiarity with Work. By executing this Contract, Contractor warrants that Contractor (a) has thoroughly investigated and considered the scope of services to be performed, (b) has carefully considered how the services should be performed, and (c) fully understands the facilities, difficulties and restrictions attending performance of the services under this Agreement. If the services involve work upon any site, Contractor warrants that Contractor has or will investigate the site and is or will be fully acquainted with the conditions there existing, prior to commencement of services hereunder. Should the Contractor discover any latent or unknown conditions, which will materially affect the performance of the services hereunder, Contractor shall immediately inform the Agency of such fact and shall not proceed except at Contractor's risk until written instructions are received from the Contract Officer. 1 em � • I'4i EXHIBIT "A" SCOPE OF SERVICES Contractor shall provide the Agency professional consulting services with respect to the evaluation and negotiation of commercial, entertainment and/or recreational developments and related issues all as directed by the Redevelopment Director. Such services may include, but shall not be limited to: 1. Analyzing the economics of various proposals to redevelop the Desert Fashion Plaza, such as was done for the project proposed by Excel Legacy Corporation. Analysis shall include review of developers' project pro formas, including construction costs, anticipated rent schedules, occupancy rates, and market absorption; in addition, Contractor shall compare developers' projections against industry averages, other benchmarks and market data. 2. Analyzing the economics and redevelopment value of various hotel and resort development proposals, including those on City- or Agency-owned land. Analysis shall include review of developers' project pro formas, including construction costs, anticipated daily rates, occupancy rates, and market absorption; in addition, Contractor shall compare developers' projections against industry averages, other benchmarks and market data. 3. Determining, based on the project economics (including a reasonable return on investment) an amount of"warranted public assistance" to each project. 4. Preparing a report to the Redevelopment Director summarizing the developers' requests, Contractor's analysis, and recommendation of warranted assistance. 5. Presenting the findings, conclusions and recommendations to the Agency at a minimum of one (1) Agency or City Council meeting or study session. The services performed by Contractor under this agreement shall be performed on a project by project basis as agreed in advance and in writing by the parties. Said agreement shall contain a specific scope of services to be performed by Contractor for a particular project. 12 e" I> ,9 �' EXHIBIT "B" SPECIAL REQUIREMENTS The parties hereto acknowledge that the work to be performed by Contractor with respect to this Agreement may create a conflict of interest with work being performed or work which may be performed by Contractor for other cities located in the Coachella Valley. In light of this fact, Contractor hereby covenants and agrees to keep all information obtained in performing this Agreement strictly confidential. In addition, Contractor hereby covenants and agrees to notify Agency of any work Contractor will perform for any Agency, or any private developer, located in the Coachella Valley which may conflict with the services to be performed by Contractor pursuant to this Agreement. Section 5.3, "Performance Bond," is waived. Additional language in Section 6.4, "Ownership of Documents," shall read: "Products of consulting. All products of consulting, with the exception of computer software developed by the Consultant, shall become the property of the Agency and shall be delivered to the Agency before the end of performance under this Agreement. Computer software remains the property of Consultant." 13 EXHIBIT "C" SCHEDULE OF COMPENSATION Contractor shall be compensated for the services to be performed by Contractor pursuant to this Agreement on an hourly basis pursuant to the hourly rates attached hereto as Exhibit "I" and incorporated herein by reference. Contractor shall also be reimbursed for its actual out-of-pocket expenses specified in Section 2.1 of the Agreement incurred by Contractor. The total compensation paid to Contractor, inclusive of expenses, shall not exceed the Contract Sum. For each project to be performed by Contractor pursuant to this Agreement, Contractor and Agency shall mutually agree in writing on the maximum compensation to be paid to Contractor for the project before Contractor commences work on the project. The following is the fee schedule for the Contract: KEYSER MARSTON ASSOCIATES, INC. HOURLY FEE SCHEDULE 2001/2002 A. JERRY KEYSER* $210.00 MANAGING PRINCIPALS* $200.00 PRINCIPALS* $185.00 MANAGERS $155.00 SENIOR ASSOCIATES* $140.00 ASSOCIATES $120.00 SENIOR ANALYSTS $105.00 ANALYSTS $ 90.00 TECHNICAL STAFF $ 72.50 ADMINISTRATIVE STAFF $ 57.50 Directly related job expenses not included in the above rates are: auto mileage, air fares, hotels and motels, meals, car rentals, taxies, telephone calls, delivery, electronic data processing, graphics and printing. Directly related job expenses will be billed at 110% of cost. Monthly billings for staff time and expenses incurred during the period will be payable within thirty (30) days of invoice date. A charge of 1% per month will be added to all past due accounts. *Rates for individuals inthese categories will be increased by 50% for time spent in court testimony. EXHIBIT "C" TO CONTRACT SERVICES AGREEMENT t4h b - �s EXHIBIT "D" SCHEDULE OF PERFORMANCE The Agency and Contractor shall mutually agree, in writing, on the Schedule of Performance for each project to be performed by Contractor before Contractor commences the project. EXHIBIT "I" TO CONTRACT SERVICES AGREEMENT eo4 b AG RESOLUTION NO. OF THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, APPROVING A CONTRACT WITH KEYSER MARSTON ASSOCIATES, INC. IN THE AMOUNT OF $20,000 FOR THE FINANCIAL ANALYSIS OF HOTEL-, RETAIL-, AND ENTERTAINMENT- CENTER DEVELOPMENT PROPOSALS SEEKING AGENCY ASSISTANCE. BE IT RESOLVED BY THE COMMUNITY REDEVELOPMENT AGENCY of the City of Palm Springs, California, that a Contract for Services with Keyser Marston Associates, Inc., in the amount of $20,000, for the financial analysis of hotel-, retail-, and entertainment-center-related development proposals seeking Agency assistance, is approved; and, the Executive Director or his designee is authorized to sign any documents related to the Contract. ADOPTED this day of , 2001. AYES: NOES: ABSENT: ABSTAIN: ATTEST: COMMUNITY REDEVELOPMENT AGENCY By Assistant Secretary Chairman REVIEWED & APPROVED