HomeMy WebLinkAbout2/5/2014 - STAFF REPORTS - 2.N. iy
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°OF F.Olt sR��P" CITY COUNCIL STAFF REPORT
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DATE: February 5, 2014 CONSENT CALENDAR
SUBJECT: TERMINATION OF CITY DEVELOPMENT AGREEMENT AND FORMER
COMMUNITY REDEVELOPMENT AGENCY DISPOSITION AND
DEVELOPMENT AGREEMENT WITH WYNDHAM VACATION
OWNERSHIP, INC., (FORMERLY FAIRFIELD RESORTS, INC.),
RELATED TO STAR CANYON RESORT PROJECT
FROM: David H. Ready, City Manager
BY: Community & Economic Development Department
SUMMARY
The City Council and as the Successor Agency to the Palm Springs Community
Redevelopment Agency will consider the approving the termination of: (1) the
Development Agreement between Fairfield Resorts, Inc. ("Fairfield") and the City of
Palm Springs for Case 5.0830, a 255-unit timeshare project, approved in 2004; and (2)
the Disposition and Development Agreement between Fairfield and the former
Community Redevelopment Agency originally approved in 1991. The project proposed
at the time was never constructed and the two agreements remain as clouds on the title.
The owner, Wyndham Vacation Ownership, Inc. (the new name for Fairfield) has a
buyer for the property and needs to clear title.
RECOMMENDATION:
1. City Council as Sucessor Agency to the Palm Springs Community
Redevelopment Agency, Approve the termination of the Disposition and
Development Agreement between Fairfield and the former Community
Redevelopment Agency and the Development Agreement between Fairfield and
the City.
2. Authorize the City Manager to execute all documents to effectuate the
termination; and authorize and the City Clerk to record appropriate documents.
BACKGROUND AND ANALYSIS:
The Community Redevelopment Agency of the City of Palm Springs, California
("Agency") approved a Disposition and Development Agreement ("DDA"), on September
19, 2001 with SCHLPS, LLC, a California Limited Liability Company ("Developer"), to
ITEM NO. —
City Council Staff Report
February 4, 2014 -- Page 2
Fairfield Resorts Development Agreement
effectuate the development of a resort hotel and vacation ownership project on South
Palm Canyon Drive between Mesquite Avenue and Sunny Dunes Road in Merged
Project Area No. 1. The Agency approved the assignment of the DDA to Fairfield
Resorts, Inc. ("Fairfield") and an Amendment No. 1 to the DDA in February, 2003.
In 2004, the City and Fairfield approved a Development Agreement for the project. By
2005, Fairfield had failed to receive an approval of architectural conformity of the Final
Planned Development District to the Preliminary Planned Development District and
withdrew the project from further entitlement consideration. At that point both the DDA
and the Development Agreement were considered no longer effective.
Fairfield marketed the property to prospective developers, and the City cooperated in
each of those endeavors, culminating with an application for "The Trails" mixed use
development project in 2007, which also included the adjacent Magruder Chevrolet site.
The Council approved terminating the Development Agreement on March 7, 2007,
subject to the developer of The Trails project closing escrow on the property. That
escrow never closed and that project did not move forward due to the economic
downturn, and that developer no longer has an interest in the property.
Since 2005, Fairfield Resorts, Inc. has been rebranded as Wyndham Vacation
Ownership, Inc. ("Wyndham") and Wyndham is now the successor in interest to
Fairfield.
Wyndham now has a buyer for the site, which means that a new project could move
forward in the next year or so. The Title Company for the transaction has requested
that an action be taken that would be recordable against the property and which would
clear the title exception created by the DDA and the Development Agreement.
All parties agree that the Development Agreement and the DDA became ineffective
circa 2005, when Fairfield withdrew the development application and did not pursue the
development of the project described in both agreements. Neither party has any claim
against or responsibility to the other. These actions merely formalize the understanding
that all parties have been acting upon for nearly nine years.
ion Ra o , Director of David H. Ready, Cit ager
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