HomeMy WebLinkAbout5/15/2002 - STAFF REPORTS (33) DATE: MAY 15, 2002
TO: CITY COUNCIL
FROM: DIRECTOR OF COMMUNITY & ECONOMIC DEVELOPMENT
APPROVING AN ACCESS AGREEMENT WITH MCCORMACK BARON SALAZAR ON A
53,578 SQUARE FOOT PARCEL (1.23 ACRE) FROM THE CITY OF PALM SPRINGS FOR
THE PURPOSES OF DUE DILIGENCE ON A SPECIAL NEEDS HOUSING AND COMMUNITY
SERVICES PROJECT
RECOMMENDATION:
It is recommended that the City Council approve an Access Agreement on a 53,578
Square Foot (1.23 acre) Parcel with McCormack Baron Salazar for the purposes of
planning and designing a special needs housing and community services facility on Vista
Chino Road and Sunrise Way
SUMMARY:
McCormack Baron Salazar was selected by Desert AIDS Project to be the master
developer on the special needs housing project and community services facility located
near the DAP facility. This is the facility that was initiated by the Homeless Task Force,
and would include two types of housing along with a County urgent care facility, social
services offices, and a homeless day care facility. MBS needs the Access Agreement
with the City on its parcel to perform the necessary testing and due diligence on the
property. This agreement does not commit the City to contribute the property to the
project, however; that would come in a later agreement.
BACKGROUND:
The Community Redevelopment: Agency of the City of Palm Springs ("Agency") sold this
53,578 square foot parcel to the City of Palm Springs in 2001. The purpose of that sale
was to enable the Agency to comply with California Redevelopment Law, which prohibits
agencies from holding land purchased for low- or moderate-income housing to hold such
parcels for longer than five years.
The parcel was purchased by the Agency on March 1, 1975, prior to the enaction of
such law, and once encompassed a total of 323,649 square feet (7.43 acres). In 1995,
the Agency sold 3.47 acres to Palm Springs Senior Housing, Inc. for the development of
low-income senior housing (Vista Serena Co-op Apartments); in 1998, the Agency sold
2.73 acres to Vista Chino Senior Housing, Inc. for an additional low-income senior
housing development (Vista Del Monte Co-op). The 1.23 acres is a remainder parcel,
which the Agency and City intend to use for the purposes set forth in Redevelopment
Law; namely, the development of housing for low-income families and individuals.
Recently, the parcel has been under discussion with the Homeless Task Force and its
member organizations, including Desert AIDS Project and the Coachella Valley Housing
Coalition, as part of a larger site that would encompass a social services campus,
including a possible Riverside County Health Center and a special needs housing
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development, but not a homeless shelter. The Desert Healthcare District is the owner
of the adjacent four acre parcel that would constitute the bulk of the site.
Were it not for the State provision prohibiting the Agency from holding onto the land,
there was no reason for the Agency to convey the parcel to the City with a likely project
so close to being developed.
This Agreement allows MBS access to the site for a period of 90 days.
J b HN S. a AYMONP
Director of Community and Economic Development
.._.e
APPROVED
Executu4- +rector
ATTACHMENTS:
1. Resolution
2. Access Agreement
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RIGHT TO ACCESS AGREEMENT
This Right to Access Agreement (this "Agreement") is entered into as of , 2002
(the "Effective Date") by and between the City of Palm Springs ("Grantor") and McCormack
Baron Salazar, a Delaware corporation ("Grantee") with reference to the following facts:
RECITALS
A. Grantor is the owner of that certain real property and improvements thereon, if
any, located in the City of Palm Springs, California, and commonly known as the Vista Serena
Co-op Remainder Parcel, which consists of one parcels, totaling approximately 1.23 acres, as
such parcel is more particularly described on Exhibit "A", which is attached to this Agreement
and incorporated herein by this reference (the "Property").
B. Grantee desires to obtain from Grantor, and Grantor desires to provide to
Grantee, a right to enter onto the Property to conduct such due diligence activities as it deems
necessary or advisable ("Due Diligence") to determine the Property's suitability for the
development and construction of a residential real estate project (the "Project") thereon. In
connection therewith, Grantor desires to agree that it will not, directly or indirectly, enter into any
negotiations or agreements with any person with regard to the sale or any other transfer of all or
any portion of the Property.
AGREEMENT
NOW THEREFORE, with reference to the foregoing facts, and in consideration of the
sum of ten and 00/100 dollars ($10.00), the mutual covenants contained herein, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
Grantor and Grantee, intending to be legally bound, agree as follows:
1. Recitals. The recitals set forth above are hereby incorporated herein by this reference
and made a part of this Agreement.
2. Grant of Right to Conduct Due Diligence. Commencing on the Effective Date and
ending at 5:00 p.m. PST on the 90th day following the Effective Date (the "Exclusivity Period"),
Grantor hereby grants to Grantee (and its employees, agents, representatives and contractors acting
on its behalf) the exclusive right to conduct Due Diligence during normal business hours and, in
connection therewith, Grantee (and its employees, agents, representatives and contractors acting on
its behalf) shall have the right to enter upon and make all inspections and investigations of the
condition and all other aspects of all or a portion of the Property and shall have access to and the
right to inspect and copy(wherever located) all Diligence Materials (as defined herein)which Grantee
may deem necessary or desirable in its sole discretion, including, but not limited to, the right to
conduct such surveys, tests, studies, inquiries, investigations and reviews relating to all or a portion
of the Property, and the right to review and copy all permits and plans, maps, plats, surveys, soil
borings, percolation tests, engineering and topographical studies, seismic tests, asbestos,
hazardous substance and other environmental studies, inquiries, and investigations of zoning and
land use restrictions applicable to of all or a portion of the Property, and any notice or directive
regarding non-compliance with any applicable law, ordinance, rule or regulation and title exceptions
to the extent applicable to the Property or any part thereof in the possession or control of Seller or
any of its agents, employees or contractors (collectively the "Diligence Materials"). Grantor shall
cooperate with Grantee, at no cost to Grantor, in obtaining any information regarding the Property
from any governmental agency or third party, which has such information. Excluding matters which
are public record or are required to be disclosed by law, all Diligence Materials shall be kept
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63
confidential and shall not be disclosed by Grantee to any third party (other than Grantee's agents,
representatives and consultants in connection with its evaluation of the Property)without Grantor's
prior consent, which consent shall not unreasonably be withheld. Grantee shall indemnify and hold
harmless Grantor and the Property from and against any liens, claims or encumbrances, costs,
expenses and fees, including reasonable attorneys fees, related thereto, directly related to any entry,
inspection or testing activities of Grantor at the Property, and shall repair any damage to the Property
caused by such entry, inspection and testing (and shall restore the Property to its original condition).
3. Non-Solicitation. Grantor agrees that during the Exclusivity Period, Grantor shall not,
directly or indirectly, through any affiliate, officer, director, employee, attorney, representative or
agent of Grantor solicit, initiate, encourage, respond to or in any manner engage or participate in any
inquiries, proposals, activities, discussions or negotiations that constitute, or could lead to, an
Acquisition Proposal (as hereinafter defined) with regard to the Property. For purposes of this
Agreement, "Acquisition Proposal" means any offer or proposal for, or any indication of interest in,
the acquisition of all or any portion of the Property.
4. Further Assurances. The parties hereto agree to take such actions as are
necessary to effect the actions contemplated hereby, as either party hereto may reasonably
require.
5. Applicable Law. This Agreement has been made and entered into in the State of
California and the laws of said state shall govern the validity and interpretation hereof and the
performance hereunder by the parties hereto.
6. Attorneys' Fees. In the event of the bringing of any action or suit by a party hereto
against the other party, or by reason of any breach of any covenant, representation, warranty or
condition on the part of the other party arising out of this Agreement, then and in that event the
party in whose favor the final judgment shall be entered shall be entitled to have and recover of
and from the other party or parties all costs and expenses of suit, including reasonable attorneys'
fees.
7. Counterparts. This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which taken together shall constitute one and the
same instrument. The submission to Grantee of an unsigned draft of this Agreement does not
constitute an offer capable of acceptance or otherwise give rise to any right or interest on the
part of Grantee.
8. Notices. All notices and demands shall be given in writing by personal delivery or
registered mail, postage prepaid, and return receipt requested. Notices shall be considered
given upon receipt by the addressee or its agent, provided, however, that if the addressee or its
agent refuses or rejects such delivery or the addressee has changed its address without
providing written notice thereof to the party attempting to deliver such notice prior to ten (10)
business days prior to the attempted delivery of such notice, such notice shall be deemed
received on the date such delivery was attempted. Notices shall be addressed as appears below
for the respective parties, provided that if any party gives notice of a change of name or address,
notices to the giver of the notice shall thereafter be given as demanded in that notice.
Grantor: City of Palm Springs, California
Attn: City Manager
3200 Tahquitz Canyon Drive
P.O. Box 2743
Palm Springs, CA 92263
Telephone: (760) 323.8259
Fax: (760) 322-8325
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with a copy to (but such copy shall not constitute notice):
Burke Williams & Soresen, LLP
Attn: David J. Aleshire
18301 Von Karman Avenue
Suite 1050
Irvine, CA 92612-1009
Telephone: (949) 863-3363
Fax: (949) 863-3350
Grantee: McCormack Baron Salazar
Attn: Mercedes Marquez
Address: 1401 East 1 st Street Second Floor
Los Angeles, CA 90033
Telephone: (323) 981-2385
Telefax: (323) 981-0210
with a copy to (but such copy shall not constitute notice):
Riordan and McKinzie
Attn: Greg R. Langer
Address: 300 South Grand Avenue, 291h Floor
City, State, Zip: Los Angeles, California 90071
Telephone: (213) 229-8546
Telefax: (213) 830-8723
By giving the other party written notice thereof, the parties hereto shall have the right from time to
time or at any time during the term hereof to change their respective addresses for notice.
10. Memorandum of Agreement. Grantee shall have the right, at its sole and absolute
discretion, at any time during the Due Diligence Period to record a memorandum of this agreement in
the Recorder's Office of Riverside County.
[Signatures on following page]
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IN WITNESS WHEREOF, Grantor and Grantee have executed this Agreement as of the
date first above written,
Grantor:
By:
Grantee:
McCormack Baron Salazar, a Delaware corporation
By:
Mercedes Marquez, Vice President
By:
H:\USERS\TSR\DA'rA\DOCUMENT\DAP SHELL ACCESS AGRHEMENTT.DOC ,3.�
EXHIBIT "A"
LEGAL DESCRIPTION
The Land is that certain real property located in the Agency of Palm Springs, County of Riverside,
State of California, more particularly described as follows:
Assessor's Parcel Number 507 100 036
A 1.23 ACRES PORTION, AS SHOWN IN THE ASSESSOR'S MAP, OF PARCEL 2 OF PARCEL
MAP 27976, IN THE CITY OF PALM SPRINGS, COUNTY OF RIVERSIDE, STATE OF
CALIFORNIA, AS PER MAP RECORDED IN BOOK 185 PAGES 42 AND 43 OF PARCEL MAPS,
IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
H:\USE1ZS\7SR\DATA\DOCUMENT\DAP SHELL ACCESS AGREEMENT.DOC 3 A
RESOLUTION NO.
OF THE CITY OF PALM SPRINGS, CALIFORNIA,
APPROVING AN ACCESS AGREEMENT WITH
MCCORMACK BARON SALAZAR ON A 53,578
SQUARE FOOT CITY-OWNED PARCEL FOR THE
PURPOSE OF DESIGNING AN AFFORDABLE
HOUSING AND COMMUNITY SERVICES FACILITY
WHEREAS the City of Palm Springs does own a parcel of land of approximately 1.23
acres, which is remainder parcel from two previous low-income senior apartment
projects, and which it acquired from the Community Redevelopment Agency in 2001;
and
WHEREAS the City created a Homeless Task Force and asked the group to develop
strategies, programs, and facilities to meet the need of the homeless in Palm Springs;
and
WHEREAS the Desert AIDS Project (DAP), a member of the Homeless Task Force, is
attempting to develop a multi-faceted project adjacent to their offices that would include
special needs housing, transitional housing, a County urgent care facility, social service
providers, and a homeless clay care facility; and
WHEREAS DAP has engaged McCormack Baron Salazar, a national builder of
affordable housing, as the master developer for the project, and McCormack Baron
Salazar has asked for the City to grant it access to the 1.23 acre parcel for due diligence
and site planning purposes.
NOW THEREFORE BE IT RESOLVED by the City Council of the City of Palm Springs,
that a Right to Access Agreement covering the 53,578 square foot parcel for a period of
90 days, in a form approved by the City Attorney, is hereby approved.
ADOPTED this day of_ , 2002.
AYES:
NOES:
ABSENT:
ATTEST: CITY OF PALM SPRINGS, CALIFORNIA
By
City Clerk City Manager
REVIEWED & APPROVED AS TO FORM