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RA2004/08/243113 ARA 161 3112 ANAHEIM, CALIFORNIA ANAHEIM REDEVELOPMENT AGENCY MEETING August 24, 2004 The Anaheim Redevelopment Agency met in regular session. Present: Chairman Curt Pringle, Agency Members: Richard Chavez, Bob Hernandez, Shirley McCracken, and Tom Tait. Staff Present: City Manager David Morgan, City Attorney Jack White, and Secretary Sheryll Schroeder. A copy of the agenda for the meeting of the Anaheim Redevelopment Agency was posted on August 20, 2004 at the City Hall outside bulletin board. Chairman Pringle called the regular meeting of the Anaheim Redevelopment Agency to order at 5:23 P.M. in the Council Chambers of the Anaheim City Hall, 200 South Anaheim Boulevard. ADDITIONS/DELETIONS TO THE AGENDA: None PUBLIC COMMENTS: None CONSENT CALENDAR ITEMS 1-2: Agency Member McCracken removed Item 1 from the consent calendar for separate discussion. Agency Member Hernandez moved to approve the balance of the consent calendar, seconded by Agency Member McCracken. Roll Call vote: Ayes - 5; Chairman Pringle, Agency Members: Chavez, Hernandez, McCracken and Tait. Noes - 0. Motion carried. 2. RESOLUTION NO. ARA~004-10 RESOLUTION OF THE GOVERNING BOARD OF THE ANAHEIM REDEVELOPMENT AGENCY approving a purchase and sale agreement with the State of California, Department of Transportation and declaring its intention to redevelop the real property connected therewith. 3. Approve minutes of the Agency meeting held August 17, 2004. END OF CONSENT CALENDAR: Approve and authorize the Executive Director to execute the Exclusive Negotiation Agreement with Kenwood Investment, LLC to implement the master plan for the Downtown area. Elisa Stipkovich, Executive Director of Community Development, indicated Item 1 was a request for the Agency to consider an exclusive negotiation agreement with Kenwood Investment LLC, specifically for the development of the historic Citrus Packing House, a project the Agency had been working on for some time. She reported Request for Proposals (RFP's) had been advertised in 2001 and 2003 resulting in two submittals, with the Agency entering into an exclusive right to negotiate with Red Mountain in May of 2003. She stated II ANAHEIM REDEVELOPMENT AGENCY MINUTES August 24, 2004 Page 2 staff had been negotiating with Red Mountain for some time and were not able to come to agreement on the type of project that could be accomplished. She explained that staff had been approached by Kenwood Investment, had considered their previous projects as well as the proposed concept for the Packing House which was similar to the Ferry Building development in San Francisco, a food/hall restaurant combination staff felt was an exciting concept and worth pursuing. Ms. Stipkovich noted that the exclusive negotiation would be for a 90-day period resulting in actual site plans and proposed land uses to be brought to the community and to the Agency. Agency Member McCracken received clarification from Ms. Stipkovich that Kenwood Investment would develop a proposal during the 90-day negotiation process which would then be considered by the Agency in the future. Agency Member McCracken noted the project area included a number of properties the City controlled on Santa Ana Street, including three of the four corners with the fourth corner being developed for housing and also including properties along Anaheim Boulevard to the alley behind the properties located at Broadway. She wanted to ensure that adjacent residential properties to the Packing House project would not be subject to eminent domain. Ms. Stipkovich responded that the negotiation agreement was for properties solely owned by the City, noting that discussions had already been held with some of the property owners within that block and staff would continue to bring those owners into the discussion for a dialogue as to residents' preferences, further stating the Agency was not negotiating to dispose of anyone else's property. Chairman Pringle asked if the previous 12-month negotiation agreement which had been extended to 18 months was much different in terms of scope. Ms. Stipkovich indicated Item A1 was very similar to the exclusive negotiation agreement approved May, 2003. Agency Member Hernandez inquired as to how the developer came to the attention of the Redevelopment Agency and why the Red Mountain negotiation agreement ended. Ms. Stipkovich reported the developer had approached the Agency asking if there were properties for development in Anaheim, particularly properties that were unique and had difficulties associated with development. The Packing House was one of the potential sites identified by staff due to the difficulties in developing a proposal acceptable to the community as well as being economically viable. She commented that Red Mountain had proposed converting the Packing House into residential units, a plan not well received by the community and which did not meet the redevelopment objective of having a historical building available and accessible to the community. There were also some economic problems in that the developer did want to acquire additional properties that the City was not able to control, she explained. Ms. Stipkovich indicated staff had spent over a year with the developer, revising plans a number of times, however, no plan appeared to be compatible with the intent of the objectives or with the community's vision. Ms. Stipkovich reemphasized that Kenwood Investment had approached the City, that two developers had come in well after the exclusive negotiation agreement had been in place and referenced a memo sent to Agency Members on June 8, 2004 describing both proposals, with the staff recommendation to consider the Kenwood Investment proposal and asking if Agency Members had any concerns. Ms. Stipkovich indicated she had visited San Francisco with Chairman Pringle at the invitation of the developer to view the Ferry Building, and was impressed with the concept. After looking into Kenwood's background, considering the three different alternatives before the Agency detailed in the June 8t~ memo, and in consideration of the ANAHEIM REDEVELOPMENT AGENCY MINUTES August 24, 2004 Page 3 objective for that building to become an icon for the downtown making it a place where people would visit and the general public could access, staff felt the Kenwood Investment proposal seemed to be the sole proposal to accomplish the goals. Agency Member Hernandez expressed concern with proceeding with exclusive negotiations with Kenwood Investment and felt the Agency should reissue the RFP to stimulate competition among developers. Agency Member Hernandez moved to postpone the matter and open the procedure to a wider bidding process; seconded for purposes of discussion by Agency Member McCracken. Agency Member McCracken reflected there had been a proposal by Clean City as well as Red Mountain, but that the Agency had not been overwhelmed with proposals. She confirmed through staff that the process was to give Kenwood 90 days to come up with a proposal. Ms. Stipkovich pointed out this was an exclusive negotiation agreement not binding upon either party and reiterated the negotiation agreement was for 90 days with some extensions and before redevelopment could occur, a public hearing must be held and a disposition development agreement considered. Chairman Pringle pointed out the Red Mountain exclusive negotiation agreement lasted for 18 months, that much discussion was held as to how to utilize the historic building to the maximum benefit of the community and that a developer had now come forward who happened to have offices in and was part of the process of the Ferry Building development, an upper scale Farmer's Market concept which was very successful in the City of San Francisco. He indicated the community had been very clear in expressing their interest in ensuring the packing building welcomed the public and the community and was not partitioned and closed off into residential units and he felt the 90-day negotiation period would be beneficial to the City. The Chairman called for a vote on the motion to continue Item 1 to reissue the RFP. Roll Call vote: Ayes - 1; Agency Member Hernandez. Noes - 4; Chairman Pringle, Agency Members: Chavez, McCracken and Tait. Motion denied. Agency Member Tait moved to approve Item 1, seconded by Agency Member Chavez. Agency Member Tait indicated he wanted to ensure adjacent property owners were told the City did not intend to take their property by eminent domain and Ms. Stipkovich indicated she would convey that information to all three adjacent property owners. Roll Call vote: Ayes - 4; Chairman Pringle, Agency Members: Chavez, McCracken and Tait. Noes - 1: Agency Member Hernandez. Motion Carried. 5:30 P.M. JOINT PUBLIC HEARIN(~: At 5:43 P.M., the City Council meeting was reconvened for the purposes of considering a joint public hearing to consider resolutions for a disposition and development agreement between the Agency and Brookfield Anaheim II, LLC. A joint public hearing to consider approving resolutions for a Disposition and Development Agreement between the Agency and Brookfield Anaheim II, LLC. RESOLUTION NO. ARA~004-11 RESOLUTION OF THE GOVERNING BOARD OF THE ANAHEIM REDEVELOPMENT AGENCY APPROVING A Disposition and Development Agreement with Brookfield Anaheim II, LLC and making certain findings in connection therewith. ANAHEIM REDEVELOPMENT AGENCY MINUTES August 24, 2004 Page 4 Elisa Stipkovich reported Item 4 was a public hearing between the Redevelopment Agency and the City Council to consider the disposition and development agreement between the Agency and Brookfield Anaheim II. She indicated that in January, 2003, the Agency approved an agreement with Brookfield which gave them the right to develop the property known as the former Home Depot site, but now called Cantada Square. The agreement included two other parcels that the Agency would be negotiating on, the President's tract located at 3100 block of West Lincoln and two remnant parcel strips acquired from Caltrans that were located in West Anaheim in the area north of the 5 Freeway and west of Brookhurst. Because of the location in West Anaheim, the Agency negotiated with Brookfield and now had a disposition and development agreement that would sell that property to Brookfield The President's tract would be developed with 28 town homes, similar to the Cantada Square townhomes, eight units of which were designated affordable. She stated there was also a proposal to sell the two Caltrans remnant strips that could hold anywhere between 14-16 units to Brookfield pending a site plan and presentation to the Agency of their elevations and floor plans. The final drawings for the President's tract were provided to the Agency Members, however, the Caltrans parcel drawings would be considered at a later date. The total cost was $1.825 million for the President's tract and $1,050,000 for the Caltrans remnants. Ms. Stipkovich commented that the Agency could receive additional revenue from those two sites by receiving 25 percent of any amount above the projected gross sale prices. Chairman Pringle opened the public hearing. Cherie McCracken requested Item 4 be continued to allow her time to read the disposition and development agreement. As no other public input received, Chairman Pringle closed the public hearing. Agency Member Chavez commented favorably on the project noting the affordable town homes would be available for families under 20 percent of the Orange County median. He pointed out the majority of residents in West Anaheim made considerably less and he was hopeful that in the future there would be more affordable projects available to a wider range of people. Agency Member Chavez moved to approve RESOLUTION NO. ARA2004-11 RESOLUTION OF THE GOVERNING BOARD OF THE ANAHEIM REDEVELOPMENT AGENCY APPROVING A Disposition and Development Agreement with Brookfield Anaheim II, LLC, seconded by Agency Member McCracken. Roll Call vote: Ayes - 5; Chairman Pringle, Agency Members; Chavez, Hernandez, McCracken and Tait. Noes - 0. Motion Carried. ADJOURNMENT: There being no further business, Chairman Pringle adjourned the Anaheim Redevelopment Agency meeting at 5:40 P.M. Sheryll Schroeder, MMC Secretary, Anaheim Redevelopment Agency