ARA-2010/10/26 ANAHEIM REDEVELOPMENT AGENCY
REGULAR MEETING OF
OCTOBER 26, 2010
The Anaheim Redevelopment Agency met in regular session and was called to order at
5:15 P.M. in the Chambers of Anaheim City Hall located at 200 South Anaheim
Boulevard.
Present: Chairman Curt Pringle, Agency Members: Lorri Galloway, Bob Hernandez,
Lucille Kring and Harry Sidhu.
Staff Present: City Manager Tom Wood, City Attorney Cristina Talley and Secretary
Linda Andal.
A copy of the agenda was posted on October 22, 2010 on the kiosk outside City Hall.
ADDITIONS /DELETIONS TO THE AGENDA: None
PUBLIC COMMENTS: No comments offered during the joint Council /Agency public
comment session related to the Redevelopment Agency agenda.
CONSENT CALENDAR: Chairman Pringle removed Item No. 1 from the consent
calendar for further discussion. Agency Member Kring moved to approve the balance of
the consent calendar, seconded by Agency Member Hernandez. Roll Call Vote: Ayes —
5: Chairman Pringle and Agency Members: Galloway, Hernandez, Kring and Sidhu.
Noes — 0. Motion Carried
2. Approve and authorize the Agency Executive Director to execute and administer
an Exclusive Negotiation Agreement, in substantial form, with Brookfield
AGR 5210.I Southland Holdings, LLC, for the development of a 244 -unit housing project in
the Colony Park neighborhood (Colony Park Phase IV).
3. Approve minutes of the Redevelopment Agency meetings of September 14, 2010
and September 28, 2010.
END OF CONSENT:
1. Approve and authorize the Agency Executive Director to execute and administer
a Commercial Lease, in substantial form, with the City for a five year lease for a
AGR - 6510 portion of the Willdan Building located at 290 S. Anaheim Boulevard for the
Workforce Development Division (related to Council Item No. 24).
Mayor Pringle announced Item No. 1 referred to an agreement to allow use of the
Willdan building previously purchased by the City for the Workforce Development
Division. Should the City envision a better value for that property in the future, he
requested the agreement be modified to insure the ability to terminate the agreement at
any time during the lease term. Community Development Director Elisa Stipkovich
explained the agreement currently had a 30 -day termination clause for either party.
Anaheim Redevelopment Agency Minutes of October 26, 2010
Page 2 of 5
Agency Member Hernandez then moved to approve Item No. 1, seconded by Agency
Member Kring. Roll Call Vote: Ayes — 5: Mayor Pringle and Council Members:
Galloway, Hernandez, Kring and Sidhu. Noes — 0. Motion Carried.
At 5:33 P.M., Council was reconvened to consider three joint public hearing items with
the Anaheim Redevelopment Agency.
JOINT PUBLIC HEARINGS (Redevelopment Agency /City Council)
4. A joint public hearing to consider resolutions approving an Amended and
AGR 4633.A Restated Disposition and Development Agreement, in substantial form, between
the Agency and Zelman Anaheim, LLC, for the 25 -acre Anaheim Westgate Retail
Center (NE corner of Beach Boulevard and Lincoln Avenue) establishing two
development phases and providing for a restructuring of the project economics.
Redevelopment Agency Action:
RESOLUTION NO. ARA 2010 -006 A RESOLUTION OF THE
GOVERNING BOARD OF THE ANAHEIM REDEVELOPMENT AGENCY
approving an Amended and Restated Disposition and Development Agreement
with Zelman Anaheim, LLC and making certain findings in connection therewith.
Executive Director Elisa Stipkovich remarked this hearing was to consider amending the
original Disposition and Development agreement (DDA) approved June 5, 2007 with the
Zelman group. The DDA was for a former landfill site at northeast corner of Lincoln and
Beach Boulevard, slated for a high quality 300,000 square foot retail center to include a
home improvement center, a grocery store, and a variety of other retail uses, including
restaurants, a food court and a public plaza. She stated the June, 2007 DDA set the land
purchase price at the fair market value of $17.4 million and since that time, the economy
had changed significantly, and property values and the negotiated rents had decreased.
At the request of the developer, staff was proposing to revise the purchase price based
on the current fair market price and to allow the project to be developed in two phases,
and she explained, those two changes necessitated an amendment to the DDA.
She reported the Agency had performed a new appraisal which netted a new market
value of $21 million, before adjustments for certain extraordinary costs associated with
preparing the former landfill site for development. The predevelopment costs, which
included but not limited to installation of a pile - supported foundation system for the home
improvement and grocery structures and vapor barriers under all buildings, were
anticipated to cost $10.3 million, reflecting a fair market price to the developer for the
entire 25 acre site at $10.7 million. She added the Agency would hold back a
participating note which should ultimately net the City about $18.4 million in future value.
The second amendment to the DDA would have the development occur in two phases.
Since the prospective tenant for the home improvement store was not ready to proceed
at this time and the other major tenant, WinCo Foods as well as other Westgate retail
center tenants would like to move forward with the development; staff recommended
proceeding with Phase 1. This phase would consist of approximately 60 percent of the
total site, including the WinCo store, and construction could begin as early as July 2011.
Ms. Stipkovich ended her presentation recommending the project be accomplished in
two phases and the land price be lowered. She added staff believed under those
Anaheim Redevelopment Agency Minutes of October 26, 2010
Page 3 of 5
conditions, this project could go forward. She added the City had been working on
remediation of the site for some time, moving over 150,000 cubic yards of dirt and
preparing the site for development.
Chairman Pringle opened the public hearing and receiving no comments, closed the
hearing.
Agency Member Kring moved to approve RESOLUTION NO. ARA 2010 -006 OF THE
GOVERNING BOARD OF THE ANAHEIM REDEVELOPMENT AGENCY approving an
Amended and Restated Disposition and Development Agreement with Zelman Anaheim,
LLC and making certain findings in connection therewith, seconded by Agency Member
Galloway. Roll Call Vote: Ayes — 5: Chairman Pringle and Agency Members: Galloway,
Hernandez, Kring and Sidhu. Noes — 0. Motion Carried.
5. A joint public hearing to consider resolutions approving two Disposition and
Development Agreements, in its substantial form, between the Agency and Lab
Holding, LLC for (i) the Colony Marketplace project (NW corner of Anaheim Blvd.
and Santa Ana Street) and (ii) the Center Street Promenade retail space.
Redevelopment Agency Action:
AGR 6328.I RESOLUTION NO. ARA 2010 -007 A RESOLUTION OF THE
GOVERNING BOARD OF THE ANAHEIM REDEVELOPMENT AGENCY
approving a Disposition and Development Agreement with LAB Holding, LLC and
making certain findings in connection therewith (Colony Marketplace).
RESOLUTION NO. ARA 2010 -008 A RESOLUTION OF THE
AGR - 6511 GOVERNING BOARD OF THE ANAHEIM REDEVELOPMENT AGENCY
approving a Disposition and Development Agreement with LAB Holding, LLC and
making certain findings in connection therewith (Center Street Promenade Retail
Space).
Executive Director Elisa Stipkovich reported there were two proposals before the Agency
and Council to approve Disposition and Development agreements (DDAs) for the Colony
Marketplace and the Center Street Promenade retail space. Last July, the Agency
entered into an exclusive negotiation agreement with LAB Holding LLC to negotiate the
terms for an operating agreement and lease for the Colony Marketplace. While
negotiating the Colony Marketplace transaction, she remarked, staff and the developer
expanded discussions to include the retail space on Center Street Promenade which
would provide LAB Holding with the ability to successfully create and market a unique
retail destination.
Colony Marketplace - She indicated the Colony Marketplace site included the Packing
House building, the Packard building and the vacant land around and between the two
buildings and would feature restaurants, unique retail, a food emporium and other
related businesses. The agreement contained three phases: the first phase was an
operating agreement; the second phase a subsequent lease period at either the
developer's option or when the net operation income exceeded $250,000; and the third
phase contained a purchase option at a value of $11.5 million in today's dollars which
would escalate every year at three percent.
Anaheim Redevelopment Agency Minutes of October 26, 2010
Page 4 of 5
Center Street Promenade - Ms. Stipkovich explained the Center Street Promenade retail
consisted of 23,000 square feet, located in three Agency -owned downtown parking
structures. Because the property had certain physical constraints and needed
renovation, the DDA reflected the obligation of the developer to spend $500,000 on
improvements and a resulting site appraisal of $1,070,000. If approved, she noted, LAB
Holding would purchase the retail and the Agency would carry back a note at five
percent interest to be paid off in 12 years.
Agency Member Sidhu inquired if any of the retail spaces were leased and what were
the potential revenue stream figures. Ms. Stipkovich responded retail spaces were
about 90 percent leased with a potential income stream of $200,000 a year, however,
she added, many were short-term, month -to -month tenants.
Chairman Pringle opened the public hearing and receiving no comments, closed the
hearing. He remarked on the success of LAB Holding ventures in Costa Mesa utilizing
unique or historic buildings and distinctive architecture to address and market retail and
he looked forward to this next step in revitalizing the downtown area.
Agency Member Galloway expressed her support as well for the LAB group in creating
excitement with this project and bringing back diversity to Anaheim's downtown.
Agency Member Hernandez moved to approve RESOLUTION NO. ARA2010 -007 OF
THE GOVERNING BOARD OF THE ANAHEIM REDEVELOPMENT AGENCY
approving a Disposition and Development Agreement with LAB Holding, LLC and
making certain findings in connection therewith; and to approve RESOLUTION NO. ARA
2010 -008 OF THE GOVERNING BOARD OF THE ANAHEIM REDEVELOPMENT
AGENCY approving a Disposition and Development Agreement with LAB Holding, LLC
and making certain findings in connection therewith, seconded by Agency Member
Galloway. Roll Call Vote: Ayes — 5: Chairman Pringle and Agency Members: Galloway,
Hernandez, Kring and Sidhu. Noes — 0. Motion Carried.
6. A joint public hearing to consider resolutions approving a Disposition and
Development Agreement, in substantial form, between the Agency and Southern
California BIA Educational Foundation to develop two affordable single family
AGR - 6512 homes as an educational demonstration project for energy efficiency (428 South
Melrose Street).
Redevelopment Agency Action:
RESOLUTION NO. ARA 2010 -009 A RESOLUTION OF THE
GOVERNING BOARD OF THE ANAHEIM REDEVELOPMENT AGENCY
approving a Disposition and Development Agreement with Southern California
BIA Educational Foundation and making certain findings in connection therewith
(BIA/Anaheim Green House).
Executive Director Elisa Stipkovich announced this was an opportunity for the City to be
part of a unique demonstration project. The Southern California Building Industry
Association (BIA) Educational Foundation, she stated, had submitted a proposal to the
City to develop property for two affordable single - family homes as a demonstration
project for energy on 428 South Melrose Avenue and was negotiating with BIA for
purchase of that land, valued at $200,000, for the building of two homes at BIA cost.
Anaheim Redevelopment Agency Minutes of October 26, 2010
Page 5 of 5
BIA, utilizing volunteers, both professional architects and engineers as well as members
of the building industry, would build a demonstration project for two homes side by side,
however one would be built under current code and the other built to "net zero energy
use" standards to become a state -of- the -art home for energy efficiency. The BIA would
have two years to use this project as a demonstration to both builders and individuals in
the building industry as well as for educational purposes. She added that at the end of
that period, the homes would be sold to moderate income families with the Agency
contributing down payment assistance to make that happen.
Chairman Pringle opened the public hearing.
Dave Bartlett, president of BIA/Orange County Chapter, remarked this project rested on
the platform of energy and water efficiency, resource conservation, and technology. He
added that supporting that platform were the concepts of education, demonstration,
feasibility and affordable housing. He noted this was a real opportunity for the BIA and
its members as well as the general public and local officials to see the differences
between a home built to current code and a net zero energy home.
Kristine Thalman, BIA, remarked that at every turn in the project, BIA had been met with
enthusiasm. The partners involved provided either in -kind or professional services and
involved companies such as Fosco Engineering, Gobis Engineering, Danielli &
Associates, Fidelity National Title, SunTrek Solar Systems, OCB Reprographics, Studio
6 Architects, Lo Jolla Pacific, Land Concern Landscape, Consol Energy System,
Sweitzer and Associates, Brookfield Homes, Simpson Strong, MWD, and SOCAL GAS.
Other institutional partnerships involved a number of schools, colleges, educational
programs and others. She noted the Orange County Housing Trust was interested as
well as the California Housing Foundation but that the most important partnership was
that of the City of Anaheim.
With no other comments offered, Chairman Pringle closed the hearing.
Agency Member Galloway moved to approve RESOLTION NO. 2010 -009 OF THE
GOVERNING BOARD OF THE ANAHEIM REDEVELOPMENT AGENCY approving a
Disposition and Development Agreement with Southern California BIA Educational
Foundation and making certain findings in connection therewith, seconded by Agency
Member Hernandez. Roll Call Vote: Ayes — 5: Chairman Pringle and Agency Members:
Galloway, Hernandez, Kring and Sidhu. Noes — 0. Motion Carried.
Adjournment: At 6:00 P.M., with no other business to conduct, Chairman Pringle
adjourned the Anaheim Redevelopment Agency meeting of October 26, 2010.
R ully submitted,
I ,
Linda N. Andal, CMC
Secretary, Anaheim Redevelopment Agency