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Home My WebLink AboutCOUNCIL - AGENDA ITEM - 07/19/2005 - SECOND READING OF ORDINANCE NO. 077, 2005, AUTHORI ITEM NUMBER: 11 AGENDA ITEM SUMMARY DATE: Julyl9, 2005 FORT COLLINS CITY COUNCIL STAFF: Greg Byrne SUBJECT Second Reading of Ordinance No. 077, 2005, Authorizing the Sale of City-owned Property Consisting of a Portion of Block 33,Fort Collins, Colorado, to Penny Flats, LLC. RECOMMENDATION Staff recommends adoption of the Ordinance on Second Reading. EXECUTIVE SUMMARY In July 2004,the City Council adopted Resolution 2004-081 setting out a process for selling portions of Block 33 to a private developer. Staff entered into an exclusive negotiating agreement with Coburn Development after receiving eight proposals and interviewing four teams. Coburn has complied with all provisions of the agreement,and has decided to proceed with development of the property. Coburn has named the project Penny Flats. It will have approximately 150 dwelling units in a mixed use project with approximately 30,000 square feet of commercial space. Parking would be provided on site, in a combination of below-ground and at-grade spaces. The sale would be accomplished in phases, with Coburn purchasing property for each phase prior to commencement of construction. The City would grant Coburn options on future phases, with interest on the unpurchased portions accruing to the City at seven percent. They would receive easement(s) on the City land for construction easements. The City would retain ownership of the Trolley Car Barn and associated parking area. Ordinance No. 077, 2005, was unanimously adopted on First Reading on July 5, 2005. ORDINANCE NO. 077, 2005 OF THE COUNCIL OF THE CITY OF FORT COLLINS AUTHORIZING THE SALE OF CITY-OWNED PROPERTY CONSISTING OF A PORTION OF BLOCK 33, FORT COLLINS, COLORADO, TO PENNY FLATS, LLC. WHEREAS,the City of Fort Collins is the owner of that certain real property located in Fort Collins, Larimer County, Colorado, described as Block 33; and WHEREAS, the City acquired Block 33 over time with the intention of having it available for future public use; and WHEREAS,a new Civic Center Plan adopted in 1997 called for residential development of Block 33; and WHEREAS, the Land Use Code permits residential mixed-use development in the zone district applied to Block 33; and WHEREAS, in July 2004, the City Council adopted Resolution 2004-081 setting out a process for selling Block 33 to a private developer ready, willing and able to develop the Block in rigorous conformity with the City's comprehensive plan; and WHEREAS,through use of a Request for Proposals process,the City solicited proposals and selected Coburn Development, Inc. ("Coburn"), to develop a proposed project for Block 33; and WHEREAS, Coburn is proposing that the City sell certain portions of Block 33 referred to below as the "Property" and more particularly described as Lots 1-8 and Lots 13-16,Block 33,City of Fort Collins, County of Larimer, State of Colorado to Penny Flats, LLC, a company comprised of the owners of Coburn and other possible investors, in phases, for a total purchase price of $1,624,000, plus interest at seven percent per year on any unpaid portion; and WHEREAS, as part of its agreement with the City,Coburn shall be required to develop the Property in accordance with the proposal approved by the City, to comply with the requirements of the City's development review process, and provide assurances that the "pedestrian spine" linking Block 33 with the rest of the Civic Center will be completed; and WHEREAS, Section 23-111 of the City Code provides that the City Council is authorized to sell, convey or otherwise dispose of real property owned by the City, provided the Council first finds by ordinance that any sale or other disposition of real property owned by the City is in the best interest of the City of Fort Collins. NOW,THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS, as follows: Section 1. That the sale of the Property for ONE MILLION SIX HUNDRED TWENTY FOUR THOUSAND DOLLARS($1,624,000.00)plus seven percent interest on any unpaid balance is in the best interest of the City of Fort Collins. Section 2. That the Mayor is hereby authorized to execute such conveyance documents as are necessary for the City to sell and convey the Property consistent with the terms and conditions described above. Introduced,considered favorably on first reading,and ordered published this 5th day of July, A.D. 2005, and to be presented for final passage on the 19th d f July, A.D. 2005. May ATTEST: City Clerk Passed and adopted on final reading this 19th day of July, A.D. 2005. Mayor ATTEST: City Clerk ITEM NUMBER: 33 AGENDA ITEM SUMMARY DATE: July5, 2005 FORT COLLINS CITY COUNCIL STAFF: Greg Byrne SUBJECT First Reading of Ordinance No. 077, 2005, Authorizing the Sale of City-owned Property Consisting of a Portion of Block 33, Fort Collins, Colorado, to Penny Flats, LLC. RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. FINANCIAL IMPACT Under the proposed sales agreement, the City would receive, over the life of the agreement, the appraised value of the property $1;6 1,0 , lus il#er t even percent per year on any unpaid portion. Additional positiv fnanci impaas for e ty include sales and use tax on construction materials, associ ed user es, ar1e1 i act fees. .,(See Attachment 2 for a financial impact summary.) EXECUTIVE SUMMARY In July 2004, the City Council adopted Resolution 2004-081 setting out a process for selling portions of Block 33 to a private developer. Staff entered into an exclusive negotiating agreement with Coburn Development after receiving eight proposals and interviewing four teams. Coburn has complied with all provisions of the agreement, and has decided to proceed with development of the property. Coburn has named the project Penny Flats. It will have approximately 150 dwelling units in a mixed use project with approximately 30,000 square feet of commercial space. Parking would be provided on site, in a combinatf be 04 -grPh n t-grad spaces. The sale would be accompli ed in p ses, urn p' chasing property for each phase prior to commencement of con ctidn: - he td gra Coburn options on future phases, with interest on the unpurchased portions accruing to the City at seven percent. They would receive easement(s) on the City land for construction easements. The City would retain ownership of the Trolley Car Barn and associated parking area. July 5, 2005 -2- Item No. 33 BACKGROUND Block 33 has been acquired over tie,yea by tPniltyc*eor rt,Collins, originally with an eye toward pubic uses. Options include �eo�a , a new library, a new performing arts center, or a parking garage. IT' All the potential public uses, with the exception of a parking garage, have been fulfilled on other sites. Staff has concluded that a parking garage on Block 33 would not be consistent with the Civic Center Plan. In 1997, in conjunction with the City Plan process, a new Civic Center Plan was also adopted. It called for residential development of the block. That land use goal was reinforced with the Downtown Strategic Plan a few years later. In 2004, the Council reviewed several options for disposing of the property, and decided to place a strong emphasis on residential development that complied with the Civic Center Plan, rather than simply trying to maximize return on the sale. Therefore, the staff issued an RFP that invited potential developers to assess the market for residential development, and to propose a project that would meet the market. The current proposal is a result of a se erali$onth-long proc s. The developer and staff are persuaded that a healthy rket to dow4l living - ists in Fort Collins. Coburn Development has completed ceptUaessr the pr ct, performed a market analysis, completed an environmental assessment, and made an offer to purchase. An important component of the Civic Center Plan is a pedestrian spine, running north-south through Block 33, and the public blocks to the south. The spine is the central organizing element, and we will seek financial assurances in the agreement from Coburn that it will be built. The staff and Coburn have coordinated their planning carefully with the Downtown Development Authority. DDA may choose to participate in project financing in order to achieve a higher level of materials and public improvements. Coburn proposes to enter into a purchase agreement with the City as soon as reasonably feasible after Council approval, and to prepare a full development application for City review. The development review process will follow all City rules and regulations. The timetable calls for construction to begin in August 20Q6 Future pha o7th� ecuthrough 2009. ay Staff proposes to include in th agreein t, a r ui zthe entire site be developed within a certain time frame. If it is riot poption ofT th ro would expire, or Coburn would be required to propose an extension. Sale of the property would be tied to a requirement that it be developed as proposed. Coburn would not have the ability to purchase the site, and remarket it to a third party. Nor would Coburn be permitted to purchase the property, and build something entirely different, without renegotiation with and approval by the City. July 5, 2005 -3- Item No. 33 The benefits to the City are the same as those outlined in the original report to the Council last year. Briefly, they include: • The property would b de wed to with;Council-adopted master plans. This is ai impo t "transit n e"lbetween Martinez Park on the north, and the pubic office building 'to the south, and includes portions of the Civic Center`§pine. - • The development will contribute to the resident and customer base downtown, strengthening neighborhoods and retail. • The property would return to the tax rolls. • The project is infill, making use of existing infrastructure. • The City will receive full appraised value, and revenues from other fees and taxes. Staff recommends approval of the Ordinance and believes that the proposal fully complies with the direction given by City Council last year. The proposed use of the property promises to achieve important City goals wi nirpal risk pq#blic. v At the same time, it provides experienced private sector capability, market as ss ent, .and assumption of risk. Council adoption of the Ordinance wilb�ermit the City;Manager to n tiate an agreement in substantial compliance with the terms described in tfi -.AIS: - ATTACHMENTS 1. Vicinity Map 2. Location Map 3. Financial Impact Summary