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HomeMy WebLinkAboutRDA C ST. IMPROV'S 08-17-81TO: FROM: SUBJECT: Redevelopment Agency Community Development Department Proposed Plaza Tmprovements on "C" Street Applicant: Gfeller Development Location: "C" Street between Main and 6th Street RECOMMENDED ACTION Staff recommends that the Redevelopment Agency appropria~ a sum of money not to exceed $50,000 for improvements to circulation and traffic safety in the interest of the downtown redevelopment area. Staff recommends the Redevelopment Agency direct staff to begin vacation procedures on the affected portion of "C" Street. The distribution of these funds shall be dictated by the above agreement between the Redevelopment Agency and Gfeller Development Company. DISCUSSION On August 11, 1981, Gfeller Development Corporation held a meeting at City Hall with interested property owners. In attendance were: Bob Lindquist Mr. Gatlbreth John Prescott and Tom Prescott Sy Nozick Walt Fredericksen Mike Brotemarkle-Co,mm. Dev. Dir. Margaret Pottinger John Orr-Tustin News Doug Gfeller-Gfeller Dev. Co. Mary Ann Chamberlain, Associate Planner Comments were basically in favor of the project except for Sy Nozick who was concerned about the removal of truck traffic from "C" Street. MAC/dar ~ AGEND, , DATE: FRO#: August 3, 1981 No. 5 8-3-81 Inter-Corn Honorable Chatrman and Redevelopment Agency Members Community Development Department SUBJECT: Parking Structure tn Old Town Tusttn BACKGROUND This report examtnes a proposal to construct a two 1eve1 parktng structure and adjacent plaza that wtll front on "C",~treet near the corner of Math Street. Municipally owned parktng spaces wtl1 be uttltzed to aid. tn the mvttaltzatton of adjacent uses tn the downtown ~edevelopment area. In January of 1980, Gfeller Oevelopeant Company recetved approval for a use per~t: to allow for the construction of new offtce b~tldtngs with the preservation of the Steven's house included. The use per, it included the provision to provide an underground parktng structu~eto supply parktng spaces for the project. In approximately March of 198L, Gfeller acquired the Francts Brother Screendoorfact6ry tn order to provfde at-grade parking spaces. In June of 1981, the use pemit was amended allowtng for the renmval of the bnderground parking and construction of at-grade parktng at the adjacent Francis lot.' The Ctty has considered the Francts Brothers site as an excellent location for public owned parking spaces. Condition (R) of Resolution No. 1974 for mended Use Permit 80-1 states that the. developer (Gfeller) wtll rom an agreement with the City regarding the acquisition of parking spaces for public use. The agreement could take the form of City participation tn the construction of muntclpa~ parking or an abdication by the City for the need of any public-parking spaces. In July, Gfeller subettted a conceptual plan for the construction of · parking structure and a plaza on vacated "C" Street. The conceptual plan !ncludes: The construction of an upper level parking structure of approximately 105 spaces. The lower level would be utllizedby the Steven's Project, along wtth 24 spaces on the second level. August 3, I981 Parking Structure in 01d Town TUstin Page Two TheCity would pa~ the full cost of the parking structure, which is estimated at $600,000. Gfeller Development will receive 13 parking spaces on the second level that were eliminated on the first level by the second level improvements, Gfeller Development will purchase the remaining 1L spaces at a pro-rated figure. The City RDA and Gfeller Development would split the cost for the plaza.. The approximate cost of the plaza is $250,000 with each participant paying $125,000. The City will vacate "C" Street. Construction of the structure will be by Gfeller Development Company and all costs will be subject to an audit by the City. No profit will be allocated to Gfeller Development Company for acting as the general contractor, however, an allowance to cover office and field supervision will be agreed upon. The City coulU have the option of an outright purchase of the structure at the time of construction or lease the structure with an option to purchase at a future date. The option price would be the actual construction costs. OISCUSSION Staff analyzed the proposal utilizing the following criteria: does the proposal meet with the intent of the goals for the downtown Redevelopment Area; does the proposal represent a positive contribution for the on-going revitalization of the area; can all costs be fully amortized and payed back to the RDA or will the benefits to the City equal on outlay of cash? Staff has determined that the parking structure would represent a positive contribution to the downtown area. These benefits will not be apparent immediately, but represent a long range co,,,.itment to the downtown area. If Gfeller development were to construct only at-grade parking with no extra spaces for public use, the surrounding block would continue to be stagnated. The shops along Main Street have no on-site parking and little opportunity to expand. The lots fronting on El Camino are too small to develop with on-site parking and produce enough revenue to warrant improvement. The area would basically remain the way it is for years to come. August 3, 1981 Parking Structure in Old Town Tusttn Page Three The public parking structure will allow the surrounding areas to grow, by allowing the shops with no parking to expand. Lots that were previously uneconomical to develop could construct additional square footage instead of parking lots. These improvements will not happen in the i,,maediate future, but the opportunity will be there. (See Exhibit A) Conceivably, the full cost of the structure can be fully amortized, either by the sale of spaces or leasing each space. The sale of spaces could be pro-rated to cover the cost, administration and maintenance. Leasing the spaces would require that the yearly cost be set up in such a matter that at the absolute minimum the total cost of the structure would be fully amortized before the Redevelopment Agency is abolished (25 years). (See Exhibit B) Gfeller Development is proposing to utilize 24 spaces of the second level parking. Staff has analyzed the conceptual plans for the parking' structure and has determined that the second level improvements will eliminate thirteen spaces from the first level. Staff is not adverse-to allow Gfeller the use of these 13 spaces on the secondlevel to make up for this loss, but definitely feels that the remaintpg 11 parking spaces should be purchased or leased, at a sum to be determined. Staff has determined that the cost of these spaces are $6,500 per space, which is the pro-rated cost of 92 spaces divided by' $600,000. This results in an approximate $70,000 cash outlay by Gfeller Development for these 11 spaces. One aspect the parking structure represents will be a further cowitment on the part of the Redevelopment Agency. Improvements will not happen immediately, and this structure could conceivably be underutilized for several years. The Agency may have to take a more active role in marketing the downtown and conceivably have to condemn some properties to facilitate improvements. Staff utilized the same criteria in analyzing the proposal for a 50 percent contribution for the development of the quasi-public plaza. The plaza does not represent a clear-cut fiscal cost/benefit analysis as the parking structure does. It's benefits are an intangible contribution to the area. Staff does feel that the plaza would represent some benefits to the City. These include: Some of the public will utilize the plaza as an exit from the parking structure, going- to shops and restaurants along Main Street. Outsiders who are visiting in the City and shopping in this area will receive a positive impression from the plaza. Traffic and circulation in the area will be improved, not August 3, 1981 Parking Structure tn 01d Town Tusttn Page Four only for Gfeller but for the City also. Traffic exiting the site would be split with the majority heading to 6th and E1 Camino Real. The plaza could be utilized by local merchants and public interest groups. A kiosk could announce public events, sales, and new~ of public interest. Local merchants could utilize the plaza for sidewalk sales and art shews. These benefits are intangibles, and their basic contribution would be a positive preception from citizens or individuals visiting this area of the City. The only real tangible cost benefit the plaza gives is to traffic safety. The City Engineer has reviewed the double cul-de-sac and found it to be acceptable with respect to traffic circulation within the area. The double cul-de-sac will allow the traffic to be segregated to north ahd southbound "C" Street from the upper and lower levels respecively of the proposed parking structure. This segregated traffic will help reduce the need for a traffic signal installation at "C" and Main Streets as traffic volumes increase in the future. The elimination of a traffic signal at an estimated cost of $50,000 will not only be an economical benefit to the City, but will also eliminate the problems of two signal installations at a very close distance of 330 feet apart. (See Exhibit C) Even though the cost of the plaza could be repayed through lease payments charged for parking spaces in the structure, staff feels that there is not enough public benefit to warrant a investment. Staff can recommend that the Redevelopment Agency allocate $50,000 for improvements to trafffc and circulation. By utilizing these funds for "C" Street improvemens instead of the traffic signal, a greater public good will be achieved by improving pedestriaan safety, improved traffic safety, and improved circulation along Main Street. CONCLUSIONS One of the goals of the Redevelopment Agency Plan is for the development of public parking to aid in the revitalization of the area. This proposal will aid in accomplishing this major goal. The total cost of the structure can be payed back to the RDA. Preliminary estimates indicate that the structure will generate additional funds, which can be utilized for other projects is ~he RDA area. August 3, 1981 Parking Structure in Old Town Tustin Page Five The public parking will allow existing structures to expand that previously had no parking opportunities, and vacant lots could develop that were uneconomical .before. If properly designed, the structure can' be obtrusive and not distract from the character of the area. The parking structure will represent the need for greater commitment by the RDA. Even though condemnation will be held as a last resort, the probability of its use must be considered. The structure probably will not have an immediate effect on the area., but represents a long-range commitment. The Redevelopment Agency budget currently has $250,000 for the purpose of acquisition and construction of public parking. Proposed financing methods should be reviewed by the City Attorney to determine the best utilization of funds. The quasi-public plaza does represent a. publlc benefit, but staff is reluctant to commit to a full $125,000 cash outlay. The plaza will improve traffic safety and circulation in the area, and help reduce the need for a traffic signal at "C" and Main Street, resulting in a $50,000 savings from the general fund. The cost of the plaza could be amortized by purchase or lease revenues from the parking structure. The vacatidn of "C" Street will provide a safe-area for employees passing through to the office complex. It will also eliminate the on-going maintenance of that area of street pavement. The current tax increment for the Steven's property is approximately $1,200 per year. The proposed office building will increase the increment to $67,800 or an increase of $66,600. This will result in an additional $1,598,400 of tax increment for the remaining life of the agency. This figure does not include the tax increment for the parking structure or the additional tax increment on the portion of vacated "C" Street. August 3, 1981 Parktng Structure in 01d To~n Tustfn Page Six RECOMMENDED,ACTION Staff reco.w~mnds that the Redevelopment Agency direct the City Attorney to contact Gfeller Development Companies attorneys to formulate an agreement with Gfeller Development Company to construct a municipally owned parking structure over the at-grade parking facilities used by the Steven's Development. A consultant should be retained to perform an economic analysis to determine whether a lease or sale would be advantageous, lease rates, and a proforma to estimate yearly revenue, plus projected revenue for the remaining life of the Redevelopment Agency. Be- Staff recommends that the Redevelopment Agency appropriate a sum of money' not to exceed $50,000 for improvements to circulation and traffic safety in the interest of the downtown redevelopment area. Staff recommends to the Redevelopment Agency direct staff to begin vacation procedures on the affected portion of "C" Street. e EMK/dat The distribution of these funds shall be dictated by the above agreement between the Redevelop]qent Agency and Gfel I er Bevel opment Company. _~e~- EXHIBIT A An exemple of tax Increment generated by developing the three lots along El Camino Real to the allowable by zoning. 1 and cost construction cost Parking improvement on-site parking 250,000 1,500 e 45 = 67,500 4,000 @ 1.25 - 5,000 buy from city owned parking 250,000 5,000 e 45 = 225,000 124,800 Total $322,500 $599,80Q Tax increment per year Square footage breakdown Office Retail 3,225 $ 5,998 1,500 sq.ft. 5,000 sq. ft. 800 sq.ft. 3,000 sq.ft. 700 sq.ft. 2,000 sq.ft. These figures assume thmt the first floor will go to retail uses, which is a goal for the Ordinance 510 area. A lease of parking spaces will reduce the tax increment to $4,750, but give the Agency approximately $10,400 in yearly lease fees. (Based on $650 per year fee x 16 spaces.) EXHIBIT B Preliminary cost and revenue breakdown Cost 70,000 $530,000 $ 6,500 92 spaces 11 spaces purchased by Gfeller Development l~available spaces for lease or purchase per space initial cost Revenue Sell administration and maint, figured at 10% each of initial cost $5,500 initial cost 600 administration 650 maintenance $7,~l~sales price per space $7,800 x 8I spaces ~ $631,800 tax increment to agency (five years to sell out) average of $7,581 x 20 years = $151,620. Total Revenue $783,420 Lease $650 per year per space, based on a $2.50 cost per day for260 days. (5 days per week for 52 weeks). five years to full lease. $650 x 81 = $52,650 per year $52,650 x 20 years=S1,053,000 this flgue is revenue before administration, maintenance, or interest cost. $1,053,000 DA TE: EXHIBIT C JULY 28, 1981 Inter-Corn FRON: S UBJ ECT: MIKE ~~, ~ ~~NT DIRECIDR BO~ r.~n~X~ER, DIRECTOR OF PUblIC ~DI~S/CITY B~GINEER TRACT NO. 10979 (STEVEN'S SQ~%RE) The p~oposed double, cul-de-sac of "C" between Main Street and Sixth Street ha-~ been reviewed and found to be acceptable with respect to traffic circulatic~ within the area. The double cul-de-sac will allow the traffic to be segregated to north and southbound "C" Street frc~ the. upper and lower levels, respectively, of the parking structure. This segregated traffic w-ill help reduce the need for a traffic signal inse~l lation at "C" am~ Main Streets as traffic volumes in=ease in the future. The elimination of a traffic signal of an estimated cc~t of $50,000 - $55,000 will not only be an econcmical benefit to the City, but will ~l-~o eliminate the ~o~lems of two signal ins~llatio~s at & wry clc~e distance of 330 ft. apart. The abandonment of a portion of "C' Street will also elim/nate on-going street maintenance for that area of street pavement and provide a ~a~e area free from thron~h vehicular traffic be6~n the pazk/ng area a~x] ~o~k area for the ~loyees of the proposed condcm/nium development. Any public utilities within the area of street abandonment would r~main in place within a pern~nent easem, t: for rior operation and maintenance. DIPJ~'~OR OF PU~IC ~DI~S/ CIT~ ~SINm~