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HomeMy WebLinkAbout01 DDA 06-001, PROSPECT VILLAGE 01-15-07AGENDA REPORT MEETING DATE: JANUARY 15, 2007 TO: WILLIAM A. HUSTON, CITY MANAGER FROM: ELIZABETH BINSACK, COMMUNITY DEVELOPMENT DIRECTOR SUBJECT: DEVELOPMENT AGREEMENT 06-001 SUMMARY: The developer, Prospect Village LP, a California Limited Partnership (formerly known as Pelican Center LLC), is proposing to construct an approximately 9,300 square foot two-story commercial/office building and twelve (12) three-story live-work units on a 1.036 acre site at the northwest corner of Main Street and Prospect Avenue. Parking for the development is to include fifty-nine (59) off-site parking spaces identified to be provided at the adjacent Tustin Water Yard under an Agreement between the Developer and the City of Tustin. The purpose of Development Agreement 06-01 is to give the developer the assurance that the City will not repeal or substantively amend the provisions of City's Public Parking Area Ordinance related to designation or de-designation of City-owned property as a public parking area in any manner that materially affects the Project, and to the give the City the assurance that the Developer shall work toward and complete the development of the Project. At its meeting of January 8, 2007, the Planning Commission recommended approval of Development Agreement 06-01. RECOMMENDATION: That the City Council introduce Ordinance No. 1327 and set for second reading at the Council's next scheduled meeting. FISCAL IMPACT: There are no fiscal impacts anticipated as a result of adopting Ordinance No. 1327. ENVIRONMENTAL: The City Council previously approved Resolution No. 04-45 certifying the Prospect Village Project Final Environmental Impact Report CIFEIR") pursuant to the California Environmental Quality Act, and adopting Findings of Fact, a Statement of Overriding Consideration and a Monitoring Program for the Project. The FEIR identified Mitigation Measure T-2 which would provide fifty nine (59) parking spaces off-site at the City Council Report - Development Agreement 06-01 January 15, 2007 Page 2 Tustin Water Yard parking lot to reduce the Project's potential parking impact to a less than significant level. The City Attorney has determined that City Council approval of the recommended actions satisfy the requirements of the FEIR certification resolution. Further, based on a determination by the Community Development Department the approval of the proposed attached Development Agreement are proposed actions that are not subject to the California Environmental Quality Act ("CEQA") pursuant to Title 14, California Code of Regulations, Section 15060 (c) (2) and 15060 (c) (3). BACKGROUND AND DISCUSSION: Pelican Center, L.P. ("Developer") purchased the property located at 191 and 193-195 East Main Street from the Tustin Community Redevelopment Agency pursuant to a Disposition and Development Agreement (DDA) for the Prospect Village Project dated June 21, 2004. Under the terms of the DDA and City Council actions of May 17, 2004 approving Design Review 03-012 and Conditional Use Permit 03-012 for the Project (Resolution Nos. 04-48 and 04-49 respectively), the Developer is required to construct or cause be constructed certain Project improvements on the subject property, including private improvements and public improvements as approved by the Agency, Planning Commission and City Council. The private improvements contain a two-story commercial building fronting on Main Street ("Main Street Commercial Building") of approximately 9,887 square feet and twelve detached live-work residential units. On- site parking for the Project is to consist of two garage spaces per each live-work unit and three additional guest parking spaces for the live-work units located off of a private drive/auto court ("Prospect Lane"), and three on-site parking spaces to the serve the Main Street Commercial Building along with fifty nine (59) off-site parking spaces identified to be provided at the adjacent Tustin Water Yard under an Agreement between the Developer and the City of Tustin. The project is located in the Parking Overlay District (P) which allows for reduced parking and off-site parking in the district. The City owns 81 parking spaces located at the Stevens Square parking structure and an additional 67 spaces at the Tustin Water Yard which may be used for off-site parking under non-exclusive agreements to accommodate off-site parking within the district. On August 1, 2005, the City Council authorized staff to enter into a parking license agreement with the Developer. Although the license. was subsequently executed by the Developer, additional concerns about the terms and conditions associated with the parking license surfaced from the lenders for the project and potential tenants of the commercial building, all of which resulted in progress on the project slowing down. In an effort to address these concerns based on discussions and meetings with the Develop.er and their legal representative, the City Attorney recommended an approach which appears acceptable to all parties to resolve concerns. The approach includes three steps which were approved by the City Council on December 4, 2006, as follows: City Council Report -: Development Agreement 06-01 January 15, 2007 Page 3 1. The City Council introduced and had the first reading of Ordinance No. 1323*, which provides the authorization for designation of public parking areas within the City by City Council Resolution and identifies a public hearing process for either designation or alternation of any designation of public parking areas within the City. 2. The City Council instructed staff to commence proceedings, provide a notice consistent with Ordinance No. 1323, and prepare a resolution designating parking spaces owned by the City of Tustin, located at the Tustin Water Yard parking lot, as a public parking area. 3. The City Council referred to the Tustin Planning Commission a proposed Development Agreement (attached hereto as Development Agreement 06-01) between the City and Prospect Village, L.P., whereby the City would agree not to repeal or substantially amend the provisions of proposed Ordinance No. 1323 for a period of twenty five (25) years. The Development Agreement would not affect the ability of the City Council to designate or de-designate any public parking area so long as the City Council follows the procedures identified in Ordinance No. 1323. *(On January 2, 2007, the City Council introduced and had the first reading of a revised version of Ordinance No. 1323 with minor modifications.) DEVELOPMENT AGREEMENT 06-001 To strengthen the public planning process, encourage private participation in comprehensive planning, and reduce the economic risk of development, the California Legislature adopted the Development Agreement Statute of the Government Code. Pursuant to the Statute, the City may enter into an agreement with any person having a legal or equitable interest in real property and to prov.ide for the development of such property and to establish certain development rights therein. The purpose of Development Agreement 06-01 is to give the develo'per the assurance that the City will not repeal or substantively amend the provisions of City's Public Parking Area Ordinance related to designation or de-designation of City-owned property as a public parking area in any manner that materially affects the Project, and to the give the City the assurance that the Developer shall work toward and complete the development of. the Project. The development and use of the Project in the future will provide significant benefits to the community and promote the public health, safety,. and welfare for the following reasons, among others: (i) development of the Project will generate tax revenues that can be used to provide essential services to the community; (ii) development will put the Property to productive use consistent with the objectives of the City's General Plan and City Council Report - Development Agreement 06-01 . January 15, 2007 Page 4 Town Center Redevelopment Plan; and (iii) development of the Project will provide a long term source of employment opportunities for local residents. At its meeting of January 8, 2007, the Planning Commission recommended approval of Development Agreement 06-01. A copy of the proposed Development Agreement 06- 01 is attached for the City Council's consideration as Exhibit 1 to Ordinance No. 1327. Scott Reekstin Senior Planner Elizabeth A. Binsack Community Development Director Attachments: A. Planning Commission Resolution No. 4049 B. Ordinance No. 1327 ATTACHMENT A Planning Commission Resolution No. 4049 RESOLUTION NO. 4049 A RESOLUTION OF THE PLANNING COMMISSION OF. THE CITY OF TUSTIN, CALIFORNIA, RECOMMENDING THAT THE CITY COUNCIL APPROVE DEVELOPMENT AGREEMENT 06-01, AS DEFINED BY SECTION 65865.2 OF THE CALIFORNIA GOVERNMENT CODE, BETWEEN THE CITY OF TUSTIN AND PROSPECT VILLAGE LP PERTAINING TO DEVELOPMENT OF THE PROPERTY LOCATED AT 191 AND 193-195 EAST MAIN STREET, TUSTIN, CALIFORNIA. The Planning Commission of the City of Tustin does hereby resolve as follows: I. The Planning Commission finds and determines: A. That Prospect Village LP, a California Limited Partnership ("Developer") is owner of certain real property, located at 191 and 193-195 East Main Street, Tustin, California (the "Property"). B. That Developer intends to develop the "Property" by constructing and then owning or leasing premises on the Property for a retail, restaurant, and office use (the "Project"). C. That the Project does not have sufficient on-site parking to conform to the requirements of the City of Tustin, and available off-site parking in the area is insufficient to adequately serve the Project. D. That on January 2, 2007, the Tustin City Council introduced and had first reading of Ordinance No. 1323 with minor modifications, which would add Chapter 9 of Article 7 to the Tustin City Code to provide for a process for the designation and de-designation of public parking" areas in the City (the "City's Public Parking Area Ordinance"). E. That to help alleviate the parking issues related to the Project, the City intends to consider designation of certain City-owned property near the project area as a Public Parking Area pursuant to the proposed Public Parking Area Ordinance. F. That to strengthen the public planning process, encourage private participation in comprehensive planning, and reduce the economic risk of development, the California Legislature adopted the Development Agreement Statute of the Government Code. Pursuant to the Statute, the City may enter into an agreement with any person having a legal or equitable interest in real property and to provide for the development of such property and to establish certain development rights therein. Resolution No. 4049 Page 2 G. That the purpose of Development Agreement 06-01 is to give the developer the assurance that the City will not repeal or substantively amend the provisions of City's Public Parking Area Ordinance related to designation or de-designation of City-owned property as a public parking area in any manner that materially affects the Project, and to the give the City the assurance that the Developer shall work toward and complete the development of the Project. H. That the development and use of the Project in the future will provide significant benefits to the community and promote the public health, safety, and welfare for the following reasons, among others: (i) development of the Project will generate tax revenues that can be used to provide essential services to the community; (ii) development will put the Property to productive use consistent with the objectives of the City's General Plan and Town Center Redevelopment Plan; and (iii) development of the Project will provide a long term source of employment opportunities for local residents. I. 'That a public hearing was duly noticed, called, and held on January 8, 2007, by the Planning Commission, and the Planning Commission recommended that the City Council approve Development Agreement 06-01. J. That the Tustin City Council previously approved Resolution No. 04-45 certifying the Prospect Village Project Final Environmental Impact Report (tlFEIRtI) pursuant to the California Environmental Quality Act, and adopting Findings of Fact, a Statement of Overriding Consideration and a Monitoring Program for the Project. The FEIR identified Mitigation Measure T-2 which would provide fifty nine (59) parking spaces off-site at the Tustin Water Yard parking lot to reduce the Project's potential parking impact to a less than significant level. K. That approval of Development Agreement 06-01 is a proposed action that is not subject to the California Environmental Quality Act ("CEaA") pursuant to Title 14, Califomia Code of Regulations, Section 15060 (c) (2) and 15060 (c) (3). L. That Development Agreement 06-01 is consistent with the objectives, policies, general land uses, and programs specified in the Tustin General Plan, in that sufficient off-street parking would be provided for the proposed Project, which is consistent with Circulation Element Policy 7.2. M. That Development Agreement 06-01 is compatible with the uses authorized in the district in which the real property is located in that the Developer intends to develop the Property by constructing and then owning or leasing premises on the Property for retail, restaurant, and office uses, all of which are permitted uses for the Property. N. That Development Agreement 06-01 is in conformity with the public necessity, public convenience, general welfare, and good land use practices, in that Resolution No. 4049 Page 3 sufficient off-street parking would be provided in close proximity to the proposed Project. O. That Development Agreement 06-01 will not be detrimental to the health, safety, and general welfare in that sufficient off-street parking will reduce the demand for on-street parking such that traffic flow will be maximized and potential conflicts between pedestrians and motorists will be minimized. P. That Development Agreement 06-01 will not adversely affect the orderly development of property in that the proposed Project will put the Property to productive use consistent with the objectives of the City's General Plan. Q. That Development Agreement will have a positive fiscal impact on the City in that development of the Project will generate significant tax revenues that can be used to provide essential services to the community. II. The Planning Commission hereby recommends that the City Council approve Development Agreement 06-01 as included in Exhibit 1 attached hereto and subject to final appr~val of the City Attorney. PASSED AND ADOPTED by the Planning Commission of the City of Tustin at a regular . meeting held on.the 8th day of January, 2007. BRETT FLOYD Chairperson ELIZABETH A. BINSACK Planning Commission Secretary STATE OF CALIFORNIA ) COUNTY OF ORANGE ) SS CITY OF TUSTIN ) I, ELIZABETH A. BINSACK, the undersigned, hereby certify that I am the Planning Commission Secretary of the Planning Commission of the City of Tustin, California; that Resolution No. 4049 was duly passed and adopted at the regular meeting of the Tustin Planning Commission, held on the 8th day of January, 2007. ELIZABETH A. BINSACK Planning Commission Secretary ATTACHMENT B Ordinance No. 1327 ORDINANCE NO. 1327 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TUSTIN, CALIFORNIA, APPROVING DEVELOPMENT AGREEMENT 06-01, AS DEFINED BY SECTION 65865.2 OF THE CALIFORNIA GOVERNMENT CODE, BETWEEN THE CITY OF TUSTIN AND PROSPECT VILLAGE LP PERTAINING TO DEVELOPMENT OF THE PROPERTY LOCATED AT 191 AND 193-195 EAST MAIN STREET, TUSTIN, CALIFORNIA. The City Council of the City of Tustin hereby ordains as follows: SECTION 1. The City Council of the City of Tustin finds: A. That Prospect Village LP, a California Limited Partnership ("Developer") is owner of certain real property, located at 191 and 193-195 East Main Street, Tustin, California (the "Property"). B. That Developer intends to develop the "Property" by constructing and then owning or leasing premises on the Property for a retail, restaurant, and office use (the "Project") . C. That the Project does not have sufficient on-site parking to conform to the requirements of the City of Tustin, and available off-site parking in the area is insufficient to adequately serve the Project. D. That on January 2, 2007, the Tustin City Council introduced and had first reading of Ordinance No. 1323, which would add Chapter 9 of Article 7 to the Tustin City Code to provide for a process for the designation and de-designation of public parking areas in the City (the "City's Public Parking Area Ordinance"). E. That to help alleviate the parking issues related to the Project, the City intends to consider designation of certain City-own~d property near the project area as a Public Parking Area pursuant to the proposed Public Parking Area Ordinance F. That to strengthen the public planning process, encourage private participation in comprehensive planning, and reduce the economic risk of development, the California Legislature adopted the Development Agreement Statute of the Government Code. Pursuant to the Statute, the City may enter into an agreement with .any person having a legal or equitable interest in real property and to provide for the development of such property and to establish certain development rights therein. G. That the purpose of Development Agreement 06-01 is to give the developer the assurance that the City will not repeal or substantively amend the provisions of City's Public Parking Area Ordinance related to designation or de- designation of City-owned property as a public parking area in any manner that materially affects the Project, and to the give the City the assurance that the Developer shall work toward and complete the development of the Project. Ordinance 1327 Page 2 H. That the development and use of the Project in the future will provide significant benefits to the community and promote the public health, safety, and welfare for the following reasons, among others: (i) development of the Project will generate tax revenues that can be used to provide essential services to the community; (ii) development will put the Property to productive use consistent with the objectives of the City's General Plan and the Town Center Redevelopment Plan; and (iii) development of the Project will provide a long term source of employment opportunities for local residents. I. That a public hearing was duly noticed, called, and held on January 8, 2007, by the Planning Commission, and the Planning Commission recommended that the City Council approve Development Agreement 06-01. A public hearing was duly noticed, called, and. held on January 15, 2007, by the City Council. J. That the Tustin City Council previously approved Resolution No. 04-45 certifying the Prospect Village Project Final Environmental Impact Report C'FEIR") pursuant to the California Environmental Quality Act, and adopting Findings of Fact, a Statement of Overriding Consideration and a Monitoring Program for the Project. The FEIR identified Mitigation Measure T-2 which would provide fifty-nine (59) parking spaces off-site at the Tustin Water Yard parking lot to reduce the Project's potential parking impact to a less than significant level. K. That approval of Development Agreement 06-01 is a proposed action that is not subject to the California Environmental Quality Act ("CEQA") pursuant to Title 14, California Code of Regulations, Section 15060 (c) (2) and 15060 (c) (3) L. That Development Agreement 06-01 is consistent with the objectives, policies, general land uses, and programs specified in the Tustin General Plan, in that sufficient off-street parking would be provided for the proposed Project, which is consistent with Circulation Element Policy 7.2. M. That Development Agreement 06-01 is compatible with the uses authorized in the district in which the real property is located in that the Developer intends to develop the Property by constructing and then owning or leasing premises on the Property for retail, restaurant, and office uses, all of which are permitted uses for the Property. N. That Development Agreement 06-01 is in conformity with the public necessity, public convenience, general welfare, and good land use practices, in that sufficient off-street parking would be provided in close proximity to the proposed Project. o. That Development Agreement 06-01 will not be detrimental to the health, safety, and general welfare in that sufficient off-street parking will reduce the demand for on-street parking such that traffic flow will be maximized and potential conflicts between pedestrians and motorists will be minimized. Ordinance 1327 Page 3 P. That Development Agreement 06-01 will not adversely affect the orderly development of property in that the proposed Project will put the Property to productive use consistent with the objectives of the City's General Plan. Q. That Development Agreement will have a positive fiscal impact on the City in that development of the Project will generate significant tax revenues that can be used to provide essential services to the community. SECTION 2. The City Council hereby approves Development Agreement 06-01 as included in Exhibit 1 attached hereto and subject to final approval of the City Attorney. SECTION 3. Upon the effective date of this Ordinance, the provisions hereof shall supersede any inconsistent or conflicting provisions of the Codified Ordinances of the County of Orange, or other relevant Orange County non-codified Ordinances, as the same were adopted by reference by City Ordinance. SECTION 3. If any section, subsection, sentence, clause, phrase or portion of this ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this ordinance. The City Council of the City of Tustin hereby declares that it would have adopted this ordinance and each section, subsection, sentence, clause, phrase or portion thereof irrespective of the fact that anyone or more sections, subsections, sentences, clauses, phrases, or portions be declared invalid or unconstitutional. . PASSED AND ADOPTED, at a regular meeting of the City Council for the City of Tustin on this 5th day of February, 2007. LOU BONE, Mayor PAMELA STOKER, City Clerk Ordinance 1327 Page 4 STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss. CITY OF TUSTIN ) ORDINANCE NO. 1327 PAMELA STOKER, City Clerk and ex-officio Clerk of the City Council of the City of Tustin, California, does hereby certify that the whole number of the members of the City Council of the City of Tustin is five; that the above and foregoing Ordinance No. 1327 was duly and regularly introduced and read at the regular meeting of the City Council held on the 15th day of January, 2007, and was given its second reading, passed and adopted at a regular meeting of the City Council held on the 5th day of February, 2007, by the following vote: COUNCILPERSONS AYES: COUNCILPERSONS NOES: COUNCILPERSONS ABSTAINED: COUNCILPERSONS ABSENT: PAMELA STOKER, City Clerk Published: Exhibit 1 to Ordinance No. 1327 RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) ) City of Tustin ) 300 Centennial Way ) Tustin, California 92780 ) Attn: City Clerk ) APN No.: 401-585-01 (Space Above This Line for Recorder's Use) This document is exempt from payment of a recording fee pursuant t~ Government Code Section 6103. Dated: DEVELOPMENT AGREEMENT THIS DEVELOPMENT AGREEMENT, (this "Agreement") is made and entered into this date of , 2006, by and between the CITY OF TUSTIN, a municipal corporation organized and existing under the laws of the State of Cali fomi a ("City") and PROSPECT VILLAGE LP, a California Limited Partnership ("Developer"). City and Developer are sometimes referenced together herein as the "Parties," and, in instances when a provision hereof applies to each of the Parties individually, either of the Parties may be referenced as a "Party." RECITALS A. Developer is owner of certain real property, located at 191 and 193 - 195 East Main Street in Tustin, California, and more fully described in Exhibit "A" and depicted on Exhibit "B", both attached hereto and incorporated by reference herein (the "Property"). · B. Developer intends to develop the "Property" by constructing and then owning or leasing premises on the .Property fora retail, restaurant, and office.use (the "Project") in accordance with and subject to the provisions set forth herein and in the "DDA," City's "Existing Land Use Regulations," City's "Existing Development Approvals," and the "Future Development Approvals" to be obtained by Developer, all as more particularly set forth herein. C. The Project does not have sufficient on-site parking to conform to requirements of the City of Tustin, and available off-site parking in the area is insufficient to adequately serve the Project. D. On , the Tustin City Council adopted Ordinance No: _ adding Chapter 9 of Article 7 to the Tustin City Code providing for a process for the designation and de-designation of public parking areas in the City (the "City's Public Parking Area Ordinance"). 512651.1 E. In order to help alleviate the parking issues related to the Project, the City intends to consider designation of certain City-owned property near the project area as a Public Parking Area pursuant to.the City's Public Parking Area Ordinance. F. To strengthen the public planning process, encourage private participation in comprehensive planning, and reduce the economic risk or development, the Legislature of the State of California adopted the "Development Agreement Statute", Sections 65864, et seq., of the Government Code. The Development Agreement Statute authorizes City to enter into an agreement with any person having a legal or equitable interest in real property and to provide for development of such property and to establish certain development rights therein. Pursuant to the authorization set forth in the Development Agreement Statute, City has enacted procedures for entering into development agreements which are contained in Tustin City Code Sections 9600 to 9619. G. City has determined that development and use of the Project in the future will provide significant benefits to the. community and promote the public health, safety, and welfare for the following reasons, among others: (i) development of the Project will generate significant tax revenues that can be utilized to provide police, fire and other essential important public services to the community; (ii) development will put the Property to productive use consistent with the objectives of the City's General Plan; and (iii) developmen~ of the Project will provide a long term source of employment opportunities for residents of the City and the surrounding region. In consideration of Developer's provision of these benefits, City has determined that it is appropriate to enter into this Agreement to provide assurances to Developer that the City's Public Parking Area Ordinance will continue in effect as it relates to the Project for the term of this Agreement. H. This Agreement will promote and encourage the development ofthe Project by providing the Developer with a greater degree of certainty of the Developer's ability to use and maintain the Property as provided for herein. The parties agree that the consideration to be received by the City pursuant to this Agreement and the rights secured to the Developer hereunder constitute sufficient consideration to support the covenants and agreements of the City and the Developer I. On , the Planning Commission of the City held a public hearing on Developer's application for approval of this Agreement and recommended to the City Council of City that this Agreement be approved. On , the City Council of City held a public h~aring on Developer's application for approval of this Agreement, considered the recommendations of the Planning Commission, and adopted Ordinance No. approving this Agreement and authorizing its execution. AGREEMENT NOW, TIIEREFORE, in consideration of the above recita]s~ which are incorporated herein by this reference, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows: 2 522651.1 1. Definitions. 1.1 The term "Agreement't shall mean this Development Agreement, including the exhibits hereto, for the Project by and between the City of Tustin and Developer, as the same may be amended from time to time. 1.2 The term "Cityu shall mean the City of Tustin, a municipal.corporation organized and existing under the laws of the State of California. 1.3 The term "City's Development Agreement Procedures and Requirements" means the Tustin City Code Sections 9600 to 9619", as may be amended from time to time. 1.4 The term "City's Public Parking Area Ordinance" means Ordinance No: _ of the Tustin City Council adding Chapter 9 to Article 7 of the Tustin City Code providing for a process for the designation and de-designation of public parking areas in the City 1.5 The term "DDA" refers to that certain Disposition and Development Agreement, dated June 21, 2004, entered into by and between Developer and the Tustin Community Redevelopment Agency, a copy of which is on file with the City Clerk. 1.6 The term "Developer" shall collectively mean Prospect Village LP, a California limited partnership, and its successors and assigns. 1.7 The term "Development Agreement Statute" shall mean Article 2.5 (commencing with Section 65864) of Chapter 4 of Division 1 of Title 7 of the California Government Code. 1.8 The terms "Development," "development," and "develop" mean the improvement of the Property for the purposes of completing the structures, improvements, and facilities comprising the Project including, but not limited to: grading; the construction of infrastructure and public facilities related to the Project whether located within or outside the Property; the construction, demolition, reconstruction, and redevelopment of buildings and structures; and the installation of landscaping. 1.9 The term "Development Approvals" means all land use and building permits and entitlements subject to approval or issuance by CITY in connection with development of the . Home Ranch Project, including, but not limited to: · Parcel maps and/or lot line adjustmepts; · Conditional use permits, final development permits and variances; . Zoning .changes; · Preliminary and/or Final Master Plan approvals or amendments; · Tentative and Final Subdivision Maps; · Grading and building pet;mits; and .3 522651. I · Occupancy permits. 1.10 The term "Development Exaction" means any requirement of CITY in connection with or pursuant to any Land Use Regulation or Development Approval for the dedication of land, the construction of public improvements or public facilities, or the payment of fees in order to lessen, offset, mitigate or compensate for the impacts of development on the environment or other public interests. 1.11 The term "Effective Date" means the date the ordinance approving this Agreement becomes effective. Subject to the provisions of the California Elections Code, relating to referendum petitions, said ordinance will become effective 12:01 a.m. on the thirty- first (31 st) day following its adoption by the City Council. 1.12 The tenn "Existing Development Approvals" means all Project Development Approvals approved or issued prior to the Effective Date. Existing Development Approvals include the Development Approvals listed on Exhibit "e" and incorporated herein by reference. 1.13 The term "Existing Land Use Regulations" means all Land Use Regulations in effect on the Effective Date of this Agreement. The Existing Land Use Regulations are listed on Exhibit "D" and incorporated herein by reference. 1.14 The term "Future Development Approvals" means all Developm~nt Approvals required or requested subsequent to the Effective Date in connection with the development of the Property in accordance with the Existing Land Use Regulations. 1.15 The term "Land Use Regulations" means all ordinances, resolutions, codes, rules, regulations and official policies of City governing land use develop~ent and building construction, including, without limitation: the permitted use of land; the density or intensity of use; subdivision requirements; the maximum height and size of proposed buildings; Development Exactions; regulations regarding the rate, time or sequence of development; parking requirements and the design, improvement and construction standards and specifications applicable to the development of the Property. ' 1.16 The term "Mortgagee" means a mortgagee of a mortgage, a beneficiary under a deed of trust or any other secured lender, and their successors and assigns. 1.17 The term "Party" shall refer singularly to City or Developer and collectively to City and Owner. 1.18 The term "Property" means the real property located at 191 and 193 - 195 East Main Street in Tustin, California, and more fully described in Exhibit "A" and depicted on Exhibit "B" to this Agreement. . 1.19 The term "Subsequent Land Use Regulations" means any Land Use Regulations adopted and effective after the Effective Date of this Agreement. 2. Duration. This Agreement shall expire twenty-five (25) years from its Effective Date. 4 522651.1 3. Aereement and Assurances on the Part of Developer. From and after the Effective Date, Developer shall work toward and complete the development of the Project in accordance with the DDA (including without limitation completion dates and any related milestones), the Existing Land Use Regulations, the Existing Development Approvals, and the Future Development Approvals to be obtained pursuant hereto. Not by way of limitation of the foregoing, Developer shall comply with all conditions imposed by City on the Existing Development Approvals, and all valid conditions consistent with this Agreement that City may impose on the Future Development Approvals. Developer shall also comply with all the requirements now in force, or which may thereafter be in force, of all municipal, county, state~ and federal authorities~ pertaining to the Property 'and the Project as well as operations conducted thereon. 4. Agreement and Assurances on the Part of City. City hereby agrees that commencing on the Effective Date, and continuing during the entire remaining term of this Agreement, City will not repeal or substantively amend the provisions of City's Public Parking Area Ordinance related to designation and de-designation of City-owned property as a public parking area in any manner that materially affects the Project. Throughout the term of this Agreement, City hereby reserves the right, in its sole discretion, to designate and de-designate any City-owned property as public parking areas pursuant to the provisions of the City's Public Parking Area Ordinance. 5. General. The uses permitted hereunder, the density and intensity of development, minimum lot sizes and building setbacks, the maximum height and size of buildings, provisions for reservation or dedication of land for public purposes, and all other matters affecting land use and development of the Project shall be as set forth in the express provisions of this Agreement and the Existing Land Use Regulations, the Existing Development Approvals, and once the same have been obtained, the Future Development Approvals. 6. Conditions of Approval Material Terms. Each and every obligation imposed upon Developer pursuant to the DDA regarding development of the Project, and any and all conditions of approval imposed on the Project pursuant to the Existing Development Approvals or Future Development Approvals, shall be considered material terms of this Agreement. Breach of any such DDA obligation or condition of approval shall be deemed to be a breach oftrus Agreement. 7. Periodic Review. The periodic review described in City's Development Agreement Procedures and Requirements is applicable to this Agreement. In no event shall City's failure to conduct or complete a periodic review of Developer's performance result in a termination or . modification of Developer's rights hereunder or constitute breach by the City of this Agreement. 8. Modification or Termination. This Agreement is subject to modification, amendment, and/or termination pursuant to the provisions set forth in City's Development Agreement Procedures and Requirements. This Agreement may be modified or terminated upon the happening of any of the following events: 8.1 Failure of Developer to comply with any term of this Agreement. 8.2 Mutual agreement of the Parties. 5 522651. J 8.3 Failure of Developer to cure any default under the terms and conditions of this Agreement after reasonable notice. 9. Non-Liability of Officials and Emplovees of City. No elected or appointed official, representative, employee, agent, consultant, legal counselor employee of the City shall be personally liable to the Developer, or any successor in interest in the event of any default or breach by the City for any amount which may become due to the Developer or successor or on any obligation under the terms of this Agreement. 10. Notices. All notices, demands, consents, requests and other communications required or permitted to be given under this Agreement shall-be in writing and shall be deemed conclusively to have been duly given (a) when hand delivered to the other Party; (b) three (3) Business Days after such notice has been sent by United States mail via certified mail, return receipt requested, postage prepaid, and addressed to the other Party as set forth below; ( c) the next Business Day after such notice has been deposited with a national overnight delivery service reasonably approved by the Parties (Federal Express, United Parcel Service and U.S. Postal Service are deemed approved by the Parties), postage prepaid, addressed to the Party to whom notice is being sent as set forth below with next business day delivery guaranteed, provided that the sending Party receives a confirmation of delivery from the delivery service provider; or (d) when received by the recipient Party when sent by facsimile transmission or emall at the number or email address set forth below (provided, however, that notices given by facsimile or email shall not be effective unless either (i) a duplicate copy of such notice is promptly sent by any method permitted under this Section 10 other than by facsimile or email; or (ii) the receiving Party delivers a written confirmation of receipt for such notice either by facsimile, email or any other method permitted under this Section. Any notice given by facsimile or email shall be deemed received on the next business day if such notice is received after 5:00 p.m. (recipient's time) or on a Saturday, Sunday or national holiday. Unless otherwise provided in writing, all notices hereunder shall be addressed as follows: If to the City: City of Tustin 300 Centennial Way Tustin, CA 92780 Attention: City Manager If to the Developer: Prospect Village LP . c/o John H. Tillotson, Jr., and Daniel Howse Pelican- Tustin LLC, General Partner 15272 Bolsa Chica Road Huntington Beach, CA 92649 Any Party may by written notice to the other Party in the manner specified herein change the address to which notices to such Party shall be delivered. 11. Time of the Essence. 'Time is of the essence in performance of this Agreement. 6 522651.1 12. Binding Effect. This Agreement and the terms, provisions, promises, covenants and conditions hereof shall be binding upon and shall inure to the benefit of the Parties hereto and their respective heirs, legal representatives, successors and assigns. 13. Authority to Execute. Each person executing this Agreement represents and warrants that he or she is duly authorized and has legal capacity to execute and deliver this Agreement on behalf of the Parties for which execution is made. Each Party represents and warrants to the other that the execution of this Agreement and the performance of such Partyts obligations hereunder have been duly authorized and that the agreement is a valid and legal agreement binding on such Party and enforceable in accordance with its terms. 14. Applicable Law. This Agreement shall be governed by, interpreted under, construed and enforced in accordance with the laws of the State of California, irrespective of Califomiats choice of law principles. 15. Indemnification. Developer agrees to protect, defend, and hold harmless City and its elective or appointive boards, officers, agents, and employees from any and all claims, liabilities, expenses or damages of any nature, including attorneys' fees, for bodily injury or death of any person, or damage to property, or interference with use of property, or otherwise arising out of negligent acts or omissions, or willful misconduct in the performance of the Agreement by Developer, Developer's agents, officers or employees, and subcontractors hired by Developer. 16. Entire Af!reement. This Agreement constitutes the entire understanding and agreement between the Parties and supersedes all"previous negotiations, discussions and agreements, oral or written, between the Parties with respect to all or part of the subject matter hereof. 17 . Waiver of Terms and Conditions. No waiver of any provision of this Agreement shall be effective unless in writing and signed by a duly authorized representative of the Party against whom enforcement of a waiver is sought. No waiver of any right or remedy in respect to any occurrence or event shall be deemed a waiver of any right or remedy in respect to any other or subsequent occurrence or event. 18. Severabilitv. If any term, provision, covenant, or condition set forth in this Agreement is held by the final judgment of a court of competent jurisdiction to be invalid, void, or unenforceable,' the remaining provisions, covenants, and conditions shall continue in full force and effect to the extent that the basic intent of the ~arties as expressed herein can be accomplished. In addition, in such event the Parties shall cooperate in good faith in an effort to amend or modify this Agreement in a manner such that the purpose of the invalidated or voided provision, covenant, and condition can be accomplished to the maximum extent legally permissible; provided, however, that in no event shall either Party be required to agree to an amendment or modification of this Agreement that materially adversely impacts its rights or materially increases its obligations or risks as set forth herein. 19. Recitals. The Recitals above are hereby incorporated into this section as through fully set forth herein and each Party acknowledges and agrees that such Party is bound, for purposes of this Agreement, by the same. 7 522651.1 IN WITNESS WHEREOF, the Parties hereto have executed this Agreement the day and year first above written. ATTEST: By: Pamela Stoker, City Clerk APPROVED AS TO FORl\1: By: Douglas Holland, City Attorney 522651,1 CITY OF TUSTIN By: Doug Davcrt, Mayor DEVELOPER: Prospect Village, LP, a California Limited Partnership Pelican-Tustin, LLC, a California Limited Liability Company, General and Managing Partner By: John H. Tillotson, Jr., Member By: Daniel Howse, Member 8 STATE OF CALIFORNIA) )S8. COUNTY OF ) On , before me, personally appeared personally known to me (or p~oved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in hislher/their authorized capacity(ies), and that by hislher/their signature(s) on the instrument the pcrson(s) or the entity upon behalf of which the person(s) acted, executed the instrument. Witness my hand and official seal. Notary Public [SEAL] ST ATE OF CALIFORNIA ) ) ) 58. COUNTY OF On , before me, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose narne(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in hislher/their authorized capacity(ies), and that by hislher/their signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s) acted, executed the instrument. \Vitness my hand and official seal. Notary Public [SEAL] 522651,1 EXHIBIT "A" LEGAL DESCRIPTION OF THE PROPERTY . [TO BE INSERTED] 522651.1 LEGAL DESCRIPTION The land referred to herein is situated in the State of California County of Orange described as follows: Lots 1 to 13 inclusive, and lettered Lot "A" of Tract 16481, in the City of Tustin, County of Orange, State of California, as shown on a map filed in Book 879, pages 36 to 38 inclusive of Miscellaneous Maps, records of Orange County, California. End of Legal Description EXHIBIT "B" DEPICTION OF THE PROPERTY 52265 I. J EXHIBIT "C" LIST OF EXISTING DEVELOPMENT APPROVALS 1. Prospect Village Final Environmental Impact Report Mitigation Monitoring Program for the Prospect Village Final Environmental Impact Report, certified by the City Council of the City of Tustin on May 17, 2004, pursuant Resolution No. 04-05. 2. Resolution No. 04-07, adopted by the City Council of the City of Tustin on May 17, 2004, approving Tentative Tract Map 16481. 3. Resolution No. 04-48, adopted by the City Council of the City of Tustin on May 17, 2004, approving Design Review 03-012. 4. Resolution No. 04-49, adopted by the City Council of the City of Tustin on May 17, 2004, approving Conditional Use Permit 03-012. 5. Ordinance No. 1284, adopted by the City Council of the City of Tustin on June 7, 2004, approving Zone Change 03-002. 522651.1 EXHIBIT "D" EXISTING LAND USE REGULATIONS 1. City of Tustin General Plan. 2. Title 9 of the Tustin City Code. (Planning, Zoning and Development Codes) 3. All other ordinances, resolutions, regulations, and official policies governing land use development and building construction. 4. Tustin City Code Sections 9600 to 9619, as it may be amended. COPIES OF THE EXISTING LAND USE REGULATIONS LISTED ABOVE ARE ON FILE IN THE CITY CLERK'S OFFICE. 522651. J ~!~~~rf Sanctity of Contract STEWART TITLE OF CALIFORNIA, INC., ORANGE COUNTY DIVISION 180 NORTH RIVERVIEW DR., SUITE 100 ANAHEIM, CA 92808 (800) 346-1444 www.stewarttitle.com MEMBER CALIFORNIA LAND TITLE ASSOCIATION PRELIMINARY REPORT Pelican Properties 15272 Bolsa Chica Street Huntington Beach, California 92649 Attn: Dan Howse Order Number: 86-168696 Property Address: 191-195 E Main Street, Tustin, CA Your Reference: Prospect Village I n response to the above referenced appl ication for a Pol icy of Title I nsurance, Stewart Title of Cal ifornia, I nc. hereby reports that it is prepared to issue, or cause to be issued, as of the date hereof, a Pol icy or Pol icies of Title Insurance describing the land and the estate or interest therein hereinafter set forth, insuring against loss which may be sustained by reason of any defect, I ien or encumbrance not shown or referenced to as an Exception on Schedule B or not excluded from coverage pursuant to the printed Schedules, Conditions, and Stipulations of said Pol icy forms. The printed exceptions and exclusions from the coverage of said pol icy or pol icies are set forth in the attached list. Cop i es of the po Ii cy forms shou I d be read. They are ava i I ab I e from the offi ce wh i ch issued th is report. Please read the exceptions shown or referred to below and the exceptions and exclusions set forth in Exhibit A of this report carefully. The exceptions and exclusions are meant to provide you with notice of matters which are not covered under the terms of the title insurance policy and should be carefully considered. It is important to note that this preliminary report is not a written representation as to the condition of title and may not I ist all I iens, defects, and encumbrances affecting title to the land. This report, (and any supplements or amendments thereto) is issued solely for the purpose of faci I itating the issuance of a pol icy of title insurance and no I iabi I ity is assumed hereby. If it is desired that I iabi I ity be assumed prior to the issuance of a pol icy of title insurance a binder or commitment should be requested. Dated as of February 02, 2007 at 7: 30 a. m . Updated Nancy J. Noonan, Senior Title Officer (714) 685-2320 Fax: (714) 242-9914 E-Mail: Nnoonan@stewart.com 86-168696 PRELIMINARY REPORT The form of Policy of Title Insurance contemplated by this report is: American Land Title Association Loan Policy SCHEDULE A The estate or interest in the land hereinafter described or referred to covered by this report is: A Fee Title to said estate or interest at the date hereof is vested in: PROSPECT VILLAGE LP/ a California limited partnership Continued on next page -1- 86-168696 LEGAL DESCRIPTION The land referred to herein is situated in the State of Californial County of described as follows: Lots 1 to 13 inclusivel and lettered Lot "A" of Tract 164811 in the City of Tustinl County of Orange 1 State of Californial as shown on a map filed in Book 8791 pages 36 to 38 inclusive of Miscellaneous Mapsl records of Orange CountYI California. End of Legal Description Continued on next page -2- 86-168696 SCHEDULE B At the date hereof, exceptions to coverage in addition to the printed exceptions and exclusions contained in said policy or policies would be as follows: A. Property taxes including any assessments collected with taxes/ to be levied for the fiscal year 2007-2008/ which are a lien not yet payable. B. General and Special City and/or County taxes/ including any personal property taxes and any assessments collected with taxes/ for the fiscal year 2006-2007: 1st Installment $4/502.44 Paid 2nd Installment $4/502.44/ Open Parcel No. 401-585-01 C. The lien of supplemental taxes/ if any/ assessed pursuant to the provisions of Chapter 3.5 (commencing with Section 75) of the Revenue and Taxation Code of the State of California. D. Assessments/ if any/ for community facility districts affecting said land which may exist by virtue of assessment maps or notices filed by said districts. Said assessments are collected with the County Taxes. 1. Water rights/ claims or title to water in or under said land/ whether or not shown by the public records. 2. An easement for the purpose shown below and rights incidental thereto as set forth in a document: In favor of Southern California Edison Company Purpose Public utilities Recorded August 24/ 1946 in Book 1450/ Page 130/ Official Records Affects Said land (Said easement is blanket in nature) 3. (intentionally omitted) 4. The matters contained in an instrument entitled "Statement for a Redevelopment Project" upon the terms and conditions and covenants therein provided/ recorded November 29/ 1976 in Book 11976/ Page 35/ Official Records. 5. The matters contained in an instrument entitled "Notice of Potentially Earthquake Hazardous Building(s)" upon the terms Continued on next page -3- 86-168696 and conditions and covenants therein provided/ recorded December 12/ 1991 as Instrument No. 91-682975/ Official Records. 6. The matters contained in an instrument entitled "Certificate of Dangerous Building" upon the terms and conditions and covenants therein provided/ recorded November 30/ 1992 as Instrument No. 92-816557/ Official Records. 7. Terms/ provisions/ covenants/ conditions and restrictions as contained in that certain unrecorded Disposition and Development Agreement/ dated June 21/ 2004/ executed by and between the City of Tustin and Prospect Village LP/ as disclosed by a Memorandum of Disposition and Development Agreement recorded July 22/ 2004 as Instrument No. 2004000665160 of Official Records. Trustee Beneficiary Recorded Instrument No. Deed of Trust to secure an indebtedness of the amount below/ and any other obligations secured thereby: April 18/ 2005 $500/000.00 Prospect Village/ LP/ a California limited partnership First National Bank First National Bank April 21/ 2005 2005000305697/ Official Records 8. A shown Dated Amount Trustor NOTE: An Assignment of Leases and Rents/ given as additional security for the payment of the indebtedness secured by said deed of trust/ executed by Prospect Village/ LP to First National Bank/ recorded April 21/ 2005 as Instrument No. 2005000305698/ Official Records. 9. The matters contained in an instrument entitled "Covenant Agreement (Early Issuance of a Building Permit)" dated March 30/ 2005/ executed by and between Prospect Village LP and The City of Tustin/ upon the terms/ provisions and conditions contained therein/ recorded Narch 30/ 2006 as Instrument No. 2006000208464 of Official Records. 10. An easement as shown and dedicated to the City of Tustin on the map of said Tract No. 16481: For I ingress/ egress/ access and public utilities Affects Lot A 11. The recital on the map of said Tract 16481 which states: "For Planned Unit Development." 12. An easement reservation for private storm draIn purposes over a portion of Lot 1 for the benefit of Lots 1 to 13 Continued on next page -4- 86-168696 inclusivel as shown and delineated on the map of said Tract 16381. END OF EXCEPTIONS Continued on next page -5- 86-168696 NOTES The charge for a policy of title insurance I when issued through this title orderl will be based on a contract rate. Continued on next page -6- 86-168696 CALIFORNIA "GOOD FUNDS" LAW California Insurance Code Section 12413.1 regulates the disbursement of escrow and sub-escrow funds by title companies. The law requires that funds be deposited in the title company escrow account and available prior to disbursement. Funds received by Stewart Title of California/ Inc. (Stewart Title) via wire transfer may be disbursed upon receipt. Funds received via cashier's checks or teller checks drawn on a California Bank may be disbursed on the next business day after the day of deposit. If funds are received by any other means/ recording and/or disbursement may be delayed/ and you should contact your title or escrow officer. All escrow and sub-escrow funds received will be deposited with other escrow funds in one or more non-interest bearing escrow accounts in a financial institution selected by Stewart Title. Stewart Title may recieve certain direct or indirect benefits from the financial institution by reason of the deposit of such funds or the maintenance of such accounts with the financial institution/ and Stewart Title shall have no obligation to account to the depositing party in any manner for the value of/ or pay to such party/ any benefit received by Stewart Title. Such benefits shall be deemed additional compensation to Stewart Title for its services in connection with the escrow or sub-escrow. WIRING INSTRUCTIONS Additional Note: Direct Wire Transfers To: Mellon 1st Business Bank 601 West Fifth Street Los Angeles/ CA 90071 ABA Number: 122038442 Credit: Stewart Title of California/ Inc. Account Number: 001-753-304 Benefit: Order No.: 86-168696 Title Officer: Nancy J. Noonan Please Reference: Escrow/Title Officer Escrow/Title Number -7- Exhibit 1 - '04 Stewart Title Guaranty Company, Stewart Title Insurance Company, Stewart Title of California, Inc. Privacy Policy Notice PURPOSE OF THIS NOTICE Title V of the Gramm-Leach-Bliley Act (GLBA) generally prohibits any financial institution, directly or through its affiliates, from sharing nonpublic personal information about you with nonaffiliated third party unless the institution provides you with a notice of its privacy policies and practices, such as the type of information that it collects about you and the categories of persons or entities to whom it may be disclosed. In compliance with the GLBA, we are providing you with this document, which notifies you of the privacy policies and practices of Stewart Title Guaranty Company, Stewart Title Insurance Company, Stewart Title of California, Inc. We may collect nonpublic personal information about you from the following sources: * Information we receive from you, such as on applications or other forms. * Information about your transactions we secure from our files, or from our affiliates or others. * Information we receive from a consumer reporting agency. * Information that we receive from others involved in your transaction, such as the real estate agent or lender. Unless it is specifically stated otherwise in an amended Privacy Policy Notice, no additional nonpublic personal information will be collected about you. We may disclose any of the above information that we collect about our customers or former customers to our affiliates or to nonaffiliates third parties permitted by law. We also may disclose this information about our customers or former customers to companies that perform services on our behalf as permitted by law. WE DO NOT DISCLOSE ANY NONPUBLIC PERSONAL INFORMATION ABOUT YOU WITH ANYONE FOR ANY PURPOSE THAT IS NOT SPECIFICALLY PERMITTED BY LAW. We restrict access to nonpublic personal information about you to those employees who need to know that information in order to provide products or services to you. We maintain physical, electronic, and procedural safeguards that comply with federal regulations to guard your nonpublic personal information.