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HomeMy WebLinkAbout05 TUSTIN LEGACY DISPOSITION PARCEL 6B CERTIFICATE OF COMPLIANCE AND TERMINATION OF PUBLIC ACCESS.pdAGENDA REPORT Agenda Item Reviewed: City Manager Finance Director MEETING DATE: FEBRUARY 7, 2023 TO: FROM: MATTHEW S. WEST, CITY MANAGER ECONOMIC DEVELOPMENT DEPARTMENT SUBJECT: SUMMARY: TUSTIN LEGACY DISPOSITION PARCEL 68 CERTIFICATE OF COMPLIANCE AND TERMINATION OF PUBLIC ACCESS COVENANT AND DECLARATION OF EASEMENT Request for authorization to execute the Certificate of Compliance (Certificate) and the Termination of Public Access Covenant and Declaration of Easement (Termination) for Tustin Legacy Disposition Parcel 68 (Levity at Tustin Legacy). RECOMMENDATION: Authorize the City Manager to execute the Certificate and Termination, subject to any non-substantive modifications as may be deemed necessary and/or recommended by the City's special real estate counsel or the City Attorney. FISCAL IMPACT: No fiscal impact. The approval of the Certificate recognizes all construction and financial obligations have been fulfilled pursuant the Disposition and Development Agreement (DOA) between the City and Cal Atlantic Group, Inc., which was later acquired by Lennar Homes of California, Inc. (Developer). Approval of the Termination recognizes that public access easements were incorporated into the final recorded condominium plans for the project. CORRELATION TO THE STRATEGIC PLAN: Goal A -Economic and Neighborhood Development BACKGROUND: The City and Developer entered into a DOA on February 6, 2018 for Disposition Parcel 68 at Tustin Legacy to construct a 218 unit for-sale residential project called Levity at Tustin Legacy. The 218 units are comprised of 57 detached cluster residences (Icon), 101 attached row townhomes (Fleet) and 60 motor court flats (Velocity). The project 5 DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 15131 Alton Parkway, Suite 365, Irvine, CA 92618 • Phone: 949-349 -8000 • Fax: 949-349 -1763 December 12, 2022 Mr. Matthew S. West City Manager City of Tustin 300 Centennial Way Tustin, CA 92780 RE: Request for Certificate of Compliance for Levity in Tustin Legacy (Disposition Parcel 6B) Dear Mr. West, Pursuant to the terms of the Disposition and Development Agreement dated February 6, 2018, between the City of Tustin (“City”) and Calatlantic Group, Inc., a Delaware Corporation, having merged with Lennar Homes on February 12, 2018, under the name of Lennar Corporation, a Delaware corporation (“Developer”), please consider this letter the formal request to the City to issue and record a Final Certificate of Compliance for the above referenced parcel. Initially capitalized terms used and not defined herein shall have the meanings set forth in the DDA. In connection with the foregoing request, the Developer certifies as follows: 1. All conditions set forth in Section 9.3 of the DDA have been met with respect to Parcel 6A as follows: a. Completion of the Improvements and satisfaction of all obligations under the License Agreement; b. Final inspection of the Development Parcels and the Improvements by or on behalf of the City and determination by the City that the project and all Improvements have been Completed in conformance with the DDA, including all Approved Plans and all Governmental Requirements; c. Issuance of a final certificate of occupancy by the City for all Homes within the Project; d. Release or bonding in accordance with California law of all liens or rights to record liens; e. Recordation of the CC&R’s against the Development Parcels; f. Full payment as required by the Profit Participation Agreement; g. Payment by Developer to the City of all funds owed under this Agreement and if applicable, the Other Agreements; h. No Potential Default or Material Default by Developer under this Agreement has occurred. DEVELOPER: Lennar Homes of California, Inc., a California corporation ________________________________ Brett Hamara Authorized Agent DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Parcel 6B Certificate of Compliance 1.11.23 FINAL 1 City of Tustin/Lennar Parcel 6B CITY OF TUSTIN OFFICIAL BUSINESS REQUEST DOCUMENT TO BE RECORDED AND TO BE EXEMPT FROM RECORDING FEES PER GOVERNMENT CODE 6103 AND 27383. Recording requested by and When recorded mail to: The City of Tustin 300 Centennial Way Tustin, CA 92780 Attn: City Manager SPACE ABOVE THIS LINE FOR RECORDER’S USE CERTIFICATE OF COMPLIANCE This CERTIFICATE OF COMPLIANCE (“Certificate of Compliance”) is made as of _____________ __, 2023 by the CITY OF TUSTIN, a municipal corporation of the State of California (“City”), in favor of LENNAR HOMES OF CALIFORNIA, INC., a California corporation (“Developer”), with reference to the following matters: A. The City and CalAtlantic Group, Inc., a Delaware corporation, predecessor in interest to Developer (“Original Developer”), entered into that certain Tustin Legacy Disposition and Development Agreement For Disposition Parcel 6B, dated as of February 6, 2018, 2018 (the “DDA”), which is evidenced by that certain Memorandum of Tustin Legacy Disposition and Development Agreement For Parcel 6B, made as of June 28, 2018 and recorded in the Office of the County Recorder, Orange County, California (the “Official Records”) on June 29, 2018 as Instrument No. 2018000239584 (the “Memorandum of DDA”) with respect to certain real property legally described on Exhibit “A” attached hereto and incorporated herein by this reference (the “Development Parcels”). All initially capitalized terms not otherwise defined herein shall have the meanings assigned to them in the DDA. B. Pursuant to the DDA, the Developer agreed to develop and construct certain Improvements comprising the Project on the Development Parcels. C. Pursuant to Section 9 of the DDA, the City agreed to furnish to the Developer, upon request therefor by the Developer, a Certificate of Compliance in recordable form upon satisfaction of the Conditions Precedent to issuance thereof set forth in Section 9.3 of the DDA (including, without limitation, Completion of all Improvements for the Project in accordance with the terms and conditions of the DDA). DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Parcel 6B Certificate of Compliance 1.11.23 FINAL 2 City of Tustin/Lennar Parcel 6B D. The City has determined that the Developer has satisfied the Conditions Precedent set forth in Section 9.3 of the DDA for the City’s issuance of a Certificate of Compliance with respect to the Development Parcels and the Project. NOW, THEREFORE, the City certifies as follows: 1. This Certificate of Compliance covers and applies to the Development Parcels and the entirety of the Improvements and the Project. 2. This Certificate of Compliance shall be deemed conclusive evidence of the City’s determination that the Developer has satisfactorily Completed all construction and development with respect to the Improvements comprising the Project and has satisfied all Conditions Precedent set forth in Section 9.3 of the DDA for issuance of this Certificate of Compliance. 3. Developer has completed 218 residential units on the Developer Parcels, comprising the number of units described on the Recorded Condominium Plans and actually constructed by Developer prior to issuance of this Certificate of Compliance. The City retains all excess development rights remaining within Specific Plan Neighborhood G, Planning Area 15 after deducting the foregoing 218 units, and, except to the extent any of such rights were conveyed by the City to third parties prior to the Effective Date, the City shall retain all residential units and all development rights associated with Specific Plan Neighborhood G, Planning Area 15 in excess of 218 units, and the units and development rights retained by the City shall be freely transferable by the City throughout Tustin Legacy. 4. After the Recording of this Certificate of Compliance in the Official Records, the DDA shall terminate and, except as set forth below, any Person then owning or thereafter purchasing, leasing, or otherwise acquiring any interest in the Development Parcels shall not because of such ownership, purchase, lease or acquisition incur any obligation or liability under the DDA with respect to such Improvements, except that the following matters, each made by and between City and Developer shall survive the termination of the DDA each in accordance with their terms: (a) the Quitclaim Deed dated June 28, 2018 and recorded on June 29, 2018 in the Official Records as Instrument No. 2018000239586 shall remain in effect in perpetuity; (b) the Profit Participation Agreement dated June 28, 2018, (c) the Special Restrictions dated June 28, 2018 and recorded on June 29, 2018 in the Official Records as Instrument No. 2018000239585, (d) the Landscape Installation and Maintenance Agreement dated June 28, 2018 and recorded on June 29, 2018 in the Official Records as Instrument No. 2018000239587 and (e) the Declaration of Covenants, Conditions, Restrictions and Reservation of Easements for Levity at Tustin Legacy recorded on October 1, 2019 in the Official Records as Instrument No. 2019000379394 shall each remain in effect for the terms specified therein; and DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Parcel 6B Certificate of Compliance 1.11.23 FINAL 3 City of Tustin/Lennar Parcel 6B (f) the following provisions of the DDA shall expressly survive the termination of the DDA and shall remain in effect for the period set forth below: (i) The provisions of Sections 4.5.2 and 8.14 of the DDA, including the releases set forth therein, as and to the extent set forth in the Quitclaim Deed shall survive in perpetuity, shall run with the land and shall be binding upon Developer, its successors and assigns and its Successor Owners, as well as Homebuyers and other End Users; (ii) The provisions of Section 11.1.4 of the DDA shall survive until the expiration of the time period for provision of the environmental insurance policy described thereby; and the obligation to provide such insurance policy shall remain in effect for a period of ten (10) years from Close of Escrow and shall (A) continue to run with the land owned by Developer, its successors and assigns and Successor Owners, and not then conveyed to any Homebuyer or other End User, and (B) bind Developer, its successors and assigns and Successor Owners and each and every prior Developer not released by the City pursuant to Section 2.2.3(c) of the DDA, provided that upon sale or transfer to any Homebuyer or any other End User, such obligation shall not run with the land or survive with respect to or bind any such Homebuyer or End User or any of their respective successors and assigns; (iii) The indemnities set forth in Sections 5.5, 8.12(e), 8.15, 8.16, 10.1, 10.2 and 17.12.1 of the DDA shall remain in effect as and to the extent set forth in Section 10.3 of the DDA and shall bind the Persons bound as set forth therein; provided that upon sale or transfer to any Homebuyer or any other End User, such obligation shall not run with the land or survive with respect to or bind any such Homebuyer or End User or any of their respective successors and assigns; (iv) Any and all obligations contained in the Federal Deeds shall survive in perpetuity to the extent set forth therein, unless such obligations are released by the Federal Government; (v) Neither Developer, its successors and assigns (but excluding any End Users) or any Successor Owner shall modify or terminate any prepaid environmental insurance policy in effect as of the issuance of the Certificate of Compliance; and (vi) The provisions of Section 11.1.1 of the DDA requiring liability insurance to be maintained in full force and effect until issuance of the Certificate of Compliance and so long thereafter as necessary to cover any claims of damages suffered by persons or property prior to issuance of the Certificate of Compliance, resulting from any acts or omissions of Developer, Developer’s employees, agents, contractors, suppliers, consultants or other related parties, and shall (A) continue to run with the land owned by Developer, its successors and assigns (excluding any End Users) and Successor Owners and not then conveyed to any Homebuyer or other End User and (B) bind Developer and its successors and assigns (excluding any End Users) and Successor Owners and each and every prior Developer not released by the City pursuant to Section 2.2.3(c) of the DDA, provided that upon sale or transfer to any Homebuyer or any other End User, such obligation shall not run with the land DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Parcel 6B Certificate of Compliance 1.11.23 FINAL 4 City of Tustin/Lennar Parcel 6B or survive with respect to or bind any such Homebuyer or any other End User or any of their respective successors and assigns. Except as set forth above with respect to Homebuyers and End Users and their respective successors and assigns, this Certificate shall be binding upon Developer, its successors and assigns and Successor Owners and each and every prior Developer (unless released by the City pursuant to Section 2.2.3(c)) and Successor Owner thereof, the Development Parcels and the Improvements for the term set forth above, and each such party shall be jointly and severally liable under such provisions with respect to the entirety of the Project, the Development Parcels and the Improvements for the term set forth above, but except as set forth in Sections 4(a) and 4(c)(i) of this Certificate of Compliance or in the Quitclaim Deed, shall not be binding on any Homebuyer or other End User. 5. Issuance of the Certificate of Compliance shall not waive any rights or claims that the City may have against any Person for latent or patent defects in design, construction or similar matters under any applicable law, nor shall it be evidence of satisfaction of any of Developer’s obligations to third parties who are not a party to the DDA. 6. This Certificate of Compliance is not a Notice of Completion as referred to in California Civil Code Section 8182. 7. Except as stated herein, nothing contained in this instrument shall modify in any way any other provisions of the DDA or any other provisions of the documents incorporated herein. {remainder of page is blank / signatures on following page} DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Parcel 6B Certificate of Compliance 1.11.23 FINAL S-1 City of Tustin/CalAtlantic Parcel 6B IN WITNESS WHEREOF, the City has caused this Certificate of Compliance to be duly executed by its officer duly authorized as of the date first above written. “CITY” CITY OF TUSTIN: By: , Matthew S. West City Manager ATTEST: By: ____________________________ Erica N. Yasuda City Clerk APPROVED AS TO FORM By: ____________________________ David Kendig City Attorney “DEVELOPER” Lennar Homes of California, Inc. a California corporation By: Name: Title: By: Name: Title: DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Parcel 6B Certificate of Compliance 1.11.23 FINAL S-2 City of Tustin/CalAtlantic Parcel 6B ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California ) County of ______________________ ) On _________________________, 2017, before me, , (insert name of notary) Notary Public, personally appeared , who proved 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 his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Parcel 6B Certificate of Compliance 1.11.23 FINAL S-3 City of Tustin/CalAtlantic Parcel 6B ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California ) County of ______________________ ) On _________________________, 2017, before me, , (insert name of notary) Notary Public, personally appeared , who proved 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 his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Parcel 6B Certificate of Compliance 1.11.23 FINAL Exhibit “A” City of Tustin/CalAtlantic Parcel 6B Exhibit “A” Legal Description of the Development Parcels Real property in the City of Tustin, County of Orange, State of California, described as follows: LOTS 1 THROUGH 8, INCLUSIVE, AND LETTERED LOTS “A” AND “B” OF TRACT NO. 18125, IN THE CITY OF TUSTIN, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 976, PAGES 46 THROUGH 50, INCLUSIVE, OF MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Termination of Public Access Covenant 1.11.23 FINAL 1 City of Tustin/Lennar Parcel 6B CITY OF TUSTIN OFFICIAL BUSINESS REQUEST DOCUMENT TO BE RECORDED AND TO BE EXEMPT FROM RECORDING FEES PER GOVERNMENT CODE §6103 AND §27383. RECORDING REQUESTED BY: AND WHEN RECORDED MAIL TO: City Manager The City of Tustin 300 Centennial Way Tustin, California 92780 Space Above This Line Reserved for Recorder’s Use FINAL TERMINATION OF PUBLIC ACCESS COVENANT AND DECLARATION OF EASEMENT THIS FINAL TERMINATION OF PUBLIC ACCESS COVENANT AND DECLARATION OF EASEMENT (“Termination”) is made this ____ day of__________________, 2023, by the City of Tustin (“City”), in favor of LENNAR HOMES OF CALIFORNIA, INC., a California corporation (“Developer”). A. That certain Public Access Covenant and Declaration of Easement dated June 28, 2018 (“Covenant”) was recorded as Instrument No. 2018000239588 in the Official Records of Orange County, California (“Official Records”) for the purpose of creating public access easements (as more fully described in the Covenant) for the benefit of the City during the interim period until the Condominium Plans for the respective Phases of the Project were recorded reflecting such easements thereon. B. Pursuant to the terms of the Covenant, the City has now approved, with respect to conformity with approved plans for the Project only, the Condominium Plan for the Property described in the Covenant (“Property”). The legal description of the Property is set forth on Exhibit A to this Termination. C. All capitalized terms not otherwise defined herein shall have the meaning given to them in the Covenant. NOW THEREFORE, the City hereby agrees as follows: 1. Termination. The Covenant is hereby terminated and shall be of no further force or effect. The Public Access Easement granted by the Covenant is therefore also released, and the access easement for the Publicly Accessible Common Area is now and hereafter granted solely DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Termination of Public Access Covenant 1.11.23 FINAL 2 City of Tustin/Lennar Parcel 6B pursuant to each and every one of the Condominium Plans recorded in the Official Records against the Property. 2. Recordation; Successors and Assigns. This Termination shall be recorded in the Official Records against the Property and is binding on and inures to the benefit of City and Developer, and their respective successors and permitted assigns. 3. Counterparts. This Termination may be signed in counterparts, each of which shall be deemed an original and all of which when taken together shall constitute one instrument. {remainder of page is blank / signatures on following page} DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Termination of Public Access Covenant 1.11.23 FINAL S-1 City of Tustin/Lennar Parcel 6B IN WITNESS WHEREOF, the City and Developer have executed this Termination of Public Access Covenant and Declaration of Easement on the date first above written. “CITY” CITY OF TUSTIN: By: , Matthew S. West City Manager ATTEST: By: ____________________________ Erica N. Yasuda City Clerk APPROVED AS TO FORM By: ____________________________ David Kendig City Attorney “DEVELOPER” Lennar Homes of California, Inc. a California corporation By: Name: Title: By: Name: Title: DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Termination of Public Access Covenant 1.11.23 FINAL S-2 City of Tustin/Lennar Parcel 6B ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California ) County of ______________________ ) On _________________________, 2017, before me, , (insert name of notary) Notary Public, personally appeared , who proved 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 his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Termination of Public Access Covenant 1.11.23 FINAL S-3 City of Tustin/Lennar Parcel 6B ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California ) County of ______________________ ) On _________________________, 2017, before me, , (insert name of notary) Notary Public, personally appeared , who proved 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 his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305 Tustin Lennar Termination of Public Access Covenant 1.11.23 FINAL Exhibit A Property City of Tustin/Lennar Disposition Parcel 6B (Levity) Exhibit A LEGAL DESCRIPTION OF PROPERTY Real property in the City of Tustin, County of Orange, State of California, described as follows: LOTS 1 THROUGH 8, INCLUSIVE, AND LETTERED LOTS “A” AND “B” OF TRACT NO. 18125, IN THE CITY OF TUSTIN, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 976, PAGES 46 THROUGH 50, INCLUSIVE, OF MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. DocuSign Envelope ID: 08295E19-F749-4108-AB4B-9F1A457ADE11DocuSign Envelope ID: 1A2EB726-B254-4B6D-B0CA-5BB398CA5305