09-100 - Segale Properties (La Pianta LLC) - Tukwila South Development Agreement - Amendments and Addendums

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THIRD AMENDMENT TO 09.100(f) DEVELOPMENT AGREEMENT BY AND Council Approval 6/2/14 BETWEEN THE CITY OF TUKWILA Ordinance No. 2440 AND SEGALE PROPERTIES LLC, FOR THE TUKWILA SOUTH DEVELOPMENT THIS THIRD AMENDMENT TO DEVELOPMENT AGREEMENT (the "Third Amendment") is made and entered into this i day of June, 2014, by and between the CITY OF TUKWILA ("City"), a non -charter, optional code Washington municipal corporation, and SEGALE PROPERTIES LLC, a Washington limited liability company ("Segale"). I. RECITALS WHEREAS, the City and Segale entered into that certain Development Agreement relating to the Tukwila South development, dated June 10, 2009 (the "Development Agreement") as amended pursuant to that certain First Amendment to Development Agreement dated May 18, 2010 (the "First Amendment") and that certain Second Amendment to Development Agreement dated November 20, 2012 (the "Second Amendment"). WHEREAS, Sections 4.8.1 and 4.8.3 of the Development Agreement require Segale to pay the City an O&M Guarantee for Tukwila South Project O&M Expenses and for the City and Segale to establish accounting protocols for the tracking of O&M Revenue and O&M Expenses; and WHEREAS, the Parties previously agreed to extend the deadline for executing a memorandum of understanding documenting the accounting protocols such that the effective deadline for executing such . memorandum is June 16, 2014. The Parties have held many meetings and hired a consultant to assist with the development of accounting protocols, but agree that accurately tracking O&M Revenues and O&M Expenses is not feasible; and WHEREAS, the reimbursement provisions of Section 4.8.1 of the Development Agreement were based upon an aggressive build -out schedule for the Tukwila South Project, a schedule which, due to many factors including the economic downturn, has not proved viable. Given the lack of development activity to date, and the remaining site preparation work to be performed, the risk assumptions that led to the provisions set forth in Section 4.8.1 of the Development Agreement are no longer applicable; and WHEREAS, the Parties have negotiated an alternative to the O&M Guarantee, and as such desire to amend the Development Agreement; and oi`a-01-4.1^4-0,a-, [1]