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Home My WebLink AboutCOW 2011-03-14 Item 4F - Discussion - Tukwila Village: Proposed Developer Selection Process COUNCIL A G E ND A S Y'N O P S I S rV ITEM No. J 4 J Initials ,<t e Meeting Date Prepared by 1 Mayors review 1 Cozrncil review ykkoti 4 1 03/14/11 1 DCS 1 03/21/11 DCS -41K4°).1,. ITEM INFORMATION CAS NUMBER: 11-035 I STAFF SPONSOR: DEREK SPECK I ORIGINAL AGENDA DATE: 03/14/11 AGENDA I'T'EM TITLE Tukwila Village: Approval of Developer Selection Process C T1 G URY Discussion Motion Resolution Ordinance ['Bid Award Public Hearing Other Mtg Date 03/14/11 Mtg Date 03/21/11 Mtg Date Mtg Date Mtg Date Mtg Date Mtg Date 1 SP( )NS( )R 0 Council Mayor Adm Svcs DCD Finance Fire n Legal P&R Police PW SPONSOR'S On 3/7/11 the City Council voted to start a developer selection process. The Council is SUMMARY being asked to consider and approve a recommended developer selection process. Ri .\'I1,w1?D BY COW Mtg. CA &P Cmte F &S Cmte Transportation Cmte Utilities Cmte Arts Comm. Parks Comm. Planning Comm. DATE: N/A COMMIFIEE CHAIR: N/A RECOMMENDATIONS: SPONSOR /ADMIN. Approve COMMITTEE CO IMPACT FUND SOURCE EXPI NDITURI? REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED $0 $0 $0 Fund Source: Con MTG. DATE RECORD OF COUNCIL ACTION 03/14/11 MTG. DATE ATTACHMENTS 03/14/11 Informational Memorandum dated 3/10/11 217 218 J .NILA V 4 t N i z City of Tukwila (e Jim Haggerton, Mayor 9oa ...9 INFORMATIONAL MEMORANDUM TO: Mayor Haggerton FROM: Derek Speck, Economic Development Administrator DATE: March 10, 2011 SUBJECT: Tukwila Village ISSUE Staff seeks City Council approval of a developer selection process for Tukwila Village BACKGROUND On March 7, 2011 the City Council voted in support of starting a developer selection process. State law requires the City Council to approve the developer selection procedure. DISCUSSION There are many approaches the City could take to select a developer. For government redevelopment projects, it is very common for the government agency to select a developer based on one of the following competitive methods: (1) Developer's qualifications (2) Developer's proposal (3) Developer's qualifications and proposal Under the first method the agency would issue a request for qualifications (RFQ), would review the qualifications of all the developers who apply, and would select based on that information. In this method, the RFQ would typically request information on the developer's management team, design team, experience with similar developments, experience getting financing, and experience getting commercial or residential tenants. The City of Tukwila could also request the developer to describe their concept for Tukwila Village and provide justification for why they believe their concept is feasible in the marketplace. All terms of an agreement would be negotiated. Under the second method, the agency would issue a request for proposals (RFP), would review the proposals received, and would select the developer based on the agency's preferred proposal. Typically, proposals include significantly more definition of the developer's concept and would include an estimate of land price. The more detail requested, such as architectural renderings, the more time and expense would be involved for the developer. If the agency requires an actual purchase offer, the developer would have to invest very significant time and expense. 219 INFORMATIONAL MEMO Page 2 The third method is much more common than the second method because most developers will not invest the time and expense needed to make a detailed proposal, and certainly not an offer, unless they believe they have a reasonable chance of success. The third method accommodates this by enabling developers to fairly easily submit their qualifications. The agency would then review the qualifications and select the top two or three developers to submit proposals. This two step process is effective but takes significant time. This is the process that the City used in 2008 to select a developer for Tukwila Village. At this stage for Tukwila Village, staff recommends method 1, selecting a developer through a competitive process based on qualifications. This method is the most likely for success because: (1) It is the fastest method and the library has indicated a strong desire to move forward quickly. We are most likely to have the optimal development if a developer can proceed at the same time as the library. (2) In this economy, the types of developments that are feasible in the marketplace are probably fairly limited. If all developers propose very similar concepts, then the most important criteria is the developer's qualifications. As an example, two developers who have expressed strong interest in the Village at this time have both indicated they can incorporate the elements of the Council's adopted vision and believe the most feasible concept for a residential component is senior housing. In the RFQ, staff would include some provisions that make it clear that the City is not bound by the RFQ and could end the process at any time or add additional steps. For example, if we receive applications from many highly qualified developers with very different concepts, it's possible we would add the proposal step into the process. Proposed Selection Process March 21 City Council approves developer selection process. March 23 Draft RFQ is available to the Council. March 30 Request for Qualifications (RFQ) is issued. We would post it to the City's website, publish official notice through the City's standard methods, and market it through email and selected publications. April 29 Developer applications are due. May 2 -13 Developer applications are available at City Hall for public review. Citizens would be encouraged to provide written comments that could be shared with the staff team and City Council or provide oral comments to the Economic Development Administrator. May 2 -17 Staff team review and Mayor's review /approval. In addition to city staff, the team would likely include a representative from the King County Library District. May 24 City Council discussion of staff recommendation June 6 City Council selection of developer W:12011 Info Memos\TukwilaVillage3- 14- 11.doc 220 INFORMATIONAL MEMO Page 3 Proposed Selection Principles (as approved by Council 3/7/11) (1) The City still holds the vision for Tukwila Village that was adopted in 2007. (2) The Library is still a key component of the vision and the City is committed to reasonable deal terms to include the Library at the primary corner "Site B (3) Active living, age restricted apartments "senior apartments" for 62 and older) are an appropriate type of residential space and can be a major portion, or even all, of the residential space. (4) Some portion of the apartments (senior or non senior) can be "affordable meaning income restricted to levels of 50 60% and 80% of area median income. (5) If possible, a significant portion of the units should also be "market rate meaning not income restricted. (6) A heathcare provider, including a non profit providing primary and dental care to people regardless of income, can be a positive use for the site. Proposed Selection Principles (excerpted and paraphrased from the 2008 RFQ) (1) The City desires a development that accomplishes the City's vision as adopted by the City Council in 2007: "Tukwila Village will be a welcoming place where all residents can gather and connect with each other. This mixed -use development will draw upon Tukwila's strengths and include a library, a neighborhood police resource center, retail, restaurants, public meeting space, and an outdoor plaza. The Village may also include office, live /work, and residential space. This active, vibrant place will set high standards for quality and foster additional neighborhood revitalization and civic pride. (2) The City prefers to sell all six acres to one developer. However, selling significant portions to separate developers will be considered. (3) This project is located in a designated urban renewal area in which the City has eminent domain authority; however, the City is not seeking to acquire additional property at this time. (4) In addition to the library and neighborhood police resource center, the City is amenable to concepts that include office, live /work, or residential as major components of the development. Apartments will be considered but preference may be given to concepts with ownership housing. (5) The City encourages both market rate and mixed income concepts but is not interested in concepts in which the entire residential component is income restricted, unless it is to offer housing for active seniors or artists. W:12011 Info Memos\TukwilaVillage3- 14- 11.doc 221 INFORMATIONAL MEMO Page 4 (6) The City desires to maximize its financial return while achieving the project vision. We are open to creative approaches such as phasing the construction, phasing financial payments, or retaining an equity position. (7) Improvements are scheduled for South 144 Street in the City's capital improvement plan. If technically feasible, the City is willing to coordinate the timing of those improvements to coincide with the development of this project. The City owns Tukwila International Boulevard and is willing to explore on- street parking or other improvements. (8) The City plans to own or lease approximately 2,000 square feet of office space in the development for a neighborhood police resource center. (9) We encourage green and environmentally sustainable building practices. RECOMMENDATION The Council is being asked to forward this item to the March 21, 2011 Regular Meeting to make a formal motion in support of the developer selection procedure and principles outlined in this report. ATTACHMENTS None W:12011 Info Memos\TukwilaVillage3- 14- 11.doc 222