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HomeMy WebLinkAboutResolution No. 441RESOLUTION NO. 441 A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF AZUSA GRANTING BASIC CONCEPT APPROVAL FOR THE PROJECT PROPOSED BY THE PRICE COMPANY WHEREAS, the Price Company is the record owner of a portion of the property generally located south of Foothill Boulevard, east of Todd Avenue and north of the AT & SF Railroad right-of- way in the City of Azusa as illustrated on the location map attached hereto as Exhibit "A". Said property is hereinafter referred to as "the Price Club Site;" and WHEREAS, the Price Club Site is located within and subject to the provisions of the City of Azusa West End Redevelopment Project, adopted pursuant to the provisions of California Redevelopment Law; and WHEREAS, pursuant to said provisions the Azusa Redevelopment Agency has adopted Owner -Participation Rules which establish preferences for the Redevelopment Agency to participate with property owners participating in the same location in compliance with the Redevelopment Plan and desiring to build new industrial, commercial or residential developments; and WHEREAS, Price Company has submitted a conceptual development plan for the ultimate development of the Price Club Site into a commercial center and the conceptual plan is attached hereto. NOW, THEREFORE, BE IT RESOLVED, by the Board of Directors of the Redevelopment Agency of the City of Azusa as follows: SECTION 1. Price Company has submitted a conceptual plan attached hereto as Exhibit B which describes the proposed project in general terms. The Preliminary Points of Understanding are attached as Exhibit C. SECTION 2. The Azusa Redevelopment Agency has reviewed the Conceptual Development Plan as to conformance with the Redevelopment Plan, City General Plan and zoning ordinance and finds the land use concept to be consistant with the goals, objectives and intent of said Plans and Ordinance and hereby authorizes Redevelopment Agency and City Staff to pursue negotiations with the Owner Participant. SECTION 3. The Redevelopment Agency hereby grants basic concept approval and provides the owner participant up to one hundred twenty days to enter into an Owner Participation Agreement with the Agency for the development of the Price Company Site. Nothing stated herein shall necessarily preclude the Agency from granting a resonable extension of time provided each party hereto has conducted its best effort in achieving the objectives stated in this Memorandum of Understanding. Nothing herein shall prevent the Agency from negotiating with other eligible owner participants who also choose to exercise their owner participation rights in accordance with applicable law. SECTION 4. The Owner Participant herein acknowledges the need to comply with all local, City, redevelopment agency, State and federal laws and regulations and nothing stated herein shall be construed as a waiver of such laws, regulations or requirements. APPROVED AND ADOPTED the 7th Euge a F. Moses Ch rman day of March 1988. 0 0 I HEREBY adopted by the regular meeting 1988. CERTIFY that the foregoing resolution was Redevelopment Agency of the City of Azusa thereof, held on the 7th day of March AYES: DIRECTORS: AVILA, COOK, CRUZ, LATTA, MOSES NOES: DIRECTORS: NONE Tl/ N= duly at a ) 5- ian 6Z,,J70t &r 6 PoA r se, sscr 7 33/.Od ;c' - T. . J N a z 0 FOOTHILL BOULEVARD 0 PRICE CLUB PROJECT EXISTING PRICE CLUB SITE \. PROPERTY TO BE ACQUIRED `i 0 Ii0 / s 0 tic .fir / � J. .65 •0 LOS ANGELES COUNTY ASSESSOR'S 32 $ MAP BOOK NUMBERS 8616-01 and 8616-02 .Q Y (MAP NOT TO SCALE) I 34 3' 038 rurrr• •0 LOS ANGELES COUNTY ASSESSOR'S 32 $ MAP BOOK NUMBERS 8616-01 and 8616-02 .Q Y (MAP NOT TO SCALE) A. INTRODUCTION AZUSA PRICE CLUB CENTER I. DEVELOPMENT PLAN 0 EXHIBIT B Our conceptual development plan consists of providing approximately 255,000 square feet of commercial retail oriented improvements, anchored by a new 112,000 square foot Price Club facility, on a total land area of approximately ± 27.6 acres, located at the southeast corner of Foothill Blvd. and Todd Avenue. We plan on providing approximately 1,520 parking stalls, which equates to a parking ratio of 6 cars/1000 square feet (s.f.) of Gross Leasable Area (GLA). This is more than the market standard or code requirement for such a development, which normally utilizes a 4 car/1,000 sq. ft. GLA ratio, and will be similar to several other existing Price Club anchored projects. r) rr�� 1 gas �- Opi"EMT - 1 _ur B. THE PRICE OB 0 The proposed center will be developed around a new 112,000 sq. ft. Price Club facility. The Price Club facility will serve as a regional anchor tenant for the center and will result in a substantial regional draw attracting 20,000 to 25,000 customers per week from a 10 to 15 mile radius. The Price Company is a membership cash and carry merchandising company, selling primarily to businesses and qualified Individuals. It currently operates 37 Price Club facilities in California, Arizona, New Mexico, Maryland, Virginia, New Jersey and Connecticut with expansion plans for multiple new facilities during the next 12 month period. The Price Company is a public corporation traded on the National O -T -C market, with sales for its fiscal year ended august 31, 1987, of 3,236,300,000 (see Exhibit A - Fiscal 1986 Annual Report) . - 2 - The Price Club hallproven to be a most succesTsful anchor tenant in other community and regional shopping centers and individual store locations. Current average annual sales volume for its 24 California stores exceeds $110 million per store. The three current closest Price Club facilities to the proposed Azusa site are located in the Cities of Pomona, Colton and Alhambra. Current 1987 gross annual sales volumes of these facilities are approximately the following: Pomona - 85,000,000 Colton - 140,000,000 Azusa - 120,000,000 Alhambra - Opened in August 1987 C. SHOPPING CENTER TENANTS In addition to the Price Club facility, we plan on a balanced shopping center (the "Center") for promotional and neighborhood oriented tenants in the various buildings designated in the attached shopping center site plan. For purposes of reference, we will be using the same designations in this conceptual description as indicated on the attached site plan. - 3 - 1. Promotional Tenants: Promotional retail961nants typically draw from a primary market trade area of one to five miles. These tenants are aggressive in advertising and market trade area of one to five miles. These tenants are aggressive in advertising and marketing and present very attractive stores. The space indicated on the site plan as retail building "C" consists of approximately 112,000 sq. ft. and, based upon substantial interest, is planned for a Home Club store. Home Club is a brand name discount hardware and home improvement store with annual sales in the 25-35 million dollar range. Additionally, portions of building "B" will be leased to other promotional tenants that are located in other Price Club shopping centers, including; Volume Shoe, Little Folks Shop (children's clothing), Can*da (clothing), The Jewelry Store, and Contempo Casuals (women's clothing). Other credit chain tenants that are promotional and are interested in this site are Wherehouse Records (records and tapes), Fashion Gal (women's clothing), C & R Clothiers (men's clothing), Carter (children's clothing), Athletic Shoe Factory (shoes), and Hallmark, REMCO, and House of Fabrics (specialty shops). These tenants typically generate annual sales volume of between $200 to $400 per square foot of space. - 4 - 2. Neighborhoi ants: This element of ot6development concept involves nants that Would primarily serve neighborhood and local demands. Building "B" which is 15,000 sq. ft. is planned to accommodate either promotional tenants or those tenants that provide local services and satisfy local needs. such tenancies would include cleaners, laundromat, barber/beauty shops, shoe repair, hardware, financial services, optometrist, Jewelers, health/vitamin, one-hour photo, travel agency, insurance, accounting, boutiques, luggage, ice cream/yogurt, candy and nuts. The specific tenants will consist of a combination of national or regional credit chain operations (e.g. Great Earth Vitamin, Radio Shack, 31 Flavors, See's Candies) and local independent operators. These tenancies should average $150 to $300 per square foot in annual sales. 3. Freestanding Pads: The development plan will capitalize on good visibility and the significant customer attraction of the Price Club and promotional tenants and Incorporate 12,000 sq. ft. in three freestanding pad buildings, identified as "PADS" D,E,F. The food oriented tenants in these pads, who would serve the prepared food needs of the Center and surroundign community, would include two or three from the following categories: steak (SIZZLER), donut (WINCHELL'S, YUM YUM), Mexican (EL TORRITO), hamburger (WENDY'S, BURGER KING, CARL'S), and family style food (MARIE CALENDAR'S, FUDDRUCKER'S, RED ROBIN). Such food tenants typically generate annual sales of approximately $250 to $400 per sq. ft. - 5 - We would like to point out that all of the acu al tenant names utilized in this report are tenants that have indicated significant interest in the proposed plan or that we feel would be potential based upon the past experience of our development team in other similar projects. If in fact the redevelopment area is expanded, we believe that there will be significant additional demand for many of the named tenants and others who will not be able to be accommodated in the -27.6 acre project site. Our development concept is one that would maximize the potential market draw of the site from a local, community and regional perspective. The plans for tenancies and specific site configurations were developed with a sensitivity to the diverse markets and to provide a complete line of quality merchandise and services of all types at reasonable prices. D. SHOPPING CENTER PLANNING AND DEVELOPMENT The attached site plan for the proposed shopping center has evolved from significant City input as well as balancing the constraints of the site with overall center requirements. The building configurations and locations appropriately fit the site as shown while still satisfying the tenant needs. The site plan proOdes for good circulation ad traffic flow patterns. It also provides for adequate ingress and egress along multiple access points. The attached preliminary plans for the elevations of the Price Club and other buildings were completed to provide for an attractive, balanced and aesthetically pleasing development. Special effort was placed into an architectural result that would satisfy the desires of the City and the surrounding community. The use of landscapiing is also delineated in the plans for additional enhancement. The anticipated construction time to complete the entire shopping center as proposed should be approximately one year. We are prepared to diligently pursue such construction immediately, and it is likely that the new Price Club facility would be completed within a shorter time period. - 7 - 0 0 AZUSA PRICE CLUB CENTER ll. SOCIO-ECONOMIC BENEFITS An active retail regional shopping center will provide a significant increase in sales tax and property tax revenue for the City of Azusa, as well as create a substantial number of new, permanent direct and indirect jobs for community residents. A preliminary analysis, based on present comparable operations, reveals the following estimate of annual gross sales volume after the first full year of operation of the project: Tenant A. Price Club 116,320 sq. ft B. Retail Building 15,000 sq. ft C. Retail Building 111,600 sq. ft D. Freestanding Pads 12,000 sq. f Potential Sales Volume (Rance (Low) (High) $120,000,000 $130,000,000 $ 2,500,000 $ 5,000,000 $ 25,000,000 $ 35,000,000 t. $ 3,000,000 $ 4,800,000 TOTALS 254,841 sq. ft. $150,500,000 $174,800,000 Potential annual sales tax revenue to be recaptured by City of Azusa would equal approximately 1 million to $1.2 million after the initial full year of operation of the entire project. We would expect I Center's gross sales revelte to grow thereafter and outpace most levels of inflation. In addition to the sales tax revenues, a significant amount of local revenue will be generated by the substantial increase in property tax assessment. This tax increment would result in direct revenues for the City of Azusa. We anticipate that total construction costs will amount to between $6 to $B million, which would result in approximately $65,000 to $80,000 per year in additional property tax revenues to the City of Azusa. The proposed development concept would also create a significant number of new, direct and indirect jobs. This type of economic development would have a ripple effect throughout the local economy. The development concept of 254,941 sq. ft. of commercial and retail improvements would create approximately 600 direct jobs and 1200 indirect jobs for the City of Azusa and surrounding communities (based on a multiplier of two times direct jobs for the indirect Jobs, as utilized by the City Economic Development Office, City of Los Angeles). The Price Club alone would directly employ approximately 250 people. It is the Price Company's policy to pay close to the highest prevailing wages and benefits for comparable positions in the community. Another major socia -economic benefit from theproposed shopping center operations is that its customers will travel from considerable distances, with resultant new sales to the community. The increase in shoppers, offers other nearby businesses the opportunity to increase their revenues. Business owners can also benefit by purchasing their goods in the Price Club at prices lower than those currently available to them without any quantity restrictions. FOOTHILL BLVD. o 1 UTITT�l �F1[mli-FiTim-fT mil IIIIIIHIM I 4TI, - T Loi Ila P!UMCUG RUM ------------------ EXHIBIT C PRELIMINARY POINTS OF UNDERSTANDING A. Development Entity The development entity for the purposes of an Owner Participation Agreement (hereinafter "OPA") shall be the Price Company, a California Corporation. B. Scope of Development See Attachment A, Scope of Development. C. Agency Responsibilities 1. Agency shall conduct an environmental audit to assess the risk of hazardous wastes upon the Site and the estimated costs, if any, to remove said wastes. If the costs to remedy are excessive and cannot be recovered from the property owners, the Agency at its sole discretion may terminate the Agreement. Agency and Developer shall cooperate in the soils investigations. 2. The Agency shall acquire the site (real property, fixtures and equipment) and relocate all occupants as required by law. 3. The Agency shall deliver the site in the "as -is" condition, certifiable as to the absence of hazardous wastes. 4. Agency shall pay all fees imposed by governmental agencies; including but not limited to the City of Azusa, the Azusa Unified School District, and the County Sanitation District. D. Developer Responsibilities 1. Developer shall demolish all structures, clear and grade the site for development. The verified cost for demolition and rough grading of site shall be added to the loan amount established under Section E below. 2. Developer shall construct the following in accordance with the Basic Concept Plan: a. Construct a new 112,000± square foot Price Club facility (Building A). 0 0 b. Construct approximately 15,000± square feet of ancillary retail space (Building B). C. Remodel the 112,000 sq. ft. existing building for a major promotional retail tenant, such as the Home Club (Building C). d. Construct three buildings in accordance with the site plan, limiting fast-food restaurants to no more than two of the pads. 3. Developer shall submit application for Precise Plan of Design approvals. Said Precise Plan of Design and Parcel Map, if necessary, shall be submitted to the City for processing within sixty (60) days after execution of the OPA. Developer shall subsequently submit all plans necessary for building permit issuance. 4. Developer shall be responsible for all public improvements within the curb -to -curb boundary of site, including but not limited to streets, curbs, gutters, sidewalks, driveway approaches, street lights, fire hydrants, and landscaping. 5. Developer shall provide for the installation of all on- site utilities necessary to service the site. 6. Developer shall install major off-site public improvements as required by the City. These improvements may include upgrading water lines, storm drain facilities, sewer transmission capacities, undergrounding electrical utilities, and installation of a traffic signal and median islands on Foothill Boulevard. Costs incurred for the installation of said public improvements will be reimbursed by the Agency upon receipt of documentation verifying actual costs for the construction of such off-site improvements. Verified costs shall be added to the loan amount established under Section E below. E. Proiect Financinq 1. Developer shall submit to Agency the most recent audited Price Club financial statement. Developer shall also document the 1987 taxable sales generated by the Azusa store. 2. Developer shall advance to Agency a sum necessary to assemble the site, relocate all occupants, and prepare the site in accordance with this Agreement. The 2 0 0 estimated amount of $5,143,000 is herein used for planning purposes. Said loan amount will be evidenced by a promissory note secured by a pledge of the sales tax derived from this project. The note shall have a term of twenty-five (25) years and an interest rate of 9.25 percent. Agency and City shall adopt necessary ordinances and/or resolutions to legally pledge sales tax. Agency may pre -pay the debt at any time or supplant other Agency resources for the pledged sales tax revenues. The note shall be repaid as follows: - For fiscal years 1-3 after operations commence, the City shall receive the current amount of City sales tax revenues derived from the Site (calendar year 1987). This amount shall be called the base amount. Sales tax revenues in excess of the base amount shall be paid to the Price Company. - For fiscal years 4-25 or until the note to the Agency is repaid (whichever comes first), the allocation of City sales tax revenues shall be as follows: 1) The City shall receive the first receipts generated by the project equivalent to approximately 77$ of the base amount. This amount shall be called the "adjusted base amount." For example, if the base amount is $780,000, then the adjusted base would be $600,000; 2) The Price Club shall receive the next $550,000 of tax receipts generated by the project; 3) The City shall receive the third allocation of tax receipts of an amount equal to the difference between the base amount and the adjusted base amount: 4) In the event that the annual tax receipts exceed the sum of the base amount and the Price Club's initial allocation of $550,000, then the remaining receipts shall be shared by the City and the Price Club on a 50$/50$ basis. 3. The verified costs of the off-site public improvements under Section D.7 above shall be added to the loan. 4. If the pledged revenues are insufficient to discharge the debt by the final payment date, then the Agency's debt shall be forgiven. 5. The purchase price of the site shall be equal to $4.50 per square foot of the site area. The actual square footage of the site shall be based upon an engineering survey to be completed by Agency. 3 0 0 SCOPE OF DEVELOPMENT I. GENERAL DESCRIPTION The Site includes approximately 27.6 acres located at the southeast corner of Todd Avenue and Foothill Boulevard. The Site includes the existing Price Club warehouse facility and four adjoining parcels on the east. The Agency must acquire 9.2 acres to assemble the site. Developer shall develop an approximately 255,000 square foot retail center on the Site in accordance with the Basic Concept Drawings. Developer, its architect, engineer, and contractor shall work closely with the Agency staff and planning consultant, and the City's planning staff to coordinate design, color and landscaping details which are subject to Agency approval. II. DEVELOPMENT A. Developer's Improvements Developer shall construct or lease 255,000 square feet of buildings for a retail shopping center. The project shall generally consist of the following: Construction of a new 112,000± square foot Price Club retail warehouse. Construction of 15,000 square feet of ancillary retail space. Construction of three freestanding pads. Remodeling of the existing 112,000± building for a major promotional retail tenant. The improvements shall contain all incidental driveways, parking lots, landscaping, loading, trash enclosures and related improvements required to service the development. B. Architecture and Design The exterior design of the Price Club warehouse facility shall be of good architectural quality and shall be adequately landscaped and designed as shown on 4 0 0 the approved Site plans and Construction Drawings. The Developer's plan submitted to the City for approval shall describe in reasonable detail the architectural character of the exterior design intended for the Developer's improvements. C. signs Signs shall be limited in size, subdued and otherwise designed to contribute positively to the environment. Signs identifying the building use will be permitted, but their height, size, location, color, lighting and design will be subject to Agency approval and shall conform to the Azusa Municipal Code. D. Building Setbacks Building setbacks shall be approved by the Agency and shall conform to the Azusa Municipal Code. E. Building Height Building heights shall not exceed that permitted by the applicable zoning. F. Access Vehicular access shall be as shown on approved Basic Concept Drawings. G. Loading Adequate loading and unloading space shall be provided as required by Azusa Municipal Code. Loading spaces visible from streets shall be landscaped or screened to prevent an unsightly or barren appearance. H. Screening All outdoor storage of materials or equipment shall be enclosed or screened by walls, landscaping or enclosure to the extent and in the manner required by the Agency. I. Landscaping Developer shall submit a Landscape Plan to the Agency for approval in accordance with the Schedule of Performance. Developer shall maintain landscaping consistent with the Landscape Plan within the public rights-of-way and within setback area along all street frontages and within all parking areas. 5 0 0 J. Utilities All utilities on the Site to serve the development shall be underground or enclosed at Developer's expense. K. Parking On-site parking shall be as required by the Azusa Municipal Code. L. Drainage The Site shall be graded to drain so that storm and surface water will be collected in a drainage system on the Site so that no runoff waters will cross public sidewalks and waters will drain into the public storm drain system. M. Grading and Soils Developer shall be responsible for properly grading and compacting soils on the Site. Agency shall remove all subsurface structure as part of its demolition responsibilities but will only fill the site to the extent necessary to address liability concerns. III. EASEMENTS Developer shall grant and permit all necessary and appropriate easements and rights for the development of the Site, including but not limited to temporary construction easements and easements and rights of vehicular access, pedestrian access, parking, structural support, sanitary sewers, storm drains, water, electrical power, telephone, natural gas, as are necessary for and consistent with the development as contemplated herein. IV. CONTROLS AND RESTRICTIONS - MISCELLANEOUS Controls and restrictions consistent with this Agreement including but not limited to minimum size parking spaces and minimum loading facilities shall be consistent with the Azusa Municipal Code. V. OFF-SITE IMPROVEMENTS. FACILITIES, UTILITIES, DEMOLITION All off-site improvements and utility improvements to be constructed by Developer shall be constructed or installed in accordance with the technical specifications, standards 0 0 and practices of the City and in accordance with approved plans and specifications. Developer plans for such public improvements shall be submitted to the Agency for review and approval prior to advertising for bids. All such activities shall be completed in accordance with high architectural standards at a time and in a manner consistent with Developer design and construction efforts. RRS/tmb 7