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E-11 Staff Report - Agreement Real Estate Broker and Consulting
CONSENT ITEM E-11 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL VIA: SERGIO GONZALEZ, CITY MANAGER FROM: MATT MARQUEZ, ECONOMIC AND COMMUNITY DEVELOPMENT DIRECTOR DATE: JULY 15, 2019 SUBJECT: REQUEST TO APPROVE PROFESSIONAL SERVICES AGREEMENT WITH CBRE, INC. TO PROVIDE REAL ESTATE BROKERAGE AND CONSULTING SERVICES TO THE CITY OF AZUSA BACKGROUND: On April 15, 2019, the City Council approved a Scope of Services and authorized Staff to solicit proposals for real estate brokerage and consulting services; as a result, the City received proposals from five (5) different firms. All five of the proposals were reviewed and deemed to be responsive and complete, each demonstrating unique qualifications that, if engaged, would provide valuable support to the City’s economic development efforts. Staff identified one particular firm that through its proposal demonstrated exceptional qualifications and experience assisting municipalities in the fields of real estate brokerage and consulting. As such, Staff recommends the approval of a Professional Services Agreement with CBRE, Inc. to serve the City as a Real Estate Broker and Consultant in the annual amount not to exceed $50,000. RECOMMENDATION: Staff recommends the City Council take the following actions: 1)Approve a Professional Services Agreement with CBRE, Inc. to provide Real Estate Brokerage and Consulting services in an annual amount not to exceed $50,000; and 2)Authorize the City Manager to execute the agreement, in a form acceptable to the City Attorney, on behalf of the City. ANALYSIS: CBRE, Inc. (“the consultant”) is a professional services firm that specializes in commercial real estate and is experienced with a variety of clientele. The consultant has expertise in the areas of leasing, negotiations, financing and market analysis and is qualified to assist the City in a variety of project types, including residential, commercial, mixed-use and transit-oriented development. APPROVED CITY COUNCIL 7/15/2019 Approve Professional Services Agreement with CBRE, Inc. July 15 , 2019 Page 2 On April 15, 2019 a Request for Proposals (RFP) for Real Estate Brokerage and Consulting Services was advertised through the San Gabriel Valley Tribune and made available on the City’s website. As a result, a total of five (5) firms provided proposals by the indicated deadline of April 30, 2019. An initial review for minimum qualifications pursuant to the RFP was conducted by Staff and all five (5) proposals were evaluated according to the following criteria: (1) Experience and Qualifications; (2) References; (3) Organizational Chart (or Structure); (4) Team Member Experience; (5) Management Overview/Approach and (6) Fee Proposal. Following a thorough review of all five proposals, the evaluation committee selected CBRE, Inc. (“CBRE”) as qualified to perform the required scope of services. More specifically, CBRE demonstrated the acumen to provide immediate support to the Economic and Community Development Department on current project activities, including: • Identifying underutilized or underperforming opportunity sites on major corridors; • Assisting in finding tenants for vacancies in the downtown; • Conducting market analysis; • Providing reports on the real estate climate as requested; and • Screening prospective business partners, investors and developers. If the City’s brokerage activities lead to the potential sale or lease of a City-owned property, Staff will return to the City Council to request authorization to enter into a listing agreement with the consultant in order to perform the duties necessary to complete any proposed transaction. FISCAL IMPACT: The services performed by CBRE will be provided on a time and materials basis in a not-to-exceed amount of $50,000 annually, for a period of three years. In accordance with Ordinance No. 2015-O6 relating to bidding, contracting and purchase of projects, supplies, services and equipment, all written contracts exceeding $25,000 shall be approved/awarded by the City Council. Funding for the recommended action in the amount of $50,000 of general fund account number 10-35- 630-000-6399, is included in the proposed Fiscal Year 2019-2020 budget for approval on June 17, 2019. Funding for the following year will be requested through the annual budget approval process. Prepared by: Reviewed and Approved: Aaron Ledet Carina Campos Senior Management Analyst Economic Development Specialist Approve Professional Services Agreement with CBRE, Inc. July 15 , 2019 Page 3 Reviewed and Approved Reviewed and Approved: Matt Marquez Sergio Gonzalez Economic and Community Development City Manager Director Attachments: 1) Real Estate Brokerage and Consulting Services Proposal – CBRE, Inc. 2) Professional Services Agreement – CBRE, Inc. CITY OF AZUSA REQUEST FOR PROPOSAL FOR REAL ESTATE BROKER & CONSULTANT SERVICES April 30, 2019 | 2 01. EXPERIENCE AND QUALIFICATIONS 02. REFERENCES 03. TEAM 04. MANAGEMENT OVERVIEW AND APPROACH 05. FEE PROPOSAL TABLE OF CONTENTS COVER LETTER CBRE, Inc. 234 S. Brand Blvd, Suite 800 Glendale, CA 91204 City of Azusa 213 East Foothill Boulevard Azusa, CA 91702 Dear Ms. Campos, Thank you for the opportunity to submit this proposal for “Real Estate Broker and Consultant Services” to the City of Azusa (“the City”). At CBRE we specialize in helping our public-sector clients achieve their goals through real estate, and come equipped with the expertise and resources to advise the City on reviewing your assets with an eye to streamlining and optimizing your portfolio, locating sites in ideal and accessible locations for your citizens, generating new income through existing assets, and improving the tools your hardworking staff has at its disposal to manage the portfolio. Our Public Institutions & Education Solutions (PIES) team understands the challenges you face and brings tested approaches and solutions to achieve real results for the City. In addition, CBRE brings numerous in-house specialty practices that can be accessed by the City through this assignment, including Golf, Senior Housing, Retail, Industrial, Office, Project Management, and Property Management and has advised municipalities on strategies for improving golf operations, achieving highest and best use of the property, and providing recommendations for go forward strategies up to an including sale and redevelopment. We have provided similar services to clients here in California such as, the State of California, City of Oakland, City of San Diego, City of Arcadia, and the County of Sonoma and nationally we represent the State of Florida, State of South Carolina, and the States of Maryland, New York, North Carolina, and many more small, medium, and large municipal governments around the country. We look forward to having the opportunity to partner with Azusa and assist your City in the planning and implementation of the highest and best of the City’s real estate assets. We truly see ourselves as a partner not only to the staff of Azusa but to the citizens in which you serve. Please don’t hesitate to contact me with any questions. We would be happy to clarify or elaborate on any element of our proposal or adjust our proposed scope of services to your needs. Sincerely, CHALVIS R. EVANS Managing Director CBRE Advisory & Transaction Services Los Angeles North Region +1 818 907 4635 | Chalvis.Evans@cbre.com Letter of Interest | 3 01Experience and qualifications Experience and Qualifications | 5 STATEMENT OF QUALIFICATION PUBLIC SECTOR SPECIALISTS At CBRE we understand the priorities facing state and local governments, and specialize in helping our public sector clients achieve their goals through real estate. Our Public Institutions & Education Solutions (PIES) team focuses exclusively on this sector as a team of specialists, with members ranging from former state level Directors of Real Estate, to military veterans, to former investment advisors, CBRE ‘s team brings the City experts who understand your unique perspective, stakeholders, processes, and challenges. Today, CBRE is providing comprehensive real estate services to over 60 public entities across the United States, including, but not limited to, the cities of Arcadia, San Diego, Oakland, Miami, Ann Arbor, Mobile, and Austin. We currently perform services for the states of New York, Maryland, North Carolina, South Carolina, Tennessee, Florida, Texas, California, and Washington, in addition to the Counties of Dallas and Travis. These clients require transaction services ranging from acquisition of operating real estate to disposition of surplus assets. Our experience and lessons learned on these transactions and engagements means that the City will have access to specialists who are not “learning on the job” and can provide road-tested insight on day one. CBRE’s public sector experience goes far beyond typical office and industrial transactions. Our specialists are selling ports, redeveloping convention and civic centers, identifying affordable housing opportunities, delivering solutions for generational transactions such as courthouses, and leading public private partnerships across the country. Represented on this proposal by Michael McShea and Brian Hutcherson, CBRE’s PIES team stands ready to assist the City in any type of real estate transaction. WHAT’S CURRENT IN PUBLIC SECTOR SPACE? CHALLENGES: • Deferred maintenance • Unfunded mandates • Shifting demographics • Inefficient use of space OPPORTUNITIES: • Well-located assets • Revenue generation • Economic development • Motivated staff • CBRE offers national best practices with peer agencies and municipalities, state-of-the-art technology tools, and the world’s broadest real estate platform to uncover actionable solutions. Experience and Qualifications | 6 CASE STUDIES 1 • First Generation Real Estate Services Contract • Acquisition & Disposition • Leasing • Strategic planning • Development Advisory CHALLENGE In 2014, CBRE | Public Institutions & Education Solutions was selected to provide development advisory and brokerage services to the City of Austin for a multi-year contract. The City is facing a number of generational requirements as a result of the population growth and a significant amount of deferred maintenance on key facilities, including those for Development Services, Police, Fire, EMS, Municipal Courts, and Public Works. The City was looking for an advisor to assist in defining efficient and effective space standards, to deploy market engagement strategies, and to negotiate transactions on its behalf. Notably, the City of Austin had never previously hired outside real estate advisors. SOLUTION The CBRE team has utilized multiple service lines to provide answers to key questions being asked by stakeholders, including valuation, facility condition assessments, workplace strategies and space standards, and brokerage services, all to streamline the City’s current real estate portfolio from both an expenses management and revenue generation perspective. CBRE and subcontractor partners commenced a major programming and workplace strategies initiative, along with Master Planning sites and other technical due diligence elements, and creating headquarters relocation strategies for Austin Energy and the Planning / Development Services Departments. The City is a current client and we are actively working on several projects. RESULTS CBRE has successfully performed several initiatives, including the market execution aspect. Highlights include: • Conducting Administrative Office Occupancy Plan for over 1.7 MSF of leased and owned space to determine optimal occupancy • Monetization of surplus retail/restaurant space for at the City Library to a local restaurant group, resulting in a multi-year lease expected to generate several million dollars of revenue for the City. • Marketing, selection, and negotiation of the relocation of the Planning & Zoning / Development Services department – a $122M build-to-suit office project. • Portfolio Strategy & Market Engagement Strategy – Austin Energy – multiple sites, including administrative offices and industrial sites CITY OF AUSTIN Experience and Qualifications | 7 CASE STUDIES 2 • Asset Inventory • Strategic Plan • Facility Condition Assessments &Prioritization • Space planning CHALLENGE CBRE was hired by the City of Mobile following a competitive procurement in 2016. The City was seeking a real estate advisor to develop a long-term planning initiative for the City’s real estate to include a comprehensive inventory of all City facilities, develop a master plan for long term implementation of repairs and improvements, make recommendations for the redevelopment of facilities given demographics shifts or other City comprehensive planning priorities, and to build a long range plan and develop a methodology for disposition of underutilized properties, as part of the City’s vision for improved financial stewardship and citizen service. The City faces the familiar challenge of being “land rich and cash poor” and is keen to leverage its real estate assets to make urgently needed improvements to mission-critical facilities. Of particular interest to the City is determining a path forward for the Civic Center property, a functionally obsolete but community- centric site on 24 acres in downtown. The Center is currently being subsidized by the City, which would like to seek alternatives for the property. SOLUTION Our assignment has the following elements: • Asset Inventory to identify a comprehensive listing of what property the City owns• Facility Condition Assessments (FCAs) to determine the condition of those assets, their deferred maintenance cost and replacement value• Prioritization of assets and maintenance needs based on the FCAs• A Strategic Plan with recommendations based on our findings• The evaluation of selected City facilities for redevelopment, repair, or repurposing RESULTS • In conjunction with our partners Ironbridge Systems and Digital Map Products, CBRE delivered an updated asset inventory listing 367 owned buildings, and 1,159 land parcels.• Using the expertise of our internal Facilities Assessment and Consulting Services team and partnering with a minority- owned engineering business, CBRE has completed FCAs on 2 million SF of owned property totaling 127 separate reports. • The team interviewed 11 departments and toured over 20 facilities as part of the Strategic Plan preparation. The final plan makes 13 prioritized recommendations to consolidate staff and sell surplus property, contributing to the avoidance of millions of dollars of deferred maintenance costs and revenue to the City. CBRE also recommended adopting space utilization standards, formal real estate and lease policies, and a formal process for department space requests. • FCAs for the Civic Center complex uncovered over $20 million in deferred maintenance costs, and the facility has long been cited in local government and the community as an opportunity to redevelop and revitalize downtown Mobile. CBRE has supported the City’s planning, community engagement, and marketing process in the following ways:• Subcontracted Gensler to prepare design concepts for the site comparing various layouts, uses, and densities• Conducted numerous public forums to solicit stakeholder and general public feedback about the perception of the Civic Center and preferences regarding future uses of the site• Worked consultatively with City officials, the Mayor, the City’s consultants, and our brokerage team to define and prepare a comprehensive marketing campaign targeting over 3,500 local, regional, and national developers and investors with custom materials including videos, brochures, a website, and detailed Request for Qualifications (RFQ)• The RFQ was released in September 2018, with the subsequent short-listing and Request for Proposals (RFP issued in December 2018 and developer selection well underway CITY OF MOBILE, AL Experience and Qualifications | 8 CASE STUDIES 3 • Tenant Representation • Market Engagement • Negotiation CHALLENGE The State of California’s Department of General Services (DGS) and Real Estate Service Department (RESD) has a diverse portfolio of 24 million square feet of space in state owned or managed facilities. CBRE has been RESD’s exclusive provider of tenant representation services in Southern California and the Bay area since 2005, and in 2017 was selected to continue servicing the Bay Area through 2020. The State has a number of requirements that can complicate the leasing process, such as: • DGS leases space on a net usable square foot (not rentable square foot). • DGS desires full service rates which include utilities, janitorial and maintenance services. • DGS requires that the Lessor includes in his lease rate a Tenant Improvement (“TI”) allowance. • The State pays monthly rent in arrears. • DGS does not enter into binding letters of intent. • DGS requires that the standard State lease form be used. • The State has lease requirements pertaining to ADA, structural evaluation, DVBE and CEQA requirements. CBRE RESPONSIBILITIES Under the direction of RESD, CBRE supports the State with: • Space solicitation • Site search and selection • Negotiations for lease renewals and new lease space • Document preparation • Transaction management • The contracting and management of planning and design services as needed RESULTS • Throughout our engagement(s), CBRE has represented the State on close to 200 lease assignments covering over 5,000,000 SF of office space in Southern California and the Bay Area. • Space ranges from suburban industrial flex space to downtown, Class A office space, and we have represented agencies such as the Attorney General, Appellate Courts, Department of Motor Vehicles, Department of Health Services, and Department of Rehabilitation, among others. • In the Bay Area under our latest contract, CBRE is currently advising the State on approximately 10 ongoing assignments. STATE OF CALIFORNIA Experience and Qualifications | 9 CASE STUDIES CURRENT AND RECENT PUBLIC SECTOR ASSIGNMENTS CURRENT AND RECENT PUBLIC SECTOR ASSIGNMENTS CITY OF INDIANAPOLIS CITY OF OAKLAND EL PASO COUNTY, CO $50 million redevelopment and headquarters relocation for fire department headquarters, station, and credit union. Asset inventory, strategic planning, valuation of strategic assets, and portfolio optimization recommendations on $1.5 bn portfolio. Recently selected to provide commercial real estate services for the County including leasing, disposition, acquisition, and recommendations for strategic properties. Experience and Qualifications | 10 02references REFERENCES JONATHON BAZAN JASON KRUCKEBERG PHILIP LANZAFAME Dallas County, TX Assistant County Administrator jonathon.bazan@dallascounty.org T: 214-653-6490 Arcadia, CA Assistant City Manager/ Development Services Director jkruckeberg@arcadiaca.gov 626 574-5415 Glendale, CA Director of Community DevelopmentTel. 633 E. Broadway, Room 103 PLanzafame@GlendaleCA.GOV 818 548 2140 References | 12 TESTIMONIALS CBRE has been an exceptional asset to the City, providing numerous services, including project management, appraisal, development advisory, and disposition brokerage services. In addition to CBRE’s standing as a worldwide leader in real estate, CBRE has proven its expertise of local markets. The Public Institutions and Education Solutions division has specialized knowledge and experience in the public sector process and has a broad network of brokers specializing in different areas such as Marinas, Hotels, etc. Daniel Rotenberg, Director Department of Real Estate & Asset Management City of Miami ““References | 13 TESTIMONIALS During the past three years, it has been my pleasure to work with you and the CBRE team on several real estate projects. Through CBRE’s participation, the County of Orange has extended key real estate capabilities in the areas of information gathering, marketing, and asset management.” CBRE’s assistance has been beneficial in recent leasing, acquisition, and asset disposition transactions. CBRE’s assistance with the development of a County real property inventory has enhanced timely access to property details. Scott D. Mayer - Chief Real Estate Officer County Executive Office County of Orange ““References | 14 03team ADDITIONAL SUPPORT & ADVISORY SERVICESYOUR CBRE TEAMChalvis Evans, Managing Director Michael McShea, EVP & Founder of CBRE Public Institutions and Education Solutions Executive OversighT TIMOTHY GENSKE Senior Vice President Garrett Connor Associate ADVISORY & TRANSACTION BRIAN HUTCHERSON Southwest Regional Manager PUBLIC INSTITUTIONS ADVISORY & TRANSACTION SERVICES PROPERTY MANAGEMENT CAPITAL MARKETS DEVELOPMENT & INVESTMENT SERVICES FACILITIES MANAGEMENT HEALTHCARE SERVICES INDUSTRIAL & LOGISTICS SERVICES INVESTMENT MANAGEMENT OFFICE SERVICES PROJECT MANAGEMENT RESEARCH & INVESTMENT STRATEGY RETAIL SERVICES STRATEGIC CONSULTING VALUATION & ADVISORY SERVICES FINANCIAL CONSULTING GROUP GOLF AND SENIOR HOUSING Team | 16 TEAM RESUMES Chalvis Evans leads CBRE’s LA North Region, including offices in Glendale, Woodland Hills and Oxnard. In this capacity, he directs the region’s overall strategy and oversees its occupier and investor leasing, investment sales, debt & structured finance, property management, and valuations across all property types. Mr. Evans manages more than 160 real estate professionals across the three-offices. Mr. Evans joined CBRE in 2015 as Senior Vice President with a focus on investment sales and tenant representation. During his 20-year career, he has completed more 700 transactions with an aggregate value in excess of $3 billion. As a sales professional, Mr. Evans has worked with many Fortune 100 companies, including General Electric, Citibank, Drake Beam, Emerson Electronics and Saint Gobain Cal-Mar. Prior to joining the firm, Mr. Evans served as Senior Vice President for Coldwell Banker Commercial in the Pasadena office, where he specialized in the investment sales and tenant representation throughout the San Gabriel Valley. Mr. Evans is a member of the American Industrial Real Estate Association, Multi-Regional Multiple Listing Service, City of Industry Manufacture’s Council and is on the board of The First Tee of Pasadena. He has been a resident of the San Gabriel Valley for more than 35 years. Mr. Evans has a Master of Business Administration from the University of La Verne and is on path to earn his PhD in Business Management from the University of Southern California. ACHIEVEMENTS The First Tee of America; Boardmember American Industrial Real Estate Association; Member MRMLS (Multi-Regional Multiple Listing Service); Member The City of Industry Manufacturer’s Council; Member EDUCATION PhD Candidate, Business Management; University of Southern California Master of Business Administration; University of La Verne Chalvis R. Evans Managing Director, Los Angeles North Region Lic. 00409987 T: 818.907.4635 C: 626.664.3611 Chalvis.Evans@cbre.com Team | 17 TEAM RESUMES Michael B. McShea, Executive Vice President, is a co-leader of CBRE’s state and local government practice. Mr. McShea provides strategic planning, development advisory, brokerage and other associated real estate services to government entities and education institutions nationwide. Mr. McShea manages some of the nation’s most significant state and local government projects and portfolios. His public sector career began with the oversight of a contract with the Government of the District of Columbia, involving the restructuring of over 1 million square feet of municipal space under the auspices of the congressionally established Financial Control Board. He has provided development advisory services for the College of William & Mary, Alexandria City Public School System, National Institutes of Health, John Hopkins Applied Research Laboratory and the University of Cincinnati. He has advised the cities of Indianapolis, IN, Mobile, AL, Ann Arbor, MI and Miami, FL on economic development initiatives and public private partnerships. Mr. McShea has developed strategic plans for various government entities including, most recently, the states of Florida, South Carolina, Oakland, California and Mobile, Alabama. He has implemented strategic real estate plans for the City of New York, as well as the states of Arizona, Colorado, Maryland, Michigan, and Pennsylvania. ACHIEVEMENTS United States Conference of Mayors Outstanding Achievement in Public Private Partnership, City of Tulsa, City Hall Acquisition National Association of State Facility Administrators Outstanding Achievement Award, Portfolio Management with the State of Michigan EDUCATION Mr. McShea received his Bachelor of Science degree in Business and Management from the University of Maryland. INDUSTRY RECOGNITION / SCHOLARSHIP Mr. McShea has been a guest lecturer on various topics involving corporate, municipal and educational real estate including the National Association of College & University Business Officers (NACUBO), National Association of State Facility Administrators (NASFA), American Institute of Architects, California Association for Local Economic Development, American Association of Port Authorities, the Construction Manager Association of America and the Keenan Flagler Business School at the University of North Carolina Chapel Hill. MICHAEL B. MCSHEA Executive Vice President and Co-Founder, CBRE Public Institutions and Education Solutions T: 202.585.5775 C: 202.669.2580 Michael.McShea@cbre.com Team | 18 TEAM RESUMES Brian Hutcherson is the Regional Manager for the Western Region in CBRE’s Public Institutions & Education Solutions practice. In this role, Brian advises municipal and county clients on their real estate strategies, accessing specialty practice lines and services from across CBRE to provide solutions ranging from strategic planning, to transaction management, to development advisory in California, Arizona, and New Mexico. Brian joins CBRE as a retired Marine Lieutenant Colonel, and was hand selected as of one CBRE’s first “Hiring Our Heroes” Corporate Fellows. During his fellowship, Brian supported local sales teams within the San Diego market to generate and provide analysis for Broker Opinion of Values across several different product lines which included investment sales, industrial, and multi- family assets. In addition, Brian was integral in designing and implementing a national strategic recruiting effort within CBRE to identify and recruit top talent from among retiring military personnel. From his 20 plus years as an active duty Marine, Brian brings a depth of strategic planning, leadership, and project management expertise to the practice. He is adept at leading diverse teams in remote locations and has partnered with federal agencies such as the U.S. Department of State, USAID and several U.S. allied nations while serving as a military liaison abroad. EDUCATION Bachelor of Science, History, Texas Christian University Master of Business Administration, University of Southern California BRIAN HUTCHERSON Southwest Regional Manager Public Institutions and Education Solutions Lic. 02075144 T: 858.546.2639 F: 858.546.3985 Brian.Hutcherson@cbre.com SELECT CLIENTS: City of San Diego City of Cape Coral City of Ft Myers US Marine Corps Iraqi Arm Team | 19 TEAM RESUMES Since earning his Master’s Degree in Business from the University of Southern California in 1985 (BA: Univ. Washington 1982), Tim has worked in commercial real estate (as both a real estate developer and as a real estate broker) from San Luis Obispo to San Diego, while based in Los Angeles, CA. Tim was involved in the formation of the CBRE’s first tenant representation group, exclusively representing companies such as Barnes & Noble Books, Rite Aid, Hollywood Video and Boston Market. Tim has exclusively represented Bristol Farms Markets across California since 2004 and continues to actively pursue locations. He also currently exclusively represents Boudin SF Restaurants in Los Angeles County Throughout his career, Tim has represented landlords such as Vestar, Camden Living, PacTrust, Bank of America Trust Services, M David Paul & Associates and TIAA CREF. He has been active in the marketing and leasing of shopping centers in the San Fernando, San Gabriel and Santa Clarita Valleys for 25 years. Since 2011 he has also worked on mixed-use projects in Hollywood, Glendale and Sherman Oaks. Tim also works on investment sales on a case-by-case basis, assisting clients in 1031 transactions and sales leasebacks since 2012. Tim has been married to Jennie, for 27 years, with four children ages 18 to 24. He lives in Pasadena, California. TIMOTHY GENSKE Senior Vice President Lic. 01034790 T: +1 818.502.6732 F: +1 818.243.6069 C: + 1 213.200.8084 Timothy.Genske@cbre.com Team | 20 TEAM RESUMES Garrett Connor is an associate in CBRE’s Los Angeles North division. In this region Garrett is focused on representing both Landlords and Tenants in leasing, sales and consulting. Responsibilities include negotiating new leases and lease renewals, identifying new site opportunities both on and off market, sales disposition and acquisition, consulting new mix use projects, repositioning value add properties and consulting with city planners on master plan developments. Partial client list includes: Onni Group, Bank of America, PacTrust, City of Arcadia, USPS, Blink bar, Sweethoney, Café Rio, Zankou Chicken. Prior to CBRE Garrett worked at Colliers International Las Vegas where he worked on the Urban Retail Team. In this role he focused on leasing and consulting retail project for resort and hospitality corridors. Garrett and the Urban Retail Team assisted tenants open flagship stores such as Hersheys and M&M. They have also consulted for Hard Rock Hotel and Showcase Mall on the Landlord side. EDUCATION Bachelor of Arts California State University Fullerton. GARRETT CONNOR Associate Lic. 02041842 T: 818.907.4602 F: 818.243.6069 C: 702.413.8939 Garret.Connor@cbre.com Team | 21 04Management and approach Overview OUR PROCESS Management Overview and Approach | 23EXECUTEUNDERSTANDWE START WITH YOU: YOUR CITIZENS AND YOUR DEPARTMENT Understanding your goals and objectives is fundamental across all our services. Comprehensive data gathering and quantitative and qualitative analysis. We evaluate, test and rate the possible solutions against project objectives and ROI. Actionable recommendations that are ready to be implemented, not left on a shelf. MORE EFFICIENT USE OF SPACE HIGHEST & BEST USE OF EXISTING ASSETS ENGAGED STAFF REVENUE STREAMS & COST SAVINGS Airtight business case for change combined the world’s largest services platform.ASSESSRECOMMENDEVALUATE OUR APPROACHThis all starts with the diagnostic to understand your needs as a true partner. Here is the sample diagnostic that we’ve used to help other municipalitiesCHECKLIST FOR ASSESSING YOUR REAL ESTATE ORGINZATIONS’ CAPABILITIESPORTFOLIO OVERSIGHTAND GOVERNANCEDo you have a single, accountable point of contact for all real estate activity?Do you have control over the following?• Leases• Acquisition/Disposition • Capital Expenditures • Service Contracts • Repair & Maintenance Costs • Utilities • Real Estate Personnel • Property TaxesBEST PRACTICESSTAFFING/ORGANIZATIONLEASE ADMINSTAFFING/ORGANIZATIONIs your staff specialized to provide thevarious services, such as transactionmanagement, project managementand facility management?Is your real estate organization aligned to meet the needs of the various business units?LEASE ADMINISTRATIONDo you have a reliable system to track the size and scope of your leased portfolio?Do you have a method of tracking allcritical dates across the portfolio?Are your leases all housed in a central location and accessible online?Are you reviewing the portfolioperiodically to identify opportunitiesfor space consolidation and possiblerenegotiation of lease terms?SPACE UTILIZATIONDo you have a space strategy in place anticipating growth, consolidation or both?Does your organization adhere to any space standards?ADMIN & BACK OFFICEHave you evaluated consolidation/”center of excellence” options?Have you evaluated relocation tocheaper sub-markets?RETAIL SPACEDo you have a strong understandingof the predictors of performance inyour retail portfolio, such as trafficcounts, population density, householdincomes, competition, etc?If you understand performance predictors, have you identified areas of opportunity for infill growth, new market growth, consolidation and exit opportunities?OPERATING COSTS, SERVICE & MAINTENANCE PLANSOPERATING COSTSAre you measuring andbenchmarking your operating costs?Are you currently utilizing anysourcing or group bidding programsfor major facilities costs such as janitorial, waste/recycling, landscaping, security, HVAC, maintenance?Do you have visibility into yourportfolio energy consumption andcosts?Do you have cost savings goals or doyou reward cost-saving activities?SERVICE & MAINTENANCE PLANSDo you have a Capital Plan?Do you have a Life Safety Plan? Do you have Emergency RelocationPlans?Do you have a computer based WorkOrder System?Do you have an Energy ManagementPlatform in place?YES NODo you have performance goals asa real estate organization, such ascustomer service levels and cost?Are departments charged for orheld accountable for the space theyoccupy?Do you have a lease vs. own strategy?YES NOYES NOYES NOManagement Overview and Approach | 24 Management Overview and Approach | 25 OUR APPROACH Upon gaining a deep understanding, we move forward through the following lifecycle: STRATEGIC PLANNING DEVELOPMENT ADVISORY & P3S TENANT REPRESENTATION ACQUISITION & DISPOSITION PORTFOLIO-WIDE OR SITE-SPECIFIC OPTIMIZATION ANALYSIS AND ACTION PLAN • Asset Inventory • Facility Condition Assessments • Occupancy Studies • Portfolio Review • Benchmarking • Valuation • Recommendations ACCESSING PRIVATE SECTOR CAPITAL TO REDEVELOP OWNED PROPERTY TO ITS HIGHEST AND BEST USE • Project Preparation • Visioning and Stakeholder Input • Feasibility Analysis & Modeling • RFQ/RFP Preparation • Transparent, Competitive Process • Market Engagement • Bid Evaluation Support • Negotiation • Public Process • Design Liaison Services ADVANCED PLANNING, SITE SELECTION AND BUSINESS CASE DEVELOPMENT, NEGOTIATION, AND RELOCATION • Space Planning • Lease vs Buy Analysis • Consolidation Opportunities • Location Analytics • Site Comparison • Test Fits • Landlord Due Diligence • Competitive Process • Negotiation • Business Case DISPOSITION OF SURPLUS PROPERTY, LAND SWAPS, BUILD TO SUIT TRANSACTIONS; CONSOLIDATIONS AND RELOCATIONS • Broker Opinions of Value • Professional Marketing Materials • Broad Marketing • All Property Types: Courthouses, Land, Prisons, Buildings, Ports • Transaction Structuring • Public & Transparent Process Management Overview and Approach | 26 OUR APPROACH Harnessing the technology tools and array of services most relevant to your unique needs. Lease Admin. Cost Consultancy 450 Offices Public Institutions Group 8,000 Brokers Cost Segmentation Move Management Energy & Sustainability Lease Audits Rent Payment Data Mgmt. Technology Tools Occupancy Management Vendor Management Occupancy Planning Workplace Strategy Sale & Leaseback Corporate Capital Markets Strategic Portfolio Optimization Labor Analytics Development (Trammell Crow Company ) Transaction Management Advisory Services Project ManagementFacilities Management Portfolio Services Kahua Project ManagementSierraview Occupancy Planning TransAct Transaction Tracking Sequentra Lease Administration PLAN TRA N S ACTBUILDMANAGEOCCUPIER ACTIVITY LIFECYCLE fee proposal05 FEE PROPOSAL STRATEGIC PLANNING, MARKET ANALYSIS, AND REAL ESTATE CONSULTING SERVICES: For the below Scope of Services, CBRE has included into its pricing a monthly retainer fee that shall not exceed $7,500 a month for the duration of the contractual obligation. Example: For a 1-year contract (12 X $7,500) CBRE total fees for the below services would be $90,0000. Preparation (or assist in the preparation) of a plan for various City-owned properties in order to either lease, sell, or otherwise realize capital appreciation • Prepare or review market analysis of a site and/or proposed uses • Prepare promotional and/or advertising materials (including use of Social Media) for City owned property or City commercial development projects • Advise highest/best use for sites, specific to local market conditions and other economic factors • Identify and screen prospective business partners (including investors, owners and tenants) • Coordinate solicitations for real estate development with brokers, tenants and owners/developers • Cooperate with the City’s “Owner’s Representative” for the development of City-owned property • Consult for potential real estate development in the City of Azusa’s California Opportunity • Zone Area as well as throughout various City Specific Plan areas • Provide expertise and consulting as it relates to a wide variety of potential real estate transactions • Review and analyze impacts of federal, state and local laws as it pertains to (project specific) real estate development and activity pursued by the City • Provide regularly written progress reports and updates on brokerage activity (upon request from the City) • Schedule and attend meetings and conferences with prospective third parties, including brokers, tenants, businesses and property owners. • Attend and prepare presentations for public meetings (i.e. City Council Meetings) • Perform any other work related to real estate brokerage and consulting services as it may occur. ACQUISITIONS/DISPOSITIONS: Brokerage fees are typically paid by the selling entity, CBRE will first pursue payment of those fees from the seller at a market rate. If the City of Azusa wishes to acquire or dispose of an asset that is unlisted, or that a commission for the buyer’s agent is not included in the seller’s representation agreement with their agent/broker, CBRE would seek the following compensation from the City of Azusa, on a cumulative and compounding basis. Our commission fee would include the following services for listing / marketing a property: • List properties on the MLS (Multiple Listing Services) • Utilization of Electronic Listing and Real Estate Search Engines (i.e. CoStar)as appropriate • Provide appropriate on-site Property Signage for City commercial listings • Negotiate lease terms and prepare/review lease related documents • Negotiate disposition/acquisition terms and prepare/review purchase and sale related documents • Prepare and review financial related documentation as it relates to potential real estate transactions Fee Proposal | 28 FEE PROPOSAL Sale Price CBRE Commission $0 - $5,000,000 3.0% $5,000,001 - $10,000,000 2.0% $10,000,001 +1.0% LEASING: Type of Lease Agreement Negotiated Maximum Compensation Rate NEW LEASES Total Annual Rent of the Base Term of the Lease Maximum Rate $0 - $500,000 3.50% $ 500,001 - $2,500,000 3.25% $2,500,001 - $4,500,000 3.00% $4,500,001 - $6,499,999 2.75% $6,500,000 and over 2.50% Lease Renewals, lease modifications, stay in place lease, lease extension, lease expansion 2% of the rent to be paid for the term of the particular lease renewal, modification, extension, expansion, or stay in place. Fee Proposal | 29 © 2019 CBRE, Inc. All rights reserved. This information has been obtained from sources believed reliable, but has not been verified for accuracy or completeness. You should conduct a careful, independent investigation of the property and verify all information. Any reliance on this information is solely at your own risk. BRIAN HUTCHERSON Southwest Regional Manager T: 858.546.2639 Brian.Hutcherson@cbre.com Lic. No. 02075144 TIMOTHY GENSKE Senior Vice President T: +1 818.502.6732 Timothy.Genske@cbre.com Lic. No. 01034790 GARRETT CONNOR Associate T: +1 818 907 4602 Garrett.Connor@cbre.com Lic. No. 02041842 8513273_1 CITY OF AZUSA PROFESSIONAL SERVICES AGREEMENT 1. PARTIES AND DATE. This Agreement is made and entered into this 16th day of July, 2019 by and between the City of Azusa, a municipal corporation organized under the laws of the State of California with its principal place of business at 213 East Foothill Boulevard, Azusa, California 91702 (“City”) and CBRE Inc., a Delaware corporation, with its principal place of business at 400 S. Hope St., 25th Floor, Los Angeles CA, 90071 (“Consultant”). City and Consultant are sometimes individually referred to herein as “Party” and collectively as “Parties.” 2. RECITALS. 2.1 Consultant. Consultant desires to perform and assume responsibility for the provision of certain professional services required by the City on the terms and conditions set forth in this Agreement. Consultant represents that it is experienced in providing Real Estate Consulting and Brokerage services to public clients, is licensed in the State of California, and is familiar with the plans of City. 2.2 Project. City desires to engage Consultant to render such services for the Real Estate Consulting and Brokerage services project (“Project”) as set forth in this Agreement. 3. TERMS. 3.1 Scope of Services and Term. 3.1.1 General Scope of Services. Consultant promises and agrees to furnish to the City all labor, materials, tools, equipment, services, and incidental and customary work necessary to fully and adequately supply the professional Real Estate Consulting and Brokerage consulting services necessary for the Project (“Services”). The Services are more particularly described in Exhibit “A” attached hereto and incorporated herein by reference. All Services shall be subject to, and performed in accordance with, this Agreement, the exhibits attached hereto and incorporated herein by reference, and all applicable local, state and federal laws, rules and regulations. CBRE, Inc. Page 2 of 20 8513273_1 3.1.2 Term. The term of this Agreement shall be from July 16, 2019 until July 15, 2022, unless earlier terminated as provided herein. Consultant shall complete the Services within the term of this Agreement, and shall meet any other established schedules and deadlines. The Parties may, by mutual written consent, extend the term of this Agreement if necessary to complete the Services. 3.2 Responsibilities of Consultant. 3.2.1 Control and Payment of Subordinates; Independent Contractor. The Services shall be performed by Consultant or under its supervision. Consultant will determine the means, methods and details of performing the Services subject to the requirements of this Agreement. City retains Consultant on an independent contractor basis and not as an employee. Consultant retains the right to perform similar or different services for others during the term of this Agreement. Any additional personnel performing the Services under this Agreement on behalf of Consultant shall also not be employees of City and shall at all times be under Consultant’s exclusive direction and control. Consultant shall pay all wages, salaries, and other amounts due such personnel in connection with their performance of Services under this Agreement and as required by law. Consultant shall be responsible for all reports and obligations respecting such additional personnel, including, but not limited to: social security taxes, income tax withholding, unemployment insurance, disability insurance, and workers’ compensation insurance. 3.2.2 Schedule of Services. Consultant shall perform the Services expeditiously, within the term of this Agreement, and in accordance with the Schedule of Services set forth in Exhibit “A” attached hereto and incorporated herein by reference. Consultant represents that it has the professional and technical personnel required to perform the Services in conformance with such conditions. In order to facilitate Consultant’s conformance with the Schedule, City shall respond to Consultant’s submittals in a timely manner. Upon request of City, Consultant shall provide a more detailed schedule of anticipated performance to meet the Schedule of Services. 3.2.3 Conformance to Applicable Requirements. All work prepared by Consultant shall be subject to the approval of City. 3.2.4 Substitution of Key Personnel. Consultant has represented to City that certain key personnel will perform and coordinate the Services under this Agreement. Should one CBRE, Inc. Page 3 of 20 8513273_1 or more of such personnel become unavailable, Consultant may substitute other personnel of at least equal competence upon written approval of City. In the event that City and Consultant cannot agree as to the substitution of key personnel, City shall be entitled to terminate this Agreement for cause. As discussed below, any personnel who fail or refuse to perform the Services in a manner acceptable to the City, or who are determined by the City to be uncooperative, incompetent, a threat to the adequate or timely completion of the Project or a threat to the safety of persons or property, shall be promptly removed from the Project by the Consultant at the request of the City. The key personnel for performance of this Agreement are as follows: Mr. Brian Hutcherson (Western Regional Manager) and Mr. Timothy Genske (Senior Vice President). 3.2.5 City’s Representative. The City hereby designates the Economic and Community Development Director, or his or her designee, to act as its representative for the performance of this Agreement (“City’s Representative”). City’s Representative shall have the power to act on behalf of the City for all purposes under this Contract. Consultant shall not accept direction or orders from any person other than the City’s Representative or his or her designee. 3.2.6 Consultant’s Representative. Consultant hereby designates Mr. Brain Hutcherson (Western Regional Manager), or his/her designee, to act as its representative for the performance of this Agreement (“Consultant’s Representative”). Consultant’s Representative shall have full authority to represent and act on behalf of the Consultant for all purposes under this Agreement. The Consultant’s Representative shall supervise and direct the Services, using his best skill and attention, and shall be responsible for all means, methods, techniques, sequences and procedures and for the satisfactory coordination of all portions of the Services under this Agreement. 3.2.7 Coordination of Services. Consultant agrees to work closely with City staff in the performance of Services and shall be available to City’s staff, consultants and other staff at all reasonable times. 3.2.8 Standard of Care; Performance of Employees. Consultant shall perform all Services under this Agreement in a skillful and competent manner, consistent with the standards generally recognized as being employed by professionals in the same discipline in the State of California. Consultant represents and maintains that it is skilled in the professional calling necessary to perform the Services. Consultant warrants that all employees and subcontractors shall have sufficient skill and experience to perform the Services assigned to them. Finally, Consultant represents that it, its employees and subcontractors have all licenses, permits, qualifications and CBRE, Inc. Page 4 of 20 8513273_1 approvals of whatever nature that are legally required to perform the Services, including a City Business License, and that such licenses and approvals shall be maintained throughout the term of this Agreement. As provided for in the indemnification provisions of this Agreement, Consultant shall perform, at its own cost and expense and without reimbursement from the City, any services necessary to correct errors or omissions which are caused by the Consultant’s failure to comply with the standard of care provided for herein. Any employee of the Consultant or its sub- consultants who is determined by the City to be uncooperative, incompetent, a threat to the adequate or timely completion of the Project, a threat to the safety of persons or property, or any employee who fails or refuses to perform the Services in a manner acceptable to the City, shall be promptly removed from the Project by the Consultant and shall not be re-employed to perform any of the Services or to work on the Project. 3.2.9 Period of Performance. Consultant shall perform and complete all Services under this Agreement within the term set forth in Section 3.1.2 above (“Performance Time”). Consultant shall also perform the Services in strict accordance with any completion schedule or Project milestones described in Exhibit “A” attached hereto, or which may be separately agreed upon in writing by the City and Consultant (“Performance Milestones”). 3.2.10 Laws and Regulations; Employee/Labor Certifications. Consultant shall keep itself fully informed of and in compliance with all local, state and federal laws, rules and regulations in any manner affecting the performance of the Project or the Services, including all Cal/OSHA requirements, and shall give all notices required by law. Consultant shall be liable for all violations of such laws and regulations in connection with Services. If the Consultant performs any work knowing it to be contrary to such laws, rules and regulations and without giving written notice to the City, Consultant shall be solely responsible for all costs arising therefrom. Consultant shall defend, indemnify and hold City, its officials, directors, officers, employees and agents free and harmless, pursuant to the indemnification provisions of this Agreement, from any claim or liability arising out of any failure or alleged failure to comply with such laws, rules or regulations. 3.2.10.1 Employment Eligibility; Consultant. By executing this Agreement, Consultant verifies that it fully complies with all requirements and restrictions of state and federal law respecting the employment of undocumented aliens, including, but not limited to, the Immigration Reform and Control Act of 1986, as may be amended from time to time. Such requirements and restrictions include, but are not limited to, examination and retention of documentation confirming the identity and immigration status of each employee of the Consultant. Consultant also verifies that it has not committed a violation of any such law within the five (5) years immediately preceding the date of execution of this Agreement, and shall not violate any such law at any time during the term of the Agreement. Consultant shall avoid any violation of any such law during the term of this Agreement by participating in an electronic verification of work authorization program operated by the United States Department of Homeland Security, by participating in an equivalent federal work authorization program operated by the United States CBRE, Inc. Page 5 of 20 8513273_1 Department of Homeland Security to verify information of newly hired employees, or by some other legally acceptable method. Consultant shall maintain records of each such verification, and shall make them available to the City or its representatives for inspection and copy at any time during normal business hours. The City shall not be responsible for any costs or expenses related to Consultant’s compliance with the requirements provided for in Section 3.2.10 or any of its sub- sections. 3.2.10.2 Employment Eligibility; Subcontractors, Consultants, Sub- subcontractors and Subconsultants. To the same extent and under the same conditions as Consultant, Consultant shall require all of its subcontractors, consultants, sub-subcontractors and subconsultants performing any work relating to the Project or this Agreement to make the same verifications and comply with all requirements and restrictions provided for in Section 3.2.10.1. 3.2.10.3 Employment Eligibility; Failure to Comply. Each person executing this Agreement on behalf of Consultant verifies that they are a duly authorized officer of Consultant, and understands that any of the following shall be grounds for the City to terminate the Agreement for cause: (1) failure of Consultant or its subcontractors, consultants, sub- subcontractors or subconsultants to meet any of the requirements provided for in Sections 3.2.10.1 or 3.2.10.2; (2) any misrepresentation or material omission concerning compliance with such requirements (including in those verifications provided to the Consultant under Section 3.2.10.2); or (3) failure to immediately remove from the Project any person found not to be in compliance with such requirements. 3.2.10.4 Labor Certification. By its signature hereunder, Consultant certifies that it is aware of the provisions of Section 3700 of the California Labor Code which require every employer to be insured against liability for Workers’ Compensation or to undertake self-insurance in accordance with the provisions of that Code, and agrees to comply with such provisions before commencing the performance of the Services. 3.2.10.5 Equal Opportunity Employment. Consultant represents that it is an equal opportunity employer and it shall not discriminate against any subconsultant, employee or applicant for employment because of race, religion, color, national origin, handicap, ancestry, sex or age. Such non-discrimination shall include, but not be limited to, all activities related to initial employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination. Consultant shall also comply with all relevant provisions of City’s Minority Business Enterprise program, Affirmative Action Plan or other related programs or guidelines currently in effect or hereinafter enacted. CBRE, Inc. Page 6 of 20 8513273_1 3.2.10.6 Air Quality. To the extent applicable, Consultant must fully comply with all applicable laws, rules and regulations in furnishing or using equipment and/or providing services, including, but not limited to, emissions limits and permitting requirements imposed by the South Coast Air Quality Management District (SCAQMD) and/or California Air Resources Board (CARB). Although the SCAQMD and CARB limits and requirements are more broad, Consultant shall specifically be aware of their application to "portable equipment", which definition is considered by SCAQMD and CARB to include any item of equipment with a fuel-powered engine. Consultant shall indemnify City against any fines or penalties imposed by SCAQMD, CARB, or any other governmental or regulatory agency for violations of applicable laws, rules and/or regulations by Consultant, its subconsultants, or others for whom Consultant is responsible under its indemnity obligations provided for in this Agreement. 3.2.10.7 Water Quality. (A) Management and Compliance. To the extent applicable, Consultant’s Services must account for, and fully comply with, all local, state and federal laws, rules and regulations that may impact water quality compliance, including, without limitation, all applicable provisions of the Federal Water Pollution Control Act (33 U.S.C. §§ 1300); the California Porter-Cologne Water Quality Control Act (Cal Water Code §§ 13000-14950); laws, rules and regulations of the Environmental Protection Agency, the State Water Resources Control Board and the Santa Ana Regional Water Quality Control Board; the City’s ordinances regulating discharges of storm water; and any and all regulations, policies, or permits issued pursuant to any such authority regulating the discharge of pollutants, as that term is used in the Porter-Cologne Water Quality Control Act, to any ground or surface water in the State. (B) Liability for Non-compliance. Failure to comply with the laws, regulations and policies described in this Section is a violation of law that may subject Consultant or City to penalties, fines, or additional regulatory requirements. Consultant shall defend, indemnify and hold the City, its directors, officials, officers, employees, volunteers and agents free and harmless, pursuant to the indemnification provisions of this Agreement, from and against any and all fines, penalties, claims or other regulatory requirements imposed as a result of Consultant’s non-compliance with the laws, regulations and policies described in this Section, unless such non-compliance is the result of the sole established negligence, willful misconduct or active negligence of the City, its officials, officers, agents, employees or authorized volunteers. (C) Training. In addition to any other standard of care requirements set forth in this Agreement, Consultant warrants that all employees and subcontractors shall have sufficient skill and experience to perform the Services assigned to them without impacting water quality in violation of the laws, regulations and policies described in this Section. Consultant further warrants that it, its employees and subcontractors will receive adequate CBRE, Inc. Page 7 of 20 8513273_1 training, as determined by City, regarding the requirements of the laws, regulations and policies described in this Section as they may relate to the Services provided under this Agreement. Upon request, City will provide Consultant with a list of training programs that meet the requirements of this paragraph. 3.2.11 Insurance. 3.2.11.1 Time for Compliance. Consultant shall not commence Services under this Agreement until it has provided evidence satisfactory to the City that it has secured all insurance required under this section. In addition, Consultant shall not allow any subcontractor to commence work on any subcontract until it has provided evidence satisfactory to the City that the subcontractor has secured all insurance required under this section. 3.2.11.2 Minimum Requirements. Consultant shall, at its expense, procure and maintain for the duration of the Agreement insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the Agreement by the Consultant, its agents, representatives, employees or subcontractors. Consultant shall also require all of its subcontractors to procure and maintain the same insurance for the duration of the Agreement. Such insurance shall meet at least the following minimum levels of coverage: (A) Minimum Scope of Insurance. Coverage shall be at least as broad as the latest version of the following: (1) General Liability: Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001); (2) Automobile Liability: Insurance Services Office Business Auto Coverage form number CA 0001, code 1 (any auto); and (3) Workers’ Compensation and Employer’s Liability: Workers’ Compensation insurance as required by the State of California and Employer’s Liability Insurance. The policy shall not contain any exclusion contrary to the Agreement, including but not limited to endorsements or provisions limiting coverage for (1) contractual liability (including but not limited to ISO CG 24 26 or 21 29); or (2) cross liability for claims or suits by one insured against another. (B) Minimum Limits of Insurance. Consultant shall maintain limits no less than: (1) General Liability: $1,000,000 per occurrence for bodily injury, personal injury and property damage. If Commercial General Liability Insurance or other form with general aggregate limit is used including, but not limited to, form CG 2503, either the general aggregate limit shall apply separately to this Agreement/location or the general aggregate limit shall be twice the required occurrence limit; (2) Automobile Liability: $1,000,000 per accident for bodily injury and property damage; and (3) Workers’ Compensation and Employer’s Liability: Workers’ Compensation limits as required by the Labor Code of the State of California. Employer’s Liability limits of $1,000,000 per accident for bodily injury or disease. Defense costs shall be paid in addition to the limits on CGL. (C) Notices; Cancellation or Reduction of Coverage. At least CBRE, Inc. Page 8 of 20 8513273_1 fifteen (15) days prior to the expiration of any such policy, evidence showing that such insurance coverage has been renewed or extended shall be filed with the City. If such coverage is cancelled or materially reduced, Consultant shall, within ten (10) days after receipt of written notice of such cancellation or reduction of coverage, file with the City evidence of insurance showing that the required insurance has been reinstated or has been provided through another insurance company or companies. In the event any policy of insurance required under this Agreement does not comply with these specifications or is canceled and not replaced, the City has the right but not the duty to obtain the insurance it deems necessary and any premium paid by the City will be promptly reimbursed by Consultant or the City may withhold amounts sufficient to pay premium from Consultant payments. In the alternative, the City may suspend or terminate this Agreement. 3.2.11.3 Professional Liability. Consultant shall procure and maintain, and require its sub-consultants to procure and maintain, for a period of three (3) years following completion of the Project, errors and omissions liability insurance appropriate to their profession. Such insurance shall be in an amount not less than $1,000,000 per claim, and shall be endorsed to include contractual liability. Defense costs shall be paid in addition to limits. 3.2.11.4 Insurance Endorsements. The insurance policies shall contain the following provisions, or Consultant shall provide endorsements on forms supplied or approved by the City to add the following provisions to the insurance policies: (A) General Liability. The general liability policy shall include or be endorsed (amended) to state that: (1) using ISO CG forms 20 10 and 20 37, or endorsements providing the exact same coverage, the City of Azusa, its directors, officials, officers, employees, agents and volunteers shall be covered as additional insured with respect to the Services or ongoing and complete operations performed by or on behalf of the Consultant, including materials, parts or equipment furnished in connection with such work; and (2) using ISO form 20 01, or endorsements providing the exact same coverage, the insurance coverage shall be primary insurance as respects the City, its directors, officials, officers, employees, agents and volunteers, or if excess, shall stand in an unbroken chain of coverage excess of the Consultant’s scheduled underlying coverage. Any excess insurance shall contain a provision that such coverage shall also apply on a primary and noncontributory basis for the benefit of the City, before the City’s own primary insurance or self- insurance shall be called upon to protect it as a named insured. Any insurance or self-insurance maintained by the City, its directors, officials, officers, employees, agents and volunteers shall be excess of the Consultant’s insurance and shall not be called upon to contribute with it in any way. Notwithstanding the minimum limits set forth in Section 3.2.11.2(B), any available insurance proceeds in excess of the specified minimum limits of coverage shall be available to the parties CBRE, Inc. Page 9 of 20 8513273_1 required to be named as additional insureds pursuant to this Section 3.2.11.4(A). (B) Automobile Liability. The automobile liability policy shall include or be endorsed (amended) to state that: (1) the City, its directors, officials, officers, employees, agents and volunteers shall be covered as additional insureds with respect to the ownership, operation, maintenance, use, loading or unloading of any auto owned, leased, hired or borrowed by the Consultant or for which the Consultant is responsible; and (2) the insurance coverage shall be primary insurance as respects the City, its directors, officials, officers, employees, agents and volunteers, or if excess, shall stand in an unbroken chain of coverage excess of the Consultant’s scheduled underlying coverage. Any insurance or self-insurance maintained by the City, its directors, officials, officers, employees, agents and volunteers shall be excess of the Consultant’s insurance and shall not be called upon to contribute with it in any way. Notwithstanding the minimum limits set forth in Section 3.2.11.2(B), any available insurance proceeds in excess of the specified minimum limits of coverage shall be available to the parties required to be named as additional insureds pursuant to this Section 3.2.11.4(B). (C) Workers’ Compensation and Employers’ Liability Coverage. The insurer shall agree to waive all rights of subrogation against the City, its directors, officials, officers, employees, agents and volunteers for losses paid under the terms of the insurance policy which arise from work performed by the Consultant. (D) All Coverages. CBRE shall provide that: (A) coverage shall not be suspended, voided, reduced or canceled except after thirty (30) days (10 days for nonpayment of premium) prior written notice by certified mail, return receipt requested, has been given to the City; and (B) any failure to comply with reporting or other provisions of the policies, including breaches of warranties, shall not affect coverage provided to the City, its directors, officials, officers, employees, agents and volunteers. Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to the City, its officials, officers, employees, agents and volunteers, or any other additional insureds. 3.2.11.5 Separation of Insureds; No Special Limitations; Waiver of Subrogation. All insurance required by this Section shall contain standard separation of insureds provisions. In addition, such insurance shall not contain any special limitations on the scope of protection afforded to the City, its directors, officials, officers, employees, agents and volunteers. All policies shall waive any right of subrogation of the insurer against the City, its officials, officers, employees, agents, and volunteers, or any other additional insureds, or shall specifically CBRE, Inc. Page 10 of 20 8513273_1 allow Consultant or others providing insurance evidence in compliance with these specifications to waive their right of recovery prior to a loss. Consultant hereby waives its own right of recovery against City, its officials, officers, employees, agents, and volunteers, or any other additional insureds, and shall require similar written express waivers and insurance clauses from each of its subconsultants. 3.2.11.6 Deductibles and Self-Insurance Retentions. Any deductibles or self-insured retentions must be declared to and approved by the City. Consultant shall guarantee that, at the option of the City, either: (1) the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the City, its directors, officials, officers, employees, agents and volunteers; or (2) the Consultant shall procure a bond guaranteeing payment of losses and related investigation costs, claims and administrative and defense expenses. 3.2.11.7 Subconsultant Insurance Requirements. Consultant shall not allow any subconsultants to commence work on any subcontract relating to the work under the Agreement until they have provided evidence satisfactory to the City that they have secured all insurance required under this Section. If requested by Consultant, the City may approve different scopes or minimum limits of insurance for particular subconsultants. The Consultant and the City shall be named as additional insureds on all subconsultants’ policies of Commercial General Liability using ISO form 20 38, or coverage at least as broad. 3.2.11.8 Acceptability of Insurers. Insurance is to be placed with insurers with a current A.M. Best’s rating no less than A:VIII, licensed to do business in California, and satisfactory to the City. 3.2.11.9 Verification of Coverage. Consultant shall furnish City with original certificates of insurance and endorsements effecting coverage required by this Agreement on forms satisfactory to the City. The certificates and endorsements for each insurance policy shall be signed by a person authorized by that insurer to bind coverage on its behalf, and shall be on forms provided by the City if requested. All certificates and endorsements must be received and approved by the City before work commences. The City reserves the right to require complete, certified copies of all required insurance policies, at any time. 3.2.11.9 Reporting of Claims. Consultant shall report to the City, in CBRE, Inc. Page 11 of 20 8513273_1 addition to Consultant’s insurer, any and all insurance claims submitted by Consultant in connection with the Services under this Agreement. 3.2.12 Safety. Consultant shall execute and maintain its work so as to avoid injury or damage to any person or property. In carrying out its Services, the Consultant shall at all times be in compliance with all applicable local, state and federal laws, rules and regulations, and shall exercise all necessary precautions for the safety of employees appropriate to the nature of the work and the conditions under which the work is to be performed. Safety precautions as applicable shall include, but shall not be limited to: (A) adequate life protection and life saving equipment and procedures; (B) instructions in accident prevention for all employees and subcontractors, such as safe walkways, scaffolds, fall protection ladders, bridges, gang planks, confined space procedures, trenching and shoring, equipment and other safety devices, equipment and wearing apparel as are necessary or lawfully required to prevent accidents or injuries; and (C) adequate facilities for the proper inspection and maintenance of all safety measures. 3.2.13 Accounting Records. Consultant shall maintain complete and accurate records with respect to all costs and expenses incurred under this Agreement. All such records shall be clearly identifiable. Consultant shall allow a representative of City during normal business hours to examine, audit, and make transcripts or copies of such records and any other documents created pursuant to this Agreement. Consultant shall allow inspection of all work, data, documents, proceedings, and activities related to the Agreement for a period of three (3) years from the date of final payment under this Agreement. 3.3 Fees and Payments. 3.3.1 Compensation. Consultant shall receive compensation, including authorized reimbursements, for all Services rendered under this Agreement at the rates set forth in Exhibit “A” attached hereto and incorporated herein by reference. Any additional compensation shall not be approved without written approval of the City Council. Extra Work may be authorized, as described below, and if authorized, will be compensated at the rates and manner set forth in this Agreement. 3.3.2 Payment of Compensation. Consultant shall submit to City a monthly itemized statement which indicates work completed and hours of Services rendered by Consultant. CBRE, Inc. Page 12 of 20 8513273_1 The statement shall describe the amount of Services and supplies provided since the initial commencement date, or since the start of the subsequent billing periods, as appropriate, through the date of the statement. City shall, within 45 days of receiving such statement, review the statement and pay all approved charges thereon. 3.3.3 Reimbursement for Expenses. Consultant shall not be reimbursed for any expenses unless authorized in writing by City. 3.3.4 Extra Work. At any time during the term of this Agreement, City may request that Consultant perform Extra Work. As used herein, “Extra Work” means any work which is determined by City to be necessary for the proper completion of the Project, but which the parties did not reasonably anticipate would be necessary at the execution of this Agreement. Consultant shall not perform, nor be compensated for, Extra Work without written authorization from City’s Representative. 3.3.5 Prevailing Wages. Consultant is aware of the requirements of California Labor Code Section 1720, et seq., and 1770, et seq., as well as California Code of Regulations, Title 8, Section 16000, et seq., (“Prevailing Wage Laws”), which require the payment of prevailing wage rates and the performance of other requirements on “public works” and “maintenance” projects. If the Services are being performed as part of an applicable “public works” or “maintenance” project, as defined by the Prevailing Wage Laws, and if the total compensation is $1,000 or more, Consultant agrees to fully comply with such Prevailing Wage Laws. City shall provide Consultant with a copy of the prevailing rates of per diem wages in effect at the commencement of this Agreement. Consultant shall make copies of the prevailing rates of per diem wages for each craft, classification or type of worker needed to execute the Services available to interested parties upon request, and shall post copies at the Consultant’s principal place of business and at the project site. Consultant shall defend, indemnify and hold the City, its elected officials, officers, employees and agents free and harmless from any claim or liability arising out of any failure or alleged failure to comply with the Prevailing Wage Laws. 3.4 Termination of Agreement. 3.4.1 Grounds for Termination. City may, by written notice to Consultant, terminate the whole or any part of this Agreement at any time and without cause by giving written notice to Consultant of such termination, and specifying the effective date thereof, at least seven (7) days before the effective date of such termination. Upon termination, Consultant shall be compensated only for those services which have been adequately rendered to City, and Consultant shall be entitled to no further compensation. Consultant may not terminate this Agreement except CBRE, Inc. Page 13 of 20 8513273_1 for cause. 3.4.2 Effect of Termination. If this Agreement is terminated as provided herein, City may require Consultant to provide all finished or unfinished Documents and Data and other information of any kind prepared by Consultant in connection with the performance of Services under this Agreement. Consultant shall be required to provide such document and other information within fifteen (15) days of the request. 3.4.3 Additional Services. In the event this Agreement is terminated in whole or in part as provided herein, City may procure, upon such terms and in such manner as it may determine appropriate, services similar to those terminated. 3.5 Ownership of Materials and Confidentiality. 3.5.1 Documents & Data; Licensing of Intellectual Property. This Agreement creates a non-exclusive and perpetual license for City to copy, use, modify, reuse, or sublicense any and all copyrights, designs, and other intellectual property embodied in plans, specifications, studies, drawings, estimates, and other documents or works of authorship fixed in any tangible medium of expression, including but not limited to, physical drawings or data magnetically or otherwise recorded on computer diskettes, which are prepared or caused to be prepared by Consultant under this Agreement (“Documents & Data”). All Documents & Data shall be and remain the property of City, and shall not be used in whole or in substantial part by Consultant on other projects without the City's express written permission. Within thirty (30) days following the completion, suspension, abandonment or termination of this Agreement, Consultant shall provide to City reproducible copies of all Documents & Data, in a form and amount required by City. City reserves the right to select the method of document reproduction and to establish where the reproduction will be accomplished. The reproduction expense shall be borne by City at the actual cost of duplication. In the event of a dispute regarding the amount of compensation to which the Consultant is entitled under the termination provisions of this Agreement, Consultant shall provide all Documents & Data to City upon payment of the undisputed amount. Consultant shall have no right to retain or fail to provide to City any such documents pending resolution of the dispute. In addition, Consultant shall retain copies of all Documents & Data on file for a minimum of fifteen (15) years following completion of the Project, and shall make copies available to City upon the payment of actual reasonable duplication costs. Before destroying the Documents & Data following this retention period, Consultant shall make a reasonable effort to notify City and provide City with the opportunity to obtain the documents. CBRE, Inc. Page 14 of 20 8513273_1 3.5.2 Subcontractors. Consultant shall require all subcontractors to agree in writing that City is granted a non-exclusive and perpetual license for any Documents & Data the subcontractor prepares under this Agreement. Consultant represents and warrants that Consultant has the legal right to license any and all Documents & Data. Consultant makes no such representation and warranty in regard to Documents & Data which were prepared by design professionals other than Consultant or its subcontractors, or those provided to Consultant by the City. 3.5.3 Right to Use. City shall not be limited in any way in its use or reuse of the Documents and Data or any part of them at any time for purposes of this Project or another project, provided that any such use not within the purposes intended by this Agreement or on a project other than this Project without employing the services of Consultant shall be at City’s sole risk. If City uses or reuses the Documents & Data on any project other than this Project, it shall remove the Consultant’s seal from the Documents & Data and indemnify and hold harmless Consultant and its officers, directors, agents and employees from claims arising out of the negligent use or re- use of the Documents & Data on such other project. Consultant shall be responsible and liable for its Documents & Data, pursuant to the terms of this Agreement, only with respect to the condition of the Documents & Data at the time they are provided to the City upon completion, suspension, abandonment or termination. Consultant shall not be responsible or liable for any revisions to the Documents & Data made by any party other than Consultant, a party for whom the Consultant is legally responsible or liable, or anyone approved by the Consultant. 3.5.4 Indemnification. Consultant shall defend, indemnify and hold the City, its directors, officials, officers, employees, volunteers and agents free and harmless, pursuant to the indemnification provisions of this Agreement, for any alleged infringement of any patent, copyright, trade secret, trade name, trademark, or any other proprietary right of any person or entity in consequence of the use on the Project by City of the Documents & Data, including any method, process, product, or concept specified or depicted. 3.5.5 Confidentiality. All Documents & Data either created by or provided to Consultant in connection with the performance of this Agreement shall be held confidential by Consultant. All Documents & Data shall not, without the prior written consent of City, be used or reproduced by Consultant for any purposes other than the performance of the Services. Consultant shall not disclose, cause or facilitate the disclosure of the Documents & Data to any person or entity not connected with the performance of the Services or the Project. Nothing furnished to Consultant which is otherwise known to Consultant or is generally known, or has become known, to the related industry shall be deemed confidential. Consultant shall not use City’s name or CBRE, Inc. Page 15 of 20 8513273_1 insignia, photographs of the Project, or any publicity pertaining to the Services or the Project in any magazine, trade paper, newspaper, television or radio production or other similar medium without the prior written consent of City. 3.6 General Provisions. 3.6.1 Delivery of Notices. All notices permitted or required under this Agreement shall be given to the respective parties at the following address, or at such other address as the respective parties may provide in writing for this purpose: Consultant: Mr. Brian Hutcherson Western Regional Manager CBRE, Inc. 4301 LA Jolla Village Dr., Suite 300 San Diego, CA 92122 With a copy to: Mr. Chalvis R. Evans Managing Director CBRE, Inc. 234 S. Brand Boulevard, Suite 800 Glendale, CA 91204 City: City of Azusa 213 E. Foothill Blvd. Azusa, CA 91702 Attn: Matt Marquez, Economic and Community Development Director Such notice shall be deemed made when personally delivered or when mailed, forty-eight (48) hours after deposit in the U.S. Mail, first class postage prepaid and addressed to the party at its applicable address. Actual notice shall be deemed adequate notice on the date actual notice occurred, regardless of the method of service. CBRE, Inc. Page 16 of 20 8513273_1 3.6.2 Indemnification. 3.6.2.1 Scope of Indemnity. To the fullest extent permitted by law, Consultant shall defend, indemnify and hold the City, its directors, officials, officers, employees, volunteers and agents free and harmless from any and all claims, demands, causes of action, costs, expenses, liability, loss, damage or injury of any kind, in law or equity, to property or persons, including wrongful death, in any manner arising out of, pertaining to, or incident to any alleged acts, errors or omissions of Consultant, its officials, officers, employees, subcontractors, consultants or agents in connection with the performance of the Consultant’s Services, the Project or this Agreement, including without limitation the payment of all consequential damages, expert witness fees and attorneys fees and other related costs and expenses. Notwithstanding the foregoing, to the extent Consultant's Services are subject to Civil Code Section 2782.8, the above indemnity shall be limited, to the extent required by Civil Code Section 2782.8, to claims that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Consultant. 3.6.2.2 Additional Indemnity Obligations. Consultant shall defend, with legal counsel chosen by City, at Consultant’s own cost, expense and risk, any and all claims, actions or other proceedings of every kind covered by Section 3.6.2.1 that may be brought or instituted against City or its directors, officials, officers, employees, volunteers and agents. Consultant shall pay and satisfy any judgment, award or decree that may be rendered against City or its directors, officials, officers, employees, volunteers and agents as party of any such claim, suit, action or other proceeding. Consultant shall also reimburse City for the cost of any settlement paid by City or its directors, officials, officers, employees, agents, or volunteers as part of any such claim, suit, action or other proceeding. Such reimbursement shall include payment for City’s attorneys’ fees and costs, including expert witness fees. Consultant shall reimburse City and its directors, officials, officers, employees, agents, and/or volunteers, for any and all legal expenses and costs incurred by each of them in connection therewith or in enforcing the indemnity herein provided. Consultant’s obligation to indemnify shall survive expiration or termination of this Agreement and shall not be restricted to insurance proceeds, if any, received by the City, its directors, officials officers, employees, agents, or volunteers. 3.6.3 Governing Law; Government Code Claim Compliance. This Agreement shall be governed by the laws of the State of California. Venue shall be in Los Angeles County. In addition to any and all contract requirements pertaining to notices of and requests for compensation or payment for extra work, disputed work, claims and/or changed conditions, Consultant must comply with the claim procedures set forth in Government Code sections 900 et seq. prior to filing any lawsuit against the City. Such Government Code claims and any subsequent lawsuit based upon the Government Code claims shall be limited to those matters that remain unresolved after all procedures pertaining to extra work, disputed work, claims, and/or changed CBRE, Inc. Page 17 of 20 8513273_1 conditions have been followed by Consultant. If no such Government Code claim is submitted, or if any prerequisite contractual requirements are not otherwise satisfied as specified herein, Consultant shall be barred from bringing and maintaining a valid lawsuit against the City. 3.6.4 Time of Essence. Time is of the essence for each and every provision of this Agreement. 3.6.5 City’s Right to Employ Other Consultants. City reserves right to employ other consultants in connection with this Project. 3.6.6 Successors and Assigns. This Agreement shall be binding on the successors and assigns of the parties. 3.6.7 Assignment or Transfer. Consultant shall not assign, hypothecate, or transfer, either directly or by operation of law, this Agreement or any interest herein without the prior written consent of the City. Any attempt to do so shall be null and void, and any assignees, hypothecates or transferees shall acquire no right or interest by reason of such attempted assignment, hypothecation or transfer. 3.6.8 Construction; References; Captions. Since the Parties or their agents have participated fully in the preparation of this Agreement, the language of this Agreement shall be construed simply, according to its fair meaning, and not strictly for or against any Party. Any term referencing time, days or period for performance shall be deemed calendar days and not work days. All references to Consultant include all personnel, employees, agents, and subcontractors of Consultant, except as otherwise specified in this Agreement. All references to City include its elected officials, officers, employees, agents, and volunteers except as otherwise specified in this Agreement. The captions of the various articles and paragraphs are for convenience and ease of reference only, and do not define, limit, augment, or describe the scope, content, or intent of this Agreement. 3.6.9 Amendment; Modification. No supplement, modification, or amendment of this Agreement shall be binding unless executed in writing and signed by both Parties. 3.6.10 Waiver. No waiver of any default shall constitute a waiver of any other default or breach, whether of the same or other covenant or condition. No waiver, benefit, CBRE, Inc. Page 18 of 20 8513273_1 privilege, or service voluntarily given or performed by a Party shall give the other Party any contractual rights by custom, estoppel, or otherwise. 3.6.11 No Third Party Beneficiaries. Except to the extent expressly provided for in Section 3.6.7, there are no intended third party beneficiaries of any right or obligation assumed by the Parties. 3.6.12 Invalidity; Severability. If any portion of this Agreement is declared invalid, illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining provisions shall continue in full force and effect. 3.6.13 Prohibited Interests. Consultant maintains and warrants that it has not employed nor retained any company or person, other than a bona fide employee working solely for Consultant, to solicit or secure this Agreement. Further, Consultant warrants that it has not paid nor has it agreed to pay any company or person, other than a bona fide employee working solely for Consultant, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award or making of this Agreement. Consultant further agrees to file, or shall cause its employees or subconsultants to file, a Statement of Economic Interest with the City’s Filing Officer as required under state law in the performance of the Services. For breach or violation of this warranty, City shall have the right to rescind this Agreement without liability. For the term of this Agreement, no member, officer or employee of City, during the term of his or her service with City, shall have any direct interest in this Agreement, or obtain any present or anticipated material benefit arising therefrom. 3.6.14 Cooperation; Further Acts. The Parties shall fully cooperate with one another, and shall take any additional acts or sign any additional documents as may be necessary, appropriate or convenient to attain the purposes of this Agreement. 3.6.15 Attorney’s Fees. If either party commences an action against the other party, either legal, administrative or otherwise, arising out of or in connection with this Agreement, the prevailing party in such litigation shall be entitled to have and recover from the losing party reasonable attorney’s fees and all other costs of such action. 3.6.16 Authority to Enter Agreement. Consultant has all requisite power and authority to conduct its business and to execute, deliver, and perform the Agreement. Each Party warrants that the individuals who have signed this Agreement have the legal power, right, and CBRE, Inc. Page 19 of 20 8513273_1 authority to make this Agreement and bind each respective Party. 3.6.17 Counterparts. This Agreement may be signed in counterparts, each of which shall constitute an original. 3.6.18 Entire Agreement. This Agreement contains the entire Agreement of the parties with respect to the subject matter hereof, and supersedes all prior negotiations, understandings or agreements. This Agreement may only be modified by a writing signed by both parties. [SIGNATURES ON NEXT PAGE] CBRE, Inc. Page 20 of 20 8513273_1 CITY OF AZUSA CBRE, Inc. By: By: Mr. Joseph Romero Rocha Mr. John Frager Mayor Executive Managing Director Date: __________________________ Date: _________________________ Attest: Attest: By:___________________________ Jeffrey Lawrence Cornejo, Jr. City Clerk Name:_________________________ Date: __________________________ Approved as to Form: Title:__________________________ Best Best & Krieger LLP Date:__________________________ City Attorney Date: _________________________ 8513273_1 EXHIBIT “A” SCOPE OF SERVICES, SCHEDULE OF SERVICES, COMPENSATION The following elements will be addressed under the scope of services: Task: Perform all duties on an as-needed basis necessary to fulfill real estate consulting and brokerage services, including but not limited to: consult for potential real estate development of properties throughout City; prepare and review financial documentation related to real estate analysis and transactions; coordinate with real estate owners, developers, brokers, and tenants; and attend meetings with staff and City Council meetings as requested. Professional Fees FEE: Not-to-Exceed amount of $50,000 on a Time and Material Basis (with hourly rates) per annum, for a period of three (3) years. The following hourly rates will apply: Western Regional Manager- $275/HR Senior Vice President- $275/HR