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HomeMy WebLinkAbout8.2 Proposed Framework for Dublin Commons Development Agreementr DUBLIN CALIFORNIA STAFF REPORT CITY COUNCIL Agenda Item 8.2 DATE: August 20, 2024 TO: Honorable Mayor and City Councilmembers FROM: Linda Smith, City Manager SU B.ECT : Proposed Framework for Dublin Commons Development Agreement Prepared by: Hazel L. Wetherford, Deputy City Manager EXECUTIVE SUMMARY: The City Council will review the proposed framework for the Dublin Commons Development Agreement for the future development of the site. STAFF RECOMMENDATION: Review and provide direction on the proposed framework for the Dublin Commons Development Agreement. FINANCIAL IMPACT: There are no financial impacts associated with approving the proposed framework. DESCRIPTION: Background Over the last several years, the City Council has made significant progress towards realizing the goal of delivering a downtown project to the community through the Downtown Dublin Preferred Vision. There have been at least 10 public meetings and subsequent actions during that period. Following is a summary of those meeting dates and actions taken: October 15, 2019 Resolution No. 107-19 which approved a Memorandum of Understanding (MOU) between the City and American Realty Advisors (ARA), the primary property owner of the Dublin Place shopping center. November 5, 2019 Resolution No. 115-19 which approved the Downtown Dublin Preferred Vision (DPV) and its three main principles (siting of the town square, a new street grid network, and the downtown character). Page 1 of 6 1 December 3, 2019 Resolution No. 126-19 which amended the General Plan and Downtown Dublin Specific Plan (DDSP) to allow an increase in the allowable commercial floor area ratio (FAR) in the Transit Oriented and Retail Districts, combined new residential dwelling unit allocation into one pool for all three districts, and amended the parking standards for the Village Parkway and Transit Oriented Districts. July 21, 2020 Resolution No. 79-20 which amended the DDSP to create a new street grid in the Retail District, site a town square, combine the remaining allocation of new non-residential square footage from the Transit Oriented and Retail Districts into one pool, allow lodging in the Retail District, and update the design guidelines for the Core Area of the Retail District. November 17, 2020 Resolution No. 121-20 which adopted the Downtown Dublin Streetscape Plan and amended the City of Dublin Streetscape Master Plan. April 6, 2021 Resolution No. 26-21 which approved a First Amendment to the MOU with ARA, providing a 12-month term extension. April 5, 2022 Resolution No. 30-22 which approved a Second Amendment to the MOU with ARA, providing a 14-month term extension. November 6, 2023 Received a presentation from Staff, the City's consultant Urban Field Studio, and ARA on the proposed implementation of the DPV. After the presentation, the City Council provided direction to Staff on additional DDSP Amendments required to support the DPV. December 19, 2023 Resolution No. 134-23 amending the General Plan and DDSP to further implement the Downtown DPV. The amendments consisted of adding Research and Development as a new land use, increasing the residential allocation by 465 units, decreasing the non-residential allocation by 300,000 square feet, increasing the building height and floor area ratio in the Core Area of the Retail District, and changing setbacks. July 16, 2024 Received a presentation from Staff on updates to the Downtown Dublin efforts, including the ongoing work on the development of the Dublin Commons project, which includes the town square, living options, commercial uses, and the proposed life science buildings. Upon adoption of the DDSP amendments in December 2023, ARA and Hines (Applicant) submitted a Planning Application for the Dublin Commons project which is the redevelopment and rebranding of the Dublin Place shopping center consistent with the core tenants of the Preferred Vision. Dublin Commons is a mixed -use project of up to 275,000 square feet of retail (consisting of 155,000 square feet of new retail and 120,000 square feet of existing retail), 535,000 square feet Page 2 of 6 2 of Research and Development (Life Science), up to 1,510 multifamily residential units (inclusive of the affordable housing site units) and a new Town Square. As Staff has shared in previous presentations, the City has partnered with ARA to bring the City's Preferred Vision to reality. The City approached ARA with the opportunity for a public -private partnership to deliver a project that neither the City nor the property owner could accomplish alone. Based on this partnership, ARA has made significant commitments exceeding $90 million as further detailed in Attachment 2. Framework for Development Agreement and Community Benefit Agreement As part of the proposed project, the Applicant is requesting approval of a Development Agreement and Community Benefit Agreement (Agreement). The Agreement would provide security to the Applicants that the City will not change its zoning and other laws applicable to the project for a stated period. Additionally, it is a mechanism for the City to obtain commitments from the Applicants that the City might not otherwise be able to obtain. Below is the framework for the Agreement. • Term o An initial 25-year term with options to extend one-year increments for up to 10 additional years. o Applicant would make a community benefit payment to the City of $250,000 per year unless, at the time of the extension request, the City Manager determines that significant process is being made on the project. • Phasing o The project will be phased over time and the initial phase will include the Town Square and the surrounding commercial development around the Town Square, both of which will be completed prior to or concurrently with the first residential development. • Downtown Dublin Specific Plan Residential Development Pool o Applicant is requesting a reservation of the remaining 1,270 units from the Downtown Dublin Specific Plan Residential Development Pool. o In order to pull units from the Pool, community benefits must be considered. The Staff has included the following benefits: ■ Project will generate significant new revenue for the City, anticipated to be $130 million over 30 years. ■ Project is estimated to generate 1,400 jobs at build out. ■ Project will serve as a catalyst for future economic development around the Downtown area and is consistent with the goals and objective of the Downtown Preferred Vision. ■ City has requested from the Applicant to designate Dublin as the point of sale for the general contractor and sub -contractors so any sales tax derived from such activities during construction can be allocated to the City. Page 3 of 6 3 One item still under discussion is the ability to utilize future square feet within the Life Science/Office buildings for use as a lab and coworking center. • Affordable Housing o Applicant would enter into an affordable housing agreement with the City, which would include an alternative method of compliance to dedicate Block H, just east of the Dublin Senior Center, to the City and/or designee. This 1.1-acre site was contemplated by the City Council as part of its Memorandum of Understanding with ARA in 2019 for a senior affordable housing project. The site can accommodate between 80-170 units and 80 of these units are included in the overall request for the project. It should be noted that there are additional obligations outlined in the Housing Element for this location that have been codified in the DDSP that would need to be addressed as part of any agreed upon affordable housing program for this site. • Public Infrastructure and Improvements The public infrastructure and improvements are a vital part of the overall project and the City's involvement in participating in these costs is key to the overall feasibility. Following is a summary of the items and obligations being discussed: o Applicant will receive fee credits and reimbursements for certain public improvements made on behalf of the City. These include: ■ Town square dedication and improvements ■ Construction of new public streets ■ Modifications to existing intersections ■ Bicycle and pedestrian improvements ■ Other improvements identified in the Western Dublin Transportation Impact Fee program o Staff is recommending an allocation of public art fees to the project area, as well as a future gateway sign. o Public Parking Garage: The garage is extremely important to the overall project at a later phase once the second life science building is constructed. The Applicant and Staff propose the following: ■ City acquisition of the 2-acre public parking garage site (Block E2). ■ Applicant to improve surface parking during the intervening period. ■ Improvement of the public parking garage site upon approval of the second life science building. The number of parking stalls, 1,100, was vetted by the City's parking consultant. This number will provide adequate market -based parking for life science users as well as daytime and weekday use. The capacity will also be necessary to handle the Page 4 of 6 4 more intense use during the evenings and weekends. The parking garage site is estimated to cost $6 million, and the garage improvement is estimated to cost $75 million. Staff is recommending a financial commitment to support these public improvements through available grant funding, financing, and use of the General Fund Reserves. Staff will continue to allocate future annual surpluses and other lump -sum funding to the General Fund Downtown Public Improvements Reserve towards the project during the initial phase and during later phases (public parking garage) to help offset costs associated with these public infrastructure improvements. • Marketing and Promotion o The Agreement will also anticipate language to have the Applicant formalize a marketing and promotion effort to support the businesses surrounding the Town Square, as well as events within the Town Square. • Maintenance o The Agreement will also address ongoing maintenance of the private and public infrastructure in Dublin Commons with consideration of the Applicant agreeing to funding maintenance for public infrastructure. The Applicant may propose an alternate method, to be approved by the City Engineer. • Small Business Support o Staff and Applicant proposed to work together to provide small business support programs to help incentivize the attraction of high -quality restaurants and retailers. Currently, the City has sewer capacity set aside for the Downtown area that could be provided to the project and to specific restaurant tenants at the City Council's discretion. Additional support could come from the use of the Small Business Assistance Program that has been in use by the City to support improvements related to Title 24/ADA and/or trash enclosure requirements. • Commercial Retail Development o To ensure high -quality restaurants and retailers, Staff and the Applicant agree that the Site Development Review will include: ■ Minimum ground floor commercial height of 18' ■ Minimum of 100,000 square feet of retail spaces surrounding the Town Square ■ Provide several outdoor dining areas to support a vibrant dining experience • Funding Mechanisms o Staff and the Applicant agree to work on possible funding mechanisms to support the project including, but not limited to: ■ Use of the General Fund Reserve for public infrastructure and improvements ■ Lease revenue bond (finance the construction of the parking garage) ■ Available Grant Funding Page 5 of 6 5 ■ Fee Deferrals ■ Tax Sharing Options (Property/Sales) ■ Statewide Communities Infrastructure Program ■ Enhanced Infrastructure Financing Districts ■ Community Facilities District ■ City's existing programs, including Sewer Capacity, Commercial Facade Grants and Small Business Assistance programs. To summarize, Staff is recommending receiving feedback and direction from the City Council so that Staff can proceed with the preparation of the Agreement. Should the City Council authorize Staff to move forward, a Development Agreement and Community Benefit Agreement will be formalized and will be brought to the Planning Commission for review and recommendation to the City Council. STRATEGIC PLAN INITIATIVE: Strategy 1: Economic Development, Small Business Support, and Downtown Dublin Objective B: Work with ARA and Hines on the development of the Dublin Commons project, including associated public improvements, relocation of tenants, development agreement and appropriate incentives to effectuate physical changes to the area, as well as support for small businesses. NOTICING REQUIREMENTS/PUBLIC OUTREACH: The City Council Agenda was posted, and a copy of the Staff Report was shared with the Applicant. ATTACHMENTS: 1) Site Plan 2) July 16, 2024 City Council Staff Report Page 6 of 6 6 SITE PLAN " a IIIIIIIIIIIIIIi]iIIIiIIIIIeiC AMADOR VALLEY BOULEVAR �I�I II�I';IYIIIIIIIIIIIIIIIIIIIIIIIIIII' runerniftware 11111111111111 �ux�u u tWL 1 Lr SECOND ST LIN BOULEVARD S C ' D STREET PLAZA DR PLAZA DRIVE II II II III - III III III III III III III DUBLIN BOULEVARD f.1 �YJ 1 Attachment RESTAURANT/ CAFE RETAIL RESIDENTIAL LOBBY FITNESS OFFICE PARKING Hines AAMERICAN REALTY ADVISORS DUBLIN COMMONS swa Gensler 7 Attachment 2 r DUBLIN CALIFORNIA STAFF REPORT CITY COUNCIL Agenda Item 7.1 DATE: .Lily 16, 2024 TO: Honorable Mayor and City Councilmembers FROM: Linda Smith, City Manager SU B.ECT: Downtown Dublin Update Prepared by: Hazel L. Wetherford, Deputy City Manager EXECUTIVE SUMMARY: The City Council will receive a presentation on updates to the Downtown Dublin efforts, including the ongoing work on the development of the Dublin Commons project, which includes the town square, living options, commercial uses, and the proposed life sciences buildings. STAFF RECOMMENDATION: Receive the presentation. FINANCIAL IMPACT: There are no financial impacts associated with receiving the presentation. DESCRIPTION: Background Over the last five years, the City has made significant progress towards realizing the Downtown Dublin Preferred Vision, including taking the following actions: • October 15, 2019 - the City Council adopted Resolution No. 107-19 which approved a Memorandum of Understanding (MOU) between the City and American Realty Advisors (ARA), the primary property owner of the Dublin Place shopping center. • November 5, 2019 - the City Council approved the Downtown Dublin Preferred Vision (DPV) and its three main principles (siting of the town square, a new street grid network, and the downtown character). • December 3, 2019 - the City Council adopted Resolution No. 126-19 which amended the General Plan and Downtown Dublin Specific Plan (DDSP) to allow an increase in the Page 1 of 4 8 allowable commercial floor area ratio (FAR) in the Transit Oriented and Retail Districts, combined new residential dwelling unit allocation into one pool for all three districts, and amended the parking standards for the Village Parkway and Transit Oriented Districts. • July 21, 2020 - the City Council adopted Resolution No. 79-20 which amended the DDSP to create a new street grid in the Retail District, site a town square, combine the remaining allocation of new non-residential square footage from the Transit Oriented and Retail Districts into one pool, allow lodging in the Retail District, and update the design guidelines for the Core Area of the Retail District. • November 17, 2020 - the City Council adopted Resolution No. 121-20 which adopted the Downtown Dublin Streetscape Plan and amended the City of Dublin Streetscape Master Plan. • April 6, 2021 - the City Council adopted Resolution No. 26-21 which approved a First Amendment to the MOU with ARA, providing a 12-month term extension. • February 5, 2022 - the City Council received an update on Downtown Dublin as part of the Strategic Planning retreat. • April 5, 2022 - the City Council adopted Resolution No. 30-22 which approved a Second Amendment to the MOU with ARA, providing a 14-month term extension. • November 6, 2023 - the City Council received a presentation from Staff, the City's consultant Urban Field Studio, and ARA on the proposed implementation of the DPV. After the presentation, the City Council provided direction to Staff on the DDSP Amendments required to support the DPV. • December 19, 2023 - the City Council adopted Resolution No. 134-23 amending the General Plan and DDSP to further implement the Downtown DPV. The amendments consisted of adding Research and Development as a new land use, increasing the residential allocation by 465 units, decreasing the non-residential allocation by 300,000 square feet, increasing the building height and floor area ratio in the Core Area of the Retail District, and changing setbacks. Upon adoption of the DDSP amendments, ARA and Hines submitted a Planning Application for a Site Development Review Permit, including a Vesting Tentative Tract Map and a Development Agreement for the Downtown DPV. As part of this process, the existing Dublin Place shopping center is being rebranded as Dublin Commons. ARA and Hines have also submitted a Planning Application for a Site Development Review Permit for the northerly corner of the shopping center, located at the intersection of Amador Valley Boulevard and Amador Plaza Road. This application includes the demolition of two existing commercial buildings and the construction of a new multi -tenant commercial building. Redevelopment of the northern corner will facilitate the relocation of current tenants into new Page 2 of 4 9 spaces, enabling the demolition of the southern portion of the shopping center and paving the way for the Dublin Commons Project. As Staff has shared in previous presentations, the City has partnered with ARA to bring the City's Downtown DPV to fruition. The City approached ARA with the opportunity for a public -private partnership to deliver a project that neither the City nor the property owner could accomplish alone. Based on this partnership, ARA has made significant commitments exceeding $90 million, which include: • Acquiring 7300 Amador Plaza Road parcel • Acquiring 7050 Amador Plaza Road parcel • Buying out the Hobby Lobby lease • Halting redevelopment of 7505 Dublin Boulevard (the former Coco's site) • Ceasing the leasing of retail spaces • Paying off the property loan • Negotiating a relocation agreement with PetSmart • Hiring a Development Manager (Hines) • Hiring an Architecture, Design, and Planning Firm (Gensler) • Securing contracts for the Burlington parcels Update In support of the Downtown DPV, Staff has been working on the deal terms for the Development Agreement and the City's commitment to financially supporting the public improvements required for the Dublin Commons Project. These improvements include but are not limited to the following: • Town square park • Construction of public streets • Modifications of intersections • Improvements identified in the Western Dublin Transportation Impact Fee program • Bicycle and pedestrian improvements • Public parking garage (see below) • Public art and gateway signage In addition to these public improvements, the City will also support utility relocation, business relocation, sales tax sharing, property tax sharing, and commercial facade improvements. These initiatives align with Strategy 1B of the City Council's Strategic Plan and will directly contribute to physical changes in the area. Staff will present the Development Agreement deal terms, including the items outlined, at a future City Council meeting. Of note among the deal terms being negotiated is the public parking garage, the cornerstone of the City's investment in the infrastructure of this new Downtown area. Based on the City's evaluation of the overall parking need, the garage will need to include approximately 1,100 parking stalls. These stalls will provide the needed market -based parking for the future life science buildings and capacity for daytime use, but also for more intense use during the evenings and weekends. It should be noted that the future parking garage will not be necessary until the life science buildings Page 3 of 4 10 are constructed. The parking garage is currently estimated to cost more than $75 million, and Staff is exploring ways for the City to fund its construction. The General Fund Downtown Public Improvements Reserve has a current balance of $25.8 million, and Staff plans to recommend the continued allocation of annual surpluses and other lump -sum funding to this reserve over the next several years to either fully fund the garage or be positioned for a manageable debt issuance for a portion of the cost. It is important to highlight that Downtown Dublin, when completed, is expected to bring in more than $4 million in new revenue to the City, which is an important factor in considering the City's ability to sustain long-term debt service payments for the garage. Staff is working with its consultants on a variety of financing options and will bring this issue back to the City Council at a future meeting. STRATEGIC PLAN INITIATIVE: Strategy 1: Economic Development, Small Business Support, and Downtown Dublin Objective B: Work with ARA and Hines on the development of the Dublin Commons project, including associated public improvements, relocation of tenants, development agreement and appropriate incentives to effectuate physical changes to the area, as well as support for small businesses. NOTICING REQUIREMENTS/PUBLIC OUTREACH: The City Council Agenda was posted. ATTACHMENTS: None. Page 4 of 4 11 Proposed Framework for Dublin Commons Development Agreement August 20, 2024 DUBLIN CALIFORNIA 12 Background • 10-15-2019 MOU with American Realty Advisors • 11-5-2019 Downtown Preferred Vision Approved • 12-3-2019 DDSPAmendments • 7-21-2020 DDSPAmendments Background, 2 • 1 1-17-2020 Downtown Dublin Streetscape Plan Adoption • 4-6-2021 FirstAmendmentto MOU • 4-5-2022 Second Amendment to MOU • 11-6-2023 Downtown Dublin Update 14 Background, 3 • 12-19-2023 DDSPAmendments • 7-16-2024 Presentation from Staff 15 Framework • Development Agreement and Community Benefit Agreement • Term — 25 years — Options to extend in one-year increments for up to 10 additional years Framework, 2 • Phasing — Project will be phased over time — Initial phase will include Town Square and surrounding commercial development • Residential Development Pool — Request to reserve 1,270 units Framework, 3 • Community Benefits — SI 30M anticipated new revenue over 30 years — 1,400 estimated new jobs at build out — Catalyst for the Downtown area — Consistent with the goals and objective of the Downtown Preferred Vision — Designate Dublin as the point of sale — Designate square feet for lab and coworking space (under discussion) Framework, 4 • Affordable Housing — Affordable Housing Agreement — Dedication of a I.1-acre site — 80-1 70 units for senior affordable housing — Housing Element sites would need to be addressed as part of any agreed upon affordable housing program for the site Framework, 5 • Public Infrastructure and Improvements — Fee credits and reimbursements for certain public improvements made on behalf of the City — Allocation of public art fees to the project including a future gateway sign Framework, 6 — Public Parking Garage ■ City to acquire 2-acre site (estimated cost: $6M) ■ Applicant to improve site to provide surface parking ■ Public parking garage would be improved upon approval of second Life Science building (estimated cost: $75M) — City to provide financial commitment • Marketing and Promotion — Formalize a marketing and promotion effort to support businesses surrounding the Town Square, as well as events Framework, 7 • Maintenance — Ongoing maintenance of the private and public infrastructure • Small Business Support — Small business support programs to help with attracting high -quality restaurants and retailers • Commercial Retail Development — Minimum ground floor commercial height of 18' — Minimum of 100,000 SF of retail spaces surrounding Town Square — Provide several outdoor dining areas Framework, 8 • Funding Mechanisms — Use of General Fund Reserve — Lease revenue bond — Available grant funding — Fee deferrals — Tax sharing options (property/sales) — Statewide Communities Infrastructure Program — Enhanced Infrastructure Financing District — City's existing programs Recommendation • Receive feedback and direction from the City Council so that Staff can proceed with the preparation of the Development Agreement and Community Benefit Agreement • Questions