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HomeMy WebLinkAboutMINUTES - 05031988 - 2.8 2 . 8 THE BOARD OF SUPERVISORS OF CONTRA COSTA COUNTY, CALIFORNIA Adopted this Order on _May 3 , 1988 by the following vote: AYES: Supervisors Powers, Fanden, McPeak, Torlakson, Schroder NOES: None ABSENT: None ABSTAIN: None ------------------------------------------------------------------ ------------------------------------------------------------------ SUBJECT: Reynolds and Brown Option to Lease Agreement at Buchanan Field The Board considered the report containing the recommendation of J. M. Walford, Public Works Director, relative to the Reynolds and Brown Option to Lease Agreement at Buchanan Field Airport. A copy of the referenced report is attached and included as a part of this document. Mr. Walford commented on the proposal of Reynolds and Brown to construct a 10-story building on airport property. He advised that through the negotiation process Reynolds and Brown have tentatively agreed to reduce the height of their tallest building to seven stories. He stated that the Developer has expressed an interest in advancing the timing on the development of a portion of the project for the placement of a restaurant on the property. Mr. Walford advised that the developer has agreed to resume payment on the option agreement commencing April 1, 1988. He noted that Reynolds and Brown asserts that last year the Board imposed a moratorium on the project and recommended that this matter be referred to County Counsel. Mr. Walford advised that he believes it to be of mutual interest to both the County and the developer to extend the option agreement by three years. The Public Works Director further commented on anticipated revenues that would be received by the County from this project. Board members commented on the report and expressed agreement with reducing the building to seven stories and not waiving collection of the back payments for the lease option. Supervisor McPeak recommended that the Board receive the report, refer to County Counsel the question relative to the suspension of the lease option payment by Reynolds and Brown, and directed the Public Works Director to pursue collection of the unpaid lease option payments. It was further recommended that the Public Works Director report to the Board on the renegotiated project for construction of an office complex. IT IS BY THE BOARD ORDERED that the aforesaid recommendations are APPROVED. 1 hereby certify,thot this 13 a an acaion taken and entered on the Boasts of Supervisors on Ih-e date shoein. ATTESTED: �' / CC: Public Works Director MIL BATCH ®R, Clerk of the weird County Counsel i of Superdisms and County Ad.m'snissrn or County Administrator 13Y U O , Deputy TO: BOARD OF SUPERVISORS FROM: J. MICHAEL WALFORD, PUBLIC WORKS DIRECTOR DATE: May 3, 1988 SUBJECT: Reynolds and Brown Option to Lease Agreement at Buchanan Field Specific Request(s) or Recommendation(s) & Background & Justification I. RECOMMENDATION ACCEPT report from the Public Works Director and DIRECT him, together with the Lease Management Division of General Services and County Counsel , to prepare the appropriate modifications to the Option Agreement and the Development Agreement, II. FINANCIAL IMPACT Approval of these amendments will provide for resumption of the $10,000 per month option fee which has not been paid since February 1987. III. REASONS FOR RECOMMENDATION/BACKGROUND The County Grand Jury, in a report dated Feb. 11, 1.987, expressed concern over the siting of a ten story building proposed by Reynolds & Brown, on Airport owned property. Two weeks later, Supervisor Sunne Mc Peak introduced a letter from Reynolds & Brown, wherein Mr. Jon Reynolds advised that their consultant had determined that the proposed ten story building penetrated the imaginary surfaces, or safety zone, for Buchanan Field. The Board referred the Reynolds letter to the Public Works Director, Airport Land Use Commission, Aviation Advisory Committee and County Counsel for investigation and report. Both the Aviation Advisory Committee and the Airport Land Use Commission reported to the Board in April , 1987 that Reynolds' consultant was in error, and the building in question did not penetrate the safety zones surrounding Buchanan Field. Both groups, however, expressed concern similar to that of the Grand Jury relative to the construction of such a tall building so ose to Buchanan Field's runways. Continued on attachment: x yes Signature:-- Recommendation ignature:Recommendation of County Administrator Recommendation of Board Committee Approve Other: Signature(s) : May 3, 1988 - Page 2 Board Order - Reynolds & Brown Option to Lease Agreement at Buchanan Field On June 2, 1987 the Public Works Director provided the Board of Supervisors with a detailed report regarding the proposed Reynolds & Brown development. The Board of Supervisors ordered the Public Works Director to meet with Reynolds & Brown and attempt to negotiate a modification to the proposed Reynolds & Brown project, and the Development Agreement, to provide for reducing the height of the ten story building to no more than seven stories. A number of meetings have occurred between Reynolds & Brown, the Lease Management Division of the General Services Department, and the Public Works Director. A compromise agreement was reached which achieves the most important objectives of both parties. Of greatest importance to the County, Reynolds & Brown have agreed to modify their plan to reduce the height of the tallest building to seven stories. Also of importance to the County, Reynolds & Brown has agreed to advance the timing for construction of the restaurant part of the development in order to speed up revenue generation by the proposed project. In order to allow early construction of the restaurant, the County has agreed in concept to permit its relocation from the originally proposed site on top of the parking structure, to a ground level site. To accommodate the relocated restaurant the County is allowing Reynolds & Brown to make minor changes to the orientation and location of the other structures included within the project. The third item which is of importance to the County is that Reynolds & Brown has agreed to resume option payments as of April 1 , 1988 . They had discontinued payments on their option in February, 1987 claiming that the Board 's action on Feb. 24 had created a moratorium on the development. In return for these concessions it was agreed Reynolds & Brown 's option to lease could be extended by three years, from June, 1989 to June, 1992. This was important to Reynolds and Brown because their proposed project is basically an office complex, and the office market in central Contra Costa County is overbuilt at the present time. There was considerable discussion during the various meetings of totally changing the type development which Reynolds & Brown was proposing. However, it was decided to be advantageous to both the County and Reynolds & Brown to stick with a development that was basically unchanged. The reasons were: -the environmental process had already been completed -the traffic mitigation measures had already been determined . -revenue projections developed by Lease Management staff indicated that even with the extended option period the revenue to the County from the originally proposed development would surpass that from any other type development within less than ten years. Revenue projections to twenty years in the future would be several times that which could be expected from other types of development. In addition to the extended option period the County also agreed to option payments of $10,000 per month. This is the same amount as Reynolds & Brown originally paid for the option; however, under the original agreement the option payments doubled to $20,000 per month during the latter part of the option period. Lease Management, County Counsel and the attorneys for Reynolds & •Brown are making the necessary revisions to the option to lease and development Agreement and it is expected the documents will go to the Board for approval within a few weeks. IV. CONSEQUENCES OF NEGATIVE ACTION The original option and development agreement would still be in place. Reynolds and Brown would be faced with proceeding to build the office complex, including a ten story building, in an adverse market or abandoning their option. If Reynolds and Brown were to abandon their option, the County would have to seek another proposal by rebidding the project. JMW:djh bo:3.t5