Title
Conduct a Public Hearing to Consider/Discuss/Act on a Resolution Authorizing the City Manager to Negotiate an Agreement(s) with a Development Firm(s) for the Redevelopment of City-Owned Properties in the Downtown Area
Summary
MEETING DATE: November 5, 2013
DEPARTMENT: Planning
CONTACT: Michael Quint, Director of Planning
Barry Shelton, AICP, Executive Director of Development Services
RECOMMENDED CITY COUNCIL ACTION:
· Approve the Resolution.
ITEM SUMMARY:
· After evaluating the proposals based on the selection criteria published in Section 5 of the Request for Proposals (RFP) as well as on the results of the interviews and the Open House event, Staff recommends moving forward with the following development groups:
o Zenstar Development (Proposal #4)
o InTown Homes (Proposal #2)
· City Council's approval of the Resolution represents formal selection of the proposals and authorizes the City Manager to negotiate the terms of public/private partnerships with the selected development firms for the development, design, and construction of the City-owned properties. City Council's approval of the Resolution does not obligate the City to participate in a public/private partnership.
· Detailed financial analysis of specific City participation elements will be performed as part of the negotiation process. Upon completion of the negotiation process, agreements (along with specific City participation elements) will be brought to the City Council for consideration and approval.
· In the event that a mutually beneficial agreement is not reached with a selected development firm(s), the City Manager will begin to negotiate with the next best qualified offeror. In that event, the City Council would be notified of that situation and a revised Resolution would be brought back to the City Council for consideration and approval.
BACKGROUND INFORMATION:
· Since the adoption in 2008 of the Town Center Study Initiative Phase 1 Report and associated illustrative vision (together known as the "Town Center Master Plan"), the City of McKinney has been evaluating and implementing a comprehensive strategy of implementation tools (e.g. development policies, development ordinances, grants, public infrastructure investments, catalyst projects, etc.) in order to bring the vision to life and truly allow revitalization and economic redevelopment of the historic Town Center to be achieved and sustained over the long-term.
· In July 2012, as a proactive step to increase momentum for continued revitalization in the Town Center, the City issued a Request for Proposals (12-025RFP) seeking master development proposals from qualified private development firms for the redevelopment of 10 City-owned downtown properties. Redevelopment of any combination of these properties is expected to include new residential uses and/or new commercial uses (in single use and/or mixed use buildings) within a compact and pedestrian-friendly design that is consistent with the City's adopted Town Center Master Plan.
· In November 2012, the City received the following 4 proposals:
o Proposal #1 submitted by CB Jeni Homes (Allen, TX)
o Proposal #2 submitted by InTown Homes (Houston, TX)
o Proposal #3 submitted by GroundFloor Development (Dallas, TX)
o Proposal #4 submitted by Zenstar Development (Austin, TX)
· The proposals have been evaluated by an executive-level Staff team that includes members from the City Manager's Office, City Attorney's Office, Development Services, Planning, Engineering, and Purchasing Department.
· As published in Section 5 of the RFP, evaluation criteria include but are not limited to:
o Demonstrated experience and performance of the development firm with comparable projects and public/private partnerships
o Financial capacity of the development firm
o Financial and technical competence of the development firm
o Capability of the development firm to deliver the project as proposed
o Financial and technical feasibility of the proposal
o Quality of comparable projects
o Sensitivity of the proposal to the existing context
o Consistency of the proposal with the McKinney Town Center Master Plan
· Between February 28, 2013 and March 8, 2013, Staff conducted interviews with each of the four development firms.
· On April 8, 2013, the City hosted an informational Open House event during a Special Meeting. Approximately 75 stakeholders were in attendance. Each of the four development firms made a 15-minute presentation to the City Council. Subsequent to each presentation, the City Council had 10 minutes to ask questions of each development firm. Then, during a "breakout" session (approximately 90 minutes), each development firm was available to discuss their proposals with any interested stakeholders face-to-face and answer any questions. Stakeholders were invited to share their thoughts regarding the four proposals on comment cards.
· On May 7, 2013, Staff recommended the approval of a resolution that would allow the City Manager's Office to negotiate an agreement(s) with Zenstar Development and InTown Homes for the redevelopment of City-owned properties in the downtown area. At this meeting, the City Council expressed concerns regarding residential density, parking, infrastructure capacity, and where a future municipal center would be located.
· On June 17, 2013, Staff asked the City Council if there were any additional concerns regarding the redevelopment of City-owned properties in the downtown area. No additional concerns were expressed.
CONCERNS REGARDING THE REDEVLEOPMENT OF CITY-OWNED PROPERTY:
· Subsequent to the June 17 meeting, Staff researched the issues identified by the City Council. That research is attached for reference but more generalized summaries are reflected below.
· Residential Density.
o Staff has evaluated the existing and potential residential densities and feels that the densities that result from the proposed developments will not negatively impact McKinney's Historic Downtown. In fact, the additional residential densities should benefit existing businesses and should lure additional business to the downtown area.
o "MTC" - McKinney Town Center Zoning District (190 net acres) Residential Density:
§ Current density - 0.98 d.u. per net acre
§ Anticipated density (+1,000 d.u. w/out passenger rail) - 5.26 d.u. per net acre
o Primary Site (8.67 gross ac.) Residential Density:
§ Current density - 0.00 dwelling units per net and gross acre
§ Proposed density (InTown Homes Proposal, 320 d.u. on 4.7 ac.) - 37 d.u. per gross acre (68 d.u. per net acre)
§ Proposed density (Zenstar Development Proposal, 150 d.u. on 3.3 ac.) - 17 d.u. per gross acre (46 d.u. per net acre)
o Comparison Densities:
§ City of McKinney - 5.2 d.u. per net acre
§ City of Frisco - 5.4 d.u. per net acre
§ City of Allen - 5.0 d.u. per net acre
§ Times Square at Craig Ranch - 70 d.u. per acre
· Parking.
o At any time of the day (except during special events), there is available parking in a number of public parking lots. Each development proposal for the primary site reflects the possible construction of structured parking with City participation. Structured parking may also be constructed on the northern sites. As such, Parking should not be an issue.
o Example Analysis: Primary Site (480 off-street public parking spaces)
§ 20% occupied weekday (peak)
§ 5% occupied weeknight
§ 30% occupied Saturday morning Farmers Market at Chestnut Square
§ 5% occupied weekend (not during Farmers Market)
· Infrastructure Capacity.
o Some minor, localized water (minimum fire flows) and sanitary sewer (deteriorating pipes) improvements may be necessary pending a definitive development proposal but capacity should not be an issue.
o Estimated costs to be approximately $150,000 - $200,000.
· Future Municipal Facility.
o The anticipated space needs of the City assuming a build-out population of 350,000 - 380,000 is approximately 225,000 square feet of floor area.
o The City's northern sites can accommodate these needs and reserving the primary (9 ac.) site allows for greater economic development opportunities. A partnership with MISD for a joint facility (an additional 100,000 sq. ft.) is possible on the northern sites.
o Staff recommends the future municipal facility be located on some combination of the northern sites. The final location may be determined at a future date.
FINANCIAL SUMMARY:
· Detailed financial analysis of specific City participation elements will be performed as part of the negotiation process. Upon completion of the negotiation process, agreements (along with specific City participation elements) will be brought to the City Council for consideration and approval.
BOARD OR COMMISSION RECOMMENDATION:
· N/A