2004-09-01 ARRA PacketAGENDA
Regular Meeting of the Governing Body of the
Alameda Reuse and Redevelopment Authority
Alameda City Hall
Council Chamber, Room 390
2263 Santa Clara Avenue
Alameda, CA 94501
1. ROLL CALL
2. CONSENT CALENDAR
Wednesday, September 1, 2004
Meeting will begin at 5:30 p.m.
City Hall will open at 5:15 p.m.
2 -A. Recommendation to approve a 20 -year lease agreement with Nelson's Marine for Building
167.
2 -B. Recommendation to approve a five -year lease, with a possible 3(5 -year) options, with
Nelson Marine for 400 linear feet of Pier 1.
2 -C. Recommendation to authorize the Executive Director to direct P.M. Realty, acting as
property manager, to enter into a contract with Urban Waterproofing Inc. to waterproof
City Hall West (Building One) in an amount not to exceed $547,541.
3. PRESENTATION
3 -A. Presentation /update on Alameda Point Navy Negotiations and Land Use Planning.
4. REGULAR AGENDA ITEMS
None.
5. ORAL REPORTS
5 -A. Oral report from APAC.
5 -B. Oral report from Member Matarrese, RAB representative.
5 -C. Oral report from the Executive Director (non- discussion items).
ARRA Agenda — September 1, 2004 Page 2
6. ORAL COMMUNICATIONS, NON - AGENDA (PUBLIC COMMENT)
(Any person may address the governing body in regard to any matter over which the
governing body has jurisdiction that is not on the agenda.)
7. COMMUNICATIONS FROM THE GOVERNING BODY
8. ADJOURNMENT TO CLOSED SESSION OF THE ARRA TO CONSIDER
CONFERENCE WITH REAL PROPERTY NEGOTIATOR:
8 -A. Property:
Negotiating parties:
Under negotiation:
Alameda Naval Air Station
ARRA, Navy, and Alameda Point Community Partners
Price and Terms
Announcement of Action Taken in Closed Session, if any.
9. ADJOURNMENT
This meeting will be cablecast live on channel 15. The next regular ARRA meeting is
scheduled for Wednesday, October 6, 2004.
Notes:
• Sign language interpreters will be available on request. Please contact the ARRA Secretary, Irma Frankel
at 749 -5800 at least 72 hours before the meeting to request an interpreter.
• Accessible seating for persons with disabilities (including those using wheelchairs) is available.
• Minutes of the meeting are available in enlarged print.
• Audio tapes of the meeting are available for review at the ARRA offices upon request.
Alameda Reuse and Redevelopment Authority
Interoffice Memorandum
August 19, 2004
TO: Honorable Chair and Members of the
Alameda Reuse and Redevelopment Authority
FROM: Jim Flint, Executive Director
SUBJ: Recommendation to Approve a 20 -year Lease Agreement With Nelson's Marine for
Building 167
Background
Nelson's Marine is one of the original tenants at Alameda Point, operating a boatyard in Building
167. Building 167 is a structure located in the Tidelands Trust property; Nelson Marine is a
compatible use for the site. The lease commenced in June 1997 and expired in September 2002. In
July 2002, APCP, acting as property managers, executed a lease amendment for a month -to month
lease at $16,000 /month and began renegotiating a 20 -year lease for Building 167. Under the
existing lease, the tenant has the first right to negotiate a new lease for the premises at 90% of fair
market value upon expiration of the initial term.
Discussion
The current lease with Nelson allows the ARRA and Nelson to share the cost of an appraisal to
determine the correct "market value" for the lease. As a result, the financial terms of the Nelson
Marine lease are based on a rental survey /appraisal performed by Dunn & Associates. The appraisal
was initiated and managed by P.M. Realty Group, the ARRA's property manager.
The appraisal looked at several lease structures, including a percentage rate lease, in which the
landlord receives a percentage of the gross annual sales. The appraisal recommended a straight per
square foot rate lease in order to avoid fluctuations in the market. The appraiser also felt that the
Nelson Marine site was not a "prime" location for a boatyard as it's not easy to access from a
vehicle. However, the new lease with Nelson does allow for the ARRA to collect a percentage of
sales, when 6 percent of Nelson's gross annual sales exceed their current rent. Therefore, Nelson
would have to exceed approximately $3.4 million in annual gross sales before the ARRA would
receive its 6 percent profit share. P.M. Realty will require quarterly sales reports from Nelson.
Fiscal Impact
The proposed base rent for the property is:
Years 1 -5: $16,943 $203,316 /annually
Years 6 -10: $18,637 $223,644 /annually
Years 11 -15: $20,501 $246,012 /annually
Years 16 -20: $22,551 $270,612 /annually
Dedicated to Excellence, Committed to Service
Honorable Chair and Members of the
Alameda Reuse and Redevelopment Authority
Recommendation
August 19, 2004
Page 2
The Executive Director recommends that the Alameda Reuse and Redevelopment Authority approve
the proposed Nelson Marine lease.
PB /SP/NB:dc
Respectfully submitted,
Stephen Proud
Alameda Point Project Manager
�?.
By: Nanette Banks
Finance & Administration Manager
Attachments: Dunn & Associates Rental Survey /Appraisal
G: \Comdev\Banks\ARRA Staff Reports\2 -B Nelson 20 -Year Lease Approval - Building 167.dec
Dedicated to Excellence, Committed to Service
Dunn & Associates
REAL ESTATE APPRAISERS AND CONSULTANTS
RENTAL SURVEY
OF
NELSON'S MARINE
53,785 SQUARE FOOT WAREHOUSE
ON A 4.29 ACRE SITE
1500 Ferry Point
Alameda, California
For
Mr. Mike Hampen
Property Manager
PM Realty Group
Real Estate Services
2175 Monarch Street
Alameda, California 94501
As of
June 10, 2004
1657 N. California Blvd., #208 • Walnut Creek, CA 94596 • Phone: (925) 472 -5850 • Fax: (925) 472 -5855
June 11, 2004
Mr. Mike Hampen
Property Manager
PM Realty Group
Real Estate Services
2175 Monarch Street
Alameda, California 94501
Re: NELSON'S MARINE
53,785 SQUARE FOOT WAREHOUSE
ON A 4.29 ACRE SITE
1500 Ferry Point
Alameda, California
Dear Mr. Hampen:
04 -05 -52
At your request and authorization, I have been requested to estimate the market rental rate for
Nelson's Marine located at 1500 Ferry Point, in the City of Alameda, California. The subject
improvements consist of a 53,785 square foot warehouse built -out with 19% office space on a 4.29
site indicating a site coverage of 26 %. The office portion of the subject property is two -story and
located on the west side of the property. In addition to the main structure, the leasable area includes
a boat launch facility and a 400 linear feet of pier located across Ferry Point. The yard area is
enclosed with a cyclone fence and is accessed from the northwest corner of the property facing West
Oriskany. The subject is located on property which was previously the Alameda Naval Air Station
at the northernmost point of the City of Alameda.
The purpose of the rental survey is to estimate the market rental rate of the subject property. The
function of the rental survey is to assist in establishing the market rent for use by PM Realty Group
for internal decision purposes.
Identification: The subject improvements consist of a steel frame structure with a wood
frame exterior warehouse with an approximate 32 foot clear height. The
property is accessible by slide doors located on both the north and south sides
of the building. There are windows located around the perimeter of the
structure, which provide ample interior natural light. The structure is
improved with a flat roof with composition cover which is assumed to be in
average condition. The interior of the warehouse is improved with concrete
floors, open beam ceilings with overhead sodium vapor lighting as well as
skylights. The warehouse area is used for boat repair as well as a showroom
DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point, Alameda Page 1
for newer, smaller vessels. The interior of the office space consists of painted
sheetrock walls and ceilings with carpet flooring and overhead fluorescent
lighting. There are restrooms on each floor of the office space. The
improvements consist of 53,785 square feet consisting of 43,600 square feet
of warehouse and 10,185 square feet of office space. The improvements
cover 26% of the site and the improvements are built out with 19% of office
space. The warehouse is accessed by side sliding doors which are atypical of
the market and lack utility. The overall layout of the improvements is ideal
with the two -story office space and warehouse at the rear which makes the
property highly useable for an alternative user, for both single and multi -
tenant occupancy.
Ownership: United States of America
Alameda County
Assessor's Parcel No.:
Zoning:
Improvement Size:
Area Data:
074 -0891 -001
M2 /G, Industrial Manufacturing- Government
53,785 square feet
The subject property is located at the southwest corner of Ferry Point and
West Oriskany in the old Alameda Naval Air Station area of the City of
Alameda. The City of Alameda is located approximately fifteen miles
southeast of San Francisco, between the San Francisco Bay and San
Leandro Bay. The city encompasses 12.4 square miles and had a
population of 74,400 as of January 1, 2004, making it the eighth largest
city in the county. Over the last 22 years, the city has experienced
moderate growth. Census and State Department of Finance figures
indicate that the city's population increased by 11,148 from 1980 to 2004,
an increase of 0.64% per year on an average annual rate. Reasons for this
relatively low growth rate include the city's limited availability of land
for potential development for residential uses.
DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point, Alameda Page 2
According to the Alameda Chamber of Commerce, there are
approximately 28,000 of jobs in the City of Alameda. The local economy
is dominated by service sector jobs with manufacturing employers
leading all employment sectors. Some of the largest employers in the
City of Alameda include Ascend Communications with 620 employees,
the Alameda Hospital with 456 employees, Alameda Unified School
District with 446 employees, City of Alameda with 718 employees and
Wind River Systems with 282 employees. Other major employers in the
City of Alameda include Faralon Computing, Weyerhouser Company,
Roach Molecular Systems, Cybex, Kaiser Foundation, Lucky Stores and
Intrepid Systems.
Transportation systems near the City of Alameda include Highways 580
and 880 to the west in the City of Oakland. These highways provide
access throughout Alameda County in the north/south direction. In
addition to the freeway service, air transportation is available at the
Oakland International Airport and approximately 30 miles west at the San
Francisco International Airport.
In general, expectations for the City of Alameda are that the city will
continue to experience slow growth and be reasonably well supported by
a diversified economic base. The city's centralized location and well
educated population in close proximity to the major employment hubs of
the cities of Oakland and San Francisco has enhanced the attractiveness
of the city as a residential community.
DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point, Alameda Page 3
PROPERTY DESCRIPTION
Site Description:
Location: 1500 Ferry Point
Alameda, California
Site: 4.29 acres, or 187,000 square feet
Shape: Rectangular
Topography: Level
Utilities: All standard utilities are available to the site, delivered above and
underground by the following:
Utility Provider
Electricity Alameda Power and Telecom
Gas Alameda Power and Telecom
Water East Bay Municipal Utility District
Sewer City of Alameda
Telephone AT &T
Police City of Alameda
Fire City of Alameda
Street
Improvements: The subject property is located at the southwest corner of Ferry Point and
West Oriskany Avenue in the Alameda Naval Station, across from Piers
2 and 3, which is the docking location of the USS Hornet. Both streets
consist of two lanes of traffic, one in each direction. The streets are
asphalt paved and have no concrete curbs, gutters nor sidewalks.
DUNN & ASSOCIATES
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DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point, Alameda Page 5
Site
Improvements:
Building Description:
The uncovered portion of the site consists of asphalt and concrete paved
yard area which is enclosed by a cyclone fence.
The subject improvements consist of a steel frame structure with a wood
frame exterior warehouse with an approximate 32 foot clear height. The
property is accessible by slide doors located around the perimeter of the
structure. There are windows located on the west and east sides of the
warehouse as well as along the two story office space consisting of single
pane windows which provide ample interior natural light. The structure
is improved with a flat roof with composition cover which is assumed to
be in average condition. The interior of the warehouse is improved with
concrete floors, open beam ceilings with overhead sodium vapor lighting
as well as skylights. The warehouse area is used for boat repair as well
as a showroom for newer, smaller vessels. The interior of the office
space consists of painted sheetrock walls and ceilings with carpet flooring
and overhead fluorescent lighting. There are restrooms on each floor of
the office space. The improvements consist of 53,785 square feet
consisting of 43,600 square feet of warehouse and 10,185 square feet of
office space. The improvements cover 26% of the site and the
improvements are built out with 19% of office space. The warehouse is
accessed by side sliding doors which are atypical of the market and lack
utility. The overall layout of the improvements is ideal with the two -story
office space and warehouse at the rear which makes the property highly
useable for an alternative user, for both single and multi - tenant
occupancy.
Condition/Utility: The subject property was built in 1960 and has an actual age of 44 years
old. The structure is somewhat atypical of the market compared to other
warehouse buildings that are generally equipped with overhead grade
level doors. In addition, most competing warehouse space is either
concrete tilt up or metal exterior. Overall, the subject property is
considered to be in average condition.
DUNN & ASSOCIATES
225 T.
1
218 FT.
NELSON'S MARINE
1500 FERRY POINT
BUILDING DIAGRAM
DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point, Alameda
Page 7
VIEW OF SUBJECT PROPERTY LOOKING SOUTH ACROSS THE INTERSECTION
OF FERRY POINT AND WEST ORISKANY (PHOTO NO. 1)
VIEW OF SOUTH SIDE OF SUBJECT PROPERTY LOOKING WEST
(PHOTO NO. 2)
DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point Alameda
Page 8
VIEW OF EAST SIDE SUBJECT PROPERTY LOOKING NORTH
(PHOTO NO. 3)
INTERIOR VIEW OF WAREHOUSE SPACE
USED FOR BOAT REPAIR (PHOTO NO. 4)
DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point, Alameda
Page 9
INTERIOR VIEW OF WAREHOUSE AREA
USED FOR BOAT SALES (PHOTO NO. 5)
VIEW OF LAUNCHING RAMP
ACROSS FERRY POINT (PHOTO NO. 6)
DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point, Alameda
Page 10
VIEW OF 400 FEET OF PIER AREA ACROSS FERRY POINT
(PHOTO NO. 7)
INTERIOR VIEW OF OFFICE SPACE
(PHOTO NO. 8)
DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point, Alameda Page 11
Zoning:
According to Dave Valeskas, in charge of federal facilities, the subject
property is zoned M2 /G, Industrial Manufacturing /Government.
Permitted uses under the general industrial zoning include box and
cooperage manufacturing, breweries, cork production manufacturing, dye
casting, electrical equipment manufacturing, foundries, furniture
manufacturing, and other manufacturing uses. According to Mr.
Valeskas, there are no anticipated changes negatively impacting the
subject property.
DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point, Alameda Page 12
VALUATION
In order to estimate the market rental rate for the subject property I have obtained rental information
from both recently executed industrial leases in the subject's market, as well as boat yard lease
comparables throughout the Bay Area. I will first analyze the industrial lease comparables followed
by the boat yard lease comparables.
Industrial Lease Comparables
I have obtained eight recently executed lease comparables which range in size from 20,000 to
233,640 square feet, reflecting an unadjusted rental rate range of $0.20 to $0.26 per square foot on
a triple net expense basis. The comparables are summarized on the following page. The comparables
reflect office build -outs ranging from 1.8% to 5.7% and were leased with no tenant improvements.
The comparables reflect site coverages ratios ranging from 9% to 30 %. The comparable leases were
executed on terms ranging from 26 months to 120 months. All of the comparable leases were
executed within the last 12 months under similar market conditions. All of the comparable leases
represent arms- length transactions and warrant no adjustments. The real estate market for industrial
space over the last 12 months has been fairly consistent, and all of the comparable leases were
executed within this time frame, and warranting no adjustment for market conditions (time). Typical
tenant improvements for industrial space within the subject market consists of no contribution by
the lessor. None of the comparables were granted tenant improvements therefore warrant no
adjustment.
As previously indicated, the comparable leases reflect office build -outs ranging from 1.8% to 5.7 %.
All of the comparables have an inferior office build -out to the subject property, therefore warranting
upward adjustments. The comparables reflect site coverages ranging from 9% to 30 %. The subject
property as a site coverage of 29 %. Comparable Nos. 1, 4 and 6 reflect site coverages ranging from
30% to 30.3% which is similar to the subject property and warrant no adjustments. Comparable Nos.
2, and 5 reflect site coverages, of 20.4% and 8.7 %, respectfully, therefore warranting downward
adjustments. Comparable No. 3 has an estimated site coverage of 80% which is inferior to the
subject property, therefore warranting an upward adjustment.
DUNN & ASSOCIATES
COMPARABLE INDUSTRIAL LEASES
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DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point, Alameda Page 14
This analysis estimates the industrial rent of the subject warehouse, including the amenity of its boat
launch facility and pier rights. After adjusting the comparable leases for their various differences
in comparison to the subject property, I have concluded with an adjusted rental rate range of $0.30
to $0.35 per square foot on a triple net expense basis. In consideration of the subject property's size,
average location on the naval air station in the City of Alameda, age and average condition of the
improvements, 29% site coverage, 19% office build -out, 32 foot clear height and overall site utility,
I have concluded with a rental rate in the higher end of the adjusted range, or $0.35 per square foot.
Therefore, the estimated market rental rate based on the industrial lease comparable, as of June 10,
2004 is:
53,785 square feet x $0.35 = $18,825 per month
DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point, Alameda Page 15
Boatyard Lease Comps
As previously stated, I have also analyzed boatyard lease comparables from the Bay Area in order
to estimate the market rental rate for Nelson's Marine as reflected on the following page. The
comparable leases of the boat yards are atypical of the market given that they are generally current
rental rates and the details of the leases were difficult to obtain and were confirmed when possible
by both the lessee and the lessor.
Comparable Lease No. 1, the Berkeley Marine Center is a 50 year lease that started in 1978 and
expires in 2028. The tenant is currently paying $1,700 per month versus 5% of gross sales. This
lease is adjusted every five years and in addition has a percentage sale of 2.5% on alcohol sales. This
is a triple net lease. The property consists of 4.5 acres and is a ground lease which has been
improved with approximately 8,000 square feet of improvements. This lease was confirmed by Cliff
Marchetti with the City of Berkeley. This comparable has fair access and is in average condition.
Comparable Lease No. 2 is Svendsen Marine located in Alameda, California. This represents a
twelve year lease which commenced in 2001 and expires in 2013. The tenant is currently paying
$31,065 per month for a 1.78 acre yard and 26,000 square feet of improvements plus an additional
$1,531 per month for nine slips, indicating a total rent of $32,596 per month. This is a gross lease
with lessor paying taxes, insurance and maintenance. This lease was confirmed by Sean Svendsen,
operator. This comparable has average access and is in good condition.
Comparable Lease No. 3 is the Mariner BoatYard located at 2021 Alaska Packer Place in Alameda,
California. I was informed by Rochella, the operator's assistant, that the improvements consist of
one shop and three offices estimated area of 20,000 square feet. The property is leased for 6% of
gross sales plus $14,000 per month. She was unable to provide any other details on this lease. We
have pulled county records to indicate that this site is 1.6 acres. This comparable has fair access and
is in average condition.
Comparable Lease No. 4 is the San Francisco Boat Works leased by Mike Denmen from the Port
of San Francisco. According to Rich Ravetti, representative with the Port of San Francisco, this is
a 20 year lease that began in 1987. It is a triple net lease with the tenant paying $10,000 per month
versus 8% of alcohol, and bar sales, 6% of food sales, 20% of boat storage, 10% of any sub - leasing
and 10% of all other uses. There are adjustments every five years on this lease. The operator, Mr.
Mike Denmen, indicates that he is in overage rent 9 out of 12 months per year. This comparable has
good access and is in average condition.
DUNN & ASSOCIATES
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3 W 3AN CAfiL(SS -.,, EDIA(ARD ;00‘
IE
1 L Comparable Leases
BOATYARD LEASE COMPA.
Alameda and Berkeley, California
DETAIL
4.5 Acres, ground lease
approx. 8.000 sf building
Direct water access
Confirmed: CliffMarchettc. City of Berkeley
l.7 Acre yard
26,000 sf Buildings
Direct water access
9 Slips ($1.531 /month)
Confirmed: Sean Ss•endsen. Operator
cst. 1.6 Acres
est. 20,000 sf bulling
Direct water access
Confirmed: Rochella. assistant
est. 4.0 acres
est. 7.000 sfbuilding
Direct water access
Boat yard and Restaurant
Confirmed: Mike Derunen. operator and Rich Ranetti. Port of
S.F
Facility Handles 9 Dry Dock Boats
Direct water access
2 -3 Boats in water
est. 4.000 sf building
Confirmed: Phil ifestcon. Operator
2 -3 acres
est. 6,000 sf improvements
Direct water access
Confirmed: Ron Anderson. operator
EXPENSES
R
Taxes - Lessor
Insurance - Lessor
Maintenance - Lessor
RENT
$1,700 /mo. vs. 5% of gross sales
Adjusted every 5 years
2.5% based on sales
$31,065 /month
Slips $1,53lhnonth
Total $32,596 /month
Escalations: Annual CPI
6% of gross sales
plus $14,000 /month for land
$10.000/Month verses 8% alcohol and bar
sales, 6% food sales, 20% boat storage, 10%
sub - leases, 10% all others
Monthly rent
Annual escalations
Monthly rent
Annual escalations
Monthly Rent
TERM
(MONTHS)
50 Year Lease
1978 -2028
2001 -2013
14,000 sfstructure and land
2000 -2005
2 small buildings
Not Available
20 Year lease
Short Term 3 Years
Month/Month
Short Tenn
TENANT
Berkeley Marine Center
Spinnaker Way
Alameda, California
Mariner Boat Yard
2021 Alaska Packer Place
San Francisco, California
San Rafael, California
Sausalito, California
Sausalito, California
,i
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4
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s4,-:
x:
Rental Survey: 1500 Ferry Point, Alameda Page 17
In addition to the four boatyard lease comparables, I was able to obtain general information on three
other boat yards within the Bay Area.
According to Phil Westcott, the operator of Westmore Marine located at 145 Third Street in San
Rafael, he is currently paying a monthly rental rate with annual escalations. He has room for nine
boats for dry dock and two to three boats in the water. He has direct water access and a small shop
area. This boatyard has good access and is in average condition.
Bayside Boat Works located at 2360 MarinShip Way, Sausalito, California is on a month -to -month
lease with annual escalations. This facility has room for eight to ten boats for dry dock and two to
three boats in the water and has minimal shop space. This lease was confirmed by Mike Winder,
operator. This boat yard has average access and is in fair condition.
According to Ron Anderson, operator for Anderson's Boatyard, he is currently leasing his facility
on a short term lease. Mr. Anderson is paying a monthly triple net rent. This boat yard has average
access and is in good condition.
In general, three of the comparable boatyard comparable leases were leases on a percentage rent and
four were leased on a base monthly rent basis.
Given that the subject property consists of a 53,785 square foot warehouse built -out with 19% office
space with a 26% site coverage, its average location, average condition, indirect access to the water,
and use of 400 linear feet of pier area. I have concluded with a base rent of $0.35 per square foot,
or $18,825 per month versus a percentage rent of 6% of all annual gross sales based on a typical
lease term of ten years. Assuming a 10% escalation in the 61st month of the lease. This is a triple
net lease with the lessee paying all expenses.
DUNN & ASSOCIATES
Rental Survey: 1500 Ferry Point, Alameda Page 18.
If major improvements were required, which would be necessary for the lessee to amortize the
improvements over the term of the lease, a longer lease would be considered. I do not see that there
were any major improvements necessary for the current operation.
Respectfully submitted,
DUNN & ASSOCIATES
Michael E. Dunn, M I, CCIM
Certified General Real Estate Appraiser
State of California #AG002882
DUNN & ASSOCIATES
ADDENDUM
Exhibit A. Photographs of Comparable Industrial Leases
Exhibit B. Photographs of Comparable Boatyard Leases
Exhibit C. Engagement Letter
Exhibit D. Zoning Ordinance
Exhibit E. Qualifications
EXHIBIT A
PHOTOGRAPHS OF COMPARABLE INDUSTRIAL LEASES
PHOTO OF COMPARABLE LEASE NO. 1
PHOTO OF COMPARABLE LEASE NO. 2
PHOTO OF COMPARABLE LEASE NO. 3
PHOTO OF COMPARABLE LEASE NO. 4
PHOTO OF COMPARABLE LEASE NO. 5
PHOTO OF COMPARABLE LEASE NO. 6
EXHIBIT B
PHOTOGRAPHS OF COMPARABLE BOATYARD LEASES
PHOTO OF COMPARABLE LEASE NO. 1
PHOTO OF COMPARABLE LEASE NO. 2
PHOTO OF COMPARABLE LEASE NO. 3
PHOTO OF COMPARABLE LEASE NO. 4
I 1 1
• §?4,....... ,: •.•-tA,Z1
,.. "i". '. • • •-•'-'... • 4.---..{. .....
'.:'-.'•-.7. —.:.,145.:. • -•:?.,..-, ,---It-,-;,'.. ''.. 1 , . „ .
....""..- . -;.:?....e........1: r.."......., .:, .. .. •--.... . , w .74:54.v:.:.--.:.z.:t.r..: .. . ....• owirmvorrcras.4vfor,-.' ;;;.-f4kr-,,,,,-;.:
1
•.,
PHOTO OF COMPARABLE LEASE NO. 5
4rrezremnii-,7.
PHOTO OF COMPARABLE LEASE NO. 6
- r
-%sly '1►� .. ,c_r . �.�_ fiic.
PHOTO OF COMPARABLE LEASE NO. 7
EXHIBIT C
IM Realty Group
REAL ESTATE SERVICES
May 13, 2004
Mike Dunn
Dunn & Associates
1657 N. California Blvd., Ste 208
Walnut Creek, CA 94596
Dear Mr. Dunn:
This letter will confirm the telephone conversation between David Jaber, Regional Vice President PM Realty
Group, and yourself held Tuesday, May 11, 2004, to engage your company to conduct an MAI appraisal of
lease rates at Nelson's Marine located at 1500 Ferry Point, Alameda, CA 94501.
The scope of work to be provided is a current market rate lease appraisal of the above building, the surrounding
yard area and associated private marina space. Once begun, the appraisal shall be conducted and a report
prepared in a three (3) week time frame. The agreed upon cost for this work is Four Thousand and No /100ths
Dollars ($4,000). Please signify your agreement to the terms described herein by affixing your signature below
and returning to my office at 2175 Monarch St., Alameda, CA 94501, Attention: Mike Hampen.
If you have any questions, please contact me by telephone at (510) 749 -0304 or by electronic mail at
mhampen(a7pmrealtygroup.com.
Sincerely,
Realty Group as agent for
eda Reuse and Redevelopment Authority
MIMI IWO
ike Hampen
roperty Manager
I hereby agree to the terms describ
like Dunn
2175 MONARCH STREET ALAMEDA, CA 94501 510/749 -0304 FAX: 510/749-1095
HOUSTON LOS ANGELES CHICAGO SAN FRANCISCO ATLANTA DALLAS DENVER DETROIT ORLANDO PHOENIX NEW YORK
HONOLULU NEWPORT BEACH WASHINGTON DC CINCINNATI SEATTLE LAS VEGAS
pmrealtygroup.com
EXHIBIT D
MAY 26 2004 12:25PM CITY OF ALAMEDA PLANNING 5107476804 p.1
http: / /www.ci.alameda .ca.us /govimunicipal_code.html Chapter 30, Section 30 -4
Subsection 30 -4 -17 G, Special Government Combining District.
a. General, The G District classification shall be combined with the district classifications applied
to all lands in the ownership of the U.S. Government or the State of California.
b. Prior to the use of any lands by any private or public entity other than the United States or State
of California, through purchase or pursuant to lease from the U.S. Government or State of California,
rezoning procedures shall be completed to remove the G classifications and to consider further
appropriate district classification changes.
c. Notwithstanding the provisions in subsection (b) herein, interim uses by private or public entities
other than the United States or State of California of lands owned by the U.S. Government or State of
California may be allowed, subject to a Use Permit, pursuant to subsection 30 -213, if the following
additional findings can be made:
1. The interim use is approved for a limited time, not to exceed the maximum time frame set forth
in the interim leasing program criteria;
2. The interim use utilizes existing facilities and does not require substantial new development;
3. The interim use will not disrupt on- going operations of the governmental entity should the
interim use occur concurrent with continuing operations by a governmental entity;
4. The interim use will not be detrimental to the ultimate redevelopment of the property or the
potential resumption of use of the property by the governmental agency; and
5. The interim use is consistent with an interim leasing program adopted by the City.
d. An interim leasing program shall be adopted by the City prior to interim use, as provided in
subsection (c) herein. The interim leasing program shall be for a specific parcel or parcels, shall specify
permitted land uses, consistent with the underlying zoning district, and shall specify the maximum time
frame for which a Use Permit may be granted. In the absence of an adopted interim leasing program, all
interim leases shall require rezoning. (Ord. No. 2658 N.S. §1: Ord. No. 535 N.S. §11 -1374; Ord. No.
1277 N.S.)
Post -it° Fax Note 7671
t i
Co. /Dept.
Phone #
Fax #C3 $ 47Z, S— 5.re
Page 1 of 1
Dates/2404f Agtes ► 3
FromGtik1 0 PAL-iviePP'
Co.
Phone #7' - 7`hSrO
Fax #
MAY 26 2004 12:25PM CITY OF ALAMEDA PLANNING 5107476804 p.2
http:// www. ci. alameda .ca.uslgov /municipal_code.html Chapter 30, Section 30 -4
Subsection 30 -442 M -2, General Industrial (Manu - facturing) District.
a. General. The following specific regulations and the general rules set forth in Section 30 -5 shall
apply in all M -2 Districts as delineated and described in the zoning map(s). It is intended that this district
classification be applied in areas suitable for the least restricted use of land within the City and that the
restrictions applied shall be those necessary for the public health, safety and general welfare.
b. Uses Permitted.
1. Any use as permitted and regulated in the M -1 District.
2. The following and similar uses from which noise, smoke, dust, noxious fumes and gasses, glare,
heat and vibration are confined within the premises or held to volumes, intensities and levels at the
perimeters of individual properties which are no greater than those in the general area, and in which
disposal of all waste matter and material is in conformity with local and State standards and regulations,
and in which all operations are conducted principally within buildings, except that other operations will
be permitted within enclosures under conditions consistent with the intent of this article if approved by
the Planning Board.
(a) Box or cooperage manufacturing,
(b) Breweries,
(c) Cork products manufacturing,
(d) Die casting,
(e) Electrical Equipment manufacturing, including heavy motors (one (1) horsepower and over),
switch gear, transformers, turbines and similar items,
(f) Enameling works, including ferrous enamel, panels, cast iron or pressed steel, sanitary ware and
similar items,
(g) Foundries - ferrous and nonferrous,
(h) Furniture (wood or metal) manufacturing,
(I) Match manufacturing (safety machines only),
(j) Metal products manufacturing or processing, structural, fabricated,
(k) Metal shipping drum, barrel manufacturing,
(1) Paperboard container product manufacturing and processing,
(m) Pickle or vinegar manufacturing,
(n) Pipe and pipe fitting manufacturing,
(o) Planing mill,
(p) Plumbing fixture manufacturing,
(q) Poultry or rabbit killing and dressing,
(r) Prefabricated houses or wood structural member manufacturing,
(s) Textile manufacturing, including canvas, cloth and similar items,
(t) Tool manufacturing - machine, hand,
(u) Transportation equipment manufacturing,
(v) Wood preservation processing,
(w) Trash Transfer Station. Hours of operation limited from 8:00 a.m. to 5:00 p.m. Trash burning or
storage of hazardous materials is prohibited.
3. Uses customarily incidental to any of the above uses when located on the same premises,
including an attached or detached residence for an on- premises watchperson or manager and his or her
family, subject to provision of two hundred forty (240) square feet of private useable open space
immediately adjacent to and accessible from the residence. Open storage of materials and equipment
shall be permitted only within an area enclosed on all sides with a solid or open grill type wall, or a chain
link `fence and gates, all not less than six (6') feet in height and in a manner consistent with the intent of
the section except that no wall or fence shall be required on the side that a property abuts a railroad right -
of -way, the Estuary or U.S. Tidal Canal. A solid wall or fence not less than six (6') feet high shall be
required where the proposed use adjoins property in an R District.
4. Signs: Those pertaining to the permitted and accessory uses on the property, poster panels and
painted bulletins, all as regulated further in Section 30 -6 of these regulations.
Page 1 of 2
MAY 26 2004 12:25PM CITY OF ALAMEDA PLANNING 5107476804
c_ Uses Requiring Use Permits. It is the intent of this paragraph that the following uses shall be
reviewed by the Planning Board for their appropriateness in a specific location, or for such other factors
as safety, congestion, noise, and similar considerations.
L Auto wrecking yards,
2. Outdoor amusements,
3. Veterinary clinics and/or veterinary hospitals upon the same terms and conditions set out in
subsection 30- 4.10c,
4. Any existing dwelling use as regulated by subsection 30 -4.11 c,
5. Airport and related facilities, aircraft landing areas,
6. Asphalt batching plants, including hot mix,
7. Concrete products manufacturing, batching plants,
8. Lumberyard (wholesale), kiln,
9. Railroad yards,
10. Shipbuilding and repairing (over one hundred (100) tons),
11. Shipping terminals,
12. Permitted uses which are not conducted within an enclosed building or structure,
13. Commercial marinas subject to the requirements of subsection 30- 4.9c.15,
14. Columbariums and crematoriums,
15. Liquor stores,
16. Convenience stores located within three hundred (300) feet of any residential zoning district,
17. Hazardous materials processing, as defined by subsection 30 -2(b) of the Alameda Municipal
Code, and subject to the terms and conditions of Subsection 30- 21.3(e) thereof,
18. Work/live studios subject to the requirements of Section 30 -15.
d. Minimum Height, Bulk and Space Requirements.
1. Lot Area: None.
2. Lot Width: None.
3. Maximum Total Building Coverage, including accessory buildings: Eighty (80 %) percent.
4. Building Height Limit: One hundred (100') feet.
5. Front Yard Five (5') feet minimum.
6. Side Yards: None, or where a side yard is desired, a minimum of twelve (12') feet shall be
provided; provided further, that in the event the use is adjacent to an R District, a minimum of twelve
(12') feet shall be maintained.
7. Rear Yard: None required, except that in the event the use is adjacent to an R District, a
minimum of twelve (12') feet shall be maintained.
8. Off -Street Parking and Loading Space: As regulated in Section 30 -7 of these regulations. (Ord.
No. 535 N.S. § §11- 1349 - -11 -1352; Ord. No. 1277 N.S.; Ord. No. 1356 N.S.; Ord. No. 1400 N.S.; Ord.
No. 1802; Ord. No. 2174 N.S.; Ord. No. 2289 N.S.; Ord. No. 2407, N.S., §9; Ord. No. 2422 N.S. §2; Ord.
No. 2671 N.S. §5; Ord. No. 2700 N.S. §4; Ord. No. 2727 N.S. §2; Ord. No. 2784 N.S. §4)
Page 2 of 2
p.3
EXHIBIT E
Dunn & Associates
REAL ESTATE APPRAISERS AND CONSULTANTS
PROFESSIONAL QUALIFICATIONS
MICHAEL E. DUNN, MAI, CCIM
PROFESSIONAL EXPERIENCE
Dunn & Associates, Walnut Creek, California, established July 1991. Provide appraisal and
consulting services for a variety of improved and vacant real estate products.
Appraisal
Experience appraising various residential and income producing proerties, both existing and
proposed, including commercial, industrial, office buildings, apartments, shopping centers, hotels
and motels, subdivisions, mixed use properties, RV parks, schools, restaurants, multi -plex
theaters, assisted living facilities, live /work complexes, and vacant land. In addition, have
appraised various agricultural properties including vineyards and wineries, as well as orchards,
row and field crop lands, and grazing land. Appraisals have been prepared for investment,
disposition, mortgage lending, loan workout, trust, condemnation and litigation support purposes.
Consultation
Acquisitions, dispositions, arbitrations, mediation, competitive market analysis, highest and best
use studies, project feasibility, market rent surveys, and lease negotiations.
Mr. Dunn holds the MAI designation from the Appraisal Institute, a CCIM designation from the
Commercial Real Estate Institute. He has been re- certified under the voluntary program of
continued education of the designated members of the Appraisal Institute. Mr. Dunn is certified
by the State of California Office of Real Estate Appraisers as a Certified General Real Estate
Appraiser ( #AG002882) and has ben appraising commercial real estate since 1986.
•
EDUCATION
BS, Agriculture Business Management Major, June 1985
California Polytechnic State University, San Luis Obispo, California
1657 N. California Blvd., #208 • Walnut Creek, CA 94596 • Phone: (925) 472 -5850 • Fax: (925) 472 -5855
Appraisal Institute Courses
Standards of Professional Practice
Real Estate Appraisal Principals
Basic Valuation Procedures
Capitalization Theory and Techniques, Part A
Capitalization Theory and Techniques, Part B
Case Studies in Real Estate Evaluation
Report Writing and Valuation Analysis
Commercial Investment Real Estate Institute
CI 101 Financial Analysis for Commercial Real Estate
CI 201 Market Analysis for Commercial Real Estate
CI 301 Investment Analysis for Commercial Investment Real Estate
PROFESSIONAL ASSOCIATIONS AND MEMBERSHIPS
Member (MAI), Appraisal Institute ( #9671)
Certified General Real Estate Appraiser, State of California ( #AG002882)
Member (CCIM), Commercial Investment Real Estate Institute ( #8538)
Member, International Right of Way Association
Affiliate Member of the National Association of Realtors (NAR)
California Real Estate License ( #01029164)
Currently serving as the Assistant Regional Member for Region 1 of the Ethics Administration
Division of the Appraisal Institute.
DUNN & ASSOCIATES
Alameda Reuse and Redevelopment Authority
Interoffice Memorandum
August 19, 2004
TO: Honorable Chair and Members of the
Alameda Reuse and Redevelopment Authority
FROM: Jim Flint, Executive Director
SUBJ:
Background
P''"moved > Se>✓
It'1`b�C AFA
A e tq (4-)
Recommendation to Approve a 5 -year Lease, With a Possible 3(5 -year) Options With
Nelson Marine for 400 Linear Feet of Pier 1
Nelson's Marine is one of the original tenants at Alameda Point, operating a boatyard in Building 167 with
an adjacent 400 linear feet of pier space on Pier 1. The pier has served as a marina for small boats. Nelson
Marine has operated a boat yard and marina at Alameda Point since June 1997.
Discussion
Nelson Marine pier is an existing use at Alameda Point. The premises are used for storage, repair and sales
of boats.
Fiscal Impact
The proposed base rent for the pier is $5 per linear foot, which is $2,000 monthly or $24,000 annually. The
ARRA will have a 50 percent profit share opportunity should the tenant assign or sublet pier space with
prior landlord approval.
Recommendation
The Executive Director recommends that the Alameda Reuse and Redevelopment Authority approve the
proposed pier lease with Nelson Marine.
PB /SP/NB:dc
Respectfully submitted,
Stephen Proud
Alameda Point Project Manager
Nanette Banks
Finance & Administration Manager
Dedicated w Excellence, Committed to Service
G: \Comdev \Base Reuse& Redevp \ARRA \STAFFREP\2004 \9 September \2 -C Nelson Marine 5 -Year Lease.doc
Alameda Reuse and Redevelopment Authority
Interoffice Memorandum
August 24, 2005
TO: Honorable Chair and Members of the
Alameda Reuse and Redevelopment Authority
FROM: Jim Flint, Executive Director
SUBJ: Recommendation to Authorize the Executive Director to Direct P.M. Realty, Acting as
Property Manager, to Enter Into a Contract with Urban Waterproofing Inc. to Waterproof
City Hall West (Building One) in an Amount not to Exceed $547,541.
Background
Last year City Hall West had several capital projects: installation of an elevator and a complete re- roofing.
The roofing project was the first phase of preventing water intrusion into the building. The second phase
involves water sealing the outside and re- caulking the windows.
City Hall West (Building One) is a 37,084 square foot building constructed by the Navy in 1939. The
exterior concrete walls have an area of approximately 36,000; there are approximately 350 windows. City
staff began occupying the building in August 1997.
Since the negotiation of the ARRA Property Management Agreement, building maintenance for the
exterior of "City- controlled" buildings has been transferred to the contract property management company.
Therefore, the sealing project for City Hall West has been managed by P.M. Realty Company (PM).
Discussion
In December, PM engaged Wiss Janney, Elster Associates, Inc (WJE) to provide a scope of work for the
sealing project. Levine, Fricke (LFR) provided the scope of work for asbestos abatement and paint
preparation on lead- contaminating paint. After a thorough examination of the structure, the detailed scope
of work included:
■ Abatement: Removal of existing coating putty and sealant from concrete walls and
windows;
• Installation of scaffolding to access building to perform repairs;
• Concrete patching — both repair and spall repair;
• New sealant installation;
• New elastometric coating installation;
• Waterproofing at canopies
• Wood window surface preparation, recoating and reputtying; and
• Replacement of 10 existing downspouts.
Bids were solicited from the following contractors: Western Waterproofing (San Rafael), Giampolini
Courtney (San Francisco), Rainbow Waterproofing & Restoration (San Francisco), Urban Waterproofing
(San Rafael), Alpha Restoration & Waterproofing (South San Francisco). Bids for Environmental
Contractors were solicited from: Bluewater Services, Inc. (San Leandro), Complete Decon, Inc. (Benecia),
F. Scott Industries (Richmond), and LVI Environmental Services, Inc. (San Leandro). The bid walk-
Dedicated to Erceiience, Committed to Service
Honorable Chair and Members of the
Alameda Reuse and Redevelopment Authority
August 24, 2004
Page 2
through took place with all of the waterproofing and environmental contractors on August 4, 2004. Bids
were received from five contractors on August 16, 2004 from: Western Waterproofing - $573,900;
Giampolini Courtney - $475,760; Rainbow Waterproofing & Restoration - $474,378; Urban Waterproofing
$436,979; and Alpha Restoration & Waterproofing - $448,883. In order to keep costs down and to better
coordinate schedules, the environmental contractor will be a sub - contractor to the waterproof contractor.
After reviewing and clarifying bid information, PM is recommending that we contract with Urban
Waterproofing, Inc. because they were the lowest bidder and could complete the project in a timely fashion
(Attachment 1). The total estimated cost includes a 3 percent construction management fee for PM, and 7
percent project contingency.
Fiscal Impact
ARRA lease revenue will be used to fund this project. PM Realty already has identified $233,000 of new
income (not included in the 2004 -05 revenue projection — new leases - licenses /sale of personal property)
projected for this fiscal year. Additionally, the year -end ARRA fund cash balance is larger than projected
due to conservative spending in the last quarter. Therefore, the remaining funds ($314,540) can come from
the fund balance. No General Funds will be used for this project.
Recommendation
The Executive Director recommends that the Alameda Reuse and Redevelopment Authority authorize the
Executive Director to direct P.M. Realty, acting as property manager, to enter into a contract with Urban
Waterproofing Inc. to waterproof City Hall West (Building One) in an amount not to exceed $547,541,
recommended in a form substantially in the form attached (Attachment 2).
PB /SP/NB:dc
Respectfully submitted,
Stephen Proud
Alameda Point Project Manager
By:
Nanette Banks
Finance & Administration Manager
G: \Comdev \Base Reuse& Redevp\ARRA \STAFFREP\2004 \9 September\2 -D Bldg 1 weatherproofing.doc
Dedicated to Excellence, Committed to Service
Project:
■M Realty Group
R. E A L. E S - A v I T S E R v1c°::ES
Project Cost Summary
Alameda Point
Building 1
Exterior Facade Repair / Repaint
ATTACHMENT 1
Date: August 23, 2004
Prepared by: Rick Jones, PMRG
VP - Construction
Based on: bliss Janney Elstner (WJE) Distribution: Nanette Banks (w/ attach for approval)
and Levine Fricke (LF) Specifications David Jaber (w/ attach)
Shayna Eskew (w/ attach)
Manny Moreno (w /attach)
Environmental Consultant - Levine Fricke
Analysis, evaluation, specification and air monitoring
Waterproofing Consultant - bliss Janney Elstner
Inspection evaluation, specifications, and construction observation
Abatement, Waterproofing, Repainting - Urban Waterproofing Inc.
Based on low net bid, reference attached bid analysis
Landscape Trimming for Access - Allowance
Electrical Removal / Replacement - Allowance
Subtotal
PMRG Const. Mgmt. Fee ($0- $100,000 @5 %, $100 ,001 - $500,000 @4 %, > $500,000 @3%)
Contingency @ 7%
Total Estimated Cost
$ 25,100.00
$ 25,300.00
$436,979.00
$ 1,000.00
$ 4,000.00
$492,379.00
$ 20,695.16
$ 34,466.53
$547,540.69
CONTRACTOR AGREEMENT
No. XXXXXXXX
THIS AGREEMENT, entered into this XXth day of August, 2004, by and between PM
REALTY GROUP, L.P. ( "Manager "), as agent for the Alameda Reuse and Redevelopment
Authority, a Joint Powers Authority Established by the City of Alameda and the County of Alameda
Under the California Joint Exercise of Powers Act (hereinafter referred to as "ARRA "), whose
address is 2175 Monarch St, Alameda, CA 94501, and , a
whose address is (hereinafter called "Contractor "), in reference to
the following:
RECITALS:
A. ARRA has an interest in certain real property and improvements known as
Alameda Point located in Alameda, California, on behalf of the ARRA (the "Project ").
B. PM Realty Group, L. P., a Delaware limited partnership, has been appointed as
the manager of the Project and is authorized to enter into this Agreement as "Agent" for the
APCP.
C. Manager and Contractor desire to enter into an agreement for
sealing /waterproofing repairs and environmental remediation in accordance with Specifications,
Special Provisions and Plans as attached in "Exhibit A."
NOW, THEREFORE, it is mutually agreed by and between the undersigned parties as
follows:
1. TERM:
The Contractor shall begin work within five (5) working days after receiving notice from the
Manager to commence the work, and shall diligently prosecute the work to completion before the
expiration of thirty (30) consecutive working days from the date of receipt of notice to begin work.
2. SERVICES TO BE PERFORMED:
Contractor agrees, at its own cost and expense, to furnish all labor, tools, equipment,
materials, except as otherwise specified, and to do all work strictly in accordance with
Specifications, Special Provisions and Plans, which Specifications, Special Provisions and Plans are
hereby referred to and expressly made a part hereof with the same force and effect as if the same
were fully incorporated herein.
3. COMPENSATION TO CONTRACTOR:
Contractor shall be compensated for services performed pursuant to this Agreement in the
amount and manner set forth in Contractor's bid, which is attached hereto as "Exhibit B" and
incorporated herein by this reference. Payment will be made in the same manner that claims of a like
character are paid by the Manager, with checks drawn on the treasury of the ARRA, to be taken from
the operating fund.
Payment will be made within thirty (30) days by the Manager in the following manner: On
the first day of each month, Contractor shall submit a written estimate of the total amount of work
done the previous month. Payment shall be made for 90% of the value of the work. The Manager
shall retain 10% of the value of the work as partial security for the completion of the work by
Contractor. Retained amounts shall be paid to Contractor within 15 days of acceptance by the Owner
of the project. Payment shall not be construed as acceptance of defective work. No interest will be
paid to Contractor on retained funds.
4. TIME IS OF THE ESSENCE:
Contractor and Manager agree that time is of the essence regarding the performance of this
Agreement.
It is agreed by the parties to the Agreement that in case all the work called for under the
Agreement is not completed before or upon the expiration of the time limit as set forth in paragraph
1 above, damage will be sustained by the Manager, and that it is and will be impracticable to
determine the actual damage which the Manager will sustain in the event of and by reason of such
delay. It is therefore agreed that the Contractor will pay to the Manager the sum of $500.00 (five
hundred dollars) per day for each and every day's delay beyond the time prescribed to complete the
work; and the Contractor agrees to pay such liquidated damages as herein provided, and in case the
same are not paid, agrees that the Manager may deduct the amount thereof from any money due or
that may become due the Contractor under the Agreement.
It is further agreed that in case the work called for under the Agreement is not finished and
completed in all parts and requirements within the time specified, the Manager shall have the right to
extend the time for completion or not, as may seem best to serve the interest of the Manager; and if it
decides to extend the time limit for the completion of the Agreement, it shall further have the right to
charge the Contractor, his or her heirs, assigns, or sureties, and to deduct from the final payment for
the work, all or any part, as it may deem proper, of the actual costs and overhead expenses which are
directly chargeable to the Agreement, and which accrue during the period of such extensions.
The Contractor shall not be assessed with liquidated damages during any delay in the
completion of the work caused by an act of God or of the public enemy, acts of the Manager, fire,
flood, epidemic, quarantine restriction, strikes, freight embargoes, and unusually severe weather or
delays of subcontractors due to such causes; provided that the Contractor shall, within one (1) day
from the beginning of such delay, notify the Manager in writing of the causes of delay. The Manager
shall ascertain the facts and the extent of the delay, and its findings of the facts thereon shall be final
and conclusive.
5. STANDARD OF CARE:
Contractor agrees to perform all services hereunder in a manner commensurate with the
prevailing standards of like professionals in the San Francisco Bay Area and agrees that all services
shall be performed by qualified and experienced personnel who are not employed by the Manager, or
ARRA, nor have any contractual relationship with Manager or ARRA.
6. INDEPENDENT PARTIES:
Manager and Contractor intend that the relationship between them created by this Agreement
is that of employer- independent contractor. The manner and means of conducting the work are
under the control of Contractor, except to the extent they are limited by statute, rule or regulation and
the express terms of this Agreement. No civil service status or other right of employment will be
acquired by virtue of Contractor's services. None of the benefits provided by Manager to its
employees, including but not limited to unemployment insurance, workers' compensation plans,
vacation and sick leave are available from Manager to Contractor, its employees or agents.
Deductions shall not be made for any state or federal taxes, FICA payments, PERS payments, or
other purposes normally associated with an employer- employee relationship from any fees due
Contractor. Payments of the above items, if required, are the responsibility of Contractor.
7. IMMIGRATION REFORM AND CONTROL ACT (IRCA):
Contractor assumes any and all responsibility for verifying the identity and employment
authorization of all of its employees performing work hereunder, pursuant to all applicable IRCA or
other federal, or state rules and regulations. Contractor shall indemnify and hold Manager, and
ARRA harmless from and against any loss, damage, liability, costs or expenses arising from any
noncompliance of this provision by Contractor.
8. NON - DISCRIMINATION:
Consistent with the Manager's policy that harassment and discrimination are unacceptable
employer /employee conduct, Contractor agrees that harassment or discrimination directed toward a
job applicant, a Manager or City of Alameda employee, or a citizen by Contractor or Contractor's
employee on the basis of race, religious creed, color, national origin, ancestry, handicap, disability,
marital status, pregnancy, sex, age, or sexual orientation will not be tolerated. Contractor agrees that
any and all violations of this provision shall constitute a material breach of this Agreement.
9. HOLD HARMLESS:
Contractor shall indemnify, defend, and hold harmless Manager, Alameda Point Community
Partners, ARRA, the City of Alameda, its City Council, boards, commissions, officials, employees,
and volunteers ( "Indemnitees ") from and against any and all loss, damages, liability, claims, suits,
costs and expenses whatsoever, including reasonable attorneys' fees ( "Claims "), arising from or in
any manner connected to Contractor's negligent act or omission, whether alleged or actual, regarding
perfoilliance of services or work conducted or performed pursuant to this Agreement. If Claims are
filed against Indemnitees which allege negligence on behalf of the Contractor, Contractor shall have
no right of reimbursement against Indemnitees for the costs of defense even if negligence is not
found on the part of Contractor. However, Contractor shall not be obligated to indemnify
Indemnitees from Claims arising from the sole or active negligence or willful misconduct of
Indemnitees.
10. INSURANCE:
On or before the commencement of the terms of this Agreement, Contractor shall furnish
Manager with certificates showing the type, amount, class of operations covered, effective dates
and dates of expiration of insurance coverage in compliance with paragraphs 10A, B, C and D.
Such certificates, which do not limit Contractor's indemnification, shall also contain substantially
the following statement: "Should any of the above insurance covered by this certificate be
canceled or coverage reduced before the expiration date thereof, the insurer affording coverage
shall provide thirty (30) days' advance written notice to ARRA by certified mail, "Attention: Risk
Manager." It is agreed that Contractor shall maintain in force at all times during the performance
of this Agreement all appropriate coverage of insurance required by this Agreement with an
insurance company that is acceptable to Manager and licensed to do insurance business in the
State of California. Endorsements naming the United States Department of the Navy, Alameda
Reuse and Redevelopment Authority, City of Alameda, Alameda City Council, their respective
Boards, Commissions, Officers, Employees and Agents, Alameda Point Community Partners,
LLC, PM Realty Group, their Officers and Employees as additional insured shall be submitted
with the insurance certificates.
A. COVERAGE:
Contractor shall maintain the following insurance coverage:
(1) Workers' Compensation:
Statutory coverage as required by the State of California.
(2) Liability:
Commercial general liability coverage in the following minimum limits:
Personal Injury or Death: $3,000,000 each occurrence
Property Damage: $1,000,000 each occurrence
If submitted, combined single limit policy with aggregate limits in the
amounts of $3,000,000 will be considered equivalent to the required
minimum limits shown above.
(3) Automotive:
Comprehensive automobile liability coverage in the
following minimum limit:
Combined Single Limit: $1,000,000 each occurrence
B. SUBROGATION WAIVER:
Contractor agrees that in the event of loss due to any of the perils for which it has agreed to
provide comprehensive general and automotive liability insurance, Contractor shall look solely to its
insurance for recovery. Contractor hereby grants to the ARRA, APCP, Manager, or the City of
Alameda on behalf of any insurer providing comprehensive general liability, and automotive liability
insurance to either Contractor or ARRA, APCP, Manager, or the City of Alameda with respect to the
services of Contractor herein, a waiver of any right to subrogation which any such insurer of said
Contractor may acquire against ARRA, APCP Manager, or the City of Alameda by virtue of the
payment of any loss under such insurance.
C. FAILURE TO SECURE:
If Contractor at any time during the term hereof should fail to secure or maintain the
foregoing insurance, Manager shall be permitted to obtain such insurance in the Contractor's name or
as an agent of the Contractor and shall be compensated by the Contractor for the costs of the
insurance premiums at the maximum rate permitted by law and computed from the date written
notice is received that the premiums have not been paid.
D. ADDITIONAL INSURED:
The United States Department of the Navy, Alameda Reuse and Redevelopment Authority,
City of Alameda, Alameda City Council, their respective Boards, Commissions, Officers,
Employees and Agents, Alameda Point Community Partners, LLC, PM Realty Group, their
Officers and Employees shall be named as an additional insured under all insurance coverages,
except worker's compensation insurance. The naming of an additional insured shall not affect
any recovery to which such additional insured would be entitled under this policy if not named as
such additional insured. An additional insured named herein shall not be held liable for any
premium, deductible portion of any loss, or expense of any nature on this policy or any extension
thereof. Any other insurance held by an additional insured shall not be required to contribute
anything toward any loss or expense covered by the insurance provided by this policy.
E. SUFFICIENCY OF INSURANCE:
The insurance limits required by Manager are not represented as being sufficient to protect
Contractor. Contractor is advised to consult Contractor's insurance broker to determine adequate
coverage for Contractor.
11. BONDS:
Contractor shall furnish the following bonds from a bonding company acceptable to the
ARRA's Risk Manager:
A. Faithful Performance:
A bond in the amount of 100% of the total contract price guaranteeing the faithful
performance of this contract, and
B. Labor and Materials:
A bond for labor and materials in the amount of 100% of the total contract price.
12. PROHIBITION AGAINST TRANSFERS:
Contractor shall not assign, sublease, hypothecate, or transfer this Agreement, or any interest
therein, directly or indirectly, by operation of law or otherwise, without prior written consent of
Manager. Any attempt to do so without said consent shall be null and void, and any assignee,
sublessee, hypothecate or transferee shall acquire no right or interest by reason of such attempted
assignment, hypothecation or transfer. However, claims for money by Contractor from Manager
under this Agreement may be assigned to a bank, trust company or other financial institution without
prior written consent. Written notice of such assignment shall be promptly furnished to Manager by
Contractor.
The sale, assignment, transfer or other disposition of any of the issued and outstanding capital
stock of Contractor, or of the interest of any general partner or joint venturer or syndicate member or
cotenant, if Contractor is a partnership or joint venture or syndicate or cotenancy, which shall result
in changing the control of Contractor, shall be construed as an assignment of this Agreement.
Control means fifty percent (50 %) or more of the voting power of the corporation.
13. SUBCONTRACTOR APPROVAL:
Unless prior written consent from Manager or ARRA is obtained, only those people and
subcontractors whose names are listed in Contractor's bid shall be used in the performance of this
Agreement.
Requests for additional subcontracting shall be submitted in writing, describing the scope of
work to be subcontracted and the name of the proposed subcontractor. Such request shall set forth
the total price or hourly rates used in preparing estimated costs for the subcontractor's services.
Approval of the subcontractor may, at the option of Manager, be issued in the foul' of a Work Order.
In the event that Contractor employs subcontractors, such subcontractors shall be required to
furnish proof of workers' compensation insurance and shall also be required to carry general and
automobile liability insurance in reasonable conformity to the insurance carried by Contractor. In
addition, any work or services subcontracted hereunder shall be subject to each provision of this
Agreement.
14. PERMITS AND LICENSES:
Contractor, at its sole expense, shall obtain and maintain during the term of this Agreement,
all appropriate permits, certificates and licenses, including a City of Alameda Business License that
may be required in connection with the performance of services hereunder.
15. REPORTS:
Each and every report, draft, work product, map, record and other document reproduced,
prepared or caused to be prepared by Contractor pursuant to or in connection with this Agreement
shall be the exclusive property of the ARRA.
No report, information or other data given to or prepared or assembled by Contractor
pursuant to this Agreement shall be made available to any individual or organization by Contractor
without prior approval by the ARRA, or Manager.
Contractor shall, at such time and in such foiin as the ARRA, or Manager may require,
furnish reports concerning the status of services required under this Agreement.
16. RECORDS:
Contractor shall maintain complete and accurate records with respect to sales, costs,
expenses, receipts and other such information required by Manager that relate to the perfamiance of
services under this Agreement.
Contractor shall maintain adequate records of services provided in sufficient detail to permit
an evaluation of services. All such records shall be maintained in accordance with generally
accepted accounting principles and shall be clearly identified and readily accessible. Contractor shall
provide free access to such books and records to Manager or ARRA at all proper times, and gives
Manager or ARRA the right to examine and audit same, and to make transcripts there from as
necessary, and to allow inspection of all work, data, documents, proceedings and activities related to
this Agreement. Such records, together with supporting documents, shall be kept separate from other
documents and records and shall be maintained for a period of three (3) years after receipt of final
payment.
If supplemental examination or audit of the records is necessary due to concerns raised by the
ARRA, or Manager's preliminary examination or audit of records, and the ARRA, or Manager's
supplemental examination or audit of the records discloses a failure to adhere to appropriate internal
financial controls, or other breach of contract or failure to act in good faith, then Contractor shall
reimburse The ARRA for all reasonable costs and expenses associated with the supplemental
examination or audit. This section limits the records available to payroll, invoices, contracts, or
manufacture correspondences to the project covered under this Agreement.
17. NOTICES:
All notices, demands, requests or approvals to be given under this Agreement shall be given
in writing and conclusively shall be deemed served when delivered personally or on the second
business day after the deposit thereof in the United States Mail, postage prepaid, registered or
certified, addressed as hereinafter provided.
All notices, demands, requests, or approvals from Contractor to Manager shall be addressed
to Manager at:
Alameda Reuse and Redevelopment Authority
c/o PM Realty Group L.P.
2175 Monarch St.
Alameda CA 94501
Attention: Property Manager
All notices, demands, requests, or approvals from Manager to Contractor shall be addressed
to Contractor at:
18. SAFETY REQUIREMENT
All work performed under this Agreement shall be performed in such a manner as to provide
safety to the public and to meet or exceed the safety standards outlined by CAL -OSHA. Manager
reserves the right to issue restraints or cease and desist orders to Contractor when unsafe or harmful
acts or conditions are observed or reported relative to the performance of the work under this
Agreement.
Contractor shall maintain the work sites free of hazards to persons and/or property resulting
from his or her operations. Any hazardous condition noted by Contractor, which is not a result of his
or her operations, shall immediately be reported to Manager.
19. REQUIREMENT TO PAY PREVAILING WAGE
Contractor shall comply with the City of Alameda Labor Compliance Program and all other
requirements set forth in Labor Code section 1770 et seq. The Manager shall require payment of the
general rate of per diem wages or the general rate of per diem wages for holiday and overtime work.
Contractor will submit monthly certified payroll records to the Manager or all employees and
subcontractors in a pre- approved format or a City of Alameda provided form. Any delay in remitting
certified payroll reports to the Manager upon request from the Manager will result in either delay
and/or forfeit of outstanding payment to Contractor.
20. URBAN RUNOFF MANAGEMENT:
The Contractor shall avoid creating excess dust when breaking asphalt or concrete and during
excavation and grading. If water is used for dust control, contractor shall use as little as necessary.
Contractor shall take all steps necessary to keep wash water out of the streets, gutters and storm
drains.
The Contractor shall develop and implement erosion and sediment control to prevent
pollution of storm drains. Such control includes but is not limited to:
A. Use storm drain inlet protection devices such as sand bag barriers, filter fabric fences,
block and gravel filters. (Block storm drain inlets prior to the start of the rainy season (October 15),
in site de- watering activities and saw - cutting activities; shovel or vacuum saw -cut slurry and remove
from the site).
B. Cover exposed piles of soil or construction material with plastic sheeting. All
construction materials must be stored in containers.
C. Sweep and remove all materials from paved surfaces that drain to streets, gutters and
storm drains prior to rain as well as at the end of the each work day. At the completion of the
project, the street shall be washed and the wash water shall be collected and disposed of offsite in an
appropriate location.
D. After breaking old pavement, Contractor shall remove all debris to avoid contact with
rainfall or runoff.
E. Contractor shall maintain a clean work area by removing trash, litter, and debris at the
end of each work day. Contractor shall also clean up any leaks, drips, and other spills as they occur.
The objective is to ensure that the City and County of Alameda County -Wide Clean Water
Program is adequately enforced. These controls should be implemented prior to the start of
construction, up- graded as required, maintained during construction phases to provide adequate
protection, and removed at the end of construction.
These recommendations are intended to be used in conjunction with the State s Best
Management Practices Municipal and Construction Handbooks, local program guidance materials
from municipalities, Section 7.1.01 of the Standard Specifications and any other appropriate
documents on storm water quality controls for construction.
Failure to comply with this program will result in the issuance of noncompliance notices,
citations, project stop orders or fines. The fine for noncompliance of the above program is two
hundred and fifty dollars ($250.00) per occurrence per day. The State under the Federal Clean Water
Act can also impose a fine on the contractor, pursuant to Cal. Water Code ' 13385.
21. COMPLIANCE WITH MARSH CRUST ORDINANCE:
Contractor shall perform all excavation work in compliance with the City of Alameda's
Marsh Crust Ordinance as set forth at Section 13 -56 of the Municipal Code. Prior to performing any
excavation work, Contractor shall verify with the Building Official whether the excavation work is
subject to the Marsh Crust Ordinance. Contractor shall apply for and obtain permits from Building
Services on projects deemed to be subject to the Marsh Crust Ordinance.
22. TERMINATION:
In the event Contractor fails or refuses to perform any of the provisions hereof at the time and
in the manner required hereunder, Contractor shall be deemed in default in the performance of this
Agreement. If such default is not cured within a period of two (2) days after receipt by Contractor
from Manager of written notice of default, specifying the nature of such default and the steps
necessary to cure such default, Manager may terminate the Agreement forthwith by giving to the
Contractor written notice thereof.
Manager shall have the option, at its sole discretion and without cause, of terminating this
Agreement by giving seven (7) days' prior written notice to Contractor as provided herein. Upon
termination of this Agreement, each party shall pay to the other party that portion of compensation
specified in this Agreement that is earned and unpaid prior to the effective date of teiuiination.
23. COMPLIANCES:
Contractor shall comply with all laws, state or federal and all ordinances, rules and
regulations enacted or issued by The ARRA, City of Alameda, or Manager.
24. CONFLICT OF LAW:
This Agreement shall be interpreted under, and enforced by the laws of the State of California
excepting any choice of law rules which may direct the application of laws of another jurisdiction.
The Agreement and obligations of the parties are subject to all valid laws, orders, rules, and
regulations of the authorities having jurisdiction over this Agreement (or the successors of those
authorities.) Any suits brought pursuant to this Agreement shall be filed with the courts of the
County of Alameda, State of California.
25. ADVERTISEMENT:
Contractor shall not post, exhibit, display or allow to be posted, exhibited, displayed any
signs, advertising, show bills, lithographs, posters or cards of any kind pertaining to the services
perfoinied under this Agreement unless prior written approval has been secured from The ARRA or
Manager to do otherwise.
26. WAIVER:
A waiver by the ARRA or Manager of any breach of any term, covenant, or condition
contained herein, shall not be deemed to be a waiver of any subsequent breach of the same or any
other term, covenant, or condition contained herein, whether of the same or a different character.
27. INTEGRATED CONTRACT:
This Agreement represents the full and complete understanding of every kind or nature
whatsoever between the parties hereto, and all preliminary negotiations and agreements of
whatsoever kind or nature are merged herein. No verbal agreement or implied covenant shall be held
to vary the provisions hereof. Any modification of this Agreement will be effective only by written
execution signed by both Manager and Contractor.
28. INSERTED PROVISIONS:
Each provision and clause required by law to be inserted into the Agreement shall be deemed
to be enacted herein, and the Agreement shall be read and enforced as though each were included
herein. If through mistake or otherwise, any such provision is not inserted or is not correctly
inserted, the Agreement shall be amended to make such insertion on application by either party.
29. CAPTIONS:
The captions in this Agreement are for convenience only, are not a part of the Agreement and
in no way affect, limit or amplify the terms or provisions of this Agreement.
30 SEVERABILITY
If any term or provision of this Agreement shall be held to be invalid or unenforceable, the
remaining teinis and provisions of this Agreement shall be valid and enforceable to the fullest
extent permitted by law.
IN WITNESS WHEREOF, the parties have caused the Agreement to be executed on the day
and year first above written.
CONTRACTOR
MANAGER:
PM REALTY GROUP, L.P., as agent for
the Alameda Reuse and Redevelopment
Authority.
By By:
Title Title:
Exhibit "C"
Utilities
Contractor shall pay all charges for fuel, gas, water, electricity, telephone services and any other utilities
necessary to carry on the operations of Contractor.
Exhibit "D"
Nuisance
Contractor shall not maintain, commit, or permit the maintenance or commission of any nuisance in connection
with the performance of services under this Agreement.
Exhibit "E"
Safety Requirement
All work performed under this Agreement shall be perfoiuied in such a manner as to provide safety to the public
and to meet or exceed the safety standards outlined by CAL -OSHA. City reserves the right to issue restraints or cease
and desist orders to Contractor when unsafe or harmful acts or conditions are observed or reported relative to the
performance of the work under this Agreement.
Contractor shall maintain the work sites free of hazards to persons and/or property resulting from his or her
operations. Any hazardous condition noted by Contractor, which is not a result of his or her operations, shall
immediately be reported to City.
Exhibit "F"
Hours of Operation
Contractor shall be allowed to operate only for the hours of
has been secured from City to do otherwise.
a.m. to p.m. unless prior written approval
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CITY OF ALAMEDA•CALIFORNIA
SPECIAL JOINT MEETING OF THE COMMUNITY IMPROVEMENT COMMISSION
AND HOUSING AUTHORITY BOARD OF COMMISSIONERS
WEDNESDAY - - - SEPTEMBER 1, 2004 - - - 5:40 P.M.
Time:
Place:
Wednesday, September 1, 2004, 5:40 P.M.
Council Chanibers, City Hall, corner of Santa Clara Avenue
and Oak Street.
Roll Call
Public Comment
Anyone wishing to address the Commission/Board on agenda items only
may speak for a maximum of 3 minutes per item.
Consent Calendar
Consent Calendar items are considered routine and will be enacted,
approved or adopted by one motion unless a request for removal for
discussion or explanation is received from the Commission/Board or a
member of the public.
1. Recommendation to approve First Amendments to the Owner
Participation Agreements between the Community Improvement
Commission, Housing Authority and Resources for Community
Development for Development of 52 Units of Affordable Rental
Housing and Ten Units of Affordable For-Sale Housing at the
Former Fleet Industrial Supply Center.
Regular Agenda Items
None.
Adjournment
Beverly Johnson, Chair, Community
Improvement Commission and Housing
Authority Board of Commissioners
Housing
Authority of the City of Alameca
701 Atlantic Avenue - Alameda, California 94501-2161 - TEL: (510) 747-4300 - FAX: (510) 522-7848 - TDD: (510) 522-8467
IF YOU WISH TO ADDRESS THE BOARD:
1. Please file a speaker's slip with the Executive Director, and
upon recognition by the Chair, approach the rostrum and
state your name; speakers are limited to 3 minutes per item.
2. Lengthy testimony should be submitted in writing and only a
summary of pertinent points presented verbally.
3. Applause and demonstrations are prohibited during Board of
Commissioners meetings.
AGENDA SPECIAL MEETING OF THE BOARD OF COMMISSIONERS
DATE & TIME Wednesday, September 1, 2004, 5:35 PM
LOCATION City Hall, Council Chambers, Room 390, 2263 Santa Clara Ave., Alameda, CA
Welcome to the Board of Commissioners of the Housing Authority of the City of Alameda
meeting. Regular Board of Commissioners meetings are held on the first Tuesday of each
quarter in the Council Chambers at City Hall.
Public Participation
Anyone wishing to address the Board on agenda items or business introduced by
Commissioners may speak for a maximum of three minutes per agenda item when the
subject is before the Board. Please file a speaker's slip with the Housing Authority Executive
Director if you wish to address the Board of Commissioners.
PLEDGE OF ALLEGIANCE
1. ROLL CALL - Board of Commissioners
2. CONSENT CALENDAR
Consent Calendar items are considered routine and will be approved or accepted
by one motion unless a request for removal for discussion or explanation is
received from the Board of Commissioners or a member of the public.
2-A. Approval of First Amendment to the Ground Lease between the Housing Authority and
Resources for Community Development for Construction of 52 Units of Affordable
Housing.
"Dedicated to Excellence, Committed to Service."
Board of Commissioners Meeting
September 1, 2004 Page 2
3. AGENDA
None.
4. ORAL COMMUNICATIONS, Non-Agenda (Public Comment)
5. COMMISSIONER COMMUNICATIONS, (Communications from the Commissioners)
6. ADJOURNMENT
* * *
Note:
• Sign language interpreters will be available on request. Please contact Carol Weaver,
Secretary, at 747-4325 voice or 522-8467 TDD at least 72 hours before the meeting to
request an interpreter.
Accessible seating for persons with disabilities (including those using wheelchairs) is
available.
• Minutes of the meeting are available in large print.
• Audiotapes of the meeting are available on request.
• Please contact Carol Weaver at 747-4325 voice of 522-8467 TDD at least 72 hours
prior to the meeting to request agenda materials in an alternative format, or any other
reasonable accommodation that may be necessary to participate in and enjoy the
benefits of the meeting.
Dedicated to Excellence, Committed to Service.
City of Alameda
Memorandum
August 26, 2004
To: Hono w le Chair and Members
o e Housing Authority Board of Commissioners
From:
Flint
ecutive Officer
Subject: Reco endation to Approve a First Amendment to the Ground Lease Between the
Housin _ Authority and Resources for Community Development
Backgroun
In March 2003, the Housing Authority Board of Commissioners authorized the Chief Executive
Officer to negotiate and execute a long -term lease with Resources for Community Development
(RCD) for construction and management of 52 units of affordable housing at a portion of the former
East Housing/FISC site (See attached site map.). The lease was executed on March 14, 2003.
Discussion
Execution of the lease provided RCD with the necessary site control to apply for State Multi -
Housing Program (MHP) funds. RCD was awarded $3 million in MHP funding in July 2003. In
Fall, 2003, RCD also received tax credit financing for the 52 -unit project. Receipt of tax credit
financing requires formation of a tax credit partnership to implement the housing project.
The tax credit partnership, The Breakers at Bayport, L.P., has been formed. RCD is the general
managing partner and the tax credit investors are the limited partners. Pursuant to the Lease, RCD
intends to assigns its interest in the lease to the Limited Partnership. However, there are several
technical revisions to the lease that must be made to comport with requirements of Federal Tax
Credit law. These technical revisions are made as part of the First Amendment to Ground Lease
Agreement on file in the City Clerk's Office.
The revisions include amending the definition of "Foreclosure Transferee "; modifying the rental,
sale and occupancy requirements to provide more flexibility in the allowable range of incomes to be
served by the project; and clarifying certain noticing and other requirements in the event the
"Foreclosure Transferee" becomes the legal owner of the leasehold estate. In addition, the First
Amendment to Ground Lease Agreement reduces the amount of land subject to the ground lease.
When the initial lease was executed, it included the property where the ten affordable for -sale units
will be built.
Dedicated to Excellence, Committed to Service
Honorable Mayor and Members
of the Housing Authority Board of Commissioners
August 26, 2004
Page 2
The City Council has subsequently approved a subdivision map to create twelve legal lots. The 52-
unit project will be built on lots 11 and 12 and the ten units will be built on lots 1 -10. Therefore, the
ground lease as amended will only cover lots 11 and 12.
Fiscal Impact
There is no fiscal impact to approving the First Amendment to Ground Lease.
Recommendation
The Chief Executive Officer recommends that the Housing Authority Board of Commissioners
authorize the Chief Executive Officer to execute the First Amendment to Ground Lease Agreement.
On file with the City Clerk:
First Amendment to Ground Lease Agreement
Attachment
Respectfully submitted,
Michael T. Pucci
Executive Director
By
ebbie Potter
Base Reuse and Redevelopment Manager
G: \Comdev \Base Reuse& Redevp \DebbiePotter \Staff Reports\HA -RCD 1st Amendment 8- 26- 04.doc
Dedicated to Excellence, Committed to Service
nu6, L , LUU4
HAILE STREET
No, 3335 P. 1
ROTH LANE
NEPTUNE GARDENS AVENUE
FIFTH STREET
City of Alameda
Memorandum
August 26, 2004
To:
From:
Subject:
Background
Honorable air and Members of the Housing Authority Board of Commissioners
Honorab Chair and Members of the Community Improvement Commission
tion to Approve First Amendments to the Owner Participation
between the CIC, Housing Authority and Resources for Community
De •pment for Development of 52 Units of Affordable Rental Housing and Ten
Units of Affordable For -Sale Housing at the Former Fleet Industrial Supply.
Center.
On December 16, 2003, the Housing Authority Board of Commissioners (HABOC) and the
Community Improvement Commission (CIC) approved an Owner Participation Agreement
(OPA) with Resources for Community Development (RCD) for the construction of 52 affordable
rental units at the former Fleet Industrial Supply Center (FISC).
On June 15, 2004, the HABOC and the CIC approved an OPA with RCD for the construction of
10 affordable for -sale units at the former FISC property.
Both projects have been moving forward and escrow is scheduled to close on each property by
early September, 2004. Financing for both projects is completed. Key financing sources for the
52 -unit project include State Multi- Housing Program funds and equity raised through the Federal
affordable housing tax credit program. Wells Fargo is providing the construction loan for the 10-
unit project and Catellus affordable housing fees will provide the borrower equity for the Wells
Fargo loan. Both OPA's require technical revisions to meet lender /funder requirements. These
revisions are contained in proposed first amendments to each OPA on file in the City Clerk's
Office.
Discussion
52 -Unit Affordable Rental Housing Project: The primary proposed revision to the OPA is a
statement clarifying Section 7.7 of the original OPA (Loan Forgiveness). The First Amendment
acknowledges that the CIC loan will not be forgiven, but rather, if the loan is assumed by another
person or entity, RCD shall be relieved of its obligation to repay the CIC loan.
10-Unit Affordable For -Sale Housing Project: The First Amendment to the OPA provides a new
Section 4.9, Performance Under Loan Documents. The new section requires RCD to assume all
Dedicated to Excellence, Committed to Service
Honorable Mayor and Members
of the Housing Authority Board of Commissioners and
Members of the Community Improvement Commission
August 26, 2004
Page 2
of the Owner's (Housing Authority's) obligations under the construction loan that may be
required by the lender.
Fiscal Impact
Approving the First Amendments to the 52 -unit and 10 -unit OPA's as described above has no
fiscal impact.
Recommendation
The Chief Executive Officer recommends that the Housing Authority Board of Commissioners
authorize the Chief Executive Officer to execute the First Amendments to the Owner
Participation Agreements between the Housing Authority, CIC and Resources for Community
Development for development of 52 units of affordable rental housing and ten units of affordable
for -sale housing at the former Fleet Industrial Supply Center.
The Executive Director recommends that the Community Improvement Commission authorize
the Executive Director to execute the First Amendments to the Owner Participation Agreements
between the Housing Authority, CIC and Resources for Community Development for
development of 52 units of affordable rental housing and ten units of affordable for -sale housing
at the former Fleet Industrial Supply Center.
On file with the City Clerk:
First Amendment to Owner Participation Agreement (10 Unit Project)
First Amendment to Owner Participation Agreement (52 Unit Project)
Respectfully submitted,
Ze,re At � /ter
Leslie Little
Development Services Director
Michael T. Pucci
Executive Director
Debbie Potter
Base Reuse and Redevelopment Manager
G: \Comdev\Base Reuse& Redevp\DebbiePotter \Staff Reports \CIC -RCD 1st Amendment 8- 26- 04.doc
Dedicated to Excellence, Committed to Service
COX, WOOTTON, GRIFFIN, HANSEN & POULOS, LLP
TERENCE S. COX
RICHARD C. WOOTTON*
MITCHELL S. GRIFFIN
RUPERT P. HANSEN, JR.
GREGORY W. POULOS
FREDERICK J. CARR
*ALSO ADMITTED IN HAWAII
ATTORNEYS AT LAW
190 THE EMBARCADERO
SAN FRANCISCO, CALIFORNIA 94105
TELEPI-IONE: (415) 438 -4600
FACSIMILE: (415) 438 -4601
WEBSITE: http: / /www.cwghp.com
August 31, 2004
MARC T. CEFALU
LYNN L. KRIEGER
LAURA A. SCALES
MAX LEE KELLEY
GALIN G. LUK
ROBERT A. SCHWARTZ
ARRA HEARING SEPTEMBER 1, 2004
SUBMISSION REGARDING AGENDA ITEMS 2 B & 2C
PROPOSED TERMS OF LEASE RENEWAL WITH NELSON'S MARINE
TO:
FROM:
SUBJECT:
Honorable Chair and members of the
ALAMEDA REUSE AND REDEVELOPMMENT AUTHORITY
Four Concerned Bay Area Boatyards, on behalf of themselves
And the Public Interest
Terms of the Proposed Lease which are Detrimental to Fair Market
Competition in the Boatyard Industry and are Detrimental to the
Public Interest
DISCUSSION:
Four reputable San Francisco Bay Area Boatyards 1 have reviewed
the proposed terms of the ARRA's renewal of its sublease to Nelson's Marine. They
unanimously share the concern that the proposed terms will be detrimental to fair
market competition in the marine repair industry and will be detrimental to the
Public Interest by depriving the taxpayers of the City of Alameda of tens of million
of dollars in lost revenue over the proposed 20 year term of the sublease.
The boatyards' primary concerns all derive from the City's
assumptions combined with the Appraisal [entitled "Rental Survey "] performed by
Dunn & Associates applying flawed methodology in arriving upon the current Fair
Market Value of the subleased property. The boatyards' concerns are:
1 The boatyards are: (1) Keefe Kaplan Maritime, Inc, in Richmond; (2) Mariner Boat Yard in Alameda; (3)
Berkeley Marine Center in Berkeley; and (4) San Francisco Boat Works in San Francisco.
Cox, Wootton, Griffin, Hansen & Poulos, LLP
September 13, 2004
Page 2
(1) The ARRA is bound by the sublease terms to apply the "Fair Market Value"
The Sublease provides at Paragraph 2.3 regarding extensions: "....At ninety
percent of the then existing fair market value of the Leased Premises. "The
fair market value shall be based upon the highest and best use of the Leased
Premises." [See Sublease Excerpts, highlighted, as EXHIBIT ONE]
That provision is obviously mandatory. A failure to follow that mandate
would constitute an abuse of this Authority's power, subjecting it to review.
(2) The Staff Recommendation Contains a Fundamental and Factually
Unsupported Conclusion which is Contrary to the Known Facts
The Executive Director's Memorandum dated August 19, 2004 states:
"The appraiser also felt that the Nelson Marine site was tzot a prime location
for a boatyard as it's not easy to access from a vehicle."
No such language appears in the Appraisal itself. The Appraisal instead
describes the Leased Premises as being located at a transportation hub of the
East Bay [at Page 2].
More importantly, Nelson's Marine itself has emphasized the location of the
Leased Premises as being "perfect" for the business of a boatyard. Staff
presumably considered the article reporting upon the flaunted success of
Nelson's Marine contained in the August 2003 edition of Boat & Motor
Dealer [See copy of article, EXHIBIT TWO, highlighted]. Carl Nelson, the
owner of Nelson's Marine, is quoted as stating:
"If you had to design a facility for a boatyard, I think an airplane hangar is the
perfect thing..."
The article speaks of "a steady stream of customers at the complex" and that
the immediately surrounding area "includes a 800 slip marina to be built in
the same lagoon as the boatyard's docks...This plan will bring housing and
many more boaters to the area." The cover to the magazine refers to "A
Waterfront Service Mecca" with the article's subheading speaking of the
business `flourishing" and as a "service giant" and as "a marine complex that
is one of the largest in California." Not a negative comment is to be found as
to the boatyard currently suffering from an "access" problem.
If the terms of the proposed sublease approved by this Authority were to be
premised upon the Executive Director's factually inaccurate assumption, it
once again would be an abuse of discretion subject to review.
Cox, Wootton, Griffin, Hansen & Poulos, LLP
September 13, 2004
Page 3
(3) The Appraisal Contains the Following Critical Oversights and /or Flaws
(a) Only the Structure and Not the Entire Leased Premises Have Been
Appraised
The Appraisal describes the "Subject Property" as consisting of the
warehouse and office space [Pages 1 and 2] and barely mentions the
4.62 acres, or 201,275 square feet, of land that is subleased with those
structures, which include the Finger Piers of 400 sq. ft. and the North
side of Pier 1 400' in length described in the Sublease; The Appraisal
not only fails to contain a single word or reference to those acres'
intrinsic monetary value, such as the growth potential and sublease
income that Nelson's Marine has been and will continue to generate
from its own subtenants, but its Evaluation omits any mention of the
that enormous square footage when it states its Conclusion [see
Appraiser's Conclusion, EXHIBIT THREE] It should be noted that
Nelson's Marine referred to the enormous pier frontage as being one
of the Leased Premises' attractive qualities that it selected to promote
its business among the pictures included in the magazine article.
Nelson's Marine is currently paying $.06 per square foot for the
Leased Premises while it has been reportedly subleasing portions of
the premises for in the range of $1.00 per foot to other vendors in the
boatyard industry. Nelson's has therefore been substantially
profiting every year from its own subcontracts on the acreage that has
not been properly appraised, with none of that income inuring to the
benefit of the public.
If the unimproved acreage is not adequately appraised, the Authority
will be granting Nelson's Marine a free license to operate as a real
estate landlord, with an unbridled ability to profit at the City's
expense. As Carl Nelson astutely stated in the magazine article:
"The rare privilege of having surplus space has not been lost on Carl..."
There would appear to be no logical reason why the Authority would
wish to waive that potential income on behalf of the public.
(b) The "Comparable" Lease Terms Have Not Been Correctly Analyzed
The Appraisal recommends that the renewed sublease begin at the flat
rate of $16,943, or $203,316 annually, based upon comparable leases.
The City would logically be the most interested in making
comparisons with those leases entered into by boatyards doing
business within the City limits, which are the Svendsens Boat Works,
Inc. and Mariner Boat Yard leases [see Appraisal at Pages 15 & 16].
Cox, Wootton, Griffin, Hansen & Poulos, LLP
September 13, 2004
Page 4
By analyzing those two leases it quickly becomes apparent that the
appraiser's analysis is objectively flawed, which would result in a
shockingly high loss of revenue in the range of $34 million to the City
over the proposed 20 year term of the sublease [See EXHIBIT FOUR,
"Summary of Loss "]. The most glaring oversights are:
(1) The appraisal analyzed several lease structures and selected a
straight per foot rate. The appraisal identifies the Building at
53,785 sq. ft (Lease states 55,400). The appraisal recommends a
rate of $.35 per sq. ft. for the entire Building. Comparable
boatyards in Alameda are paying an average of $.72 per sq. ft..
After the Tenant is allowed a deduction of 10% of the fair
market value a comparable rate would be $.65 per sq. ft.
Based on the correct size of the Building this equals $36,120 per
month or $432,120 per year.
(2) Comparable boatyards in Alameda are paying an average of
$.23 per sq. ft. for unimproved land such as the open acreage,
finger piers and North side of Pier 1. After the Tenant is
allowed a deduction of 10% of the fair market value a
comparable rate would be $.21 per sq. ft. Based on the 201,275
sq. ft. of unimproved land rented this equals $42,267 per month
or $507,204 per year.
(3)
The 400' of linear dock space, which is listed separately on the
Agenda as item 2 -C should not logically be excluded from this
same comparative analysis. Comparable boatyards in
Alameda are paying an average of $5,83 per linear ft. After the
Tenant is allowed a deduction of 10% of the fair market value
a comparable rate would be $5.25 per lineal ft. Based on the
400 linear feet of dock space rented this equals $2,100 per
month or $25,200 per year.
(4) The above components of the Leased Premises, when analyzed in
a truly comparative fashion and added together, result in a total
comparable value of the sublease equaling $80,377 per month or
$964,524 per year [See EXHIBIT FIVE, "Comparable Alameda
Boatyards" and EXHIBIT SIX, "Comparable Boatyard
Capacities'''.
(5) The flawed analysis becomes equally dramatic when one
calculates the amount of rent that Nelson's would be paying if
it were to pay the same rate per square foot for its subleased
property that Svendsen's Boat Works, Inc. and Mariner Boat
Yard are currently paying on their leases.
Cox, Wootton, Griffin, Hansen & Poulos, LLP
September 13, 2004
Page 5
Svendsen's leases a structure that is approximately 1/2 the
square footage of Nelson's structure an open unimproved land
that is just over 114th the size of Nelson's acreage. Yet
Svendsen's is currently paying $32,596 per month in
comparison to the $16,943 being proposed for Nelson's. If
Nelson's were to pay the same rate per square foot for its Leased
Premises that is currently being paid by Svendsen's, it would be
paying $91,366 per month [over 5 and 1/2 times the monthly rental
rate that the Appraisal recommends].
Similarly, the Mariner Boat Yard leases a structure that is a
little over 1115th the size of Nelson's structure and its
unimproved acreage is a little over 115th the size of Nelson's
unimproved acreage. Yet Mariner is currently paying $14,000
per month plus 6% of its gross revenues. Even excluding the
City's income from the gross revenues, which it can retrieve from
its own records, if Nelson's were to pay the same rate per square
foot that is currently being paid by Mariner, it would be paying
$88,230 per month [again, over 5 times the monthly rental rate
that the Appraisal recommends].
(6) The need for the proposed 20 year term is unexplained and
adverse to the interests of the City and the public; the existing
sublease was structured in 5 year increments with yearly
increases. There is no apparent reason why the City would
relinquish its right to have the sublease adjusted every 5 years in
the future to `fair market value at the highest and best use," just
as was done in the original sublease.
(7) The proposed sublease contains no "carry over" provision;
commercial leases typically provide that once a new fair
market value has been determined, the tenant will retroactively
pay the landlord for the difference between the old lease rate
and the new fair market value from the date upon which the
original lease expired [as a strong incentive for the tenant not
to drag out renewal negotiations and to allow the landlord to
recapture lost revenue to which it should be entitled]; had the
sublease included a carry over provision with the original
sublease having expired approximately 2 years ago, and if the
City were now to establish a fair market value of $88,230 per
month, the City would have been able to recapture $1,673,802 in
past due rent.
Cox, Wootton, Griffin, Hansen & Poulos, LLP
September 13, 2004
Page 6
The competing Bay Area boatyards simply want to see: (1) a fair competitive
playing field within their specialized industry; and (2) the taxpayers of the City obtain a
fair return for the value of the Leased Premises. They look forward to detailing at
the Hearing more reasons which will support the Authority in arriving upon terms
to the sublease that will serve the best interest of the public.
Respectfully Submitted,
Terence S. Cox
Exhibits: (1) Excerpts from Nelson's Marine Sublease [highlighted]
(2) Boat & Motor Dealer article, August 2003 [highlighted]
(3) Appraiser's Conclusion [highlighted]
(4) Summary of Loss
(5) Comparable Alameda Boatyards Based on Square Feet Rented
(6) Comparable Boat Yard Capabilities