STAFF REPORT
Meeting Date: March 15, 2022
To: Honorable Mayor & City Council
From: Logan Phillippo, Policy & Management Analyst
Subject: Affordable Housing Development on City-Owned Property Attachments: 1. Property Information Sheets
2. Draft RFQ/P
INTRODUCTION
Staff seeks City Council direction on preliminary sites for the development of an affordable housing project on City-owned property. DISCUSSION
The City is considering the solicitation of development proposals for an affordable housing project to be located on property already owned by the City. The City Council has established an Affordable Housing Ad Hoc Subcommittee with Councilmember Mirisch and Councilmember Gold.
On October 4, 2021, the Ad Hoc Subcommittee met and requested that Staff provide a summary of each property owned by the City in order to ensure a comprehensive and strategic approach to site selection. The Ad Hoc Subcommittee also requested that Staff consider existing parking structures that may require substantial capital improvements and/or structural reinforcement in the future.
On March 4, 2022, the Ad Hoc Subcommittee met and Staff presented a booklet of property summary sheets developed by Staff that could be used to help make decisions regarding affordable housing development or other property development in the future. The Ad Hoc Subcommittee reviewed potentially feasible sites and discussed advantages and disadvantages of various sites/areas. The City and Parking Authority own 132 parcels of land, which includes several civic facilities, parks and open space, public parking structures, water infrastructure, and commercial buildings. Of these, the Ad Hoc Subcommittee discussed properties in three key areas of Beverly Hills. The table below shows the properties preliminarily discussed.
Attachment 1 includes a one-page description sheet of each property.
Areas/Sites Discussed
Entertainment Business District (near intersection of W. 3rd and Foothill) 9268 W. 3rd St. Office Building1
9298 W. 3rd St. Office Building1
336 Foothill Rd. Office Building
Alden Surface Parking Lot (no official address, east of the Dog Park) Southeast Area
8421 Wilshire Blvd. Metro Staging Yard
327 S. Robertson Blvd. Retail Building
Business Triangle, N. Crescent from Wilshire to S. Santa Monica, & S. Beverly 333 N. Crescent Dr. Parking Structure
1 These sites have previously been considered in more detail by City Council at previous Study Session meetings. Each site listed above has existing infrastructure, uses, and/or encumbrances that would require further evaluation and consideration. For example some properties such as the existing parking structure at 333 N. Crescent Dr. might require a longer-term approach so that adaptive reuse and/or redevelopment is strategically timed with any necessary future capital improvements and a plan for offsetting lost parking spaces could be evaluated.
Additionally, some properties have long-term leases, temporary construction easements, or other encumbrances in effect that extend 10 or more years into the future. These properties would require a longer-term approach to any development to avoid the costs associated with a potential lease buyout. At the March 4, 2022 meeting, the Ad Hoc Subcommittee suggested that staff incorporate potential hidden costs into each one-page property description. For example, the potential costs to get an existing property into a leasable condition, any necessary structural reinforcement that may be required in the future, the cost to negotiate an early lease termination, etc.
The Ad Hoc Subcommittee additionally recommended that Staff also incorporate potential opportunity costs into each one-page property description and solicit input from affordable housing developers regarding the sites described in the table above and allow developers to propose other sites on City-owned property that a developer identifies as potentially feasible.
Staff has worked with consultant Keyser Marston Associates to develop a Request for Qualifications and Conceptual Proposals (RFQ/P), included as Attachment 2, to be distributed to potential developers to solicit input and further inform site selection and/or potential costs. RFQ/P respondents would be required to: Demonstrate relevant experience, financial capabilities and conceptual development, financing and operations plans. Conduct an analysis of the neighborhood characteristics to inform project proposals; Utilize existing senior housing development standards; o RFQ/P Respondents may diverge from these standards, provided justification is included in the response; Identify a cohesive vision for the project and list the number of proposed dwelling units along with the mix of units (i.e. studio, one-bedroom, two-bedroom, etc.)
Propose income and affordability thresholds for prospective residents, including a potential preference for Beverly Hills residents to the extent allowable by outside funding sources; Propose site amenities such as a plaza or courtyard or ground-floor commercial space (and potential tenants/business types) for the City’s consideration; and Demonstrate the project is financially feasible and that available outside funding sources will be utilized to the maximum amounts possible.
Public Engagement
City Council has previously emphasized that Staff conduct public outreach regarding future siting and development plans. In this exploratory phase Staff believes that the first step should be to obtain input from prospective developers, as recommended by the Ad Hoc Subcommittee. This would better prepare the City to solicit input from the public regarding the most feasible options or a range of feasible options, allowing for more structured and productive public engagement. Staff will advertise for future public meetings through social media, newspaper advertisements, email lists and mailed letters.
FISCAL IMPACT
The City will incur costs related to consultant fees to assist with the RFQ/P process any subsequent developer/proposal review, and/or development agreement negotiation.
Funding for these purposes is included in the Real Estate Management program budget for contractual services.
If the City were to complete an RFQ/P process and ultimately proceed with site development, the City could be expected to ground lease the City-owned land for a nominal fee. Additionally, the City should expect to contribute cash to the project to support a developer’s financing gap between the available funding from outside funding sources (such as Low Income Housing Tax Credits) and the actual costs of the project. The City cash contribution required to support the project would depend on the overall project composition such as the number of dwelling units, site amenities and project design features. Staff will provide updates to City Council as the site selection and development process continues.
RECOMMENDATION
Staff seeks City Council direction regarding the Ad Hoc Subcommittee’s recommendations to solicit qualifications and conceptual proposals from prospective developers regarding the sites listed in this report while leaving the option open to a developer to propose other potentially suitable sites for a project. If approved, Staff would review results with the Affordable Housing Ad Hoc Subcommittee, conduct public outreach and return to City Council with an update and additional recommendations.
Gabriella Yap,
Deputy City Manager
Approved By
Attachment 1
9268 W. 3rd St. Office Building
Property Overview
Vacant single-story brick office building with adjacent surface parking lots to the east and west.
Key Information
Property Information Zoning Primary Use
Year Built: 1937
Stories: 1
Building sqft: 19,008
Land sqft: 51,283
APN(s): 4342-010-901
APN(s): 4342-010-904
Owner: City
Commercial Low Density
General & Municipal
Public Service Zone (P-S)
Vacant
Formerly leased to Lakeshore
Entertainment through
3/31/2020
Property Revenue
Activity FY 2017 FY 2018 FY 2019 FY 2020 FY 2021
Lease Activities $(1,135,320.15) $(1,172,658.96) $(1,212,753.87) $(930,896.55) - Additional Insights/Potential Hidden Costs
A commercial lease agreement at this site could bring in up to approximately $100,000 per month with annual increases once the certain building infrastructure has been replaced/repaired. This is based on proposals previously submitted to the City.
The building is in need of upgrades to the roof as well as certain base building mechanical, electrical and plumbing (MEP) systems, dependent on the scope of future use.
The surface parking lot to the east has 23 striped parking spaces, to the west has 31 striped parking spaces. The property is situated behind (to the north of) taller properties along Burton Way, including a residential structure and the L’Ermitage Beverly Hills, with separation via an alleyway.
Additional Photographs
9298 W. 3rd St. Office Building
Property Overview
Leased single-story brick office building.
Key Information
Property Information Zoning Primary Use
Year Built: N/A
Stories: 1
Building sqft: 1,902
Land sqft: 12,104
APN(s): 4342-010-900
Owner: City
Commercial Low Density
General & Municipal
Public Service Zone (P-S)
Commercial Leases
Beverly Hills City Employee
Federal Credit Union
Property Revenue
FY 2017 FY 2018 FY 2019 FY 2020 FY 2021
Lease Activities $(10,000.00) $(12,000.00) $(12,000.00) $(12,000.00) $(12,000.00) Additional Insights/Potential Hidden Costs
The City currently collects $1,000 per month as a part of a month-to-month agreement with the Beverly Hills City Employees Federal Credit Union. If the City were to choose to relocate those offices to another City-owned property, capital expenditures could be required.
There are approximately 15 striped parking spaces associated with the building. Parking behind (to the south of) the building is accessed via the adjacent 9268 W. 3rd St. office building, which is also owned by the City.
Additional Photographs
336 Foothill Rd. Office Building
Property Overview
Vacant office building with historically significant elements and one level of subterranean parking along with adjacent surface parking lot that has two auxiliary single-story brick buildings.
Key Information
Property Information Zoning Primary Use
Year Built: 1925
Stories: 2
Building sqft: 61,595
Land sqft: 97,557
APN(s): 4342-009-903
APN(s): 4342-009-904
Owner: City
Commercial Low Density
General & Municipal
Public Service Zone (P-S)
Vacant office building
Formerly leased to Virgin
Records through 11/12/2004
Property Revenue
N/A – The building is vacant.
Additional Insights/Potential Hidden Costs
City Staff estimate that a commercial lease agreement at this site could generate up to approximately $310,000 per month with annual increases once certain building facilities have been replaced/repaired. This is based on a proposal previously received. The building would first require of substantial upgrades performed by the City in order to be leasable.
There is one level of subterranean parking with approximately 55 parking spaces. There is an adjacent surface parking lot that can accommodate up to approximately 128 parking spaces. The Public Works Department currently uses it as a laydown yard. Impound vehicles are also stored at this location. A 1985/86 Historic Resource Inventory compiled by the City states the historical and architectural importance of the building. However, the building is not listed on the City’s Local Register of Historic Properties.
Additional Photographs
Alden Surface Parking Lot
Property Overview
A surface parking lot with an existing month-to-month lease for parking/vehicle storage.
Key Information
Property Information Zoning Primary Use
Year Built: N/A
Stories: N/A
Building sqft: N/A
Land sqft: 24,750
APN(s): 4342-009-906
Owner: City
Low Density General &
Municipal
Public Service Zone (P-S)
Commercial Lease
Mercedes Benz of Beverly
Hills
Property Revenue
FY 2017 FY 2018 FY 2019 FY 2020 FY 2021
Lease Activities $(42,000.00) $(42,000.00) $(42,000.00) $(42,000.00) $(42,000.00) Additional Insights/Potential Hidden Costs
The property is to the east of the Beverly Hills Dog Park and do the north of a Public Works laydown yard. The City currently collects $3,500 per month as a part of a month-to-month agreement with Mercedes Benz of Beverly Hills. The City could generate additional commercial lease income if the property was improved. However, specifies would first need to be determined prior to estimating any potential income.
Additional Photographs
8421 Wilshire Blvd. Metro Staging Yard
Property Overview
Vacant lot with an existing temporary construction easement in connection with the Metro Purple (D-Line) extension project. Acquired by the City in 2017.
Key Information
Property Information Zoning Primary Use
Year Built: N/A
Stories: N/A
Building sqft: N/A
Land sqft: 18,623
APN(s): 4334-022-900
Owner: City
Commercial Low Density
General
C-3
Los Angeles County
Metropolitan Transit
Authority – temporary
construction easement
Property Revenue
The City acquired the property from Metro for $15.845 million in 2017. In connection with the temporary construction easement, Metro subsequently paid the City $2.345 million. There is no additional revenue associated with the property at this time.
Additional Insights
The property is contiguous with other City owned property, the 8423 Wilshire Clock Market Building, which is currently leased to O’Gara Coach.
The temporary construction easement with Los Angeles County Metropolitan Transit Authority (Metro) is in place through the sooner of (i) when Metro’s project is operational, (ii) when Metro no longer needs the property as determined by metro, or (iii) 2/21/2032.
327 S. Robertson Blvd. Retail Building
Property Overview
Leased single-story retail building. Acquired by the Parking Authority in 2019.
Key Information
Property Information Zoning Primary Use
Year Built: 1946
Stories: 1
Building sqft: 6,000
Land sqft: 13,740
APN(s): 4333-01-901
Owner: Parking Authority
Commercial Low Density
General
C-3
Commercial Leases
Robertson Optical
Contempo Nails
Shorty Yoga
Anu Beauty
Property Revenue
FY 2017 FY 2018 FY 2019 FY 2020 FY 2021
Lease Activities $(136,939.99)* $(135,100.00)*
* Represents revenue accrued during Fiscal Year, but not yet collected due to COVID-19 eviction moratorium.
Additional Insights/Potential Hidden Costs
The City currently collects $12,540 per month as a part of month-to-month leases with four tenants at this site.
There are four additional units that are currently vacant and could be leased for additional income. Expanding the footprint of the property by assembling land could allow room for a future parking structure. The property abuts single-family residential uses to the west, separated by an alleyway. Across the street, to the east, is City of Los Angeles jurisdiction.
Additional Photographs
333 N. Crescent Parking Structure
Property Overview
A public parking structure that has first-floor retail facing N. Crescent Dr.
Key Information
Structure Information Zoning Parking
Year Built: 1982
Stories: 7
Rentable sqft: 15,733
Land sqft: 45,761
APN(s): 4343-007-900
Owner: Parking Authority
Transitional Multi-Family
Residential-Commercial
Parking Zone (RMCP)
Commercial Zone (C-3)
Parking Spaces
730
Commercial Leases
Beverly Cleaners
Beverly Hills Market
Lukaro Salon
Pioneer Hardware
The Art of Juice & Water
Tutto Bene
USPS
Property Revenue
FY 2017 FY 2018 FY 2019 FY 2020 FY 2021
Lease Activities $(342,988.81) $(350,305.03) $(375,052.33) $(359,881.18) $(313,239.30) Parking Ops. $(1,173,067.46) $(1,090,367.78) $(999,779.58) $(851,264.87) $(619,029.71) Total $(1,516,056.27) $(1,440,672.81) $(1,374,831.91) $(1,211,146.05) $(932,269.01) Additional Insights/Potential Hidden Costs
Some public parking spaces may need to be placed elsewhere if redeveloped. Further study is required. All seven tenant spaces are currently leased, all but two will expire by 12/31/2024. The parking structure has two entrances, lower levels accessible via Dayton Way, upper levels via N. Crescent Dr.
Additional Photographs
Attachment 2
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REQUEST FOR QUALIFICATIONS / CONCEPTUAL PROPOSALS
(RFQ/P)
AFFORDABLE HOUSING OPPORTUNITY
CITY OF BEVERLY HILLS
Request for RFQ/P Release Date: ____________, 2022
Request for RFQ/P Submittal Deadline: Two months following the Relase Date DRAFT – SUBJECT TO CHANGE
Request for Qualifications –Affordable Housing Opportunity Page i City of Beverly Hills
TABLE OF CONTENTS
I. INTRODUCTION .............................................................................................................. 1 II. OVERVIEW OF THE DEVELOPMENT OPPORTUNITY .......................................................... 2 A. GENERAL CONTEXT................................................................................................................... 2 B. POTENTIAL DEVELOPMENT SITES................................................................................................. 3 III. THRESHOLD REQUIREMENTS .......................................................................................... 5 A. DEVELOPMENT TEAM EXPERIENCE THRESHOLDS............................................................................. 5 B. TRANSACTION STRUCTURE ......................................................................................................... 5 IV. SUBMISSION REQUIREMENTS ......................................................................................... 6 A. SUBMITTAL COVER ................................................................................................................... 6 B. TABLE OF CONTENTS................................................................................................................. 6 C. COVER LETTER......................................................................................................................... 6 D. DEVELOPMENT ENTITY .............................................................................................................. 7 E. CONCEPTUAL DEVELOPMENT PROGRAM....................................................................................... 7 F. FINANCING STRATEGY ............................................................................................................... 8 G. FINANCIAL CAPABILITY .............................................................................................................. 8 H. COMPARABLE DEVELOPMENT/PROPERTY MANAGEMENT EXPERIENCE................................................ 9 I. IMPLEMENTATION TIMEFRAME ................................................................................................. 10 J. POTENTIAL CONFLICTS OF INTEREST ........................................................................................... 10 V. AVAILABLE RESOURCES................................................................................................. 10 VI. RFQ/P SUBMITTALS AND QUESTIONS ........................................................................... 11 VII. SELECTION PROCESS AND CRITERIA............................................................................... 11 VIII. POTENTIAL FUTURE OPPORTUNITIES ............................................................................ 12 IX. CAVEATS....................................................................................................................... 12 A. RIGHTS AND UNDERSTANDINGS ................................................................................................ 12 B. COST LIABILITY....................................................................................................................... 13 C. AMENDMENTS....................................................................................................................... 13 DRAFT – SUBJECT TO CHANGE
Request for Qualifications –Affordable Housing Opportunity Page ii City of Beverly Hills
EXHIBITS
Exhibit A: Descriptions of Potential Development Sites
Exhibit B: Notice of Intent to Respond
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I. INTRODUCTION
The following Request for Qualifications / Conceptual Proposals (RFQ/P) is being distributed to identify qualified development teams that are offering conceptual development programs that meet the City’s goals and objectives. The City will require the selected development team to undertake the following threshold activities:
1. Acquire the selected development site from the City in the form of a long-term ground lease.
2. Develop a senior citizen rental housing project in which 100% of the units are subject to long-term income and affordability covenants.
3. Manage and operate the completed project throughout the covenant period.
Development teams that can demonstrate the experience, capability, and creativity to successfully undertake this opportunity are invited to respond to this RFQ/P by outlining their:
1. Relevant experience;
2. Financial capabilities;
3. Conceptual development plans;
4. Conceptual financing and operation plans; and
5. Other information that will enhance the City’s ability to evaluate the development team.
The pertinent actions and due dates related to this RFQ/P are as follows:
RFQ/P Release Date __________, 2022
Notice of Intent to Respond Form Due Date 14 days after Release Deadline for Written Questions 21 days after Release
Release of Final Responses to Written Questions 7 days after Deadline RFQ/P Submittal Deadline Two months after Release
The selection process will consist of two phases. The first phase will involve the identification of a shortlist of the development teams based on the identified selection criteria. The second DRAFT – SUBJECT TO CHANGE
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phase will involve interviews of each of the shortlisted teams with City’s evaluation committee. At the completion of the interview process, the City will conduct public outreach and make recommendations regarding the development to the City Council for consideration and direction.
If the City selects a development team, the next step in the process is for the City and the development team to enter into an Exclusive Negotiating Agreement (ENA) with a term of six (6) months. Any extensions to that terms will be subject to City Council approval in their sole discretion. During the ENA period the City staff and the development team representatives will negotiate the terms of a ground lease and an Affordable Housing Agreement (AHA). If the negotiations are successful, the City staff will bring forward the draft ground lease and AHA for City Council consideration and action.
II. OVERVIEW OF THE DEVELOPMENT OPPORTUNITY
A. General Context
The City of Beverly Hills was incorporated in 1914, and it encompasses approximately 5.7 square miles. Beverly Hills has grown from a population of 550 in 1914 to 34,627 in 2019.
Beverly Hills is a general law city with a City Council – City Manager form of government.
Beverly Hills encompasses approximately 5.7 square miles, and approximately 92% of the land area is residential in nature. Residential development in Beverly Hills can be divided roughly into the following areas:
1. The area to the north of Sunset Boulevard consists primarily of estate-style properties.
2. The central area, located between Sunset and Santa Monica Boulevards, is characterized by large homes.
3. The area to the south of Santa Monica Boulevard consists largely of condominiums and apartment buildings along with smaller single family homes.
With numerous corporate headquarters, more than 200,000 people work in Beverly Hills each day. However, even with its world-class profile, Beverly Hills remains a small town at heart, proud of its neighborhoods, municipal services, fine schools, and community involvement.
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B. Potential Development Sites
On a preliminary basis the City has identified seven potential development sites. The sites are identified below, and descriptions are presented in Exhibit A:
9268 West 3rd Street
9298 West 3rd Street
336 Foothill Road
Alden Surface Parking Lot
8421 Wilshire Boulevard, Metro Staging Yard
327 South Robertson Boulevard
333 North Crescent Drive
The City owns numerous other properties throughout Beverly Hills. Upon request, the City will provide prospective proposers with a list that identifies the entire City-owned portfolio.
Proposers may choose to submit a proposal for any of these properties. The proposal should provide an explanation of how the City will recoup the opportunity costs associated with a proposal for any City-owned property outside of the seven identified potential development sites.
Zoning Designation and Development Standards
Prior to the conveyance of the development site, the City will agree to modify the development standards to allow for the selected development scope to be implemented.1 For the purposes of responding to this RFQ/P, respondents should assume that the City’s existing development standards for senior/disabled housing in multifamily zones will be acceptable. These standards can be summarized as follows:
1. The maximum allowable building height is 60 feet.
2. The maximum density is 165 units per acre.
1 Beverly Hills Municipal Code Article 13 of Chapter 1 of Title 1 states: “Notwithstanding any other provision of this code, no provision of this code shall apply to, direct, or restrict the city unless the provision specifically indicates that it is intended to apply to, direct, or restrict the city.” The City has previously invoked this provision for various projects that have been developed on City-owned properties.
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3. The base parking standard is one space per unit. However, this requirement can be reduced to .4 spaces per unit if an appropriate finding can be made by the City.
4. No more than 5% of the units in the project may include two bedrooms, and no unit in the project may include more than two bedrooms.
5. The following minimum unit sizes are applied by the existing development standards:
Unit Type
Minimum Size
(Square Feet)
Studio Units 415
One-Bedroom Units 540
Two-Bedroom Units 800
Respondents that wish to diverge from any of the identified development standards must submit the following information:
1. A narrative description of the proposed modifications to the identified development standards;
2. An explanation of why the proposed modifications are necessary; and
3. A description of how the proposed modifications will enhance the opportunity for the project to fulfill the City’s stated goals and objectives.
Project Amenities
It is the City’s objective to attract an apartment project dedicated to very low and low income senior citizens. In addition, the City would like the project to include public serving amenities such as a plaza or courtyard; ground floor retail space; and/or other amenities identified by the respondents.
Financing and Operation Plans
The City is seeking a development that meets the following financial criteria:
1. The project must be demonstrably financially feasible to construct and operate throughout the ground lease term; and
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2. The development team should maximize the use of available outside funding sources such as Low Income Housing Tax Credits (Tax Credits) in order to enhance the feasibility of providing very low and low income units.
III. THRESHOLD REQUIREMENTS
A. Development Team Experience Thresholds
Respondents must demonstrate the following threshold experience in order to be considered for selection in this RFQ/P process:
1. Experience in the successful development and management of affordable housing of comparable complexity and scale;
2. Demonstrated design experience with completed projects of comparable complexity, scale and nature;
3. Experience in application to and participation in federal, state, regional, and/or local affordable housing funding programs; and
4. Experience and capacity to conduct income verification and screening of tenants to ensure ongoing compliance with the defined income and affordability restrictions.
B. Transaction Structure
Respondents must agree to enter into negotiations with the City toward reaching agreements for the disposition and development of the selected development site. The transaction structure that will be entered into by the City will include the following component:
1. The development site will be conveyed to the selected development entity in the form of a long-term ground lease.
2. An AHA will be executed by the City and the selected development entity that includes the following key components:
a. A schedule of performance will be included that defines the time frame required for the developer to apply for and secure all the funding needed to complete the proposed scope of development.
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b. The depth of the proposed income and affordability restrictions will be defined. c. Maintenance quality standards will be defined by the City.
IV. SUBMISSION REQUIREMENTS
The RFQ/P is the City’s first step in evaluating respondents interest in the development opportunity. The RFQ/P response should express the development team’s interest, vision, and capability to undertake and operate the proposed project. Concise and focused responses are encouraged. Responses to this RFQ/P shall not exceed a total of 30 pages using a minimum 11 point font size
The submittal shall include each of the following elements:
A. Submittal Cover
The submittal cover must include the following information:
1. RFQ/P title;
2. Submittal due date; and
3. Identification of the development team; the name, address, telephone number, and e- mail address of the principal contact for the respondent must be provided. B. Table of Contents The table of contents shall list corresponding headings and pages to allow for easy reference by the City’s evaluation committee. C. Cover Letter
The cover letter shall be brief and clearly identify the respondent’s principal contact, including physical address, email address, and telephone number. The cover letter must include a statement verifying that the respondent will agree to adhere to the minimum income and affordability standards identified in this RFQ/P. The signatory shall be an individual with legal authority to bind the development team.
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D. Development Entity
1. Identify the entity that would enter into a ground lease and AHA with the City, including partners, lead planning and design firm(s), and other consultants, if known.
2. For each firm included in the development team, briefly describe its role, relevant experience, and specialization.
3. Identify the project manager and personnel that will be implementing the development concept through day-to-day management, and their level of experience and responsibility.
4. Provide resumes for each of the project managers and key staff members that will be working on the proposed project.
E. Conceptual Development Program
This section should identify the respondent’s cohesive vision for the proposed project, including:
1. An identification of the proposed development site.
2. A narrative description of the proposed development concept that includes the following:
a. Project Units:
i. The total number of units;
ii. The bedroom mix; and
iii. The income and affordability standards.
b. The number and type of parking spaces.
c. Any public amenities proposed to be provided.
d. A residency preference for Beverly Hills residents to the extent allowable by outside funding sources.
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3. A conceptual development plan that illustrates the proposed site and building configurations.
F. Financing Strategy
This section should demonstrate how the project can be constructed and operated in a financially feasible manner. The required information includes:
1. A brief narrative that describes:
a. The approach to implementing the development concept; b. The management and operation plan; and
c. How the project fits into the development team’s overall business strategy.
2. A conceptual construction period sources and uses of funds statement and a permanent sources and uses of funds statement for the project.
3. A development pro forma that identifies the construction costs for the proposed development scope broken down into direct construction costs, indirect construction costs, developer fee ,and financing costs.
4. The following operating pro forma information:
a. Estimates of income, operating expenses and debt service payments for the project at stabilized occupancy; and
b. A conceptual cash flow projection for the project over a 15-year period following the project’s full buildout and achievement of stabilized occupancy.
G. Financial Capability
1. Provide a narrative that identifies the development team’s capacity and financial strength to secure the equity and financing required to implement the proposed project.
2. Provide contact information for the debt, equity, and public financial assistance sources that were used to fund the costs associated with the projects identified in the previous section of this RFQ/P.
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3. Provide financial statements for the past two years that were independently prepared in accordance with generally accepted accounting principles.2
4. Disclose if any member of the development team has ever defaulted on its financial obligations, has had developments that were foreclosed upon, or if bankruptcy has ever been filed. 5. Identify any legal actions taken against any member of the development team in the past five years, including fair housing violations. H. Comparable Development/Property Management Experience
1. Provide, no fewer than three (3) and no more than five (5), examples of the development team’s experience developing affordable housing projects that are of the same magnitude and quality level as the proposed project. The City prefers examples of projects that are underway or were completed within the past five (5) years.
2. Describe the development team’s property management and affordability compliance experience with Low Income Housing Tax Credits, regulatory agreements, and other applicable state and federal rules and regulations.
3. Outline the process that will be applied to ensure high quality property management and project operations throughout the income and affordability covenant period. 4. Indicate if the development team has experience working on projects in jurisdictions similar to Beverly Hills. 5. Provide additional information regarding each member of the development team including:
a. The length of time in business;
b. The firm’s ownership structure;
c. The location of the principal offices; and
2 The financial statements can be submitted to the City Attorney under separate cover. The financial statements do not count towards the page limit imposed by this RFQ/P.
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d. The identification of the office that would undertake the proposed project.
I. Implementation Timeframe
1. Discuss the development team’s timeline to initiate and complete the proposed project’s development scope after executing a ground lease and an AHA. 2. Outline a critical path schedule for the proposed project’s completion and methodology of due diligence including:
a. Formulation of development concepts;
b. Financing strategy;
c. City planning reviews, and
d. Completion of the proposed development scope.
J. Potential Conflicts of Interest
Disclose if any member(s) of the development team staff, board of directors, or other governing body is or has been any of the following within the past two years:
1. A City of Beverly Hills employee or consultant;
2. A City of Beverly Hills City Councilperson;
3. A Board or Commission member who has direct influence on the use of public funding.
V. AVAILABLE RESOURCES
In order to pose questions pertaining to this RFQ/P and to receive answers to the questions posed by other proposers, development teams must submit a Notice of Intent to Respond form attached as Exhibit B to this RFQ/P by 4:00 PM on 14 days following distribution of the RFQ/P. Please submit the form via email to Logan Phillippo at [email protected] with copy to [email protected] and [email protected].
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Request for Qualifications –Affordable Housing Opportunity P a g e | 11 City of Beverly Hills
VI. RFQ/P SUBMITTALS AND QUESTIONS
Development teams responding to this RFQ/P must submit one (1) original hard copy, four (4) additional hard copies, and one (1) digital PDF file (on a thumb drive or cd). Responses to this RFQ/P shall not exceed a total of 30 pages using a minimum 11 point font size. The submissions shall be placed in a sealed envelope that is addressed to:
City of Beverly Hills
455 North Rexford Drive
Beverly Hills, California 90210
Attention: Logan Phillippo, Real Estate/Special Programs Request for Qualifications
Affordable Housing Development Opportunity
City of Beverly Hills
Responses to this RFQ/P are due no later than 4:00 PM on 2 months following distribution of the RFQ/P. Incomplete submittals, incorrect information, or late submittals shall be cause for disqualification. Copies received by e-mail and/or fax will not be accepted.
Questions regarding this RFQ/P must be submitted by email prior to 4:00 PM on 21 days following distribution of the RFQ/P. Please submit all questions via email to Logan Phillippo at [email protected] with copy to [email protected] and [email protected]. For questions timely submitted, the City will provide final written responses by 7 days following the deadline to submit questions to all interested parties that have filled out and submitted the Notice of Intent to Respond form attached as Exhibit B to this RFQ/P. VII. SELECTION PROCESS AND CRITERIA Respondents will be evaluated on the strength and experience of the development team, the team’s vision for the affordable housing use of the development site, and the long-term management and operation of the proposed project. The City has assigned the following point system to the specific evaluation criteria:
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Request for Qualifications –Affordable Housing Opportunity P a g e | 12 City of Beverly Hills
Criteria Maximum Points
Development Entity 20
Conceptual Development Program 25
Financing Strategy / Financial Capability 25
Comparable Development / Management Experience 20
Implementation Timeline 10
Total 100
The City anticipates that interviews will be held with the shortlisted development teams.
Following the interviews, the selection committee may recommend a finalist development team with which to enter into an ENA, subject to City Council consideration and approval.
VIII. POTENTIAL FUTURE OPPORTUNITIES
The City has an inclusionary housing program that will result in the development of units that are subject to income and affordability covenants. The City hopes to engage an outside entity to administer the affordable housing portfolio. This information is provided for contextual purposes only. It is not a part of this RFQ/P.
IX. CAVEATS
A. Rights and Understandings
The City reserves the following rights to take the following actions with respect to the RFQ/P:
1. Accept or reject any submittals received in response to the RFQ/P.
2. Accept, reject, or negotiate modifications to any of the submissions received in response to the RFQ/P.
3. Issue additional solicitations for proposals and/or addenda to the RFQ/P. 4. Negotiate with one or more the respondents.
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Request for Qualifications –Affordable Housing Opportunity P a g e | 13 City of Beverly Hills
5. Select any submission as the basis for negotiations, and to negotiate with respondents for amendments or other modifications to their submissions.
6. Waive any irregularities in any submission.
7. Conduct investigations with respect the qualifications of each respondent; and/or to obtain additional information deemed necessary to evaluate the respondent’s experience and financial capabilities.
B. Cost Liability
The City is not liable to pay or reimburse any costs incurred by the respondents in the RFQ/P process. This includes any of the costs that may be incurred by the development team by undertaking the following activities:
1. The preparation of its response to the RFQ/P.
2. The response to any request for information made by the City during the selection process.
3. Negotiations with the City on any issue related to the RFQ/P.
4. Participation in interviews associated with the developer selection process.
5. Negotiations with the City related to the preparation of an ENA.
6. Negotiations with the City related to the preparation of a ground lease and an AHA.
C. Amendments
Any amendments to the RFQ/P will be issued by the City. The City will not be bound by any oral statements or modifications. If the RFQ/P is amended, all terms and conditions that are not modified will remain unchanged. Respondents shall acknowledge receipt of each amendment to the RFQ/P in writing by including a statement to such effect in its submission.
All respondents should note that the award of any contract pursuant to this solicitation is dependent upon the recommendation of the City staff and the approval of the City Council.
Thank you for your interest in this opportunity.
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Request for Qualifications –Affordable Housing Opportunity City of Beverly Hills
EXHIBIT A
DESCRIPTIONS OF POTENTIAL DEVELOPMENT SITES
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Request for Qualifications –Affordable Housing Opportunity City of Beverly Hills
EXHIBIT B
NOTICE OF INTENT TO RESPOND
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Request for Qualifications –Affordable Housing Opportunity City of Beverly Hills
NOTICE OF INTENT TO RESPOND
REQUEST FOR QUALIFICATIONS
AFFORDABLE HOUSING OPPORTUNITY
CITY OF BEVERLY HILLS
The purpose of the Notice of Intent to Respond is to help the City to manage information and to ensure that communications regarding this RFQ/P reach the intended recipients. Answers to questions raised during the RFQ/P process will only be sent to respondents that complete and return a Notice of Intent to Respond. Completing and submitting this Notice does not bind the undersigned to submit a response to the RFQ/P.
The authorized representative identified in the Notice of Intent to Respond will serve as the single point of contact with the City throughout the RFQ/P process. All communications to the respondent will be addressed to the authorized representative. No other methods will be used to respond to any questions received by the City during the RFQ/P process. The Notice of Intent to Respond must be returned via email by 14 days following distribution of the RFQ/P, and questions related to the RFQ/P or the Site must be submitted via email by 21 days following distribution of the RFQ/P. The City will provide final written responses by 7 days following the deadline to submit questions to all parties that submit the Notice of Intent to Respond.
The point of contact for the City is
Logan Phillippo, at [email protected]
Organization/Team Name: _______________________________________________________ Authorized Representative: _______________________________________________________ Street Address: _________________________________________________________________ City: _______________________________ State: _____ Zip code: _________ Telephone #: _________________________ Email Address: _______________________