City Council Agenda Report
November 4, 2025
TO: Honorable City Council
FROM: Jesus M. Gomez, City Manager
BY: Alex Hamilton, Interim Director of Community Development SUBJECT: RESOLUTION NO. 25-52 – APPROVING THE SECOND AMENDMENT TO THE
GROUND LEASE, AN EASEMENT AGREEMENT, AND COVENANTS,
CONDITIONS, AND RESTRICTIONS FOR THE WALK PROJECT SITE
Background:
The Ground Lease Agreement between the City and Primestor Norwalk Entertainment. LLC (“Primestor”) was approved in October 2022 (“Original Ground Lease”). The City leased a portion of City Property, including but not limited to the Surface Parking Area, to Primestor for the development and construction of a mixed use development (the “Project”) consisting of (i) approximately three hundred seventy-four (374) residential units; (ii) approximately 94,398 square feet of commercial uses, which may include, but not be limited to, food and beverage establishments, retail, health and wellness facilities, and grocery or supermarket uses; and (iii) approximately 119,643 square feet of ground-floor open space/plaza area that is publicly accessible but privately maintained and operated. The City Council subsequently approved the First Amendment to the Ground Lease in January 2025.
Analysis:
A. Second Amendment to Ground Lease (“Second Amendment”) The Second Amendment proposes to amend the Original Ground Lease in order to: (i) acknowledge and confirm that the Affordable Housing Parcel has been released from the Premises under the Ground Lease. Under the terms of the Original Ground Lease, it was anticipated that portions of the Project would be released from the Original Ground Lease to facilitate the financing and development of individual components of the Project. Following the said release, the Affordable Housing Parcel will be subject to an affordable housing ground lease; (ii) increase the area of the Premises under the Original Ground Lease to include the area adjacent to the City Hall building; and (iii) apply a rent credit against first and second year rent
City Council November 4, 2025
Resolution No. 25-52 – Second Amendment to Ground
Lease; an Easement Agreement and Covenants,
Conditions and Restrictions
Page No. 2
1 4
6 3
payments consistent with the terms of the Exclusive Negotiation Agreement previously entered into by and between the City and Primestor (“ENA”).
In addition, the Second Amendment also adds property adjacent to the City Hall building measuring approximately 5,615 square feet to the Premises under the Original Ground Lease which will be improved and incorporated into the Project’s community serving plaza.
Lastly, the Second Amendment also amends the Original Ground Lease to provide for the reimbursement of certain Project entitlement costs incurred by Primestor in accordance with the terms of the ENA as a credit against the first and second year rent. Under the Second Amendment, Primestor would be entitled to a rent credit of $500,000 in year 1 and $397,747.25 rent credit in year 2 for Project entitlement costs.
B. Easement Agreement
The City and Primestor desire to enter into an Easement Agreement in order to grant certain non-exclusive rights in, on, over, under, across, and through the easement area on the City Hall Parcel (as shown below) to Primestor to develop and construct improvements within the easement area that will be seamlessly integrated with the Project’s community plaza. After completion, Primestor will be responsible for ongoing maintenance of the easement area improvements.
C. Declaration of Covenants, Conditions, and Restrictions (“CC&R”) Also for City Council’s consideration is the Declaration of CC&Rs for the common areas within the Project that will be shared by the City and the Project’s commercial and residential
City Council November 4, 2025
Resolution No. 25-52 – Second Amendment to Ground
Lease; an Easement Agreement and Covenants,
Conditions and Restrictions
Page No. 3
1 4
6 3
components such as the community plaza, all sidewalks, driveways, landscape and other improvements (excluding buildings).
The CC&R is a legal document establishing a set of legal rules and terms that govern how the Project common areas will be used and maintained and the duties and obligations of the parties. The CC&R ensures that the Project common areas are managed and well maintained for the life of the Project. CC&Rs are very common tools for all master planned development types from residential condominiums, office, retail, and industrial developments that have single or multiple common ownership interests in the project.
The CC&R is set up to allow for Primestor to assume the responsibilities for all maintenance obligations and then offset set costs as part of the “operating expenses”. The final amount of offset will be subject to City and Primestor annual review of expenses that would be applied against base rent paid to the City by Primestor.
Environmental:
The City Council certified the Final Environmental Impact Report for the Project on October 4, 2022 through City Council Resolution No. 22-57 (“FEIR”), which evaluated the environmental impacts associated with development and implementation of the Project. The Second Amendment to the Ground Lease, Easement Agreement, and the CC&R are actions associated with the implementation of the Project and are within the scope of the FEIR and none of the conditions set forth under California Environmental Quality Act (“CEQA”) Guidelines Section 15162 requiring the preparation of a subsequent EIR have been met. Therefore, pursuant to CEQA Guidelines Sections 15162 and 15168(c)(2), no further environmental review is required.
Fiscal Impact:
The City will receive sales taxes, property taxes, and percentage rent payments from the Mixed- Use Project. All revenue receipts including net percentage rent payments will be subject to annual review and approval of a financial statement submitted every calendar year pursuant to the terms of the Ground Lease.
Citizens Advised:
N/A
Strategic Plan 2023 Implementation:
The recommended action will further the City’s Strategic Plan Goal 3: Build Public Destinations and implement the adopted Specific Plan.
City Council November 4, 2025
Resolution No. 25-52 – Second Amendment to Ground
Lease; an Easement Agreement and Covenants,
Conditions and Restrictions
Page No. 4
1 4
6 3
Recommended Action:
Staff recommend City Council adopt Resolution No. 25-52, A RESOLUTION OF THE CITY
COUNCIL OF THE CITY OF NORWALK APPROVING THE SECOND AMENDMENT TO A
GROUND LEASE BY AND BETWEEN THE CITY OF NORWALK AND PRIMESTOR NORWALK ENTERTAINMENT, LLC; AN EASEMENT AGREEMENT; AND COVENANTS, CONDITIONS, AND RESTRICTIONS; and authorize the City Manager to execute the Second Amendment to the Ground Lease Agreement, the Easement Agreement, and the Covenants, Conditions and Restrictions and any other ancillary documents and amendments in a form approved by the City Attorney.
Attachments:
1. Resolution No. 25-52
2. Second Amendment to the Ground Lease
3. Easement Agreement
4. Declaration of Covenants, Conditions, and Restrictions