File #: 2015-1526
Type: Regular Agenda Item
Body: City Council
On agenda: 4/21/2015
Title: Status Report on Site A Development at Alameda Point, including Presentation of Updated Development Plan, Approach to Transportation, Disposition and Development Agreement (DDA). (Base Reuse 819099)
Attachments: 1. Exhibit 1 - Summary of City Council, Planning Board and Other Community Comments, 2. Exhibit 2 - Updated Development Plan, 3. Exhibit 3 - Alameda Point Partners (APP) Phase 0 Implementation Plan and Schedule in the Exclusive Negotiation Agreement, 4. Exhibit 4 - Letter from APP Providing Evidence for Waiver of Alameda Municipal Code Section 30-53, 5. Exhibit 5 - Alameda Point Transportation Demand Management Plan (May 20, 2014), 6. Exhibit 6 - Outline of Site A Transportation Demand Management Compliance Strategy, 7. Exhibit 7 - Term Sheet for DDA for Site A at Alameda Point in the ENA, 8. External Correspondence

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Status Report on Site A Development at Alameda Point, including Presentation of Updated Development Plan, Approach to Transportation, Disposition and Development Agreement (DDA). (Base Reuse 819099)

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To: Honorable Mayor and Members of the City Council

From: John A. Russo, City Manager

Re: Status report on Site A development at Alameda Point, including presentation of updated development plan, approach to transportation, Disposition and Development Agreement (DDA)

BACKGROUND

On November 18, 2014, the City Council approved an Exclusive Negotiation Agreement (ENA) with Alameda Point Partners (APP), the preferred developer for a 68-acre mixed-use development site at Alameda Point (Site A) consistent with the Waterfront Town Center Plan. The ENA requires that APP complete a Disposition and Development Agreement (DDA) and a Development Plan for Site A before the end of the 6-month ENA period. As a result, this evening's meeting is part of the ongoing extensive community process that includes monthly hearings before the City Council and Planning Board, meetings with other boards and commissions, stakeholder meetings and community open houses.

The following is a summary of the meetings that have been held to date:
· On January 20, 2015, the City Council held a public meeting to review the initial development concepts and development terms.
· On January 26, 2015, the Planning Board held its first public workshop on the APP conceptual Development Plan.
· On January 29th APP and the City also held a community open house at Building 15 at Alameda Point.
· On February 5, 2015, the Historical Advisory Board reviewed the draft Development Plan.
· On February 12, 2015, the Recreation and Park Commission reviewed the draft Development Plan.
· On February 17, 2015, the City Council reviewed an updated Development Plan, comments from the various boards and commissions and staff's initial responses to those comments.

· On February 23, 2015, the Planning Board reviewed an updated Development Plan.
· On February 25, 2015 at the joint meeting of the Transportation Commission and the Planning Board, the Transportation Commission reviewed the draft Development Plan for the first time and both boards provided initial comments on a transportation strategy for Site A consistent with the recently approved Alameda Point transportation strategy.
· On March 4, 2015, APP and the City held a second open house at Bladium for the community to review updates to the draft Development Plan since the January 29th open house.
· On March 23, 2015, the Planning Board reviewed an updated Development Plan, and an outline on the transportation strategy for Site A.
· On March 28, 2015, APP and the City held a walking tour and lunch at Site A, highlighting key areas in APP's Development Plan.
As the City staff and APP receive comments, the APP design team has continued to revise and improve the Development Plan to respond to the City Council, Planning Board, other boards and commissions, and community comments. Exhibit 1 provides a summary of the comments received at these meetings. The Development Plan is being updated on an ongoing basis. Given the deadlines for reviewing and releasing staff reports, not all of the comments received on the Development Plan can be addressed in time for the very next meeting. Exhibit 1 serves as a tracking document to ensure that staff and APP address the comments received. Exhibit 2 represents the most recent, updated version of the draft Development Plan.
DISCUSSION

This staff report is divided into three sections to provide information on three important topics related to the proposed Site A development: (1) the updated Development Plan; (2) the approved Alameda Point Transportation Demand Management Plan (TDM Plan) and Site A's compliance with this document; and (3) a summary of the DDA as it currently stands.
I. Update on Development Plan for Site A
City staff and APP would like the City Council and the Alameda community to review and comment on the updated version of the Development Plan for Site A (Exhibit 2). To inform the discussion, the following provides a description of some of the key aspects of the proposed transit-oriented and mixed-use Development Plan for Site A.
A. Transit Oriented Development
· Eight hundred of the 1,425 total units programmed for Alameda Point are included in the Site A Development Plan. The 800 residential units are complimented by up to 400,000 square feet of commercial/retail development in existing buildings and approximately 200,000 square feet of retail and hotel space in new buildings.
· All 800 residential units are provided in multifamily and townhome building types on eight blocks located immediately adjacent to the primary transit corridor along the Ralph Appezzato Memorial Parkway (RAMP) that links a future ferry terminal at the Seaplane Lagoon with the planned Bus Rapid Transit (BRT) service between Site A and downtown Oakland.
· To facilitate a pedestrian oriented environment, every Alameda Point Site A household will be within a one-block walk or less of the BRT line and protected bicycle lanes along Ralph Appezzato Memorial Parkway (RAMP).
· Consistent with the Town Center Plan, the parking ratios and requirements proposed for Site A are designed to encourage a transit-oriented development by creating disincentives for residents and employees to use single occupancy vehicles, at the same time providing a sufficient level of public parking to be competitive for attracting retail and other commercial businesses. The Site A development will provide up to 1.5 spaces per residential unit and a shared public parking lot at the heart of the retail center that will ultimately be converted to a parking structure. The public parking area is located on Block 14. Each townhome unit will have one or two parking spaces on the ground floor (for an average of 1.5 spaces per unit) and all of the multifamily housing will have shared parking areas under each building. All the multifamily housing parking will be leased separately from the unit to project occupants. Parking management issues will also be addressed in APP's Site A TDM compliance strategy consistent with the TDM Plan discussed below.
B. Mixed-Use Development
· The marketing and potential lease of the 400,000 square feet of existing buildings for commercial reuse will commence immediately upon execution of the DDA regardless of what phase they are in. Phases in the Development Plan represent the timing of the transfer of land ownership from the City to APP, not the timing of reuse of the existing buildings.
· The existing buildings will be marketed for primarily light industrial and retail uses with the potential for "tasting room" or ancillary retail uses within the light industrial buildings similar to the existing wineries and distilleries along Spirits Alley at Alameda Point. These uses are complementary to the commercial uses being planned for the adjacent Building 9 at Alameda Point, which is planned for food and beverage manufacturing incubator space associated with local and regional suppliers to the Whole Foods Market company.
· The commercial space will be also marketed to other clusters of "makers" or in other words, small-scale local and regional manufacturing companies (or individuals incubating a manufacturing idea) with potential to expand and grow on-site. Other uses could include start-up and expanding clean-tech companies similar to Wrightspeed, Natel Energy, and the former Makani Power (recently acquired by Google) who are existing tenants at Alameda Point.
· APP's Phase 0 plan (Exhibit 3), which will commence almost immediately after the execution of the DDA, serves three major purposes: (1) it creates immediate activity and a sense of place along the waterfront at the core of Site A, which will maximize the potential for fostering a high-quality mixed-use community; (2) it serves as an incubator or "phase 1" for the retail development component of Site A by creating a low-cost environment for retail uses, which will allow them to occur concurrently with other development (typically, new construction of retail space occurs after other types of new development occurs), as well as more organically, resulting ultimately in the attraction of authentic commercial uses and in a high-quality and unique retail experience; and (3) it provides immediate waterfront amenities for the entire Alameda community to enjoy and experience, which begins the much-anticipated process of integrating Alameda Point with the rest of the City.
· Of the 800 units, approximately 630 of the units will be in stacked flat buildings over parking and approximately 170 of the units will be in attached townhomes and row houses.
· To create a comfortable transition between the adjacent Bayport neighborhood and the commercial center at the Seaplane Lagoon, the height and residential density of the eight residential blocks increases along RAMP and across Site A from Main Street to the Seaplane Lagoon. The blocks facing Main Street and the Bayport neighborhood are the lowest density blocks with three-story townhomes. The blocks closest to the Seaplane Lagoon and the commercial center of the project will provide space for the higher density multifamily housing units with up to six-story buildings that will support the commercial uses and waterfront activities.
· To facilitate a pedestrian oriented "town center" environment, Blocks 3, 4, 8, 9, and 11 (shown on page 12 of Exhibit 2) will have ground floor retail and/or adaptive spaces facing RAMP.

C. Affordable Housing and Density Bonus Waiver of Development Standards

· To provide for a mixed income, transit orient community, the Site A Development Plan ensures that 200 of the 800 units (25%) are to be restricted to very low-, low- and moderate-income households. The other 600 units will be market-rate units.

· One hundred twenty-eight (128) of the 200 affordable units will be permanently restricted for very low- and low-income households. The very low and low income units will be constructed by the nonprofit affordable housing developer, Eden Housing, in two buildings on a shared podium on Block 8 in the first phase of the development. Eden Housing will also provide long-term property management.

· Eden Housing is exploring two possibilities for the project. In one scenario, all 128 units are designed for family housing, in the second scenario, 50% of the units (approximately 64 units) are designed for low and very low income seniors. In addition to the 128 very low- and low-income units on Block 8, the Site A development will include 72 moderate income units that will be dispersed throughout the market rate buildings on the other residential blocks.

· Consistent with the Town Center Plan, the Development Plan does not include any single family housing, which requires a waiver from Alameda Municipal Code (AMC) 30-53. With 25% affordable housing, the project qualifies for affordable density bonuses, concessions, incentives and waivers pursuant to State law and AMC section 30-17 (Density Bonus Ordinance). The project applicant, APP, is not requesting any density bonus units, but they are requesting a waiver from AMC Section 30-53 Multiple Dwelling Units Prohibited consistent with AMC 30-17.12 (Waivers of Development Standards that Physically Preclude Construction) (Exhibit 4).

· Under State and local ordinances, the City may waive the prohibition on multifamily family housing for this Development Plan, if it is determined that the waiver is necessary because the prohibition physically precludes the applicant from accommodating the 800 units on the site. Exhibit 4 provides evidence that the waiver is necessary to enable Site A to accommodate the 800 units.

· Pursuant to Chapter 8 of the Town Center Plan, APP will be submitting the floor plans and elevations for each building for Planning Board design review and approval prior to submittal of building permits for each building over the next five to 20 years. The elevation and floor plans will be submitted prior to design review for each building and prior to construction of each structure with multifamily housing.

D. Phasing

· As shown in Exhibit 2, the 800 units will be constructed in phases over time. Upon approval of the Development Plan and DDA, the APP design team will prepare architectural drawings for design review approval by the Planning Board for each building. The submittal of subsequent design review plans will occur incrementally over the course of the development. Over the next two to four years, APP plans to submit design review plans for the approximately 650 residential units in Phase 1. Phase 1 includes the area generally north of RAMP, and Phase 2 includes the area generally south of RAMP. The land in Phase 2 is projected to be transferred from the United States Navy to the City in 2020. The final design and construction of these properties and the final 150 units will not occur until sometime after transfer of the property in 2021 or 2022.

· Through Master Plans, such as the Town Center Plan, and Development Agreements, the AMC allows the City to phase development of large mixed-use projects that will be constructed over five to 20 years and provide major public amenities.

· The phasing of subsequent design review submittals and approvals benefits the Alameda community. Phasing allows the community to change and improve the final design of each building to reflect current community preferences and current best practices rather than being bound to the community's preferences that might have existed five to 15 years earlier, when the initial approvals for the project were granted. Affordable housing needs, funding sources, and architectural preferences change over time.

E. Rental Opportunities and Home Ownership Opportunities
The proportion of rental to for-sale units will likely vary over time depending on market conditions and demand, but at this time, APP is planning for:
· 530 rental units in the first phase, which includes the very low- and low-income units.
· 120 for-sale townhomes in the first phase,
· 150 for-sale townhomes and condominiums in the second phase.
Including the affordable units, the ratio of rental to for-sale is approximately 66% to 34%, respectively. Financing structures for the low and very low affordable demand rental. When excluding the low and very low units from the mix, the rent vs. own ratio among market rate is 50%/50%, respectively. When considering the ratio of rental housing to for-sale housing, the City and community may consider the following: (1) major commercial users and employers are more likely to locate at Alameda Point if a significant amount of high-quality nearby rental housing is provided for their workforce; (2) rental housing has a greater potential to attract residents who use alternative modes of transit; (3) current market prices for condominiums in the local Alameda market do not support the high cost of the land and cost of infrastructure improvements at Alameda Point; and (4) very little market rate rental housing has been constructed in Alameda over the last several decades.

II. Alameda Point TDM Plan and Site A TDM Compliance Strategy

On May 20, 2014, the City Council approved the TDM Plan for Alameda Point consistent with the General Plan and the Alameda Point Environmental Impact Report (EIR), which require that all new development at Alameda Point comply with a TDM plan to mitigate traffic impacts from new development during peak hours and to support the creation of a transit-oriented development at Alameda Point (Exhibit 5). Specifically, the TDM Plan requires that all new development at Alameda Point, such as the proposed Site A development, prepare a TDM Compliance Strategy consistent with the TDM Plan. The ENA also requires that APP prepare a TDM Compliance Strategy consistent with the TDM Plan.
A. Alameda Point TDM Plan
TDM refers to an array of strategies, measures, and services which, individually or combined into a comprehensive program, creates the envisioned transit-oriented development at Alameda Point; achieves the City of Alameda's General Plan goals to reduce automobile trips, and in particular, targets the reduction of Single Occupant Vehicle (SOV) trips; and mitigates potential traffic impacts. TDM strategies are designed to change travel behavior (when, where, and by what means people travel) by using combinations of incentives, disincentives, and convenient transit services.

Consistent with the General Plan, the performance objectives of the TDM Plan are to reduce peak hour trips generated from Alameda Point, as projected in the EIR, by 10 percent for new residential development and 30 percent for new commercial development.
The EIR requires that all development projects at Alameda Point comply with the TDM Plan as a mitigation measure for the transportation impacts identified in the EIR. Beyond mitigating the potential traffic impacts of Alameda Point development, TDM promotes regional goals that include reducing traffic congestion on the Bay Area's routes of regional significance; reducing the primary source of mobile emissions; improving safety, and thus increasing mobility, for those who bicycle, walk or take public transit; conserving energy; and improving the health of the population by encouraging physically active forms of transportation.
The developers, property owners, residents, and employers of Alameda Point will be required to fund, comply with, and collaboratively manage, monitor and continuously improve upon a TDM program that mitigates traffic impacts as well as improves the quality of life for those who live and work at Alameda Point. The primary components of the TDM Plan include:
1. Transit Services: The TDM Plan addresses the provision of public transit or privately operated vehicles primarily for convenient, frequent, and direct connection to the regional rapid transit systems aimed at supplementing, complementing, and expanding AC Transit, Bay Area Rapid Transit (BART) and Water Emergency Transportation Authority (WETA) services.
2. Car and Bicycle Share Programs: The TDM Plan includes the provision of a collective system of vehicles and bicycles accessible to employees who use transit and residents who do not have access to a vehicle for business or personal purposes.
3. Parking Management Strategy: In concert with the development standards regulating private parking included in the recently approved Alameda Point Zoning District, the Parking Management Strategy in the TDM Plan outlines a plan for the public supply of parking that is designed to utilize public and private parking spaces efficiently and encourage alternate modes of transportation. The careful management of parking supply and pricing can be very effective in influencing parking utilization and use of single occupancy vehicles.
4. Support Services: The TDM Plan includes a variety of services and incentives that support and encourage the use of programs such as free AC Transit Easy-Passes, carpool matching service, and a guaranteed ride home in the event of emergencies for transit users.
5. Transportation Management Association (TMA). The TMA will oversee the ongoing implementation of the TDM Plan, including compliance strategies prepared by individual employers and resident associations, and is funded by special tax revenue generated annually by Alameda Point property owners. The TMA Board of Directors will be appointed by the members who are paying into the TMA (i.e. the representatives of property-owners and businesses with the TMA boundaries) and is likely to include some combination of representatives of the following organizations: Alameda Point employers, tenant associations, Homeowner Associations, and developers; City of Alameda staff; the Transportation Commission, and/or regional transit agencies. In early years before major development has occurred, the services and functions of the TMA may be served by a collaboration of City staff, the first developers, such as APP, transit agencies and any key tenants.
6. Annual Monitoring and Reporting. The TDM Plan tasks the TMA with annual monitoring and reporting of TDM Plan performance in meeting the established trip reduction goals. The monitoring will result in refinements and modifications to the Plan as development occurs. Monitoring will use a combination of survey instruments; traffic counts; utilization surveys of pedestrian, bicycle, and transit facilities and services; and employee and resident surveys. This approach to monitoring and enforcement results in a system of financial awards and penalties because the length of the cycle and the cost associated with introducing and monitoring new programs is an incentive to implement robust TDM strategies and packages of complementary services from the beginning.
7. Compliance with the TDM Plan. As required by the Mitigation Monitoring and Reporting Program (MMRP) from the EIR, and the recently approved Alameda Point Zoning District, all new development at Alameda Point will be required to comply with the TDM Plan as part of any DDA between the City and a developer, and/or as a condition of approval for any planning approval, including Development Plan, use permit, or design review. Any DDA and/or condition of approval will require that all property owners pay a special tax or fee to fund the Plan and require through covenants, conditions and restrictions, or other enforceable real property restriction that runs with the land, that all commercial tenant associations, major employers, residential tenant association, and homeowner's associations join the TMA, file a Compliance Strategy with the TMA consistent with this Plan, implement their Compliance Strategy, and refine it, as necessary.
8. Modifications to the TDM Plan. The TMA will be responsible for managing the successful implementation of the TDM Plan with annual reporting to the City's Transportation Commission. The actual implementation of the TDM Plan requires flexibility to respond to evolving and unexpected development, demographic, market and technological conditions. As a result, the TMA has the discretion to implement the TDM Plan in substantial conformance with the intent and strategies outlined in the TDM Plan, but is not required to adhere literally to every proposed aspect of the TDM Plan. It is expected and necessary that the TMA will adapt the implementation strategies for the TDM Plan as new development occurs and more information exists about the type, amount and location of new development and its associated traffic patterns.
That said, the TMA must perform a 5-year review with the City Council and Transportation Commission, to determine if any amendments to the major components of the TDM Plan are warranted. Additionally, the TMA can request approval by the City Council (with a recommendation from the Transportation Commission) of a major modification to the TDM Plan at any other time deemed necessary by the TMA.
A detailed summary of the TMA provided services and programs in the near- and long-term are provided in Table 1 on page 19 of the TDM Plan. The TDM Plan provides flexibility to 1) adapt to future phasing of Alameda Point land uses; 2) implement transit services starting at the commencement of development and introduce larger and more comprehensive services as needed by development; and 3) use annual monitoring of performance as a mechanism for continuous improvement of individual employer compliance strategies and TMA-provided services. Collectively, the property owners, residents and tenants of Alameda Point will fund, implement, and direct the management of the TDM Plan and be accountable for the TDM Plan's success. The TDM plan requires an annual reporting of traffic data analysis to the Transportation Commission. Additionally, under the Council-approved TDM plan, the TMA must perform a 5-year review with the City Council and Transportation Commission, to determine if any amendments to the major components of the Plan are warranted. As stated above, every development at Alameda Point will be required to comply with, and provide an annual financial contribution to fund the management and implementation of the TDM Plan.

The TDM Plan also includes an annual operating budget for implementing the TDM Plan and providing the services discussed above during its initial stages of implementation and at buildout of the proposed development. A summary of this budget is provided in Table 6 on page 48 of the TDM Plan. The capital costs associated with the TDM Plan are included in the recently approved MIP and a portion of those have been allocated to the Site A development in their Infrastructure Package. Ultimately, the annual operating budget will be funded through a portion of the special tax or fee revenues generated from property owners at Alameda Point, parking charges, and parking enforcement violation fines. During the initial stages of implementation, funding will come from a $150,000 grant already awarded to the City from the Metropolitan Transportation Commission (MTC) to assist in the implementation of the TDM Plan (TDM Implementation Grant), developer contributions, as well as some initial special tax or assessment revenues. The TDM Implementation Grant is funding a contract with Fehr & Peers and Wendy Silvani (transportation consultants that specialize in TDM) to help the City successfully implement its TDM Plan. The TDM Plan estimates the annual operating budget for the initial phase at approximately $360,000 and for buildout at approximately $1 million. These budgets are net of parking charges and enforcement revenues. The annual operating budget will grow and change as the TDM Plan evolves over time with the phasing of development.
B. Site A TDM Compliance Strategy
APP and its transportation consultant are preparing a TDM Compliance Strategy for the Site A development consistent with the TDM Plan. An outline of their proposed TDM Strategy that they presented at the joint Planning Board and Transportation Commission meeting on February 25, 2015 is provided in Exhibit 6. The Site A TDM Compliance Strategy will describe how the Site A development will be complying with and implementing all of the key aspects of the TDM Plan that are summarized above, including a funding and phasing plan. In certain instances, such as initial transit services, APP is proposing providing services at a greater level than proposed in the TDM Plan.
Because Site A is the first large-scale development at Alameda Point, the Site A TDM Compliance Strategy is being highly coordinated with the City's efforts to carry out the work under the TDM Implementation Grant. For instance, the work for the TDM Implementation Grant is charged with evaluating options for the organization of the Alameda Point TMA and creating the TMA; creating checklists for TDM Compliance Strategies, developing a database for the monitoring program; developing a commuter website and initial marketing materials; and planning initial transit service and TDM programs. The timing, funding, and responsibility for implementing these tasks are integral to the success of the Site A TDM Compliance Strategy and will be carefully coordinated. Additionally, the TDM Plan for Alameda Point, the TDM Implementation Grant, and Site A TDM Compliance Strategy will be highly coordinated with the City's current effort to create a Citywide Transportation Delivery Strategy that was discussed with the City Council on April 1, 2015.
Staff received initial comments on the Site A TDM Compliance Strategy from the Transportation Commission and Planning Board that will be summarized verbally to the City Council this evening. City staff and APP look forward to also receiving feedback from the City Council this evening so that APP can consider these comments as it moves forward with a draft of the TDM Compliance Strategy.
III. Summary of the Site A Disposition and Development Agreement
The ENA grants the potential developer of Site A (APP) the exclusive right to negotiate terms of disposition and development of Site A with the City for six months. The ENA includes the potential for two three-month extensions, which can be granted by the City Manager. If successful, once the ENA period is finished both parties will have agreed to a DDA (i.e., price and terms of payment for the land and development obligations), in addition to the Development Plan discussed above. Exhibit C (Term Sheet) of the ENA outlines the agreed upon key terms of a DDA (Exhibit 7). Building upon the Term Sheet, City staff has been negotiating the DDA with APP over the past several months. While the details of the DDA are still under negotiation, the following provides an overview of the organization and content of the DDA for Site A so that the City Council knows what to expect when City staff comes to the City Council in the next couple of months recommending approval of an agreed upon DDA:
1. Term of the Agreement. The DDA is expected to have a 20 year term. The DDA will also include a Milestone Schedule that sets out the schedule for development of the Property during that Term of the DDA.

2. Financial Terms. This section of the DDA consists of the following provisions, many of which were included in the Term Sheet:

a. Non-refundable deposits provided by the developer, including $200,000 that was provided at time of execution of the ENA and an additional $100,000 to be provided at execution of the DDA;

b. A total land value of $108 million. Developer will pay the land value by installing backbone infrastructure valued at $88 million, including park improvements; $5 million for the planned sports complex at Alameda Point; a $5 million credit for accelerating the Seaplane Lagoon Plaza improvements (contemplated in the $88 million infrastructure); and $10 million for a new ferry terminal; and

c. Profit participation payments (or a contingent purchase price) consistent with the details provided in the Term Sheet. The profit participation provisions are included in the DDA to ensure that the City participates in any windfall profit from the development of Site A after the developer achieves a market rate of return on their investment. The DDA contemplates increasing percentages of profit participation by the City (in addition to the land payment described above) as the developer achieves increasing rates of return on their investment, referred to as an Internal Rate of Return (IRR). This section of the DDA also defines eligible development costs, gross proceeds, and IRR, among other terms necessary for calculating the potential profit participation payments. This section also describes the City's right to audit the developer's financials to determine whether profit participation payments were warranted.

3. Financing Plan. This section requires the developer to provide a project financing plan for the entire Site A project. Additionally, prior to the conveyance of each phase of the property to the developer, the developer will be required to submit a detailed phase financing plan that includes evidence of commitment of both debt and equity sources of funding so that the City can have confidence that the developer has sufficient resources to complete the development. The project financing plan will include: a detailed development budget and cash flow analysis, including all sources and uses of funds; a description of any partnerships for equity funding; and a plan and budget for creation of any public financing districts.

4. Disposition of Property and Escrow. This section outlines the process for transferring each phase of land within Site A from the City to the developer, including the conditions that must be met by the developer and City before this can occur. The City will not transfer the property to the developer prior to the Developer obtaining all required approvals necessary for the construction of the infrastructure in the phase to be transferred. Additional conditions require that the City has title to the property, the developer has evidence of insurance and that a final map has been approved for the phase creating the parcel to be transferred. This section also establishes the outside closing dates for the transfer of each phase of property. Consistent with the Term Sheet, the Developer has the option to extend the outside closing date for transfer of a phase by paying the City an extension fee.

5. Infrastructure Construction. The backbone infrastructure to be constructed by the developer consistent with the Master Infrastructure Plan for Alameda Point was clearly delineated in the Request for Qualifications from developers for Site A and the ENA (Infrastructure Package). The DDA will have a detailed plan for the phasing of the Infrastructure Package consistent with the Term Sheet that highlighted a number of key improvements that the developer agreed to provide in Phase 1, including the complete extension of RAMP between Main Street and Ferry Point Road at the Seaplane Lagoon, $5 million worth of permanent waterfront park improvements, the sewer line between Site A and the sewer pump station at the northern edge of the property, and the Main Street intersection improvements. This section of the DDA also includes the requirements of the developer to enter into a Subdivision Improvement Agreement, including issuance of payment and performance bonds or other equivalent security to ensure completion of the infrastructure improvements; to negotiate in good faith a project labor agreement with the Building and Construction Trades Council for Alameda County; to pay prevailing wages consistent with State and local laws; and to comply with an agreement the City has with the Alameda Point Collaborative (APC), one of the three supportive housing providers located at Alameda Point, to establish a goal that residents of APC perform 15 percent of all apprentice hours.
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6. Vertical Construction. This section of the DDA sets forth the developer's obligations for construction of the vertical improvements of the Site A project (i.e., buildings) consistent with the City's approvals (i.e., Development Plan, design review, and building permits). Prior to commencement of vertical construction, the developer will be required to provide the City with a completion assurance either in the form of payment and performance bonds or completion guarantee.

7. Affordable Housing Requirements. As described above, 25% of the 800 housing units planned for Site A are required to be permanently restricted to very-low, low, and moderate income households. The 128 very-low and low-income housing units will be constructed by the nonprofit developer, Eden housing in a stand-alone project to maximize the potential for obtaining financing, while the remaining moderate income units will be integrated with the market rate housing projects. A detailed affordable housing agreement will be attached to the DDA that outlines the developer's and Eden Housing's obligations regarding constructing the affordable housing.

8. Additional Developer Obligations. This section of the DDA is a catch-all section that highlights other developer obligations related to the development of Site A, such as Project Covenants, Conditions & Restrictions (CC&Rs), which require private property owners to maintain private improvements adjacent to and visible from the public right-of-way in a first class condition, compliance with the mitigation, monitoring and reporting program (MMRP) contained in the EIR, payment of taxes, non-discrimination, among other terms.

9. Phase 0 Activities Plan. As discussed above, the developer must prepare and implement a Phase 0 Activities Plan consistent with Exhibit C of the Term Sheet (Exhibit 3). This section of the DDA outlines the developer's obligations to implement the Phase 0 Activities Plan.

10. Master Lease and Master Tidelands Lease. This section of the DDA outlines the conditions under which the City will lease certain buildings and property to the developer under two circumstances: (1) the reuse and lease of specifically identified existing buildings and their premises outside of the tidelands areas before conveyance of ownership to APP of the related land occurs (Master Lease); and (2) any interim or long-term reuse and lease of buildings and land within the tidelands areas by the developer for up to 66 years (Master Tidelands Lease), as no fee title transfer of property can occur in the tidelands areas.

11. City Obligations. This section of the DDA outlines the City's obligations related to Site A, including processing permits and approvals, facilitating conveyance of land from the Navy, effectuating a tidelands trust exchange for each phase of land from the Navy, considering in good faith the formation of one or more community facilities districts to provide funds for construction and maintenance of infrastructure.

12. Assignment and Transfer. This section of the DDA limits the developer's rights to transfer its interest in the DDA and requires the City approval of any such assignment or transfer prior to the completion of construction. Certain transfers are allowed including for financing purposes, the sale and rental of residential and commercial space and transfers to affiliates of the developer.

13. Security Financing and Rights of Holders. Mortgages, deeds of trust, and other real property security instruments are permitted to be placed on the property for purposes of financing the development as authorized in this section of the DDA.

14. Hazardous Materials. This section outlines the developer's obligations regarding hazardous materials, requirements to notify the City of any discovery of hazardous materials and/or claim related to hazardous materials, and cross-references developer's hazardous materials indemnification, as contained in the following section.

15. Indemnification. This section describes the developer's obligations to indemnify the City for: the developer's or contractor's performance or non-performance under the DDA, hazardous materials, Phase 0 activities, the Master Lease, and Master Tidelands Lease.

16. Insurance Requirements. This section of the DDA sets out the insurance requirements that are imposed on the developer once property is conveyed to the developer, including comprehensive general liability, vehicle liability, worker's compensation, construction contractor's, and pollution liability insurance.

17. Default and Remedies. This section of the DDA governs the developer's and City's rights to terminate the DDA and the developer's and City's remedies for breach or failure under the DDA.
18. General Provisions. This section of the DDA includes numerous miscellaneous provisions, such as notices and communications, non-liability of officials, employees and agents, force majeure (i.e., extensions of the term for certain circumstances outside the either party's control), severability, legal actions, covenants to run with land, authority of developer, amendments, counterparts, among others.

19. Definitions and Exhibits. This section provides explanations of all of the "defined terms" in the DDA and lists the exhibits that are part of the DDA.
It is expected that the organization and some aspects of the content of the final DDA will change from what is described above over the next couple of months, as the document is still under negotiation. It is also important to note the City's obligations under the ENA are only to negotiate exclusively with APP and to consider approval of the DDA. The City is under no obligation to approve any document produced during the ENA period. The developer has also requested a Development Agreement (DA) that would vest the Site A's current and future project approvals for the term of the DDA. Generally speaking a DA would allow greater latitude and flexibility in imposing conditions and requirements on the project in the form of public benefits, and affords the developer greater assurance that once approved, the City's regulatory structure, e.g. its zoning code, will remain the same. The City is negotiating the terms of the DA with the developer as well.
FINANCIAL IMPACT

This is an informational item only. There is no financial impact as a result of this action.

ENVIRONMENTAL REVIEW

This report is for information only.

RECOMMENDATION

No action required. This item is for informational purposes only.
Respectfully submitted,
Jennifer Ott, Chief Operating Officer - Alameda Point
Financial Impact section reviewed,
Elena Adair, Finance Director
Exhibits:
1. Summary of City Council, Planning Board and Other Community Comments
2. Updated Development Plan
3. APP's Phase 0 Implementation Plan and Schedule in the ENA
4. Letter from APP Providing Evidence for Waiver of AMC 30-53
5. Alameda Point Transportation Demand Management Plan (May 20, 2014)
6. Outline of Site A Transportation Demand Management Compliance Strategy
7. Term Sheet for DDA for Site A at Alameda Point in the ENA