To: Honorable Mayor and Members of Town Council
From: David L. Corliss, Town Manager
Title
Discussion/Direction: Recommendation for Additional Review with Castle Brae Development, LLC on Possible Public/Private Partnership on the Existing Town Parking Lot South of Town Hall
Body
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Executive Summary
Town Council directed staff to issue a request for proposals on the possible reuse/repurposing of the existing Town-owned parking lot located on South Street between Perry and Wilcox, south of Town Hall. The Town and Downtown Development Authority had recently been approached about possible interest in reuse/repurposing of the parking lot as part of possible redevelopment; the RFP process was pursued to allow any interested parties to submit a response.
An information session held in July was attended by over 20 interested parties (developers, architects, engineers, etc.). Ultimately, the Town received two responses to the RFP, one from Castle Brae Development LLC, and the other from White Construction Group/MARS Development LLC.
The purpose of this memo is to provide Council information regarding the proposals and to seek Council direction to further engage Castle Brae Development regarding its project concept.
Discussion
Background
Following submission of their proposals, an interview committee separately interviewed both responding entities. In addition to myself, the interview committee was composed of: Councilmember Jason Bower; DDA Chair Greg Boman; DDA Executive Director Kevin Tilson; Castle Rock Economic Development Council Vice President Marcus Notheisen; Downtown Alliance Assistant Director Angie Vencill; Town Attorney Bob Slentz; Finance Director Trish Muller; and Daniel Guimond of Economic and Planning Systems, whom the Town has retained as a consultant to assist in financial analysis of the project.
The Committee was pleased with the level of interest and potential investment in Downtown and saw merit in both proposals’ potential to deliver high-quality redevelopment and unique opportunities to the community. It’s important to note that these proposals are not the final design, layout, use or elevation plans for these sites - substantial due diligence and feasibility analysis going forward would be required from any development team.
Just as the proposals are at concept stage, as any public involvement (property use, land use entitlement, incentives, etc.) is at concept stage. The use of any public incentives (e.g. tax-increment, tax-sharing, etc.) is likely but undetermined at this point. Similarly, there has been no commitment from the Town concerning use of the parking lot or incentive items - Town Council has complete authority to proceed or halt consideration of the redevelopment up to the point of making a contractual commitment for any redevelopment project.
Following is a high-level summary of the proposed projects, understanding that a number of details remain to be determined.
Castle Brae Development
The project concept proposes to include the Town Hall parking lot and the three lots along Wilcox Street that Castle Brae has under contracts for purchase. The project includes 132 residential units (condominiums for sale), approximately 22,000 square feet of retail/restaurants and an increased gain of public parking of approximately 250 parking spaces (total of approximately 344 public parking spaces). The project provides 212 parking spaces for the condo units, as well.
The total project square footage is estimated at 410,000 square feet and total cost estimated at $67 million, representing a substantial investment in the community. A town plaza integrates the project into Festival Park and Town Hall. The project concept also includes the railroad horn quiet zone in the downtown area. Additional conceptual details are provided in the submission from Castle Brae (Attachment A).
White/Mars
The project concept includes a hotel (approximately 65 rooms), approximately 100 public parking spaces, a performing arts space, outdoor rooftop gathering use, office uses and other uses. A “black box” performing space would integrate into the hotel complex and community uses, with adjacencies next to Festival Park. In addition to use of the Town Hall parking lot, the proposal represents this group does not have first position for acquisition of the property along Wilcox Street at this time, but has backup proposals to the property owners. One floor of underground parking is provided for the project (public and user associated), and additional surface parking is anticipated.
At nearly $60 million, the concept represents a substantial investment in Downtown, providing a number of assets that would be valuable to the immediate area and the community at-large. Additional conceptual details are provided in the submission from White/Mars (Attachment B).
Recommendation
Both projects would represent positive redevelopment potential in our Downtown and are viewed as meritorious concepts for consideration. It was the consensus of the interview committee that the Castle Brae project provides a stronger concept for next-step discussions at this time. Strong merits of the Castle Brae concept include an existing contract for sale for the property along Wilcox Street; the opportunity to substantially increase public parking at this location (potentially going from the existing 95 public parking spaces to approximately 344 public parking spaces); and the potential success of likely end users for the project - retail/restaurants and owner-occupied residential units.
If discussions with Castle Brae do not conclude with a successful redevelopment agreement, consideration should be made of re-engaging the White/Mars team for discussions.
It is important to note that the commitment from the Town is to enter into good-faith negotiations, on an exclusive basis, with Castle Brae LLC. This commitment would be for a limited period of time, to allow for the extensive due diligence and agreement negotiation necessary to determine whether a redevelopment is in both parties’ mutual interest. The Town is not committing to any final project nor financial arrangement at this time. Instead, it is committing to a negotiation period to seek to arrive at a recommended agreement.
After Council consideration October 3, this item will be presented to the Downtown Development Authority for its review/approval on October 5.
Recommended Motion
I move to approve the recommended selection of Castle Brae Development LLC for the limited purpose of negotiation of a potential redevelopment of the Town parking lot located southeast of Town Hall, and other related redevelopment requirements for the project concept as presented by Castle Brae Development LLC, until March 1, 2018, or until a redevelopment agreement is presented for Council consideration, whichever occurs first.
Attachments
Attachment A Submission from Castle Brae
Attachment B Submission from White/Mars