HomeMy WebLinkAboutReso 138-2021 (21-568)City of South San Francisco
_ P.O. Box 711 (City Hall,
400 Grand Avenue)
South San Francisco, CA
City Council
' Resolution: RES 138-2021
File Number: 21-568 Enactment Number: RES 138-2021
RESOLUTION APPROVING THE FOURTH
AMENDMENT TO THE EXCLUSIVE NEGOTIATING
RIGHTS AGREEMENT BETWEEN ENSEMBLE
INVESTMENTS, LLC AND THE CITY FOR A
PROPOSED HOTEL DEVELOPMENT AT OYSTER
POINT.
WHEREAS, the City is the owner of certain real property (the "Property") located in the City
of South San Francisco, California, known as County Assessor's Parcel Number ("APN") 015-010-970,
and more particularly shown as Parcel 6 on Parcel Map 17-0002 attached as Exhibit A; and
WHEREAS, on March 23, 2011, the City Council approved the Oyster Point Specific Plan and
certified the Phase 1 Project Environmental Impact Report which, among other things, planned for and
analyzed the potential environmental impacts of developing a new, full-service hotel with up to 350
rooms and 40,000 square feet of retail uses on the Property; and
WHEREAS, a Disposition and Development Agreement ("DDA") was executed on March 23,
2011, between Oyster Point Ventures, LLC, the South San Francisco Redevelopment Agency, and the
City of South San Francisco for the master development of Oyster Point, including the potential
development of a hotel on the Property; and
WHEREAS, the developer obligations identified in the DDA were reassigned to KR Oyster
Point, LLC ("Kilroy") in 2018, and requires Kilroy to perform and complete certain site work, grading,
and installation of infrastructure to prepare the Property for development; and
WHEREAS, in 2018, the City selected Ensemble Investments, LLC ("Ensemble") as the
preferred developer for the project and authorized the City Manager to execute an ENRA with Ensemble,
attached as Exhibit B; and
WHEREAS, the City Council approved the First Amendment to the ENRA which extended the
ENRA until November 25, 2020, attached as Exhibit C; and
WHEREAS, the City Council approved the Second Amendment to the ENRA which extended
the ENRA until April 23, 2021, attached as Exhibit D; and
WHEREAS, the City Council approved the Third Amendment to the ENRA which extended
the ENRA until July 22, 2021, attached as Exhibit E; and
City of South San Francisco Page 1
File Number: 21-568
Enactment Number: RES 138-2021
WHEREAS, the City and Ensemble have remaining terms that need to be negotiated before the
City Council can consider the approval of a mutually agreed upon Purchase and Sale Agreement.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of South San
Francisco that the City Council hereby:
1. Authorizes the City Manager to execute the Fourth Amendment to the Exclusive Negotiating
Rights Agreement with Ensemble Investments (Fourth Amendment), attached as Exhibit F, on behalf of
the City in substantially the same form as attached hereto; to make any revisions, amendments,
corrections and modifications to the Fourth Amendment, subject to the approval of the City Attorney,
deemed necessary to carry out the intent of this Resolution and which do not materially alter or increase
the City's obligations thereunder; and
2. Authorizes the City Manager to take any other related actions consistent with the intent of the
resolution.
At a meeting of the City Council on 7/14/2021, a motion was made by Vice Mayor Nagales,
seconded by Councilmember Nicolas, that this Resolution be approved. The motion passed.
Yes: 5 Mayor Addiego, Vice Mayor Nagales, Councilmember Nicolas, Councilmember
Coleman, and Councilmember Flores
1
Attest by 01A1
�70: Rosa G ea Acosta, City Clerk
City of South San Francisco Page 2
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EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
by and between
ENSEMBLE INVESTMENTS
and
CITY OF SOUTH SAN FRANCISCO
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
ENSEMBLE INVESTMENTS
THIS EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT (this "Agreement") is
entered into by and between the CITY OF SOUTH SAN FRANCISCO, a municipal
corporation ("City"), and ENSEMBLE INVESTMENTS, LLC, a California Limited Liability
Company ("Developer"), dated as of "(the "Effective Date"). City and Developer
are each referred to as ("Party") or collectiv ly referred to as the ("Parties").
WHEREAS, the City is the owner of certain real property (the "Property") located in
the City of South San Francisco, California, known as County Assessor's Parcel Number
("APN") 015-010-600, and more particularly shown as Parcel 6 on Parcel Map 17-0002 recorded
on September 25, 2017, attached hereto as Exhibit A, and incorporated herein by this reference;
and,
WHEREAS, on March 23, 2011, the City Council approved the Oyster Point Specific
Plan and certified the Oyster Point Specific Plan and Phase 1 Project Environmental Impact
Report which, among other things, planned for and analyzed the potential environmental impacts
of developing a new full-service hotel with up to 350 rooms and 40,000 square feet of retail uses
on the Property; and
WHEREAS, a Disposition and Development Agreement was executed on March 23,
2011, between Oyster Point Ventures, LLC, the South San Francisco Redevelopment Agency,
and the City of South San Francisco ("DDA") for the master development of Oyster Point
through a multi -phased project, which included the potential development of a hotel on an
approximately 4.7 acre portion of the Property known as the "Hotel Site,"; among other things,
the DDA requires Oyster Point Development, LLC, to perform certain site work, grading, and
installation of infrastructure to prepare for the Hotel Site for development; and,
WHEREAS, in 2017, the City solicited proposals from qualified hotel developers
through a RFQ/RFP process, and upon review of the responsive proposals, the City's Joint
Housing Standing Committee made a recommendation at its December 11, 2017, meeting that
the City enter into an Exclusive Negotiating Rights Agreement ("ENRA") with Developer for
the development of a new full-service hotel on the Hotel Site; and,
WHEREAS, the City is interested in ground leasing the Hotel Site to Developer in a
manner consistent with the DDA and this ENRA, contingent upon Developer preparing all
appropriate environmental review documents, applying for land use entitlements from the City,
and, if such entitlements are granted, constructing a full-service hotel ("Project") on the Hotel
Site as more particularly described in Exhibit B attached hereto and incorporated herein by this
reference as the Development Proposal ("Development Proposal"); and,
WHEREAS, Developer anticipates expending funds to prepare architectural and design
drawings and conduct certain studies that are needed to assess the feasibility of the Project and
seek any additional land use entitlements, and therefore requires a grant of exclusive negotiating
rights in order to be willing to make such expenditures; and,
WHEREAS, at its meeting on k vi I I t , 2018 the City approved this
Agreement and directed staff to commence negotiating the terms of a Lease Disposition and
Development Agreement ("LDDA"), with a form of Ground Lease Agreement for the Hotel Site
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
ENSEMBLE INVESTMENTS
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attached as an exhibit to the LDDA, in order for the Developer to pursue land use entitlements
for the Project.
NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties agree as follows.
1. Good Faith Efforts to Ne off. The Parties agree, for the term of this Agreement, to
negotiate diligently and in good faith the terms of a LDDA and Ground Lease Agreement
for the Hotel Site. Furthermore, the Parties agree to diligently and in good faith pursue
any third -party consent, authorization, approval, or exemption required in connection
with the preparation and execution of a LDDA and Ground Lease Agreement for the
future development of the Project on the Hotel Site. This Agreement does not, however,
impose a binding obligation on City to convey any interest in the Hotel Site to Developer,
nor does it obligate City to grant any approvals or authorizations required for the
development of the Project on the Hotel Site.
a. If City believes that Developer is not negotiating diligently and in good faith, City
will give written notice thereof to Developer who will then have ten (10) business
days to commence negotiating in good faith. Following the failure of Developer
to thereafter commence negotiating in good faith within such ten (10) business
day period, this Agreement may be terminated by City. If this Agreement is
terminated by City pursuant to the above sentence, Developer acknowledges and
agrees that City will suffer damages, including lost opportunities to pursue other
development alternatives for the Hotel Site. Therefore, the Parties agree that if
this Agreement is terminated as provided above, City will retain the full Payment
and Deposit amounts (as defined in Section 5 of this Agreement, infra), plus any
interest thereon, as fixed and liquidated damages and not as a penalty, and
following such termination neither Party will have any further rights against or
liability to the other under this Agreement, except as set forth in Section 15 of this
Agreement.
b. If Developer believes that City is not negotiating diligently and in good faith,
Developer will give written notice thereof to City which will then have ten (10)
business days to commence negotiating in good faith. Following the failure of
City to thereafter commence negotiating in good faith within such ten (10)
business -day period, this Agreement may be terminated by Developer. In the event
of such termination by Developer, City will return a prorated portion of the
Deposit to Developer in accordance with the provisions of Section 5(c) of this
Agreement and neither Party will have any further rights against or liability to the
other under this Agreement, except as set forth in Section 15 of this Agreement.
C. If the Parties proceed to negotiate diligently and in good faith, but are unable to
reach agreement on the terms of a LDDA and Ground Lease Agreement, then
City will return a prorated portion of the Deposit to Developer in accordance with
the provisions of Section 5(c) of this Agreement and neither Party will have any
further rights against or liability to the other under this Agreement, except as set
forth in Section 15 of this Agreement.
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2. Developer's Exclusive Right to Negotiate With City. City agrees that it will not, during
the term of this Agreement, directly or indirectly, through any officer, employee, agent,
or otherwise, solicit, initiate or encourage the submission of bids, offers or proposals by
any person or entity with respect to the acquisition of any interest in the Hotel Site or the
development of the Hotel Site, and City will not engage any broker, financial adviser or
consultant to initiate or encourage proposals or offers from other parties with respect to
the disposition or development of the Hotel Site or any portion thereof.
Furthermore, City will not, directly or indirectly, through any officer, employee, agent or
otherwise, engage in negotiations concerning any such transaction with, or provide
information to, any person other than Developer and its representatives with a view to
engaging, or preparing to engage, that person with respect to the disposition or
development of the Hotel Site or any portion thereof.
3. Term.
a. The term of this Agreement ("Term") commences on the Effective Date, and will
terminate six (6) months from the Effective Date, unless extended or earlier
terminated as provided herein.
b. During the Term, Developer will provide City with written reports every thirty
(30) days that summarize Developer's actions taken in furtherance of this
Agreement, including but not limited to: due diligence review of the Hotel Site,
commencement of any environmental requirements under the California
Environmental Quality Act ("CEQA"), preparation of architecture and
construction plans, attendance at City meetings, master developer meetings,
adherence to a mutually agreed upon master schedule, and general progress
towards future development of the Hotel Site.
C. The Term of this Agreement may be extended for up to a maximum of two
separate ninety (90) day periods upon the receipt of an additional non-refundable
payment by Developer of twenty-five thousand dollars ($25,000) for each ninety
day extension period ("ENRA Extension Payment"), and the consent of the City
acting through and at the discretion of its City Manager, or his/her designee
("City Manager"). Developer understands that the City will only consider
extension(s) of the. Term of this Agreement where Developer has demonstrated, to
the City's satisfaction, substantial progress toward development of the Hotel Site,
including, but not limited to, submittal of a development application, submittal of
environmental review documents necessary to satisfy compliance with CEQA,
submittal of architecture and construction plans, payment of any applicable
processing and plan check fees, or pursuing land use entitlements for the Project.
4. Relationship of the Parties. Nothing in this Agreement creates between the Parties the
relationship of lessor and lessee, of buyer and seller, or of partners or joint venturers.
5. Deposit and Payment to City.
a. In consideration for the right to exclusively negotiate under this Agreement,
Developer will, within five (5) days of the Effective Date, remit to City a deposit
M
in the amount of One Hundred Thousand Dollars ($100,000), which if a LDDA is
executed that includes a final form of a Ground Lease Agreement, the deposit will
be credited toward the rent payable under the final negotiated ground lease
("Deposit"). City will deposit the Deposit in an interest bearing account of the
City and any interest, when received by City, will become part of the Deposit.
During the term of this Agreement, Developer will reimburse City for all
reasonable staff and City consultant time incurred in preparing the LDDA and
Ground Lease Agreement, and any related documents for the disposition of Hotel
Site to Developer. Developer will, within five (5) days of the Effective Date,
remit to City a payment in the amount of Twenty -Five Thousand Dollars
($25,000) in immediately available funds ("Payment"). Any funds previously
deposited by Developer pursuant to a completed preliminary application will be
credited towards the Payment. City will deposit the Payment in an interest bearing
account of City and any interest, when received by City, will become part of the
Payment. The Payment may be drawn upon by City to reimburse staff, City
Attorney, and City consultant costs for preparing the LDDA and any related
documents, including but not limited to the form of Ground Lease Agreement, at
their standard published hourly rates. Should the full amount of the Payment be
exhausted during the Term of this Agreement, City may require the Developer to
provide additional funds necessary to reimburse staff and consultant costs
expended in connection with preparation of the LDDA and any related
documents, including but not Iimited to the form of Ground Lease Agreement,.
Documentation of City's rate schedule for staff, staff time spent, and consultant
costs will be retained by City and provided to Developer upon request.
b. City agrees to account for the Deposit and Payment, interest earnings, and any
expenditures made in furtherance of this Agreement.
C. In the event that Developer terminates this Agreement before the expiration of the
Term pursuant to Section IN or Section 14(c), the City will return any prorated
portion of the Deposit to the Developer. The prorated Deposit will be calculated
by dividing the full $100,000 Depositby the number of months in the Agreement
Term. This amount will be multiplied by the number of months remaining on the
Term at the time of Developer's termination. The resulting figure will be the
prorated Deposit that the City will pay to the Developer.
d. In the event the Agreement is terminated by either Party for any reason other than
Developer's breach of its obligations under this Agreement, the remaining
balance of the Payment and any interest earned will be returned to Developer,
minus amounts that the City retains attributable to the amount of costs and
consulting fees actually and reasonably incurred and documented by City in
implementing this Agreement, as set forth in subsection (a) of this Section 5.
e. In addition to the payments to City discussed herein, Developer shall be subject to
all applicable fees imposed by the City for processing land use entitlements as set
forth in the City's adopted Master Fee Resolution and any applicable cost
recovery and indemnification agreements.
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6. Terms and Conditions of the LDDA and Ground Lease Agreement. The Parties agree to
use diligent and good faith efforts to successfully negotiate a LDDA, including a final
form of Ground Lease Agreement which would be attached to the LDDA, the conditions
of closing and delivery of the final Ground Lease Agreement, and the scope of
Developer's obligations to design and construct improvements on the Hotel Site
including, but not limited to, project design, access to recreational amenities, and
programming of the hotel. The Parties agree that the terms of the LDDA and form of
Ground Lease Agreement shall be based on those terms set forth herein and in Exhibit B.
attached hereto and incorporated herein by reference.
7. Developer's Studies, Right of Entry.
a. During the Term of this Agreement, Developer will bear all costs and expenses
associated with preparing any studies, surveys, plans, specifications and reports
("Developer's Studies") Developer deems necessary or desirable, in Developer's
sole discretion, to complete its due diligence for the Property. Developer's Studies
may include, without limitation, title investigation, marketing, feasibility, soils,
seismic and environmental studies, financial feasibility analyses and design
studies. Developer will have rights of access to the Hotel Site to prepare
Developer's Studies.
b. Developer hereby agrees to notify the City seventy-two (72) hours in advance of
its intention to enter the Hotel Site.
C. As construction commences on Phase 1 of adjacent developments by Oyster Point
Development, LLC, Developer will, with City's support, make diligent and good
faith efforts to coordinate its development efforts with the master construction
schedule for Phase 1 to ensure there is no disruption of access to the Hotel Site.
d. Developer will provide the City with work plans, drawings, and descriptions of
any intrusive sampling it intends to do. Developer must keep the Hotel Site in a
safe condition during its entry. Developer shall repair, restore and return the
Property to its condition immediately preceding Developer's entry thereon at
Developer's sole expense.
e. Without limiting any other indemnity provisions set forth in this Agreement,
Developer shall indemnify, defend (with counsel approved by City) and hold the
City, its officials, officers, employees, and volunteers harmless from and against
all claims resulting from or arising in connection with entry upon the Property by
Developer or Developer's agents, employees, consultants, contractors or
subcontractors pursuant to this Section 7. Developer's indemnification
obligations set forth in this Section 7 shall survive the termination of this
Agreement.
f. If upon expiration of the Term of this Agreement the Parties have not successfully
negotiated a LDDA and Ground Lease Agreement, Developer will, upon City's
written request, provide City within fifteen (15) days following said date of
expiration copies of any non-proprietary Developer's Studies prepared by third
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parties completed by such date. Developer will also provide City with copies of
any non-proprietary Developer's Studies prepared by third parties completed after
the expiration of the Term within fifteen ( 15) days following completion of such
studies, or if Developer intends not to complete any such Developer Studies,
Developer will provide City with copies of such uncompleted studies.
S. City's Reports and Studies,. Within twenty (20) days following the Effective Date, City
will make available or make arrangements to make available to Developer for review or
copying at Developer's expense all non -privileged studies, surveys, plans, specifications,
reports, and other documents with respect to the Property that City has in its possession
or control, which have not already been provided to Developer. Studies or documents
prepared by City and its agents solely for the purpose of negotiating the terms of a LDDA
and Ground Lease Agreement and related documents are not required to be provided by
City to Developer and are excluded from this requirement.
9. Developer's Pro Forma, Evidence of Financing and Project Schedule Related to Potential
Aeproval of a Ground Lease.
a. At least 45 days prior to City consideration of the Project entitlements, Developer
will provide City with a pro forma for the Project that confirms the financial
feasibility of Developer's proposed development of the Hotel Site, estimated
project budget, project schedule, and planned financing for the Project. The
parties agree that the LDDA will contain language that provides that: (1) not later
than forty-five (45) days prior to the execution and delivery of the final ground
lease, Developer will provide evidence satisfactory to City that Developer has
secured binding commitments, subject only to commercially reasonable
conditions, for all funding necessary for the successful completion of the Project,
and (2) issuance of a building permit for the Project shall be a condition of
execution and delivery of the final Ground Lease Agreement.
b. Prior to the end of the term of the ENRA, Developer will provide the City with
the following deliverables:
i. Complete schematic (35%) construction drawings;
ii. Final agreed upon termsheet for the LDDA, and the form of Ground Lease
Agreement;
iii. Proof of initial outreach conducted with key stakeholder groups, in
coordination with the City; and
iv. A short list of hotel brands that have indicated conditional interest in the
site.
10. Full Disclosure. Developer is required to make full disclosure to City of its principals;
officers; major stockholders, partners or members; joint venturers; negotiators;
development managers; consultants and directly involved managerial employees
(collectively, "Developer Parties"). Any material change in the identity of the Developer
Parties will be subject to the approval of City Manager and his or her designee, which will
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not be unreasonably withheld. Developer also agrees to disclose both the type of planned
financing and identity of any lenders or mortgagees in connection with the financing of
the Project.
11. Periodic Reporting to Governing Bodies. City will report periodically to the City Council
and other local and regional agencies, on the status of negotiations, and Developer may
be asked to attend such meetings to provide those bodies with a status update of their
development efforts related to this Agreement.
12. Confidentiality: Dissemination of Information. To the extent permitted by law, during the
term of this Agreement, each Party will obtain the consent of the other Party prior to
issuing or permitting any of its officers, employees or agents to issue any press release or
other information to the press with respect to this Agreement; provided however, no Party
will be prohibited from supplying any information to its representatives, agents,
attorneys, advisors, financing sources and others to the extent necessary to accomplish
the activities contemplated hereby so long as such representatives, agents, attorneys,
advisors, financing sources and others are made aware of the terms of this Section.
Nothing contained in this Agreement will prevent either Party at any time from
furnishing any required information to any governmental entity or authority pursuant to a
legal requirement or from complying with its legal or contractual obligations.
13. No Binding Committments. City has no legal obligation to grant any approvals or
authorizations for the ground lease of the Hotel Site or any development thereon until the
LDDA and Ground Lease Agreement have been approved by the City Council. Such
approvals, and any future approvals required as part of the entitlement process, are
subject to completion of environmental review by City in accordance with CEQA, and
City shall not take any discretionary actions committing it to a particular course of action
in connection with the Project until City has completed, considered and
certified/approved any additionally required CEQA environmental review documents.
14. Termination.
a. This Agreement may be terminated by mutual consent.
b. City will have the right to terminate this Agreement upon its good faith
determination that Developer is not proceeding diligently and in good faith to
carry out its obligations pursuant to this Agreement in accordance with the
provisions set forth in Section 1 of this Agreement.
C. Developer will have the right to terminate this Agreement upon its good faith
determination that City is not proceeding diligently and in good faith to carry out
its obligations pursuant to this Agreement in accordance with the provisions set
forth in Section 1 of this Agreement.
d. Developer will have the right to terminate this Agreement if the results of
Developer's investigation of the Hotel Site are unsatisfactory, in Developer's sole
and absolute discretion, with respect to Developer's desired development
activities, or if Developer is unable to obtain other necessary approvals, rights or
interests. If Developer terminates this Agreement pursuant to this Section 14(d),
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then City will return a prorated portion of the Deposit to Developer in accordance
with the provisions of Section 5( c ) of this Agreement and the remaining balance
of the Payment in accordance with the provisions of Section 5(d), and neither
Party will have any further rights against or liability to the other under this
Agreement, except as set forth in Section 15 of this Agreement.
e. Neither Party will have the right to seek an award of damages if this Agreement is
terminated pursuant to this Section.
15. Effect of Termination. Upon termination as provided herein, or upon the expiration of the
Term and any extensions thereof without the Parties having successfully negotiated a
Ground Lease Agreement, this Agreement will terminate, and there will be no further
liability or obligation on the part of either of the Parties or their respective officers,
employees, agents or other representatives; provided however, the provisions of Section 5
(Payment to City), Section 7(d) (Indemnification), Section 12 (Confidentiality;
Dissemination of Information), Section 17 (Indemnification), and Section 21 (Brokers)
will survive such termination. Provided further, that upon termination or expiration of
this Agreement without the Parties having successfully negotiated a LDDA and Ground
Lease Agreement, Developer will deliver to City any non-proprietary Developer's
Studies pursuant to the provisions of Section 7 of this Agreement.
16. Notices. Except as otherwise specified in this Agreement, all notices to be sent pursuant
to this Agreement will be made in writing, and sent to the Parties at their respective
addresses specified below or to such other address as a Party may designate by written
notice delivered to the other parties in accordance with this Section. All such notices will
be sent by:
a. Personal delivery, in which case notice is effective upon delivery;
b. Certified or registered mail, return receipt requested, in which case notice will be
deemed delivered on receipt if delivery is confirmed by a return receipt;
C. Nationally recognized overnight courier, with charges prepaid or charged to the
sender's account, in which case notice is effective on delivery if delivery is
confirmed by the delivery service;
d. Facsimile transmission, in which case notice will be deemed delivered upon
transmittal, provided that
i. A duplicate copy of the notice is promptly delivered by first-class or
certified mail or by overnight delivery, or
H. A transmission report is generated reflecting the accurate transmission
thereof. Any notice given by facsimile will be considered to have been
received on the next business day if it is received after 5:00 p.m.
recipient's time or on a nonbusiness day.
City : City of South San Francisco
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Attn: City Manager
400 Grand Avenue
South San Francisco, CA 94080
Tel (650) 877-8501
Fax (650) 829-6609
[email protected]
cc: [email protected]
with a copy to: Meyers Nave
Attn: Jason Rosenberg
555 12t11 Street, Suite 1500
Oakland, CA 94607
Tel (510) 808-200
Fax (510) 444-1108
irosenber,g @meyersnave.com
Developer: Ensemble Investments
Attn: Brian Ehrlich
2603 Camino Ramon
Suite 200
San Ramon, CA 94583
Tel (415) 652-9920
[email protected]
with a copy to: Arent Fox LLP
Attn: M.J. Pritchett
55 2nd Street, 21st Floor
San Francisco, CA 94105
Tel (415) 757-5501
Fax (415) 757-5501
[email protected]
17. Indemnification. Developer hereby covenants, on behalf of itself and its permitted
successors and assigns, to indemnify, hold harmless and defend City and its elected and
appointed officials, officers, agents, representatives and employees ("Indemnitees")
from and against all claims, costs (including without limitation reasonable attorneys' fees
and litigation costs) and liability, arising out of any breach of this Agreement by
Developer or arising out of or in connection with Developer's access to and entry on the
Property pursuant to Section 7 of this Agreement; provided however, Developer will
have no indemnification obligation with respect to the gross negligence or willful
misconduct of any Indemnitee.
18. Severability. If any term or provision of this Agreement or the application thereof will,
to any extent, be held to be invalid or unenforceable, such term or provision will be
ineffective to the extent of such invalidity or unenforceability without invalidating or
rendering unenforceable the remaining terms and provisions of this Agreement or the
application of such terms and provisions to circumstances other than those as to which it
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is held invalid or unenforceable unless an essential purpose of this Agreement would be
defeated by loss of the invalid or unenforceable provision.
19. Entire Agreement, Amendments In Writing,• Counte arts. This Agreement contains the
entire understanding of the Parties with respect to the subject matter hereof and
supersedes all prior and contemporaneous agreements and understandings, oral and
written, between the Parties with respect to such subject matter. This Agreement may be
amended only by a written instrument executed by the Parties or their successors in
interest. This Agreement may be executed in multiple counterparts, each of which will
be an original and all of which together will constitute one agreement.
20. Successors and Assigns, No _Third -Party Beneficiaries. This Agreement will be binding
upon and inure to the benefit of the Parties and their respective successors and assigns;
provided however, that neither Party will transfer or assign any of such Party's rights
hereunder by operation of law or otherwise without the prior written consent of the other
Party, and any such transfer or assignment without such consent will be void.
Notwithstanding the foregoing, Developer is permitted to assign this Agreement without
such written consent, provided that Developer assigns this Agreement to an entity that is
controlled by Developer. Subject to the immediately preceding sentence, this Agreement
is not intended to benefit, and will not run to the benefit of or be enforceable by, any
other person or entity other than the Parties and their permitted successors and assigns.
21. Brokers. Each Party warrants and represents to the other that no brokers have been
retained or consulted in connection with the selection of the Developer. Each Party agrees
to defend, indemnify and hold harmless the other Party from any claims, expenses, costs
or liabilities arising in connection with a breach of this warranty and representation. The
terms of this Section will survive the expiration or earlier termination of this Agreement.
22. Amendments. Unless otherwise provided in this Agreement, the City Manager will be
authorized to enter into all written amendments, consents or waivers under this
Agreement on behalf of the City without further authorization by the City Council.
Nothing herein, however, will be deemed to prevent the City Manager from requesting
formal approval by the City Council if the City Manager, in his or her sole discretion,
determines to seek such approval.
23. Captions. The captions of the sections and articles of this Agreement are for convenience
only and are not intended to affect the interpretation or construction of the provisions
hereof.
24. Governing Law. This Agreement will be governed by and construed in accordance with
the laws of the State of California.
SIGNATURES ON FOLLOWING PAGE
5112
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first
written above.
CITY
f
By: �� `( I
Mike Futrell
g,ity Manager
ATTEST>----->(`
City
APPROVED AS TA -F91:
wa
Jason Rosenberg
City Attorney
DEVELOPER
'Foe -
rv� C'%% e. L1 ( V%—,j lti rrz—
APPROVED AS TO FORM:
By:
tunfor Ensemble Investments
" -�*•,1� P�- . rtt•-Ititi, arcr•�- f-oi`
-11-
Exhibit A
PROPERTY
atla
Exhibit B
DEVELOPMENT PROPOSAL
Criteria
Type of land use agreement
Lease Disposition and Development Agreement,
with a Ground Lease Agreement as an exhibit
Proposed Ground Lease Payment
$500k Base + 0.5% of Gross Revenue (or
4,000 SF
financial equivalent) at project stabilization,
subject to CPI increases every five years
Proposed Project Amenities
thereafter
Common space and open space of up to 1.5 acres
50% TOT rebate for a ten year period
Lease Term
TBD
Deposit
$100,000 Deposit to be credited against future
rent under the Ground Lease.
Payment
$25,0100 for reimbursement of staff time, which
W P\ hmict-A 1 ,PVPI/�11P1 rnnw h� van ;—A +—
provide additional funds
ENRA Extension Payment $25,000 additional non-refundable payment for
each City approved extension of 90 -days with a
maximum of two separate 90 -day extension
periods
Development Type Ground -up construction hotel
Hotel Brand Full service, upper upscale or upscale hotel with:
- Complimentary services for hotel guests
and the public, which may include
restaurants, cafes, day spas, and similar
- Meeting and conference space
- Nationally -recognized brand with
competitive travel rewards program
- Customizable design like Hilton Curio or
Proposed Height of Hotel
7 floors
Proposed Number of Rooms
One full service hotel with 243 rooms
Proposed Food and Beverage
4,000 SF
Proposed Meeting Space
11,500 SF
Proposed Project Amenities
Common space and open space of up to 1.5 acres
-13-
Parking
330 stalls
Performance Milestones for:
• Negotiation of a Lease
Disposition and Development
Agreement and form of
Ground Lease Agreement
• Execution of Lease
Disposition and Development
Agreement
• Developer will apply for a
Precise Plan, pursuant to the
Oyster Point Specific Plan
and DDA
• Project Entitlement
• Building Permit Issuance
• Execution of Ground Lease
Agreement
• Master Schedule
Card Check Neutrality Agreement Explore feasibility
9H
FIRST AMENDMENT TO EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
This First Amendment to the Exclusive Negotiating Rights Agreement (this
"First Amendment") is made effective as of'
2� , 2019 ("Effective
Date") by and between the CITY OF SOUTH SA FRANCISCO, a municipal
corporation ("City"), and ENSEMBLE INVESTMENTS, LLC, a California Limited
Liability Company ("Developer"), dated as of 1 2 the "Effective Date"). City
and Developer are each referred to as ("Party") ol colle tively referred to as the
("Parties").
RECITALS
WHEREAS, the City is the owner of certain real property (the "Property")
located in the City of South San Francisco, California, known as County Assessor's
Parcel Number ("APN") 015-010-600, and more particularly shown as Parcel 6 on Parcel
Map 17-0002 recorded on September 25, 2017, attached hereto as Exhibit A to the
Exclusive Negotiating Rights Agreement ("ENRA"), and incorporated herein by this
reference; and,
WHEREAS, at its meeting on April
Developer and directed staff to commet
development and property disposition; and,
11, 2018 the City approved an ENRA with
.e negotiating the terms of the project
WHEREAS, the initially proposed development proposal, as described in Exhibit
B to the ENRA, included a development proposal which included a ground lease
transaction for ground -up construction of a 243 room full service upper upscale hotel
brand; and,
WHEREAS, in order to attract additional capital interest into the project,
Developer is proposing to modify the development proposal, attached hereto as Exhibit B
of this Amendment, and extend the duration of time of the ENRA for an additional six
months after the Amendment effective date; and,
WHEREAS, City and Developer now desire to amend certain provisions of the
ENRA, as set forth herein.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and incorporating all of the above as
though set forth in full herein and in consideration of all the recitals, conditions and
agreements contained herein, the parties agree to amend the ENRA as follows:
1. Amendment to ENRA languaze. All references to LDDA in the ENRA
shall be revised to refer to a disposition agreement that is mutually acceptable to the
parties.
FIRST AMENDMENT TO ENRA
2. Amendment to ENRA term. Section 3(a) of the ENRA is hereby deleted
in its entirety and replaced with the following:
a. The term of this Agreement ("Term") commences on the Effective Date
nf_-the. Agre ment, and will terminate six months after the effective date, or
�j 2'S (20, unless extended or earlier terminated as provided herein.
3. Amendment to Deposit. Section 5(a) of the ENRA is hereby deleted in
its entirety and replaced with the following:
a. In consideration for the right to exclusively negotiate under this
Agreement, Developer has paid to City a deposit in the amount of One
Hundred Thousand Dollars ($100,000), which if a disposition agreement
is executed, the deposit will be credited toward the purchase price payable
under the final negotiated disposition agreement ("Deposit"). City has
deposited the Deposit in an interest bearing account of the City and any
interest, when received by City, will become part of the Deposit.
During the term of this Agreement, Developer will reimburse City for all
reasonable staff and City consultant time incurred in preparing the
disposition agreement, and any related documents for the disposition of
Hotel Site to Developer ("Payment"). City will continue to deposit the
Payment in an interest bearing account of City and any interest, when
received by City, will become part of the Payment. The Payment may be
drawn upon by City to reimburse staff, City Attorney, and City consultant
costs for preparing the disposition agreement and any related documents,
at their standard published hourly rates. Should the full amount of the
Payment be exhausted during the Term of this Agreement, City may
require the Developer to provide additional funds necessary to reimburse
staff and consultant costs expended in connection with preparation of the
disposition agreement and any related documents. Documentation of
City's rate schedule for staff, staff time spent, and consultant costs will be
retained by City and provided to Developer upon request.
4. Additional Extension Payment. In consideration for the right to
exclusively negotiate during the term extension provided by this First Amendment, City
will require a non -reimbursable extension payment of $10,000.
a. Administrative Extension Payment. At the discretion of the City
Manager, the ENRA may approve up to two administrative extensions of
90 days each, for an amount of $25,000 per extension granted.
5. General Provisions. Each party hereto has received independent legal
advice from its attorneys with respect to the advisability of executing this First
Amendment and the meaning of the provisions hereof. The provisions of this First
Page 2 of 7
FIRST AMENDMENT TO ENRA
Amendment shall be construed as to the fair meaning and not for or against any party
based upon any attribution of such party as the sole source of the language in question.
Except as expressly amended pursuant to this First Amendment, the terms and provisions
of the Agreement shall remain unmodified and shall continue in full force and effect, and
Buyer and Seller hereby ratify and affirm all their respective rights and obligations under
the Agreement. Any capitalized terms not defined herein shall have the meaning ascribed
to them in the Agreement. In the event of any conflict between this First Amendment
and the Agreement, this First Amendment shall govern. The terms and provisions of this
First Amendment, together with the Agreement, shall constitute all of the terms and
provisions to which Buyer and Seller have agreed with respect to the transaction
governed hereby, and there are no other terms and provisions, oral or written, that apply
to the Agreement and/or the Property other than as set forth in the Agreement as modified
by this First Amendment. The provisions of this First Amendment shall apply to, be
binding upon, and inure to the benefit of the parties hereto and to their respective
successors and assigns. This First Amendment may be executed in multiple counterparts,
all of which shall constitute an original, and all of which together shall constitute a single
instrument. Counterparts of this First Amendment executed and delivered by facsimile,
email or other means of electronic delivery shall constitute originals for all purposes.
IN WITNESS WHEREOF, the parties have executed this First Amendment as
of the Effective Date.
SIGNATURES ON FOLLOWING PAGES.
Page 3 of 7
FIRST AMENDMENT TO ENRA
CITY
ATTEST: ' °r
By:
G' I Clerk j 2-51aO
APPROVED AS TO FORM:
ik
By: r
Citffy
DEVELOPER
APPROVED AS TO FORM:
Un
Counsel for Ensemble Investments
Page 4 of 7
FIRST AMENDMENT TO ENRA
Exhibit A
Property
Page 5 of 7
FIRST AMENDMENT TO ENRA
Exhibit B
REVISED DEVELOPMENT PROPOSAL
Type of land use agreement
Development Agreement, with a fee simple
sale
Proposed land cost
TBD
Extension Payment
$10,000
Duration of Extension
6 months
Administrative Extensions
2 administrative extensions of 90 days
each, at a cost of $25,000 each
Development Type
Ground -up construction hotel
Hotel Brand
Full service, upper upscale or upscale hotel
with:
• Complimentary services for hotel
guests and the public, which may
include restaurants, cafes, day spas,
and similar
• Meeting and conference space
• Nationally -recognized brand with
competitive travel rewards program
• Customizable design like other
upper upscale or upscale hotel
brands
Proposed Height of Hotel
9 floors
Proposed Number of Rooms
One full service hotel with 341 rooms
Proposed Food and Beverage
Not less than 4,000 SF
Proposed Meeting Space
Not less than 11,500 SF
Proposed Project Amenities
Common area and open space of no less
than 1.5 acres
Page 6 of 7
FIRST AMENDMENT TO ENRA
Parking
TBD
Performance Milestones for:
• Negotiation of a Development
Agreement
• Developer will apply for a Precise
Plan, pursuant to the Oyster Point
Specific Plan and DDA
• Pursue project entitlement
• Master Schedule
Page 7 of 7
SECOND AMENDMENT TO EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
This Second Amendment to the Exclusive Negotiating Rights Agreement (this
Second Amendment ) is made effective as of November 24, 2020 Effective Date
by and between the CITY OF SOUTH SAN FRANCISCO, a municipal corporation
City ENSEMBLE INVESTMENTS, LLC, a California Limited Liability
Developer Party or
Parties
RECITALS
WHEREAS Property
Parcel APN 015-010-970, and more particularly shown as Parcel 6 on Parcel
Map 17-0002 recorded on September 25, 2017, attached hereto as Exhibit A, and
incorporated herein by this reference; and,
WHEREAS, at its meeting on April 11, 2018, the City approved an Exclusive
Negotiating and directed staff to commence negotiating the
terms of the project development and property disposition; and,
WHEREAS, the initially proposed development proposal, as described in Exhibit
B of the ENRA, included a development proposal which included a ground lease
transaction for ground-up construction of a 243-room full service upper upscale hotel
brand; and,
WHEREAS, the Parties entered into the First Amendment to the ENRA on
November 25, 2019; and
WHEREAS, the City and Developer wish to extend the ENRA in order to
finalize business terms, as described in Exhibit B of this Second Amendment, and extend
the duration of time of the ENRA for an additional ninety-days; and,
WHEREAS, City and Developer now desire to amend certain provisions of the
ENRA, as set forth herein.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and incorporating all of the above as
though set forth in full herein and in consideration of all the recitals, conditions and
agreements contained herein, the parties agree to amend the ENRA as follows:
1. Amendment to ENRA. Section 3(a) of the ENRA is hereby deleted in its
entirety and replaced with the following:
SECOND AMENDMENT TO ENRA
Page 2 of 6
a. The term of this Agreement () commences on the Effective Date
of the Agreement, and will terminate ninety days after the effective date, or
________, 2021 unless extended or earlier terminated as provided herein.
b. The Term of this Agreement may be extended for up to a maximum of two
separate thirty (30) day periods in the discretion of the City Manager, or his/her
designee.
2. Additional Extension Payment. In consideration for the right to
exclusively negotiate during the term extension provided by this Second Amendment,
Ensemble will pay an additional extension payment of $10,000. This payment will be
credited towards any futur financial
contributions toward soft costs associated with the Harborm
redevelopment.
3. General Provisions. Each party hereto has received independent legal
advice from its attorneys with respect to the advisability of executing this Second
Amendment and the meaning of the provisions hereof. The provisions of this Second
Amendment shall be construed as to the fair meaning and not for or against any party
based upon any attribution of such party as the sole source of the language in question.
Except as expressly amended pursuant to this Second Amendment, the terms and
provisions of the Agreement shall remain unmodified and shall continue in full force and
effect, and Buyer and Seller hereby ratify and affirm all their respective rights and
obligations under the Agreement. Any capitalized terms not defined herein shall have the
meaning ascribed to them in the Agreement. In the event of any conflict between this
Second Amendment and the Agreement, this Second Amendment shall govern. The
terms and provisions of this Second Amendment, together with the Agreement, shall
constitute all of the terms and provisions to which Buyer and Seller have agreed with
respect to the transaction governed hereby, and there are no other terms and provisions,
oral or written, that apply to the Agreement and/or the Property other than as set forth in
the Agreement as modified by this Second Amendment. The provisions of this Second
Amendment shall apply to, be binding upon, and inure to the benefit of the parties hereto
and to their respective successors and assigns. This Second Amendment may be
executed in multiple counterparts, all of which shall constitute an original, and all of
which together shall constitute a single instrument. Counterparts of this Second
Amendment executed and delivered by facsimile, email or other means of electronic
delivery shall constitute originals for all purposes.
IN WITNESS WHEREOF, the parties have executed this Second Amendment
as of the Effective Date.
SIGNATURES ON FOLLOWING PAGES.
SECOND AMENDMENT TO ENRA
Page 3 of 6
CITY
By: _______________________________
Mike Futrell
City Manager
ATTEST:
By: _______________________________
City Clerk
APPROVED AS TO FORM:
By: _______________________________
City Attorney
DEVELOPER
By: _______________________________
APPROVED AS TO FORM:
By: _______________________________
Counsel for Ensemble Investments
SECOND AMENDMENT TO ENRA
Page 4 of 6
Exhibit A
Site Map
SECOND AMENDMENT TO ENRA
Page 5 of 6
Exhibit B
REVISED DEVELOPMENT PROPOSAL
Type of land use agreement Purchase and Sale Agreement and
Development Agreement, with a fee simple
sale
Proposed land cost TBD
Extension Payment $10,000
Duration of Extension 90 days
Development Type Ground-up construction hotel
Hotel Brand Full service, upper upscale or upscale hotel
with:
Complimentary services for hotel
guests and the public, which may
include restaurants, cafes, day spas,
and similar
Meeting and conference space
Nationally-recognized brand with
competitive travel rewards program
Customizable design like other
upper upscale or upscale hotel
brands
Proposed Height of Hotel Initial proposal included 9 floors, but
additional due diligence would occur
Proposed Number of Rooms One full service hotel with 341 rooms
Proposed Food and Beverage Initial proposal included not less than 4,000
SF, but additional due diligence would
occur
Proposed Meeting Space Initial proposal included not less than
11,500 SF, but additional due diligence
would occur
SECOND AMENDMENT TO ENRA
Page 6 of 6
Proposed Project Amenities Initial proposal included common area and
open space of no less than 1.5 acres, but
additional due diligence would occur
Parking TBD
Performance Milestones for:
Negotiation of a Purchase and Sale
Agreement
Negotiation of a Development
Agreement
Master Schedule
THIRD AMENDMENT TO EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
This Third Amendment to the Exclusive Negotiating Rights Agreement (this
“Third Amendment”) is made effective as of April 23, 2021 (“Effective Date”) by and
between the CITY OF SOUTH SAN FRANCISCO, a municipal corporation (“City”),
and ENSEMBLE INVESTMENTS, LLC, a California Limited Liability Company
(“Developer”). City and Developer are each referred to as (“Party”) or collectively
referred to as the (“Parties”).
RECITALS
WHEREAS, the City is the owner of certain real property (the “Property”) located
in the City of South San Francisco, California, known as County Assessor’s Parcel Number
(“APN”) 015-010-970, and more particularly shown as Parcel 6 on Parcel Map 17-0002
recorded on September 25, 2017, attached hereto as Exhibit A, and incorporated herein by
this reference; and,
WHEREAS, at its meeting on April 11, 2018, the City approved an Exclusive
Negotiating Rights Agreement (“ENRA”) and directed staff to commence negotiating the
terms of the project development and property disposition; and,
WHEREAS, the initially proposed development proposal, as described in Exhibit
B of the ENRA, included a development proposal for a ground lease transaction for ground-
up construction of a 243-room full service upper upscale hotel brand; and,
WHEREAS, the Parties entered into the First Amendment to the ENRA on
November 25, 2019; and
WHEREAS, the Parties entered into the Second Amendment to the ENRA on
November 24, 2020; and WHEREAS, the City and Developer wish to extend the ENRA
in order to finalize business terms, as described in Exhibit B of this Third Amendment, and
extend the duration of time of the ENRA for an additional thirty-days; and,
WHEREAS, City and Developer now desire to amend certain provisions of the
ENRA, as set forth herein.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and incorporating all of the above as
though set forth in full herein and in consideration of all the recitals, conditions and
agreements contained herein, the parties agree to amend the ENRA as follows:
1. Amendment to ENRA. Section 3(a) of the ENRA is hereby deleted in its
entirety and replaced with the following:
DocuSign Envelope ID: 1CBC0848-52C1-44BA-94B1-1D3102C7AF23
THIRD AMENDMENT TO ENRA
Page 2 of 6
a. The term of this Agreement (“Term”) commences on the Effective Date
and will terminate on May 24, 2021, unless extended or earlier terminated as
provided herein.
b. The Term of this Agreement may be extended for up to a maximum of two
separate thirty (30) day periods in the discretion of the City Manager, or his/her
designee.
2. Additional Extension Payment. In consideration for the right to
exclusively negotiate during the term extension provided by this Third Amendment,
Ensemble will pay an additional extension payment of $10,000. This payment will be
immediately applied to Ensemble’s financial contributions toward soft costs associated
with the Harbormaster Spit (“Spit”) redevelopment.
3. General Provisions. Each party hereto has received independent legal
advice from its attorneys with respect to the advisability of executing this Third
Amendment and the meaning of the provisions hereof. The provisions of this Third
Amendment shall be construed as to the fair meaning and not for or against any party based
upon any attribution of such party as the sole source of the language in question. Except
as expressly amended pursuant to this Third Amendment, the terms and provisions of the
Agreement shall remain unmodified and shall continue in full force and effect, and Buyer
and Seller hereby ratify and affirm all their respective rights and obli gations under the
Agreement. Any capitalized terms not defined herein shall have the meaning ascribed to
them in the Agreement. In the event of any conflict between this Third Amendment and
the Agreement, this Third Amendment shall govern. The terms and provisions of this Third
Amendment, together with the Agreement, shall constitute all of the terms and provisions
to which Buyer and Seller have agreed with respect to the transaction governed hereby,
and there are no other terms and provisions, oral or written, that apply to the Agreement
and/or the Property other than as set forth in the Agreement as modified by this Second
Amendment. The provisions of this Third Amendment shall apply to, be binding upon,
and inure to the benefit of the parties hereto and to their respective successors and assigns.
This Third Amendment may be executed in multiple counterparts, all of which shall
constitute an original, and all of which together shall constitute a single instrument.
Counterparts of this Third Amendment executed and delivered by facsimile, email or other
means of electronic delivery shall constitute originals for all purposes.
IN WITNESS WHEREOF, the parties have executed this Third Amendment as
of the Effective Date.
SIGNATURES ON FOLLOWING PAGES.
DocuSign Envelope ID: 1CBC0848-52C1-44BA-94B1-1D3102C7AF23
THIRD AMENDMENT TO ENRA
Page 3 of 6
CITY
By: _______________________________
Mike Futrell
City Manager
ATTEST:
By: _______________________________
City Clerk
APPROVED AS TO FORM:
By: _______________________________
City Attorney
DEVELOPER
By: _______________________________
APPROVED AS TO FORM:
By: _______________________________
Counsel for Ensemble Investments
DocuSign Envelope ID: 1CBC0848-52C1-44BA-94B1-1D3102C7AF23
THIRD AMENDMENT TO ENRA
Page 4 of 6
Exhibit A
Site Map
DocuSign Envelope ID: 1CBC0848-52C1-44BA-94B1-1D3102C7AF23
THIRD AMENDMENT TO ENRA
Page 5 of 6
Exhibit B
REVISED DEVELOPMENT PROPOSAL
Type of land use agreement Purchase and Sale Agreement and
Development Agreement, with a fee simple
sale
Proposed land cost TBD
Extension Payment $10,000
Duration of Extension 30 days
Development Type Ground-up construction hotel
Hotel Brand Full service, upper upscale or upscale hotel
with:
Complementary services for hotel
guests and the public, which may
include restaurants, cafes, day spas,
and similar
Meeting and conference space
Nationally-recognized brand with
competitive travel rewards program
Customizable design like other
upper upscale or upscale hotel
brands
Proposed Height of Hotel Initial proposal included 9 floors, but
additional due diligence would occur
Proposed Number of Rooms One full service hotel with 341 rooms
Proposed Food and Beverage Initial proposal included not less than 4,000
SF, but additional due diligence would
occur
Proposed Meeting Space Initial proposal included not less than
11,500 SF, but additional due diligence
would occur
DocuSign Envelope ID: 1CBC0848-52C1-44BA-94B1-1D3102C7AF23
THIRD AMENDMENT TO ENRA
Page 6 of 6
Proposed Project Amenities Initial proposal included common area and
open space of no less than 1.5 acres, but
additional due diligence would occur
Parking TBD
Performance Milestones for:
Negotiation of a Purchase and Sale
Agreement
Negotiation of a Development
Agreement
Master Schedule
3740381.1
DocuSign Envelope ID: 1CBC0848-52C1-44BA-94B1-1D3102C7AF23
FOURTH AMENDMENT TO EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
This Fourth Amendment to the Exclusive Negotiating Rights Agreement (this
“Fourth Amendment”) is made effective as of July 22, 2021 (“Effective Date”) by and
between the CITY OF SOUTH SAN FRANCISCO, a municipal corporation (“City”),
and ENSEMBLE INVESTMENTS, LLC, a California Limited Liability Company
(“Developer”). City and Developer are each referred to as (“Party”) or collectively
referred to as the (“Parties”).
RECITALS
WHEREAS, the City is the owner of certain real property (the “Property”) located
in the City of South San Francisco, California, known as County Assessor’s Parcel Number
(“APN”) 015-010-970, and more particularly shown as Parcel 6 on Parcel Map 17-0002
recorded on September 25, 2017, attached hereto as Exhibit A, and incorporated herein by
this reference; and,
WHEREAS, at its meeting on April 11, 2018, the City approved an Exclusive
Negotiating Rights Agreement (“ENRA”) and directed staff to commence negotiating the
terms of the project development and property disposition; and,
WHEREAS, the initially proposed development proposal, as described in Exhibit
B of the ENRA, included a development proposal which included a ground lease
transaction for ground-up construction of a 243-room full service upper upscale hotel
brand; and,
WHEREAS, the Parties entered into the First Amendment to the ENRA on
November 25, 2019; and
WHEREAS, the Parties entered into the Second Amendment to the ENRA on
November 24, 2020; and
WHEREAS, the Parties entered into the Third Amendment to the ENRA on April
23, 2021; and
WHEREAS, the City and Developer wish to extend the ENRA in order to finalize
additional business terms, as described in Exhibit B of this Fourth Amendment, and extend
the duration of time of the ENRA for an additional sixty-five days; and,
WHEREAS, City and Developer now desire to amend certain provisions of the
ENRA, as set forth herein.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and incorporating all of the above as
FOURTH AMENDMENT TO ENRA
Page 2 of 6
though set forth in full herein and in consideration of all the recitals, conditions and
agreements contained herein, the parties agree to amend the ENRA as follows:
1. Amendment to ENRA. Section 3(a) of the ENRA is hereby deleted in its
entirety and replaced with the following:
a. The term of this Agreement (“Term”) commences on the Effective Date
of the Agreement, and will terminate sixty-five days after the effective date, or
September 25, 2021 unless extended or earlier terminated as provided herein.
b. The Term of this Agreement may be extended for up to a maximum of one
separate thirty (30) day period in the discretion of the City Manager, or his/her
designee.
2. General Provisions. Each party hereto has received independent legal
advice from its attorneys with respect to the advisability of executing this Fourth
Amendment and the meaning of the provisions hereof. The provisions of this Fourth
Amendment shall be construed as to the fair meaning and not for or against any party based
upon any attribution of such party as the sole source of the language in qu estion. Except
as expressly amended pursuant to this Fourth Amendment, the terms and provisions of the
Agreement shall remain unmodified and shall continue in full force and effect, and Buyer
and Seller hereby ratify and affirm all their respective rights and obligations under the
Agreement. Any capitalized terms not defined herein shall have the meaning ascribed to
them in the Agreement. In the event of any conflict between this Fourth Amendment and
the Agreement, this Fourth Amendment shall govern. The terms and provisions of this
Fourth Amendment, together with the Agreement, shall constitute all of the terms and
provisions to which Buyer and Seller have agreed with respect to the transaction governed
hereby, and there are no other terms and provisions, oral or written, that apply to the
Agreement and/or the Property other than as set forth in the Agreement as modified by this
Fourth Amendment. The provisions of this Fourth Amendment shall apply to, be binding
upon, and inure to the benefit of the parties hereto and to their respective successors and
assigns. This Fourth Amendment may be executed in multiple counterparts, all of which
shall constitute an original, and all of which together shall constitute a single instrument.
Counterparts of this Fourth Amendment executed and delivered by facsimile, email or
other means of electronic delivery shall constitute originals for all purposes.
IN WITNESS WHEREOF, the parties have executed this Fourth Amendment as
of the Effective Date.
SIGNATURES ON FOLLOWING PAGES.
FOURTH AMENDMENT TO ENRA
Page 3 of 6
CITY
By: _______________________________
Mike Futrell
City Manager
ATTEST:
By: _______________________________
City Clerk
APPROVED AS TO FORM:
By: _______________________________
City Attorney
DEVELOPER
By: _______________________________
APPROVED AS TO FORM:
By: _______________________________
Counsel for Ensemble Investments
FOURTH AMENDMENT TO ENRA
Page 4 of 6
Exhibit A
Site Map
FOURTH AMENDMENT TO ENRA
Page 5 of 6
Exhibit B
DEVELOPMENT PROPOSAL
Type of land use agreement Purchase and Sale Agreement and
Development Agreement, with a fee simple
sale
Proposed land cost TBD
Duration of Extension 65 days
Development Type Ground-up construction hotel
Hotel Brand Full service, upper upscale or upscale hotel
with:
Complimentary services for hotel
guests and the public, which may
include restaurants, cafes, day spas,
and similar
Meeting and conference space
Nationally-recognized brand with
competitive travel rewards program
Customizable design like other
upper upscale or upscale hotel
brands
Proposed Height of Hotel Initial proposal included 9 floors, but
additional due diligence would occur
Proposed Number of Rooms One full service hotel with 341 rooms
Proposed Food and Beverage Initial proposal included not less than 4,000
SF, but additional due diligence would
occur
Proposed Meeting Space Initial proposal included not less than
11,500 SF, but additional due diligence
would occur
FOURTH AMENDMENT TO ENRA
Page 6 of 6
Proposed Project Amenities Initial proposal included common area and
open space of no less than 1.5 acres, but
additional due diligence would occur
Parking TBD
Performance Milestones for:
Negotiation of a Purchase and Sale
Agreement
Negotiation of a Development
Agreement
Master Schedule