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HomeMy WebLinkAboutOrd 1306-2002ORDINANCE NO. 1306-2002 AN- ORDINANCE ADOPTING A DEVELOPMENT AGREEMENT 'WITH DUC SOUTH SAN FRANCISCO FOR THE MARBELLA HOUSING PROJECT WHEREAS, the South San Francisco Municipal Code allows development of the approximately 14.9 acre vacant site located at the intersection of Westborough and Gellert Boulevards, subject to further approvals; and, WHE_-'LEAS, the DUC submitted an original plan consisting of 74 single family homes which was revised to consist of 280 multi-family units; and, WHEREAS, the 280 unit project ("Project") constitutes the present proposed development and the project is subject to the terms of the Development Agreement ("Agreement"); and, WHE_-"~EAS, a Environmental Impact Report has been prepared which analyzes the anticipated environmentfl impacts of the proposed Project; and, WHE.?,EAS, the Applicant instructed the City to process the proposed entitlements for the Project; and, WHE_--LEAS, pursuant to Municipal Code section 19.60.050, the Director of Economic and Community Development reviewed the application for the Agreement and found the proposed Agreement to be in the proper form, determined that the application was complete, and referred the application and Agreement to the Planning Commission for a public heating; and, WHE2x_EAS, on September 20, 2001, the Planning Commission held a properly noticed public hearing on the proposed Agreement for the Marbella Housing Project and recommended that the Project be continued until October 4, 2001; and, WHEREAS, on October 4, 2001, the Planning Commission recommended that the Project be continued to allow staff to revise and recirculate the Draft Environmental Impact Report; and, WHEREAS, on November 15, 2001, the Planning Commission held a duly noticed public hearing on the proposed Agreement and recommended that a final decision on the proposed Project be continued to the December 6, 2001, meeting of the Planning Commission; and, WHEREAS, on December 6, 2001, the Planning Commission held a duly noticed public hearing on the proposed Agreement and recommended that the City Council adopt the Ordinance and Developmen: Agreement by a 5-1 vote; and, WHEREAS, on December 12, 2001, pursuant to Municipal Code section 19.060.110 the City Council conducted a property noticed public hearing on the proposed Agreement for the project. NOW THEREFORE, the City Council of the City of South San Francisco does ordain as follows: Section 1. Findings A. The proposed Development Agreement for the Marbella Housing Project is consistent with the objectives, policies, general land uses and programs specified in the General Plan, as amended and adopted. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of these documents. B. The proposed Development Agreement for the Marbella Housing Project complies with all applicable zoning, subdivision, and building regulations and with the general plan. The City Council independently reviewed the proposed Development Agreement for the Marbella Housing Project, General Plan, Chapter 20.78, Chapter 20.84 of the Zoning Ordinance as amended, Title 15 of the Municipal Code, and applicable state and federal law. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of these documents and advice in the record from City staff. C. The proposed Development Agreement for the Marbella Housing Project states its specific duration. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of the proposed Development Agreement for the Marbella Housing Project and its determination that Section 1 of the Agreement states that the Agreement shall expire ten years from the effective date of the Agreement but no later than December 31, 2011. D. The proposed Development Agreement for the Marbella Housing Project states the permitted uses of the property subject thereto. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of the proposed Development Agreement for the Marbella Housing Project and its determination that Section 2 of the Agreement sets forth the documents which state the permitted uses. E. The proposed Development Agreement for the Marbella Housing Project states the permitted density and intensity of use of the property subject thereto. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of the proposed Development Agreement for the Marbella Housing Project and its determination that Section 2 of the Agreement sets forth the documents which state the permitted density and intensity of use. F. The proposed Development Agreement for the Marbella Housing Project states the maximum permitted height and size of proposed buildings on the property subject thereto. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of the proposed Development Agreement for the Marbella Housing Project and its determination that Section 2 of the Agreement sets forth the documents which state the maximum permitted height and size of buildings. G. The proposed Development Agreement for the Marbella Housing Project describes the land which will be dedicated for public purposes from the property subject thereto. This finding is based upon all evidence in the record as a whole, including, but not limited to: the City Council's independent review of the proposed Development Agreement for the Marbella Housing Project and its determination that Exhibit B to the Agreement, the Plan Set and Vesting Tentative Map dated October 5, 2001, describes the land which will be dedicated for public purposes. Section 2. The City Council of the City of South San Francisco hereby adopts this ordinance approving a Development Agreement for the Marbella Housing Project, attached hereto as Exhibit 1 and incorporated herein by reference. Section 3. Severability. In the event any section or portion of this ordinance shall be determined invalid or unconstitutional, such section or porSon shall be deemed severable and all other sections or portions hereof shall remain in full force and effect. Section 4. Publication and Effective Date. Pursuant to tee provisions of Government Code Section 36933, a summary of this Ordinance shall be prepared by the City Attorney. At least five (5) days prior to the Council meeting at which this Ordinance is scheduled to be adopted, the City Clerk shall (1) publish the Summary, and (2) post in the City Clerk's Office a certified copy of this Ordinance. Within fifteen (15) days after the adoption of this Ordinance, tke City Clerk shall (1) publish the summary, and (2) post in the City Clerk's Office a certified copy of the full text of this Ordinance along with the names of those City Council members voting for an(._ against this Ordinance or otherwise voting. This ordinance shall become effective thirty days from and after its adoption. IntrodTaced at a regular meeting of the City Council of the City of South San Francisco, held the 12th day of December 2001, by the following vote: Adopted as an Ordinance of the City of South San Francisco at a regular meeting of the City Council held the 9th day of January 2002: AYES: NOES: ABSTAIN: ABSENT: Councilmembers Joseph A. Femekes, Mayor Pro Tem Pedro Gonzalez and Mayor Eugene R. Mullin Councilmember Raymond L. Green Councilmember Karyl Matsumoto None. ATTEST: As Mayor of the City of South San Francisco, I~oing Ordinance this 9th day of January 2002. bMayor EXHBIT 1 DEVELOPMENT AGREEMENT FOR MARBELLA HOUSING PROJECT This DEVELOPMENT AGREEMENT FOR MARBELLA HOUSING PROJECT is dated ,20.31 ("Agreement"), between LBL - DUC II SOUTH SAN FRANCISCO II, LLC, a Delaware limited liability company ("Owner"), and the CITY OF SOUTH SAN FRANCISCO, a municipal corporation organized and existing under the laws of the State of California ("City"). Owner and City are collectively referred to herein as "Parties." RECITALS A. WHEREAS, California Government Code Sections 65864 through 65869.5 authorize the City to enter into binding development agreements with persons having legal or equitable interests in real property for the development of such property or on behalf of those persons having same; and, B. WHEREAS, pursuant to Government Code Section 65865, the City has adopted rules and regulations, embodied in Chapter 19.60 of the South San Francisco Municipal Code, establishing procedures and requirements for adoption and execution of development agreements; and, C. WHEREAS, this Agreement concerns an approximately 14.9 acre vacant site located to the northwest of the intersection of Westborough Boulevard and Gellert Boulevard in the City, as shown and more particularly described in Exhibit A attached hereto and incorporated herein by reference ("Property"); and, D. WHEREAS, the Owner applied to the City for a development proposal, commonly known as the Marbella Housing Project, consisting of a 74 single family home residential project, which proposal was revised to consist of a 280 unit multi-family residential project as depicted on the Marbella Planned Unit Development Alternative Plan set revised October 5, 2001, prepared by Wilsey Ham and KTGY, including the application for a Vesting Tentative Map, dated October 5, 2001, attached hereto as Exhibit B and incorporated herein by reference (the "Plan Set"), to be located on the Property (the "Residential Project"); and, E. WHEREAS, Owner provided a letter dated July 20, 2001, to the Construction Trades Council indicating that DUC Housing Partners, Inc., or its successors or assigns, intend to use Building Trades union labor for construction of the Residential Project, excluding off-site manufacturers and suppliers, provided that DUC Housing Partners, Inc., or its successors or assigns proceeds with construction of the Residential Project; and, F. WHEREAS, Owner has requested that the City enter into this Agreement to set forth the rights and obligations of the parties relating to the development of the Residential Project; and, G. WHEREAS, all proceedings necessary for the valid adoption and execution hereof have taken place in accordance with Government Code Sections 65864 through 65869.5 and with Chapter 19.60 of the South San Francisco Municipal Code; and, Development Agreen ~ent For Marbella Housing Project December 26, 2001 Final Draft Ho WHEREAS, the City Council and the Planning Commission have found that this Agreement is consistent with the objectives, policies, general land uses and programs specified in the South San Francisco's General Plan as adopted on October 13, 1999 and as amended from time to time; and, I. WHEREAS, on ,2001, the City Council adopted Ordinance No. approving and adopt: ng this Agreement and the Ordinance thereafter took effect on ,2001. AGREEMENT NOW, TIEEREFORE, the Parties, pursuant to the authority contained in Government Code Sections 65864 tl-_rough 65869.5 and Chapter 19.60 of the South San Francisco Municipal Code and in consideration of t_ae mutual covenants and agreements contained herein, agree as follows: 1. Effective Date The effective date of this Agreement shall be the date upon which this Agreement is executed by all parties (the "Effective Date"). 2. Duration This Agreement shall expire ten (10) years from the Effective Date of this Agreement but at no time later than December 30, 2011. In the event that litigation to which the City is a party against the Owner or any of its officers, agents, employees, contractors, representatives or consultants should delay implementation or construction of the Residential Project on the Property, :he expiration date of this Agreement shall be tolled from the time the summons and complaint is served on the defendant(s) until the judgment entered by the court is final and not subject to appeal; provided, however, that the total amount of time which the expiration date shall be tolled as a result of such litigation shall not exceed five (5) years. 3. Residential Project Description; Development Standards For Residential Project (a) The Residential Project shall consist of a six-building, 280 unit multi-family residential development, which development shall contain on-site amenities, including, without limitation, at least one indoor recreation area, one outdoor children's play area and one outdoor passive recreation area, and other structures and improvements as provided in the Plan Set and as approved '>y the City Council. (b) The permitted uses, the density and intensity of uses, the maximum heights, locations and total ~rea of the proposed buildings, the development schedule, the provisions for vehicular access ant parking, any reservation or dedication of land, any public improvements, facilities and services, and all environmental impact mitigation measures imposed as approval conditions for the Residential Project, shall be exclusively those provided in the Plan Set and as approved by the City Council and the applicable ordinances in effect as of the Effective Date, except as modified !n this Agreement, and applicable provisions of the South San Francisco Municipal Code as ir_ effect on the Effective Date. Development Agreement For Marbella Housing Project December 26, 2001 C :\WINDOWS\TEMP~DUC_DA_Dec26_final.docC :\WINDOWS\TEMP'~DIJC_DA_Dec26_final.doc Final Draft Page 2 of 22 (c) Subject to Owner's fulfillment of its obligations under this Agreement, upon the Effective iDate of this Agreement, the City hereby grants to Owner a vested right to develop and const_mct on the Property all the improvements for the Residential Project authorized by, and in accordance with the terms of this Agreement, the Plan Set as approved by the City Council aad the applicable ordinances in effect as of the Effective Date. (d) Upon such grant of right, Owner's exercise of such right and all other rights provided to Owner under this Agreement shall not be impaired, affected or limited by (i) Ordinance No. 1294-2001: An Urgency Ordinance of the City of South San Francisco Establishing a Moratorium on the Approval of Land Use and Building Permits for Low, Medium and High Density Residential Development the City Pending Amendment of the Zoning Code Necessary to Implement Policies in the Housing Element of the General Plan and Making Findings Relating Thereto approved by the City Council on July 11, 2001, as such may be extended or amended, (ii) any pending or future ordinances establishing moratoriums unless required by state or federal law, (iii) any pending or future ordinances related to affordable housing, childcare Sees or other fees, or (iv) any pending or future ordinances that would otherwise prevent the development of the Residential Project or would require the development to proceed irt a manner inconsistent with the Plan Set as approved by the City Council, by virtue of the parses entering into this Agreement (e) No future amendments to the City General Plan, the City Zoning Code, the City Municipa2 Code, or other City ordinances, policies or regulations in effect as of the Effective Date shall apply to the Residential Project, except such future modifications that are requested by or consented to by the Owner; provided, however, that nothing in this Agreement shall prevent or preclude the City from adopting any land use regulations or amendments expressly permitted herein or otherwise required by State or Federal Law. 4. Obligations of City and Owner. (a) In consideration of the entitlements conferred upon Owner, Owner has agreed to implement the obligations of Owner set forth in Exhibit C attached hereto and incorporated herein, according to the terms and conditions set forth therein. (b) In consideration of the rights and benefits conferred upon the City and the public by the Owner pursuant to this Agreement, the City has agreed to implement the obligations of the City set forth in Exhibit C attached hereto and incorporated herein, according to the terms and conditions set forth therein. 5. Permits For Residential Proiect. (a) Tl-.e City acknowledges that the City's approval of the improvement and grading plans, including any conditions of approval approved by the City Council, for the Residential Project (the "Improvement and Grading Plans") shall constitute Owner's satisfaction of all permit requirements imposed by the City necessary for the construction and development of the Residential Project, including, without limitation, grading and construction permits, except building permits and certificates of occupancy and the standard conditions of approval in the City's Gr,_ding Permit. Development Agreement For Marbella Housing Project December 26, 2001 C:\WlNDOWS\TE1V_PXDUC_DA_Dec26_final.docC:\WlNDOWS\TEMPXDUC_DA_Dec26_final.doc Final Draft Page 3 of 22 (b) Building permits and certificates of occupancy shall be issued by the City after the City's review and approval of Owner's applications therefore, provided that City's review of the applications for such permits and certificates is limited to determining whether the following conditions are met: 1. The application is complete; 2. The application demonstrates that Owner has complied with the conditions of the City Council's approval of the Residential Project and all applicable Uniform Code and CEQA requirements governing issuance of the such permit or ce.-:tificate; and 3. All applicable processing, administrative and legal fees have been paid su >ject to the provisions of this Agreement. 6. Design Approval for Residential Project The City acknowledges that the City's approval of the Planned Unit Development for the Residential Project, shall constitute satisfaction of all architectural and design review and approval requirements imposed by the City for the construction and development of the Residential Project, including, without limitation, design review in connection with the General Plan and fiae Westborough/Gellert Design Plan. - - 7. Vesting of Approvals. Upon the City's approval of the Improvement and Grading Plan and the Planned Unit Development, such approvals shall vest in Owner and its successors and assigns for the term of this Agreement. 8. Cooperation Between Parties in Implementation of This Agreement. The Owner and City shall proceed in a reasonable and expeditious manner, in compliance with the deadlines mandated by applicable agreements, statutes or ordinances, t° complete all steps necessary for implementation of this Agreement and development of the Property in accordance with the terms of this Agreement. The City shall proceed in an expeditious manner to complete all actions required for the development of the Residential Project, including but not limited to the following: (a) Scheduling all required public hearings by the City Council and City Planning Commission; and (b) Processing and checking all maps, plans, permits, building plans and specifications and other plates relating to development of the Property filed by Owner or its nominee, successor or assign as necessary for development of the Property. Owner, ir~ a timely manner, shall provide City with all documents, applications, plans and other information necessary for the City to carry out its obligations hereunder and to cause its planners, engineers and all other consultants to submit in a timely manner all necessary Development Agreement For Marbella Housing Project December 26, 2001 C:\WINDOWS\TEMP~DUC_DA_Dec26_final.docC:\WINDOWS\TEMP~DUC DA Dec26_final.doc Final Draft Page 4 of 22 10. 11. materials and documents. It is the parties' express intent to cooperate with one another and diligently work to implement all land use and building approvals for development of the Property in accordance with the terms of this Agreement. Acquisition of Other Property; Eminent Domain In order to facilitate and insure development of the Residential Project in accordance with the Plan Set and the City Council's approval, the City may assist Owner, at Owner's sole cost and expense, in acquiring any easements or properties necessary for the satisfaction and completion of any off-site components of the Residential Development required by the City Council in its approval of the Residential Project and the Plan Set, in the event Owner is unable to acquire such easements or properties or the Owner is unable to secure the necessary agreements with the applicable property owners for such easements or properties. Owner expressly acknowledges that the City is under no obligation to use its power of Eminent Domain. Maintenance Obligations on Property All of the Property subject to this Agreement shall be maintained by the Homeowners Association for the Residential Project in perpetuity. The Property shall be maintained in accordance with City requirements to prevent accumulation of litter and trash, to keep weeds abated, ar d to provide erosion control, and other requirements set forth in Chapter 19 of the Zoning Code, subject to City approval. Any provisions of the conditions, covenants, and restrictior s governing the Homeowners Association relating to the maintenance obligations under this section shall be subject to review by the City Attorney and shall be enforceable by the City. Fees (a) Park Fees. (i) The parties acknowledge that for purposes of calculation of the fee amount payable to the City in lieu of park land dedication required under South San Francisco Code (the "Code") Section 19.24.030, et seq. (the "Park Fee"), in connection with the Residential Project, the fair market value of each buildable acre shall equal the purchase price paid by Owner for the entire Property divided by the gross acreage of the entire Property (14.85 acres). (ii) Based upon such fair market value of each buildable acre and the formula and calculation set forth in Exhibit D attached hereto and incorporated herein, the Park Fee due to the City in connection with the Residential Project is equal to $1,646,175 if the Residential Project contains 280 dwelling units at the time the final subdivision tract map is filed with the City Council for approval. If at the time of such approval, the Residential Project contains some other number of dwelling units, the Park Fee will be calculated according to the formula contained in Exhibit D. Development Agreement For Marbella Housing Project December 26, 2001 C:\WINDOWS\TEMPXDUC DA Dec26_final.docC:\WlNDOWS\TEMP~DUC_DA_Dec26_final.doc Final Draft ~ Page 5 of 22 12. 13. (iii) In accordance with Section 19.24.030, et seq. of the Code, in the event the Owner develops a portion of the Property as private, on-site open space or recreational facility, and the City Council determines that it is in the public interest to do so, Owner shall receive a credit applied towards the Park Fee for the Residential Project at a ratio of one-to-one (1:1), meaning that for each square foot of private open space land or recreational facility or fraction thereof which qualifies as usable for active recreational activities under the Code, the Residential Project will be relieved of an equivalent amount of fees in lieu of dedication. Owner shall comply with, and be subject to, all terms and conditions of Section 19.24.105 for the dedication of land. (iv) In addition, in the event Owner constructs improvements for such on-site open space or recreational facility, Owner shall be entitled to receive a credit against the Park Fee for the Residential Project, in an amount not to exceed fifty percent (50%) of the total Park Fee due, in accordance with Section 19.24.030, et seq. of the Code. (b) Childcare Fees. The City acknowledges and agrees that the Residential Project shall not be subject to any childcare fees imposed by the City, regardless of whether such fee is in_posed by ordinance or other means. (c) Other Fees. No future fee requirements, other than those identified in subsection (d) below, imposed by the City or changes to existing fee requirements that occur on or after the date of this Agreement shall apply to the Residential Project. Owner shall not be responsible for any fees imposed by the City in connection with the development and construction of the Residential Project, except as otherwise set forth in this Agreement and/or the Planned Unit Development. (d) Revised Application Fees. Any existing application, processing, administrative, legal and inspection fees that are revised during the term of this Agreement shall apply to the Residential Project provided that (1) such fees have general applicability; (2) the application of such fees to the Property is prospective; and (3) the application of such fees would not prevent development in accordance with this Agreement New Taxes Any subsequently enacted city-wide taxes shall apply to the Property provided that: (1) the application of such taxes to the Property is prospective; and (2) the application of such taxes would not prevent development in accordance with this Agreement. Assessments Nothing herein shall be construed to relieve the Property from assessments levied against it by City pursuant to any statutory procedure for the assessment of property to pay for infrastructure and/or services which benefit the Property. 14. Indemnity. Development Agreement For Marbella Housing Project December 26, 2001 C:\WINDOWS\TEiV~DUC_DA_Dec26_final.docC :\WINDOWS\TEMPkDUC_DA_Dec26_final.doc Final Draft Page 6 of 22 Owner agrees to indemnify, defend and hold harmless City, and its elected and appointed councils, '~oards, commissions, officers, agents, employees, and representatives from any and all claims, costs (including legal fees and costs) and liability for any personal injury or property damage which may arise directly or indirectly as a result of any actions or in actions by the Owner, or any actions or in actions of Owner's contractors, subcontractors, agents, or employees in connection with the construction, improvement, operation, or maintenance of the Residential Project, provided that Owner shall have no indemnification obligation with respect to negligence or willful misconduct of City, its contractors, subcontractors, agents or employees or with respect to the maintenance, use or condition of any improvement after the time it has been dedicated to and accepted by the City or another public entity (except as provided "_n an improvement agreement or maintenance bond). 15. Interests of Other Owners 16. Owner has no knowledge of any reason why Owner, and any other persons holding legal or equitable interests in the Property as of the date on which title to the Property vests of record in Owner, will not be bound by this Agreement. Assignment Owner may at any time or from time to time transfer its right, title or interest in or to all or any portion of the Property. In accordance with Government Code Section 65868.5, the burdens of this Agreement shall be binding upon, and the benefits of this Agreement shall inure to, all successors in interest to Owner. As a condition precedent to any such transfer, Owner shall require the transferee to acknowledge in writing that transferee has been informed, understands and agrees that the burdens and benefits under this Agreement relating to such transferred property shall be binding upon and inure to the benefit of the transferee. Within 1£ days of the date escrow closes on any such transfer, Owner shall notify the City in writing of the name and address of the transferee. Upon the completion of Owner's responsibi.lities pursuant to this section, Owner shall have no further obligations or benefits hereunder with respect to such transferred property save for those the performance of which was due prior to the transfer date. Any transfer which does not comply with the notice requirements of this paragraph shall not release the Owner from its obligations to the City under this Agreement. 17. Covenants Run With The Land The terms of this Agreement are legislative in nature, and apply to the Property as regulatory ordinances. During the term of this Agreement, all of the provisions, agreements, rights, powers, standards, terms, covenants and obligations contained in this Agreement shall run with the land a~nd shall be binding upon the parties and their respective heirs, successors (by merger, consolida:ion or otherwise) and assigns, devisees, administrators, representatives, lessees and all other l:ersons or entities acquiring the Property, any lot, parcel or any portion thereof, and any interest therein, whether by sale, operation of law or other manner, and they shall inure to the benefit of the parties and their respective successors. Development Agreement For Marbella Housing Project December 26, 2001 C:\WINDOWS\TE1V~,DUC_DA_Dec26_final.docC:\WINDOWS\TEMP\DUC DA Dec26_final.doc Final Draft Page 7 of 22 18. Conflict with State or Federal Law In the event that State or Federal laws or regulations, enacted after the Effective Date, prevent or preclude compliance with one or more provisions of this Agreement, such provisions of this Agreement shall be modified or suspended as may be necessary to comply with such State or Federal l~.ws or regulations. The Residential Project shall be deemed modified only to the extent necessary to comply with future state or federal laws or regulations. Notwithstanding the foregoing, Owner shall have the right to challenge, at its sole cost, in a court of competent jurisdiction, the law or regulation preventing compliance with the terms of this Agreement and, if the cha'_lenge in a court of competent jurisdiction is successful, this Agreement shall remain unmodified and in full force and effect.. 19. Modification Because of Conflict with State or Federal Laws. In the event that state or federal laws or regulations enacted after the effective date of this Agreement prevent or preclude compliance with one or more provisions of this Agreement or require cl~.anges in plans, maps or permits approved by the City, the parties shall meet and confer in good faith in a reasonable attempt to modify this Agreement to comply with such federal or state law or regulation. Any such amendment or suspension of the Agreement shall be approved by the City Council in accordance with Chapter 19.60. 20. Periodic Review During the term of this Agreement, the City shall conduct "annual" and/or "special" reviews of Owner' s good faith compliance with the terms and conditions of this Agreement in accordance with the procedures set forth in Chapter 19.60 of the South San Francisco Municipal Code. 21. Amendment or Cancellation of Agreement This Agreement may be further amended or terminated only in writing and in the manner set forth in Government Code Sections 65865.1, 65868, 65869.5 and Chapter 19.60 of the South San Francisco Municipal Code. 22. A~reement is Entire Agreement. This Agreement and all exhibits attached hereto or incorporated herein contain the sole and entire Agreement between the parties concerning the Property. The parties acknowledge and agree that neither of them has made any representation with respect to the subject matter of this Agreement or any representations inducing the execution and delivery hereof, except representations set forth herein, and each party acknowledges that it has relied on its own judgment in entering this Agreement. The parties further acknowledge that all statements or representations that heretofore may have been made by either of them to the other are void and of no effect, and that neither of them has relied thereon in its dealings with the other. 23. Events of default Development Agreement For Marbella Housing Project - December 26, 2001 C:\WINDOWS\TEMPXDUC_DA_Dec26_final.docC:\WINDOWS\TEMPXDUC DA Dec26_final.doc Final Draft Page 8 of 22 Owner shall be in default under this Agreement upon the happening of one or more of the following events: (a) If a warranty, representation or statement made or furnished by Owner to the City is false or proves to have been false in any material respect when it was made; or 24. (b) A finding and determination by the City made following an annual or special review under the procedure provided for in Government Code Section 65865.1 and Chapter 19.60 of the South San Francisco Municipal Code that, upon the basis of substantial evidence, Owner has not complied in good faith with the terms and conditions of this Agreement. (c) O+ner fails to fulfill any of its obligations set forth in this Agreement. Procedure upon default (a) Upon the occurrence of an event of default, City may terminate or modify this Agreemert in accordance with the provisions of Government Code Section 65865.1 and of Chapter 19.60 of the South San Francisco Municipal Code. (b) Tke City shall not be deemed to have waived any claim of defect in Owner's performar_ce if, on annual or special review, the City does not propose to terminate this Agreemert. (c) No waiver or failure by the City or Owner to enforce any provision of this Agreement shall be deemed to be a waiver of any provision of this Agreement or of any subsequent breach of the same or any other provision. d) Arty actions for breach of this Agreement shall be decided in a court of competent jurisdiction located in San Mateo County, California. By signing this Agreement, Owner hereby waives any right to a jury trial for breach of this Agreement. (e) Tke City shall give Owner written notice of any default under this Agreement, and Owner shall have thirty (30) days after the date of the notice to cure the default or to reasonably commence the procedures or actions needed to cure the default. 25. Attorneys fees and costs If legal action by either Party is brought because of breach of this Agreement or to enforce a provision of this Agreement, the prevailing Party is entitled to reasonable attorney's fees and court costs. 26. Severability If any terra or condition of this Agreement is for any reason held by a final judgment of a court of competent jurisdiction to be invalid, and if the same constitutes a material change in the considera:ion for this Agreement, then this entire Agreement shall likewise be invalid, and shall be deemed null and void and of no further force or effect following such judicial determination. Development Agreement For Marbella Housing Project - December 26, 2001 C:\WINDOWS\TEIV~DUC DA Dec26_final.docC:\WINDOWS\TEMP~DUC DA Dec26_final.doc Final Draft Page 9 of 22 27. No third parties benefited No person other than the City, Owner, or their respective successors is intended to or shall have any fight or claim under this Agreement, this Agreement being for the sole benefit and protectior_ of the parties hereto and their respective successors. Similarly, no amendment or waiver of any provision of this Agreement shall require the consent or acknowledgment of any person no: a Party or successor to this Agreement. 28. Binding effect of Agreement The provisions of this Agreement shall bind and inure to the benefit of the Parties originally named herein and their respective successors and assigns. 29. Relations xip of Parties 30. It is understood that this Agreement is a contract that has been negotiated and voluntarily entered into by City and Owner and that the Owner is not an agent of City. The parties do not intend to create a partnership, joint venture or any other joint business relationship by this Agreement. The City and Owner hereby renounce the existence of any form of joint venture or partnership between them, and agree that nothing contained herein or in any document executed :_n connection herewith shall be construed as making the City and Owner joint venturers or partners. Neither Owner nor any of Owner's agents or contractors are or shall be considered to be agents of City in connection with the performance of Owner's obligations under this Agreement. Bankruptcy The obligations of this Agreement shall not be dischargeable in bankruptcy. 31. Mortl~a~ee Protection: Certain Rights of Cure (a) Mortgage Protection. This Agreement shall be superior and senior to ail liens placed upon the ?roperty or portion thereof after the date on which a memorandum of this Agreement is recorded, including the lien of any deed of trust or mortgage ("Mortgage"). Notwithstanding the foregoing, no breach hereof shall defeat, render invalid, diminish or impair the lien of any Mortgage made in good faith and for value, but all of the terms and conditions contained in this Agreement shall be binding upon and effective against all persons and entities, including all deed of trast beneficiaries or mortgagees ("Mortgagees") who acquire title to the Property or any portion thereof by foreclosure, trustee's sale, deed in lieu of foreclosure or otherwise. (b) Mortgagee Not Obligated. No foreclosing Mortgagee shall have any obligation or duty under this Agreement to construct or complete the construction of any improvements required by this Agreement, or to pay for or guarantee construction or completion thereof. City, upon receipt of a written request therefore from a foreclosing Mortgagee, shall permit the Mortgagee to succeed to the rights and obligations of Owner under this Agreement, provided that all defaults by Owner hereunder that are reasonably susceptible of being cured are cured by the Development Agreement For Marbella Housing Project December 26, 2001 C:\WINDOWS\TEMP~UC DA Dec26_final.docC:\WINDOWS\TEMP~DUC_DA_Dec26_final.doc Final Draft Page 10 of 22 Mortgagee as soon as is reasonably possible. The foreclosing Mortgagee thereafter shall comply with all of the provisions of this Agreement. (c) Notice of Default to Mortgagee. If City receives notice from a Mortgagee requesting a copy of any notice of default given to Owner hereunder and specifying the address for service thereof, City shall deliver to the Mortgagee concurrently With service thereof to Owner, all notices given to Owner describing all claims by the City that Owner has defaulted hereunder. If City de-.ermines that Owner is in noncompliance with this Agreement, City also shall serve notice of noncompliance on the Mortgagee, concurrently with service thereof on Owner. Each Mortgagee shall have the right during the same period available to Owner to cure or remedy, or to commence to cure or remedy, the condition of default claimed or the areas of noncompliance set forth iq City's notice. 32. Estoppel Certificate. Either party from time to time may deliver written notice to the other party requesting written certification that, to the knowledge of the certifying party (i) this Agreement is in full force and effect and constitutes a binding obligation of the parties; (ii) this Agreement has not been amended or modified either orally or in writing, or, if it has been amended or modified, specifying the nature of the amendments or modifications; and (iii) the requesting party is not in default in the performance of its obligations under this Agreement, or if in default, describing therein the nature and monetary amount, if any, of the default. A party receiving a request hereunder shall execute and return the certificate within thirty (30) days after rece!pt thereof. The City Manager shall have the right to execute the certificates requested by Owner hereunder. City acknowledges that a certificate hereunder may be relied upon by permitted transferees and Mortgagees. At the request of the Owner, the certificates provided by City establishing the status of this Agreement with respect to any lot or parcel shall be in recordable form, and Owner shall have the right to record the certificate for the affected portion of the Property at its cost. 33. Force Majeure. Notwithstanding anything to the contrary contained herein, either party shall be excused for the period of any delay in the performance of any of its obligations hereunder, when prevented from so doing by certain causes beyond its control, including, and limited to, major weather differences from the normal weather conditions for the South San Francisco area, war, acts of God or of the public enemy, fires, floods, strikes, freight embargoes, and acts of the government (other than the City). 34. Rules of Construction and miscellaneous terms (a) The singular includes the plural; the masculine gender includes the feminine; "shall" is mandatory, "may" is permissive. (b) Time is and shall be of the essence in this Agreement. (c) Where a Party consists of more than one person, each such person shall be jointly and severally liable for the performance of such Party's obligation hereunder. (d) The captions in this Agreement are for convenience only, are not a part of this Agreement and do not in any way limit or amplify the provisions thereof. Development Agreepaent For Marbella Housing Project - December 26, 2001 C:\WINDOWS\TEI~fP\DUC DA Dec26_final.docC:\WINDOWS\TEMPXDUC_DA_Dec26_final.doc Final Draft Page 11 of 22 35. 36. (e) Tl'_is Agreement shall be interpreted and enforced in accordance with the laws of the State of California in effect on the date thereof. Exhibits I Exhibit A - Map and Legal Description of Property Exhibit B - Project Plan Set Ethibit C - Obligations of Owner and City Exhibit D - Formula and Calculation of Park Fee Notices All notices required or provided for under this Agreement be in writing and delivered in person or sent by certified mail, postage prepaid. Notice required to be given to the City shall be addressed as follow: Ci :y Clerk P.O. Box 711,400 Grand Avenue South San Francisco, CA 94083 Notices required to be given to Owner shall be addressed as follows: LBL DUC SOUTH SAN FRANCISCO, LLC c/o DUC Housing Partners, Inc. 14107 Winchester Boulevard, Suite H Los Gatos, California 95032 Attention: Joe Finelli A party rr.ay change its address for notice by giving notice in writing to the other party and thereafter notices shall be addressed and transmitted to the new address. Development Agreement For Marbella Housing Project December 26, 2001 C:\WlNDOWS\TEhEP~DUC DA Dec26_final.docC:\WlNDOWS\TEMPXDUC_DA_Dec26_final.doc Final Draft Page 12 of 22 IN WITNESS WHEREOF this Agreement has been executed by the parties on the day and year first above writte-a. CITY OF SOUTH SAN FRANCISCO ATTEST: By: Michael A. Wilson, City Manager City Clerk APPROVED AS TO FORM Steven T. Mattas, City Attorney OWNER LBL- DUC II SOUTH SAN FRANCISCO II, LLC, a Delaware limited liability company By: Patrick J. Geary, Authorized Signatory COUNSEL FOR DUC By: Judy Davidoff, Attorney for Owner ATTEST: By: Title: Development Agree-nent For Marbella Housing Project - December 26, 2001 C:\WINDOWS\TEMP~DUC DA Dec26_final.docC:\WINDOWS\TEMP~)UC_DA_Dec26_final.doc Final Draft Page 13 of 22 EXHIBIT A MAP AND LEGAL DESCRIPTION OF THE PROPERTY Attached hereto. Development Agreement For Marbella Housing Project - December 26, 2001 C:\WINDOWS\TE~P~DUC_DA_Dec26_final.docC:\WINDOWS\TEMPXDUC DA Dec26_final.doc Final Draft Page 14 of 22 EXHIBIT B PROJECT PLAN SET Attached hereto. Development Agreement For Marbella Housing Project December 26, 2001 C :\WINDOWS\TEMP~DUC_DA_Dec26_final.docC:\WINDOWS\TEMP~DUC_DA_Dec26_final.doc Final Draft Page 15 of 22 1. Belo~ Owne Proje¢ with (al EXHIBIT C OBLIGATIONS OF OWNER AND CITY Market Rate Housing Unit Program: : shall offer for sale seventy (70) (or 25%) housing units within the Residential t at the below market sales prices specified below ("Affordable Units") in accordance ~e following terms and conditions: Based upon the median income for San Mateo County households as of March, 2001 (the "Base Median Income"), which median income equals $64,100 for a two (2) person household, $80,100 for a four (4) person household and $92,900 for a six (6) person household, the fixed below market sales prices (the "Fixed Sales Prices") for the Affordable Units shall be: (i) For a Low Income household (which is a household with an income level equal to 80% of the applicable median income), a one (1) bedroom for two (2) persons = $179,602; (ii) For a Low Income household, a two (2) bedroom for three (3) persons = $206,621; (iii) For a Low Income household, a two (2) bedroom for four (4) persons = $233,641; (iv) For a Low Income household, a three (3) bedroom for five (5) persons = $255,297; (v) For a Low Income household, a three (3) bedroom for six (6) persons = $276,952; (vi) For a Median Income household (which is a household with an income level equal to 100% of the applicable median income), a one (1) bedroom for two (2) persons = $218,145; (vii) For a Median Income household, a two (2) bedroom for three (3) persons = $249,933; (viii) For a Median Income household, a two (2) bedroom for four (4) persons = $281,720; (ix) For a Median Income household, a three (3) bedroom for five (5) persons = $307,151; (x) For a Median Income household, a three (3) bedroom for six (6) persons = $332,581; Development Agreement For Marbella Housing Project - December 26, 2001 C :\WINDOWS\TEMP'~DUC_DA_Dec26_fi nal.docC :\WINDOWS\TEMP~DUC_DA_Dec26_fi nal.doc Final Draft Page 16 of 22 (xi) For a Moderate Income household (which is a household with an income level equal to 120% of the applicable median income), a one (1) bedroom for two (2)persons = $266,315; (xii) For a Moderate Income household, a two (2) bedroom for three (3) persons = $304,079; (xiii) For a Moderate Income household, a two (2) bedroom for four (4) persons = $341,843; (xiv) For a Moderate Income household, a three (3) bedroom for five (5) persons = $372,133; and (xv) For a Moderate Income household, a three (3) bedroom for six (6) persons = $402,423. Such Fixed Sales Prices may be increased by Owner annually in proportion to any increases in the median income level for San Mateo County households over the Base Median Income, but in no instance shall the Fixed Sales Price be decreased by an amount, even in the event of a reduction of the median income level below the Base Median Income. A total of twenty (28) units (or 10% of the total number of units) shall be targeted to Low Income with an average fixed sales price of these units being at least $219,180. A total of forty-two (42) units (or 15% of the total number of units) shall be targeted to Median (21 units) and Moderate (21 units) Income households, with the average fixed sales price for these units being at least $295,293. Owner may submit an Affordable Housing Agreement, consistent with Chapter 20.125 of the City of South San Francisco Municipal Code, to the Director of Economic and Community Development that proposes a distribution of units that differs from that stated in subsection (b) above. Said Affordable Housing Agreement shall be subject to review and approval by the Director of Economic and Community Development; provided, however, that if the proposed Affordable Housing Agreement alters the proportion of units between low and median/moderate income or otherwise results in an "offset" as defined in Chapter 20.125.020 (o), the Affordable Housing Agreement shall be subject to review and approval by the City Council. Neither the filing of an Affordable Housing Agreement or the terms of this provision entitle Owner to develop affordable units in a number or distribution other than the 10% and 15% distribution set forth in paragraph 1 of this subsection (b). (cI Owner shall designate which units in the Residential Project will be offered for i sale as Affordable Units. However, all affordable units shall be constructed with i the same materials and to the same quality as the market rate units. Development Agreement For Marbella Housing Project December 26, 2001 C:\WlNDOWS\TEMPXDUC DA Dec26_final.docC:\WINDOWS\TEMP~UC_DA_Dec26_final.doc Final Draft Page 17 of 22 The City shall be responsible for locating and qualifying buyers for the Affordable Units and for marketing such Affordable Units. Owner shall pay City an Administrative Fee equal to the City's costs incurred in locating and qualifying buyers and marketing the Affordable Units. City shall provide Owner/Seller with an invoice establishing the City's costs and shall submit said invoice into escrow. Said Administrative Fee shall be paid as an obligation of Owner/Seller at or prior to the close of escrow on the Affordable Unit but may be waived, at the City's discretion, in order to further the goal of providing affordable housing. The terms and conditions of the sale of any Affordable Unit to a qualifying buyer shall be subject to the reasonable approval of the Owner. All Affordable Units shall be subject to resale restrictions, to be recorded upon sale of the Unit. After the initial sale of the Affordable Units at a price affordable to the target income level group, Affordable Units shall remain affordable to subsequent income eligible buyers, at the same income level, pursuant to a resale restriction with a term of thirty (30) years or for-sale units may be sold at a market price to other than targeted households under the terms and conditions set forth below. The Resale Restrictions applicable to the units shall be specifically identified in the Project CC&Rs and are subject to the review and approval of the City Attorney. 1. Base Resale Price: The price at which the Owner purchased the Affordable Unit shall be adjusted by the percentage increase or decrease in the median annual income at 100% of median of a family of four in San Mateo County. The percentage increase or decrease shall be computed for the period that the Affordable Unit is held by Owner.. This adjusted price shall be increased by the market value, if any, of any documented, permanent capital real estate or fixed improvements approved by City. No price adjustment will be made except upon presentation to the City of written documentation of all expenditures made by Owner for which an adjustment is requested. The adjusted price shall be decreased by the amount necessary to repair any damages and to put the unit into a sellable condition, including items such as paint, cleaning, construction repairs, and to bring said unit into conformity with all applicable provisions of the South San Francisco Municipal Code and the affordable housing guidelines established by the City. The value of price adjustments shall be reasonably determined by the City. 2. Upon resale of the unit, if the Affordable Unit is sold at market price, the City will receive the difference between the Base Resale Price and the actual market sales price of the unit. (g) Funds recaptured by the City shall be used in assisting other eligible households with home purchases at affordable prices. To the extent possible, the Project Development Agreement For Marbella Housing Project December 26, 2001 C:\WlNDOWS\TEMPXDUC_DA_Dec26_final.docC:\WINDOWS\TEMP~UC DA Dec26_final.doc Final Draft Page 18 of 22 shall be designed to be compatible with conventional mortgage financing programs including secondary market requirements. In the event Owner converts the Residential Project to units for rental, or any individual owner of an affordable unit in the project, converts an Affordable Unit to a rental unit, said unit shall be subject to the affordability criteria established in this Agreement and applicable to the unit. Said rental restrictions shall be contained in the Covenants, Conditions and Restrictions for the Residential Project. (i) Any income limits or allocation of rental units shall be subject to further review and approval by the City and in any event shall be consistent with any Inclusionary Ordinance adopted by the City. If units are offered as rental units, Owner shall be responsible for filing a report annually with the City that specifies the number of Affordable Unit rented, the income levels established for the units and the annual rent charged and shall cooperate with the City to locate and qualify renters for the Project. In no event shall the maximum monthly rent for an Affordable Unit exceed ninety percent (90%) of the actual market rent charged for a unit of comparable size in the Project. Terrrrnation of Below Market Rate Housing Unit Pro~ram. Any Affordable Units that (i) are not under a sales contract within six (6) months of the City's issuance of a certificate of occupancy for such unit, or (ii) are put under a sales contracts prior to the expiration of such six (6) month period, but which have not closed escrow for such sale within ninety (90) days after such sales contract was entered into, shall thereafter no longer be subject to the terms and conditions set forth in Paragraph 1 above and Owner shall have the right to sell such Affordable Units free of such restrictions. A. Nothwithstanding anything in the preceding sentence to the contrary, in the event escrow for an Affordable Unit that would otherwise qualify under subparagraph (ii), was delayed in closing or failed to close for any reason other than the City's failure to satisfy its obligations in escrow or to complete the sale of the Affordable Unit, such ASfordable Unit shall remain subject to the terms and conditions set forth in Paragraph 1 above for an additional 90 days from the date the original escrow period was to end or Owner may sell the unit as a market unit and provide an alternate, equivalent A.-'fordable Unit to the Buyer. If Owner provides an equivalent, alternate Affordable Unit, escrow shall be completed within 90 days from the date Owner provides an A .ternate Equivalent Unit that is ready for immediate occupancy as evidenced by a C~rtificate of Occupancy or Final Permit for the unit. B. Nothwithstanding Paragraph 2 and 2(a), the total number of Affordable Units within the Project upon build-out shall equal twenty-five percent (25%) of the total number of units unless it can be proven to the City's satisfaction that Owner has exercised cOmmercially reasonable efforts to provide the required Affordable Units. Development Agreement For Marbella Housing Project December 26, 2001 C:\WlNDOWS\TEI~ IPXDUC_DA_Dec26_final.docC:\WlNDOWS\TEMPXDUC_DA_Dec26_final.doc Final Draft Page 19 of 22 3. Certificates of Occupancy for Below Market Rate Housing Unit Program. The City coveflants and agrees that the City will issue certificates of occupancy for Affordable Units once the requirements for issuance are met and that such requirements for issuance shall in no way differ from the requirements for issuance of certificates of occupancy for market rate units in the Residential Project. 4. Right of First Refusal for Affordable Units. In the event the City is unable to locate buyers for ar_y of the Affordable Units, the City shall have the fight to purchase such Affordable Units pursuant to the terms and conditions set forth in Paragraph 1 above, provided that any such purchases by the City shall remain subject to the time limitations set forth in Paragraph 2 above. City shall also have a fight of first refusal on any subsequent sale of an Affordable Unit within the Project. 5. Marketing Plan. The Parties agree that the market rate units in Residential Project shall be marketed in a manner such that the units are targeted specifically for sale to residents of the City 6f South San Francisco; employees of businesses within South San Francisco; and local and state government employees working in South San Francisco; including but not limited to City of South San Francisco employees and employees of the South San Francisco Unified School District. The Marketing Plan shall be developed by Owner or his/her representative and approved by the Director of Economic and Community DeveSopment at or prior to receipt of a building permit for the Project. The Marketing Plan shall include, at a minimum, a comprehensive strategy for notifying the target groups and for s41iciting their interest in pumhasing the units. The parties acknowledge that nothing herein or in the marketing plan shall obligate or cause Owner or City to violate the Federal Fair Housing Law. 6. On-Site Amenities. In furtherance of the Planned Unit Development, Owner shall provide on-sile amenities for the use of the occupants of the Residential Project, including, at least one i~door recreation area, at least one outdoor children's play area and at least one outdoor passige recreation area. 7. Art/Landscape Display. In furtherance of the Planned Unit Development, Owner has agreed to provide at least one art/landscape display, which display shall be located on the Property and viewable from both the Residential Project and specifically designated locations off the Property as set forth in the Planned Unit Development. The design of such art/landscape display shall be subject to the review and approval of the Director of Economic and Community Development and said approval shall be obtained prior to receipt of a building perrmt for the Project. 8. Traff:_c Programs. In order to reduce the traffic generated from the Residential Project, Owner shall cause the Homeowners Association to implement, monitor and enforce the following: (fi) a fide sharing program for the occupants of the Residential Project; (b) a preferential parking program for the participants in the ride sharing program; and Development Agreement For Marbella Housing Project December 26, 2001 C:\WINDOWS\TEMPXDUC_DA_Dec26_final.docC:\WlNDOWS\TEMP~DUC_DA_Dec26_final.doc Final Draft Page 20 of 22 (c! an on-site shuttle program to public transportation locations, including, without ~ limitation, BART stations, Cal Train stations, and bus terminals. In addition, in order to satisfy the traffic mitigation requirements set forth as a condition to the City Council's approval of the Residential Project, Owner agrees to satisfy the traffic mitightion requirements and conditions set forth in that certain DKS Associates Traffic Repo/t dated October 2, 2001, prepared by DKS Associates. 9. Waiver of Density Bonus Offsets: In consideration of City's participation in the marketing and sale of the Affordable Units, Owner agrees to waive any right to a Density Bonus or other incentive for the provision of Affordable Units pursuant to this Agreement. Development Agreement For Marbella Housing Project - December 26, 2001 C:\WINDOWS\TEMP~DUC DA Dec26_final.docC:\WINDOWS\TEMP~DUC_DA_Dec26_final.doc Final Draft Page 21 of 22 DUs X DUs= POP= Numb~ EXHIBIT D FORMULA AND CALCULATION OF PARK FEE POP X 3acres X FMV = (sub total) X 6/5= in-lieu DU 1,000 people Buildable fee acres '~r of Dwelling units as defined by City of South San Francisco Code (Code) Section 19.24.080 Population per Dwelling unit as provided under Code Table 19.24.080(b) DU F MV =For the purposes of this Agreement, the fair market value of each Buildable acre buildable acre is equal to the purchase price paid by the Owner for the entire property, divided by the gross acreage of the entire Property (14.85 acres). Therefore, the fair market value of the property is $671,141 per buildable acre. If the 280~ X .00732 Residential Project contains 280 units, the following calculation will apply: X $671,141 = $1,371,812 X 1.2 = TOTAL FEEDUE: $1,646, 1753 1 If the number of d~velling units increase or decrease, this same formula will apply, except the number of dwelling units will vary accordingly. 2 This number is derived from Code Table 19.24.080(b) for Mulit-Family, High Density dwellings and represents the product of POP X 3 acres D-J 1,000 people 3 This total does noi include any applicable credits that apply towards the Residential Project's park land dedication or Park Fee requirements. Development Agreement For Marbella Housing Project December 26, 2001 C:\WINDOWS\TEMPXDUC_DA_Dec26_final.docC:\WINDOWS\TEMPXDUC DA Dec26_final.doc Final Draft Page 22 of 22