HomeMy WebLinkAboutReso 118-2019 (19-658)City of South San Francisco P.O. Box 711 (City Hall,
400 Grand Avenue)
South San Francisco, CA
City Council
Resolution: RES 118-2019
File Number: 19-658 Enactment Number: RES 118-2019
RESOLUTION APPROVING A SECOND EXCLUSIVE
NEGOTIATING RIGHTS AGREEMENT BETWEEN THE CITY
OF SOUTH SAN FRANCISCO, AND FIREHOUSE WORK, LLC
AND HABITAT FOR HUMANITY GREATER SAN FRANCISCO,
FOR THE PROPERTY LOCATED AT 201 BADEN AVENUE
AUTHORIZING THE CITY MANAGER TO EXECUTE THE
AGREEMENT.
WHEREAS, The City -owned, retired firehouse at 201 Baden (the "Property") is approximately 22,460
square feet (0.51 acres) and consists of three parcels (APN 012-335-100, 012-335-110 and an unnamed
parcel); and,
WHEREAS, Firehouse Live, LLC and Firehouse Work, LLC (formerly Fire House Live/Work), were
selected by Council as the developer for the site; and,
WHEREAS, after the developer selection, the Housing Standing Committee directed staff to begin
negotiations on an Exclusive Negotiating Rights Agreement ("ENRA") with the team; and,
WHEREAS, at that time the Firehouse Work team was comprised of members Group 4 and Firehouse
Live team was comprised of Lawlor Land Use; and,
WHEREAS, the consortium agreed to offer 50% of the housing units at Below Market Rate ("BMR")
prices in partnership with Habitat for Humanity Greater San Francisco ("HGSF"); and,
WHEREAS, on February 27, 2019, the City Council approved the ENRA ("Original ENRA"); and,
WHEREAS, the key terms negotiated in the ENRA included a 180 day term, three 90 day administrative
extensions for a fee of $15,000, developer commitment to the BMR units, demonstrated financial
feasibility, submission of a joint entitlement application ("Pre -App"), and the final purchase price
determination; and,
WHEREAS, the Original ENRA came into effect on March 4, 2019; and,
WHEREAS, developer team has been working with City staff on meeting the obligations of the ENRA
and troubleshooting the more complicated components of the proposed project; and,
WHEREAS, Lawlor Land Use discovered they could not make the project financially feasible with only
12 market rate units; and,
City of South San Francisco Page 1
File Number. 19-658
Enactment Number. RES 118-2019
WHEREAS, HGSF is prepared to entirely assume the Firehouse Live portion of the Project; and,
WHEREAS, HGSF will develop 24 for -sale BMR units, targeting 60-80% of Area Median Income
("AMI") levels; and,
WHEREAS, the Original ENRA expired and the City and development team are no longer in exclusive
negotiations and the development team have requested a new ENRA; and,
WHEREAS, the key business points and deviations from the Original ENRA include an increase in the
number of BMR units from 50% to 100%, exchange of developers from Lawlor Land Use to HGSF, a
term of 180 days, a joint Pre -App, and separate Purchase and Sale Agreements ("PSAs") and entitlement
processes and HGSF to provide Financing Progress reports to the City every 30 days; and,
WHEREAS, to address their different Project needs, the developer team has contemplated a path
forward where the developers remain joined through the Pre -App and PSA negotiation phase; and,
WHEREAS, prior to the PSA finalization, the developer team intends to resolve some of the issues that
may bind the projects; and,
WHEREAS, the ENRA provides the City with an option to replace one developer or terminate the
ENRA as to both, subject to City Council's approval; and,
NOW, THEREFORE, the City Council of the City of South San Francisco does hereby resolve as
follows:
1. The Recitals set forth above are true and correct, and are incorporated herein by reference.
2. The Exclusive Negotiating Rights Agreement, substantially in the form attached as Exhibit A
hereto, is hereby approved.
3. The City Manager or his designee is hereby authorized to execute it on behalf of the City Council;
to make revisions to the Agreement, with review and approval by the City Attorney, which do not
materially or substantially increase the City's obligations thereunder; to sign all documents; to make all
approvals and take all actions necessary or appropriate to carry out and implement the intent of this
Resolution.
Exhibit A: Exclusive Negotiating Rights Agreement with Firehouse Work and Habitat for
Humanity Greater San Francisco
City of South San Francisco Page 2
File Number. 19-658
Enactment Number. RES 118-2019
At a meeting of the Special City Council on 9/25/2019, a motion was made by Richard Garbarino, seconded
by Mark Addiego, that this Resolution be approved. The motion passed.
Yes: 3 Councilmember Nagales, Councilmember Addiego, and Vice Mayor Garbarino
No: 2 Mayor Matsumoto, and Councilmember Nicolas
Attest by
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Vsa Govea Acosta
City of South San Francisco Page 3
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
by and between
FIREHOUSE WORK, LLC,
HABITAT FOR HUMANITY GREATER SAN FRANCISCO, INC.
and
CITY OF SOUTH SAN FRANCISCO
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THIS EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT (this “Agreement”) is
entered into by and between the CITY OF SOUTH SAN FRANCISCO, a municipal corporation
(“City”), FIREHOUSE WORK, LLC, a California Limited Liability Company (“FHW”), and
HABITAT FOR HUMANITY GREATER SAN FRANCISCO, INC., a California Non-Profit
Corporation (“HGSF”; each a “Developer” and both collectively described as “Developers”)
dated as of _________________, 2019 (the “Effective Date”). City and Developers are each
referred to as (“Party”) or collectively referred to as the (“Parties”).
WHEREAS, the City is the owner of certain real property located at 201 Baden Avenue,
in the City of South San Francisco, California, known as County Assessor’s Parcel Numbers
(“APN”) 012-335-100, 012-335-110, and the portion of Cypress Street that is to be vacated, with
a combined lot size of 22,500 square feet, and more particularly shown attached hereto as Exhibit
A, and incorporated herein by this reference (the “Property”); and
WHEREAS, the Property, commonly known as the Old Firehouse, was decommissioned
as a fire station in 2006 and has been used for interim storage uses since 2008; and
WHEREAS, the City adopted the South San Francisco Downtown Station Area Specific
Plan in 2015 which set forth a vision for the downtown focusing on revitalization, new residential
developments, improvements along Grand Avenue and adjacent corridors, and encouraging
Transit-Oriented Development projects that encourage bicycle and pedestrian links to regional
transportation hubs; and
WHEREAS in March 2016 the City followed the Surplus Land Act (California
Government Codes Sections 54220 et seq.) noticing requirements and offered public entities an
opportunity to notify the City of its interest in purchasing or leasing the property for the purpose
of expanding parks and/or recreation services, open space public schools or affordable housing,
and received no responses; and
WHEREAS, in 2017, the City solicited proposals from qualified developers through an
RFQ process, and upon review of the responsive proposals, the City’s Joint Housing Standing
Committee made a recommendation at its November 19, 2018 meeting that the City pursue an
Exclusive Negotiating Rights Agreement (“ENRA”) with the selected developer team, Fire House
Live Work for the development of a commercial project and residential project, or projects, on the
Property; and
WHEREAS, on March 4, 2019, the City entered into an ENRA (the “Original ENRA”)
with FHW and Firehouse Live, LLC (“FHL”) which authorized the parties to commence
negotiating the terms of purchase agreements with FHW and FHL in connection with the
rehabilitation of the existing Old Firehouse and the development of a mixed-use project; on the
Property; and
WHEREAS, the Original ENRA expired on August 31, 2019, and the Parties now desire
to replace FHL with HGSF as the proponent of the residential component of the Project (as defined
below), thereby necessitating the execution of a new ENRA to replace and supersede the Original
ENRA; and
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WHEREAS, FHW desires to rehabilitate the existing Old Firehouse structure into a 9,200
square foot commercial space, preserving its historical significance (the “Commercial Project”),
and HGSF desires to construct approximately twenty-four (24) residential condominium units that
will all be deed restricted as Below Market Rate (“BMR”) on the Property (the “Affordable
Housing Project,” and collectively with the Commercial Project, the “Projects”), which is to be
bifurcated into two separate parcels that will be sold to each Developer in separate transactions;
and
WHEREAS, FHW will be responsible for entitling and developing the Commercial
Project and HGSF will be responsible for entitling and developing the Affordable Housing Project;
and,
WHEREAS, the Developers anticipate expending funds to prepare architectural and
design drawings and conduct certain studies that are needed to assess the feasibility of the Projects
and seek any additional land use entitlements, and therefore require a grant of exclusive negotiating
rights in order to be willing to make such expenditures; and its is the intent of the Developers to
work cooperatively and in good faith to meet the Performance Milestones set forth on Exhibit B
to submit and process a joint pre-application and negotiate the terms of purchase and sale
agreements and this process is material to the City entering this ENRA; and,
WHEREAS, at its meeting on ____________________, 2019,the City approved this
Agreement, and directed staff to commence negotiating the terms of two separate purchase
agreements (collectively, the “Purchase Agreements”), in order for the Developers to pursue land
use entitlements for the Projects and acquire the Property.
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 Negotiate. The Parties agree, for the term of this Agreement, to
negotiate diligently and in good faith the terms of the Purchase Agreements setting forth
the conditions and timetable for the sale of the Property (as may be subdivided by the
Developers with any necessary street and utility vacations by the City) to the Developers.
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 the Purchase Agreements for the future development of the Projects. This
Agreement does not, however, impose a binding obligation on City to convey any interest
in the Property to the Developers, nor does it obligate City to grant any approvals or
authorizations required for the development of the Projects on the Property.
a. If City believes that either Developer is not negotiating diligently and in good faith,
City will give written notice thereof to that particular Developer who will then have
ten (10) business days to commence negotiating in good faith. Following the failure
of that Developer to thereafter commence negotiating in good faith within such ten
(10) business day period, City may terminate that Developer’s rights under this
Agreement. The City Council may, in its reasonable discretion, determine that a
default by one Developer under this Agreement shall not constitute a default by the
other Developer, and the termination of one Developer’s rights under this Section
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1(a) due to its default shall not affect the other Developer’s rights under this
Agreement. The City will provide written confirmation to the Developers of this
determination if so made. If this Agreement is terminated by City pursuant to this
Section 1(a), Developers acknowledge and agree that City will suffer damages,
including lost opportunities to pursue other development alternatives for the
Property (or portion thereof). Therefore, as it pertains to FHW, FHW and the City
agree that if this Agreement is terminated as provided above due to a default by
FHW, 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 16 of this Agreement.
b. If either Developer believes that City is not negotiating diligently and in good faith,
that 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 the Developer who provided notice,
but, subject to the determination by the City Council in its reasonable discretion,
only for that Developer’s portion of the Project. In the event of such termination by
a Developer, City will return a prorated portion of the Deposit and any remaining
balance of the Payment, if any, to that Developer and neither Party will have any
further rights against or liability to the other under this Agreement, except as set
forth in Section 16 of this Agreement. Should such termination occur pursuant to
this Section 1(b), the terms of this Agreement between the other Developer and
City will remain in full force and effect.
c. If FHW and City proceed to negotiate diligently and in good faith, but are unable
to reach an agreement on the terms of FHW’s respective Purchase Agreement, then
City will return a prorated portion of the Deposit, if any, to FHW in accordance
with the provisions of Section 5(c) of this Agreement and neither FHW nor City
will have any further rights against or liability to the other under this Agreement,
except as set forth in Section 16 of this Agreement. Should that circumstance occur,
the terms of this Agreement between HGSF and City will remain in full force and
affect.
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 propo sals by any
person or entity with respect to the acquisition of any interest in the Property or the
development of the Property, 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 Property or any portion thereof. City may, at its
discretion, continue to utilize the Property for public uses until the City conveys ownership
of the Property.
Furthermore, City will not, directly or indirectly, through any officer, employee, agent or
otherwise, engage in negotiations concerning any such transaction with, or provide
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information to, any person other than Developers and their representatives with a view to
engaging, or preparing to engage, that person with respect to the disposition or
development of the Property or any portion thereof.
3. Term.
a. The term of this Agreement (“Term”) commences on the Effective Date, and will
terminate one hundred and eighty (180) days from the Effective Date, unless
extended or earlier terminated as provided herein.
b. During the Term, Developers will each provide City with written reports every
forty-five (45) days that summarize the Developer’s actions taken in furtherance of
this Agreement, which may include to the following: negotiating the terms of the
Purchase Agreements, due diligence review of the Property, commencement of any
environmental requirements under the California Environmental Quality Act
(“CEQA”), preparation of architectural and construction plans, attendance at City
meetings, adherence to a mutually agreed upon master schedule, and general
progress towards future entitlement of the Property.
c. The Term of this Agreement may be administratively extended for up to a
maximum of three separate ninety (90) day periods for each Developer or both
Developers upon the request of either Developer. In the case of FHW,
administrative approval of the request shall be contingent upon City’s receipt of an
additional non-refundable payment by FHW of fifteen thousand dollars ($15,000)
for each ninety day extension period (“ENRA Extension Payment”), and in the
case of FHW or HGSF the consent of the City acting through and at the discretion
of its City Manager or his/her designee (“City Manager”). Developers understand
that the City will only consider extension(s) of the Term of this Agreement where
Developers have demonstrated, to the City’s satisfaction, substantial progress
toward development of the Property, which may include submittal of a joint pre-
application, submittal of individual environmental review documents necessary to
satisfy compliance with CEQA, submittal of individual architecture and
construction plans, payment of any respective applicable processing and plan check
fees, or pursuing land use entitlements for each component of 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, FHW
has previously remitted to City a deposit in the amount of Fifty Thousand Dollars
($50,000) (the “Deposit”). The City agrees that such Deposit will accrue to FHW,
and no portion of the Deposit shall be attributed to HGSF. If Purchase Agreements
are executed, the Deposit will be credited toward FHW’s ultimate purchase price
for the Property. 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.
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During the term of this Agreement, FHW will also reimburse City for all staff and
City consultant time incurred in preparing the Purchase Agreement, entitlements,
and any other documents that relate to the purchase and disposition of the Historic
Firehouse portion of the Property to FHW. FHW previously remitted to City an
initial payment in the amount of Thirty Thousand Dollars ($30,000) in immediately
available funds (“Payment”) in connection with the Original ENRA, which was
subsequently drawn upon to reimburse City for work performed in connection with
the Original ENRA. City has deposited 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 FHW’s Purchase Agreement, entitlements, and
any other 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 FHW to provide additional funds necessary to reimburse staff and
consultant costs expended in connection with preparation of the Purchase
Agreement and any related documents as they relate to the Commercial Project
only. Documentation of City’s rate schedule for staff, staff time spe nt, and
consultant costs will be retained by City and provided to Developer upon request.
The City agrees to waive all such costs or fees subject to this Payment to the extent
such costs or fees pertain to HGSF’s 100% affordable residential component.
b. City agrees to account for the Deposit and Payment, any other separate payments
to City that relate to cost recovery for staff time, interest earnings, and any
expenditures made in furtherance of this Agreement. Upon reasonable notice to
City, FHW may receive copies of any records related to expenditures made in
furtherance of this Agreement, subject to any appropriate redactions.
c. In the event that FHW terminates this Agreement before the expiration of the Term
pursuant to Section 1(b), Section 1(c) or Section 13(d), the City will return any
prorated portion of the Deposit to FHW. The prorated Deposit will be calculated by
dividing the full $50,000 Deposit by 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 FHW’s termination. The resulting figure will be the prorated Deposit
that the City will pay to FHW.
d. In the event this Agreement is terminated by City or FHW with respect to the
Commercial Project for any reason other than FHW’s breach of its obligations
under this Agreement, the remaining balance of the Payment and any interest
earned will be returned to FHW, 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, Developers 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, except as may otherwise be provided through the
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Purchase Agreement including, by way of example only, if the City agrees to waive
processing fees, impact fees, or other fees for the Affordable Housing Project.
6. Terms and Conditions of the Purchase Agreements. The Parties agree to use diligent and
good faith efforts to successfully negotiate separate Purchase Agreements which will
address, among other things, the purchase price, the conditions of closing, and the scope
of Developer’s obligations to design and construct improvements on the Property. The
Parties agree that the terms of the Purchase Agreements shall be based on those terms set
forth herein and in Exhibit B, attached hereto and incorporated herein by reference, and any
other terms as may be agreed to by the respective Parties. In the event of an inconsistency
between the body of this Agreement and Exhibit B, the language in the body of this
Agreement shall prevail.
7. Developer’s Studies; Right of Entry.
a. During the Term of this Agreement, Developers will bear all costs and expenses
associated with preparing any studies, surveys, plans, specifications and reports
(“Developer’s Studies”) Developers deems necessary or desirable for each of their
respective projects, in each Developer’s sole discretion, to conduct 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. Developers will have rights of
access to the Property to prepare Developer’s Studies.
b. Developers hereby agrees to notify the City seventy-two (72) hours in advance of
its intention to enter the Property.
c. Developers will provide the City with work plans, drawings, and descriptions of
any intrusive sampling it intends to do. Developers must keep the Property in a safe
condition during its entry. Developers shall repair, restore and return the Property
to its condition immediately preceding each Developer’s entry thereon at that
Developer’s sole expense.
d. Without limiting any other indemnity provisions set forth in this Agreement, each
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 each
Developer or Developer’s agents, employees, consultants, contractors or
subcontractors pursuant to this Section 7. Developers’ indemnification obligations
set forth in this Section 7 shall survive the termination of this Agreement. For the
avoidance of doubt, FHW’s and HGSF’s indemnification obligations under this
Section 7(d) relate only to their (or their agents) entry upon the Property; FHW
shall not be obligated to indemnify the City in connection with the actions of HGSF,
and HGSF shall not be obligated to indemnify the City in connection with the
actions of FHW.
e. If upon expiration of the Term of this Agreement either Developer has not
successfully negotiated a Purchase Agreement, that Developer will, upon City’s
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written request, provide City within fifteen (15) days following said date of
expiration copies of any non-proprietary Developer’s Studies prepared by third
parties completed by such date. The Developer subject to this Section 7(e) 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.
8. City’s Reports and Studies. Pursuant to terms of the Original ENRA, the City has provided
to Developers, for review or copying at each Developer’s expense, all non-privileged
studies, surveys, plans, specifications, reports, and other documents with respect to the
Property that City is able to reasonably locate and has in its possession or control. Studies
or documents prepared by City and its agents solely for the purpose of negotiating the terms
of the Purchase Agreements and related documents are not required to be provided by City
to Developer and are excluded from this requirement.
9. Developers’ Pro Forma, Evidence of Financing and Project Schedule Related to Potential
Approval of a Purchase Agreement.
a. The Parties agree that each Purchase Agreement will contain language that provides
that: (1) not later than forty-five (45) days prior to the City consideration of Project
entitlements, Developers will provide evidence satisfactory to City that Developers
have identified potential sources and uses of funds to complete their respective
Projects, subject only to commercially reasonable conditions, for all funding
necessary for the successful completion of each Project, and (2) issuance of a
building permit for each Project shall be a condition of closing for each Project, as
further defined in the Purchase Agreements, provided that nothing in this Section
9(a) shall be construed as requiring concurrent closings for each Project.
b. Prior to the end of the term of this Agreement, Developers will provide the City
with the following deliverables:
i. Demonstrate both a conditional financial and project commitment from
HGSF to develop the Affordable Housing Project with 100% affordable
housing units; and
ii. Submit a joint planning pre-application for each component of the Project
that has been deemed substantially complete by the City.
iii. Final agreed upon Purchase Agreements.
10. Full Disclosure. Developers are 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
not be unreasonably withheld. Developers also agree to disclose both the type of planned
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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 Developers may
be asked to attend such meetings to provide tho se bodies with a status update of their
development efforts related to this Agreement.
12. No Binding Commitments. City has no legal obligation to grant any approvals or
authorizations for the Purchase Agreements or any development thereon until the Purchase
Agreements 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 each
respective Project until City has completed, considered and certified/approved any
additionally required CEQA environmental review documents for that particular Project.
13. Termination.
a. Either Developer’s rights and obligations under this Agreement may be terminated
with regard to a particular Developer by mutual consent of City and that particular
Developer.
b. City has the right to terminate this Agreement upon its good faith determination
that a particular 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, but only as to that particular Developer’s
component of the Project. The City has the right to make this determination as to
both Developers and accordingly has the right to terminate this Agremeent as to
both Developers. If the City only terminates one Developer pursuant to this
subsection, the rights of the non-terminated Developer under this Agreement shall
not be affected. The City will provide written confirmation to the Developers of its
determination as the case may be.
c. Each Developer will have the right to terminate its rights and obligations under this
Agreement as it pertains to their respective Project 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. Expressly subject to the City Council’s
determination in its reasonable discretion which the City Council may exercise to
terminate this Agreement as to both Developers, one Developer’s decision to
terminate shall not affect the other Developer’s rights and obligations under this
Agreement.
d. Each Developer will have the right to terminate this Agreement if the results of that
Developer’s investigation of the Property are unsatisfactory, in that Developer’s
sole and absolute discretion, with respect to that Developer’s desired development
activities, or if that Developer is unable to obtain other necessary approvals, rights
or interests. If either Developer terminates under this provision, the City has the
right to terminate the Agreement as to one or both Developers. If the City only
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terminates one Developer pursuant to this subsection, the rights of the non-
terminated Developer under this Agreement shall not be affected. The City will
provide written confirmation to the Developers of its determination as the case may
be. If FHW terminates this Agreement pursuant to this Section 13(d), then City will
return a prorated portion of the Deposit as applicable to FHW in accordance with
the provisions of Section 5(c) of this Agreement and the remaining balance of the
Payment as applicable in accordance with the provisions of Section 5(d), and
neither FHW nor City will have any further rights against or liability to each other
under this Agreement, except as set forth in Section 16 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.
14. Effect of Termination. Upon termination as provided herein, or upon the expiration of the
Term and any extensions thereof without the respective affected Developers having
successfully negotiated Purchase Agreements for their particular component of the Project,
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 16 (Indemnification), and Section 20 (Brokers) will survive
such termination. Provided further, that upon termination or expiration of this Agreement
with respect to either Developer without the Parties having successfully negotiated a
Purchase Agreement, that respective Developer will deliver to City any non -proprietary
Developer’s Studies pursuant to the provisions of Section 7 of this Agreement.
15. 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
ii. 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.
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City : City of South San Francisco
Attn: City Manager
400 Grand Avenue
South San Francisco, CA 94080
Tel (650) 877-8501
[email protected]
with a copy to: City of South San Francisco
Attn: ECD Director
400 Grand Avenue
South San Francisco, CA 94080
Tel (650) 829-6620
[email protected]
cc: [email protected]
with a copy to: Meyers Nave
Attn: Sky Woodruff
555 12th Street, Suite 1500
Oakland, CA 94607
Tel (510) 808-200
Fax (510) 444-1108
[email protected]
FHW: Firehouse Work, LLC
Attn: Dawn Merkes
211 Linden Ave
South San Francisco, CA 94080
Tel (650) 871-0709
Fax (650) 871-7911
[email protected]
with a copy to: Arent Fox LLP
Attn: Frank Petrilli
55 2nd Street, 22st Floor
San Francisco, CA 94105
Tel (415) 805-7970
[email protected]
HGSF: Habitat for Humanity Greater San Francisco
Attn: Maureen Sedonaen
500 Washington Street, Suite 250
San Francisco, CA 94111
Tel (415)625-1001
[email protected]
with a copy to: Holland & Knight LLP
Attn: Tamsen Plume
50 California Street, Suite 2800
12 of 19
San Francisco, CA 94111
Tel (415) 743-6941
[email protected]
16. Indemnification. Each 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 that respective
Developer or arising out of or in connection with that respective Developer’s access to and
entry on the Property pursuant to Section 7 of this Agreement; provided however, that
neither Developer will have any indemnification obligation with respect to the gross
negligence or willful misconduct of any Indemnitee, and that FHW shall not be obligated
to indemnify the City in connection with the actions of HGSF, and HGSF shall not be
obligated to indemnify the City in connection with the actions of FHW.
17. 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 is held invalid
or unenforceable unless an essential purpose of this Agreement would be defeated by loss
of the invalid or unenforceable provision.
18. Entire Agreement; Amendments In Writing; Counterparts. 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 onl y 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.
19. 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, each Developer is permitted to assign this Agreement
without such written consent, provided that Developer assigns this Agreement to an entity
that is controlled by that particular 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.
20. Brokers. Each Party warrants and represents to the other that no brokers have been retained
or consulted in connection with the selection of the Developers. Each Party agrees to
defend, indemnify and hold harmless the other Party from any claims, expenses, costs or
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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.
21. 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.
22. 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.
23. Governing Law. This Agreement will be governed by and construed in accordance with
the laws of the State of California.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first written above.
SIGNATURES ON FOLLOWING PAGE
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CITY
By: _______________________________
Mike Futrell
City Manager
ATTEST:
By: _______________________________
Rosa Acosta
City Clerk
APPROVED AS TO FORM:
By: _______________________________
Sky Woodruff
City Attorney
FHW
By: _______________________________
Dawn Merkes, member
Firehouse Work, LLC
HGSF
By: _______________________________
Maureen Sedonaen
Habitat For Humanity Greater San Francisco, Inc.
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Exhibit A
PROPERTY
The land referred to is situated in the County of San Mateo, City of South San Francisco,
State of California, and is described as follows:
PARCEL ONE:
Lots 26 and 27, in Block 141, as designated on the Map entitled "South San Francisco, San
Mateo Co. Cal. Plat No. 1", which Map was filed in the Office of the Recorder of the County of
San Mateo, State of California, on March 1, 1892, in Book 2 of Maps, Page 52, San Mateo
County Records.
APN: 012-335-100
PARCEL TWO:
Beginning at a point marking the intersection of the Southwesterly line of Baden Avenue and the
Southeasterly line of Cypress Avenue, said point being the most Northerly corner of Lot twelve
(12) in Block 145, as said Avenues, Lot, and Block are designated on the Map entitled "South
San Francisco, San Mateo Co. Cal. Plat No. 1", which Map was filed in the Office of the
Recorder of the County of San Mateo, State of California, on March 1, 1892, in Book B of
Maps, at Page 6 and a copy thereof entered in Book 2 of Maps, Page 52, San Mateo County
Records. running thence from said point of beginning South 74° 27' East along said line of
Baden Avenue 50 feet to a point thereon; thence leaving said last mentioned line South 15° 33'
West 140 feet; thence North 74° 27' West 66.44 feet to the Southeasterly line of Cypress Avenue
above mentioned; thence North 22° 14' 50" East along said last mentioned line 140.96 feet to
the point of beginning.
APN: 012-335-110
PARCEL THREE:
Beginning at the Southwest corner of the intersection of Baden Avenue with Cypress Avenue, as
shown upon that certain Map entitled: "South San Francisco San Mateo Co. Cal. Plat No. 1",
which Map was filed in the Office of the County Recorder of the County of San Mateo,
California, March 1, 1892, and recorded in Map Book No. 2 at Page 52; thence. Southerly
along the Easterly line of Lot numbered, twenty-seven (27) in Block numbered one hundred
forty-one (141), as shown upon said Map, to the Southerly line of said Lot numbered twenty-
seven (27); thence Easterly and parallel to the Southerly line of Baden Avenue to the Westerly
boundary line of Block numbered one hundred forty-five (145); thence Northerly along said
Westerly boundary line of said Block numbered one hundred forty-five (145) to the Southerly
boundary line of Baden Avenue; thence Westerly along the Southerly boundary line of Baden
Avenue to the point of beginning.
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17 of 19
Exhibit B
DEVELOPMENT PROPOSAL
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Exhibit B:
Schedule of Performance
Term / Performance
Milestone
Description
Term of ENRA 180 days
Parties Involved Firehouse Work, LLC (FHW)
Habitat For Humanity Greater San Francisco, Inc.
(HGSF)
Proposed Project Rehabilitation of existing Old Firehouse structure into a
9,200 square foot commercial space
Preserve historical significance of Old Firehouse
structure
Construct an approximate 24-unit family-sized
condominium project, of which 100% of the units will be
affordable
Price Offer Purchase price for the FHW parcel to be determined
during the ENRA period
Deposit $50,000 Deposit to be credited against future purchase
price for the FHW parcel
Payment $30,000 for reimbursement of staff time expended
towards FHW; if exhausted, FHW will be required to
provide additional funds. City will waive Payment for
staff time expended towards HGSF 100% affordable
portion
Entitlements Begin pursuing during the ENRA period by filing a joint
Pre-application
Separate entitlements for FHW and HGSF
Lot Line Adjustment and
ROW Vacation
City shall vacate Cypress Street Right of Way
Lot Line Adjustment creating two separate parcels shall
occur prior to execution of Purchase Agreements.
Purchase Agreements Separate Purchase Agreements for FHW and HGSF
Execution of Purchase Agreements after submittal of a
joint pre-application and completion of Lot Line
Adjustment creating two separate parcels.
Separate Projects Purchase Agreements shall include provisions to be
negotiated to allow the FHW and HGSF components of
the Project to proceed independent of each other.
Escrow Separate Close of Escrows for FHW and HGSF to occur
concurrent with issuance of respective Building Permits
Development Schedule To be determined during the ENRA and will be included
as a Schedule of Performance in the Purchase Agreements
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Prevailing Wage HGSF’s self-help ownership model exempts HGSF
projects from prevailing wage or union labor
requirements.
FHW portion will be exempt from prevailing wage or
union labor requirements.
HGSF Financing Progress
Reports
To be provided to the City every 30 days. These should
outline any and all sources of financing the Developer has
pursued in the previous 30 days.
Progress Reports To be provided to the City every 45 days, except for HGSD
financing progress reports which shall be provided every
30 days.
Performance Milestones Negotiation of Purchase Agreements
Pro forma showing sources and uses of funds for the
Project
Show evidence of how the Project is pursuing entitlements
by providing a joint pre-application
Due Diligence During the term of the ENRA the City and Developers shall
further define and evaluate the project parameters:
The City shall provide Developers with any and all
reports, studies and other documentation including any
existing title policies, surveys, leases, structural reports,
hazardous material reports, appraisals and other
documents relating to the Property, Baden Avenue, and
Airport Boulevard that are in City’s possession and
control.
Developers shall have the opportunity to conduct due
diligence in which to inspect the Property and to conduct
any engineering, environmental, physical inspection and
any other kind of investigation or study deems necessary.
Developers may at their own expense, conduct structural
or hazardous material investigations of the existing
improvements on the Property and City will allow access
to the Property for this purpose.
Developers may at their own expense, conduct a
subsurface investigation to confirm the findings in the
Phase I environmental site assessment report provided by
the City.
If a particular Developer is not satisfied with the results
of any information it learns during this Due Diligence
phase they may terminate their involvement in the ENRA
without affecting the rights and obligations of the other
Developer. In the case of FHW, the Deposit will be
refunded to FHW, in accordance with Sections 5 and 13
of this Agreement.
3350831.2