HomeMy WebLinkAboutResolution 2004-068 N.C.S. 05/03/2004 . - resolution No.2004-068N.C.S.
of the City of Petaluma, California
AUTHORIZING EXECUTION OF AN EXCLUSIVE NEGOTIATING RIGHTS
AGREEMENT WITH REGENCY REALTY GROUP, INC. REGARDING THE
POSSIBLE SALE OF PETALUMA SWIM CENTER AND ADJACENT LAND
WHEREAS, Regency Realty Group, Inc. (RRG) has an option to purchase the
Kenilworth School Site from Petaluma Schools; and,
WHEREAS, RRG's purchase of the Kenilworth School Site will enable the School
District to construct a new junior high school to replace the dilapidated school facilities currently
located on the Kenilworth School Site; and,
WHEREAS, the City-owned swim center located on the property commonly known.. as
900 East Washington Boulevard and more particularly described in Exhibit A to Attachment 1.1
attached hereto (the "Swim Center Site") is outdated and in need of improvements, repairs and
updated equipment, and the City wishes to explore whether the construction of a new swim
center at a different location may better serve the needs of the Petaluma community; and,
WHEREAS, the City and RRG are currently negotiating with the Fourth District
Agricultural Association ("Association") regarding a possible amendment ("Amendment") to
the lease of the Fairgrounds (the "Lease") executed by and between the City and the Association
in order to exclude from the Lease the area depicted in Exhibit B to Attachment 1.1
("Skateboard and Solar Collector Area") and the area depicted in Exhibit C to Attachment
1.1 ("Easement Area"); and,
WHEREAS, the City and Regency are currently negotiating regarding the possible
provision of an option pursuant to which Regency would have the right to acquire an access
easement across the Easement Area that would be exercisable upon the satisfaction of certain
conditions, including without limitation, execution of the Lease Amendment and environmental
review of the project proposed for the Kenilworth School Site; and,
WHEREAS, Regency believes that the Swim Center Site and the Skateboard and Solar
Collector Area (hereafter, collectively, the "Property") may serve as a useful gateway to
commercial development on the Kenilworth School Site; and,
WHEREAS, the redevelopment of the Kenilworth School Site and the Property will be
of benefit to the City of Petaluma and the Community Development Project Area ("Project
Area"), and will be consistent with the redevelopment plan adopted for the Project Area; and,
WHEREAS, execution of an Exclusive Negotiating Rights Agreement will enable the
City and RRG to plan for the orderly development and reuse of the Kenilworth School Site and
the Property; and,
Resolution No. 2004-068 N,C.S.
WHEREAS, the proposed Exclusive Negotiating Agreement does not obligate the
Developer to purchase the Kenilworth School Site or the Property, nor does the Agreement
obligate the City to sell the Property to Developer or to any other party.
NOW, THERE>F'ORE, BE IT RESOLVED that the Petaluma City Council hereby
authorizes the City Manager to execute an Exclusive Negotiating Rights Agreement substantially
in the form attached hereto as Attachment 1.1 pursuant to which. RRG shall obtain the exclusive
right during cone-year period to negotiate with the City regarding the terms and conditions for
the possible lease or sale of the Property to RRG.
Under the power and authority conferred upon this Council by the Charter of said City.
REFERENCE: I hereby certify the foregoing Resolution was introduced and adopted by the Approved as to
Council of the City of Petaluma at a (Regular) (Adjourned) (Special) meeting o
on the ........3`.d day of .......Mai......................................., 20.4.., by the
following vote:
City Attorney
AYES: Mayor Glass, Harris, Healy, Vice Mayor Moynihan, O'Brien, Thompson, Torliatt
NOES: None
ABSENT: None
)
ATTEST: ~i~h+•~.........................
Cit Clerk Mayor -
Council File
Res. No......200A.-0.68.........N.C.S.
Attachment 1.1
THIS EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT (this "Agreement") is entered
into effective as of , 2004 ("Effective Date") by and between the City of
Petaluma, a municipal corporation ("City") and Regency Realty Group, Inc., a Florida
corporation ("Regency"). City and Regency are hereinafter collectively referred to as the
"Parties."
WHEREAS, Regency has an option to purchase real property located at Kenilworth
Court ("Kenilworth School Site") from the Petaluma Joint Union High School District ("School
District");
WHEREAS, Regency's purchase of the Kenilworth School Site will enable the School.
District to construct a new junior high school to replace the dilapidated school facilities currently
located on the Kenilworth School Site;
WHEREAS, the City-owned swim center located on the property commonly known as
900 East Washington Boulevard and more particularly described in Exhibit A attached hereto
(the "Swim Center Site") is outdated and in need of improvements, repairs and updated
equipment, and the City wishes to explore whether the construction of a new swim center at a
different location may better serve the needs of the Petaluma community;
WHEREAS, the Parties are currently negotiating with the Fourth District Agricultural
Association ("Association") regarding a possible amendment ("Amendment") to the lease of
the Fairgrounds (the "Lease") executed by and between the. City and the Association in order to
exclude from the Lease the area depicted in Exhibit B ("Skateboard and Solar Collector
Area") and the area depicted in Exhibit C ("Easement Area");
WHEREAS, the City and Regency are currently negotiating regarding the possible
provision of an option pursuant to which Regency would have the right to acquire an access
easement across the Easement Area that would be exercisable upon the satisfaction of certain
conditions, including without limitation, execution of the Lease Amendment and environmental
review of the project proposed for the Kenilworth School Site;
WHEREAS, Regency believes that the Swim Center Site and the Skateboard and Solar
Collector Area (hereafter, collectively, the "Property") may serve as a useful gateway to
commercial development on the Kenilworth School Site;
WHEREAS,, the redevelopment of the Kenilworth School Site and the Property will be of
benefit to the City of Petaluma and the Community Development Project Area ("Project Area"),
and will be consistent with the redevelopment plan adopted for the Project Area;
WHEREAS, at its meeting of May , 2004, the Petaluma City Council directed staff to pursue
negotiations with Regency regarding Regency's proposed development of the Property, and
Resolution No. 2004-068 N.C.S. Page 3
authorized staff to prepare, and the City Manager to sign, an agreement granting Regency
exclusive rights to negotiate with City regarding the terms and conditions for the possible sale of
the Property to Regency;
WHEREAS, the purpose of this Agreement is to enable the Parties to plan for the orderly
development and reuse of the Kenilworth School Site and the Property, and this Agreement does
not obligate the Regency to purchase the Kenilworth School Site'or the Property, nor does this
Agreement obligate the City to sell the Property to Regency or to any other party;
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. During the term of this Agreement, -the Parties shall
diligently and in good faith negotiate the terms and conditions governing the possible disposition
of the Property to Regency. This Agreement does not obligate Regency to acquire any interest
in the Kenilworth School Site or in the Property, nor does this Agreement obligate City to
convey any interest in the Property to Regency or any other party or to grant any approval or
authorization required for development of the Kenilworth School Site or the Property.
2. Regency's Exclusive Right to Negotiate With City. City agrees that it will not, during
the term of this Agreement, solicit other offers or engage in negotiations with any other entity
regarding the sale or lease, or the grant of easements over, or the transfer of any other interest in,
the Property and the buildings located thereon.
3. Term; Evidence of Site Control. The term of this Agreement ("'Term") shall commence
on the Effective Date, and shall terminate one year thereafter, unless earlier terminated as
provided herein. Notwithstanding any contrary provision contained herein, this Agreement shall
terminate and be of no further effect if by June 30, 2004, Regency has not acquired title to the
Kenilworth School Site. On or before June 30, 2004, Regency shall provide evidence reasonably
acceptable to City that Regency possesses title to the Kenilworth School Site..
4. Relationship of Parties. The Parties agree that nothing in this Agreement shall be deemed
or interpreted to create between them the relationship of lessor and lessee, of buyer and seller, or
of partners or joint venturers.
5. Regency's Studies. During the Term, Regency shall prepare, at Regency's sole expense,
any studies, surveys, plans, specifications and reports ("Regency's Studies") Regency deems
necessary or desirable in Regency's sole discretion, to determine the suitability of the Property
for development. City is entering into this Agreement without monetary compensation. In lieu
of such compensation, if City and Regency are unable to reach agreement upon the terms and
conditions for sale or other disposition of the Property to Regency, Regency shall provide City
with copies of Regency's. Studies within 10 days following expiration of the Term or earlier
termination of this Agreement.
6. Expenses. Except as otherwise expressly provided herein, all costs and expenses incurred
Resolution No. 2004-068 N.C.S. Page 4
in connection with this Agreement and the activities contemplated hereby shall be paid by the
Party incurring the same; provided however, Regency shall reimburse the City for its reasonable
attorneys' fees and expenses incurred in connection with the negotiation and preparation of a
purchase and sale or other agreement conveying the Property or any interest therein to Regency.
7. Confidentiality. During the term of this Agreement, each Party shall obtain-the consent
of the other Party prior to issuing or permitting any of its officers, employees or agents to issue
any press release or other information to the press or any third party with respect to the
negotiations undertaken pursuant to this Agreement; provided however, no Party shall be
prohibited from supplying any information to its representatives, agents, attorneys, advisors,
financing sources and others to the extent necessary to accomplish the activities contemplated
hereby so long as such representatives, agents, attorneys, advisors, financing sources and others
are made aware of the terms of this Section. Nothing contained in this Agreement shall prevent
either Party at any time from furnishing any required information to any governmental entity or
authority pursuant to a legal requirement or from complying with its legal or contractual
obligations.
8. Execution of Purchase and Sale Agreement. If the Parties successfully negotiate the
terms of a purchase and sale agreement, prior to execution of such agreement, City shall follow
all procedures required pursuant to the Petaluma Municipal Code and other applicable law
pertaining to the disposition of City property, including without limitation, the publication of
notice and the conduct of public hearings.
9. Termination. This Agreement maybe terminated at anytime by mutual consent of the
Parties. City shall have the right to terminate this Agreement upon its good faith determination
that Regency is not proceeding diligently and in good faith to carry out its obligations pursuant to
this Agreement. City shall exercise such right by providing at least ten (10) days' advance
written notice to Regency which notice shall describe the nature of Regency's default hereunder.
Notwithstanding the foregoing, if Regency cures such default within such 10-day period, this
Agreement shall remain in effect. Regency shall have the right to terminate this Agreement,
effective upon 10 days' written notice to City, if the results of its investigation of the Property
are unsatisfactory with respect to Regency's desired development activities. Notwithstanding
anything to the contrary contained herein, this Agreement shall terminate without notice and
shall be of no further force and effect on such date that Regency ceases to have an ownership
interest in the Kenilworth School Site. Neither Party shall have the right to seek an award of
damages as a result of the termination of this Agreement pursuant to this Section.
10. Effect of Termination. Upon termination as provided herein, or upon the expiration of the
Term and any extension thereof without the Parties having successfully negotiated a purchase
and sale agreement, this Agreement shall forthwith be void, and there shall 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 (Regency's Studies),
Section 6 (Expenses), Section 7 (Confidentiality), Section 12 (Indemnification) and Section 16
(No Brokers) shall survive such termination.
Resolution No. 2004-068 N.C.S. Page 5
11. Notices. Except as otherwise specified in this Agreement, all notices to be sent pursuant
to this Agreement shall 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 shall be sent by:
(i) personal delivery, in which case notice is effective upon delivery;
(ii) certified or registered mail, return receipt requested, in which case notice shall be
deemed delivered on receipt if delivery is confirmed by a return receipt;
(iii) 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;
(iv) facsimile transmission, in which ease notice shall be deemed delivered upon
transmittal, provided that (a) a duplicate copy of the notice is promptly delivered by first-class or
certified mail or by overnight delivery, or (b) a transmission report is generated reflecting the
accurate transmission thereof. Any notice given by facsimile shall be considered to have been
received on the next business day if it is received after 5:00 p.m. recipient's time or on a
nonbusiness day.
City: City of Petaluma
11 English Street
Petaluma, CA 94952
Attn:
Regency: Regency Realty Group, Inc.
1.850 Mt. Diablo Blvd., Suite 225
Walnut Creek, CA 94596
Attn: Tom Engberg
Telephone:
Facsimile:
With copy to: Hanson Bridgett Marcus Vlahos Rudy LLP
80 E. Sir Frances Drake Blvd, Suite 3E
Larkspur, CA 94939
Attn: Mary K. McEachron
12. Indemnification. Regency hereby covenants, on behalf of itself and its permitted
successors and assigns, to indemnify, hold harmless and defend the City of Petaluma and its
elected and appointed officials, officers, agents, representatives and employees ("Indemnitees")
from and against all claims, demands, liabilities, judgments, awards, expenses (including without
limitation reasonable attorneys' fees and litigation costs), losses, damages, costs and (collectively
"Claims") arising out of or in connection with this Agreement except to the extent the same is
the result of the gross negligence or willful misconduct of any Indemnitee.
13. Severability. If any term or provision of this Agreement or the application thereof shall,
to any extent, beheld to be invalid or unenforceable, such term or provision shall be ineffective
Resolution No. 2004-068 N.C.S. Page 6
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.
14. 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 subj ect matter. This Agreement maybe amended only by a written
.instrument executed by the Parties or their successors in interest. This Agreement maybe
executed in multiple counterparts, each of which shall be an original and all of which together
shall constitute one agreement.
15. Successors and Assi~ns• No Assignment Without Consent; No Third-Party Beneficiaries.
This Agreement shall be binding upon and inure to the benefit of the Parties and their respective
successors and assigns; provided however, Regency shall not transfer or assign any of Regency's
rights hereunder by operation of law or otherwise without the prior written consent of the City,
and any such transfer or assignment without such consent shall be void. Subject to the
immediately preceding sentence, this Agreement is not intended to benefit, and shall 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.
16. No Brokers. Each Party warrants and represents to the other that no brokers have been
retained or consulted in connection with this transaction other than as disclosed in writing to the
other Party. Each Party agrees to defend, indemnify and hold harmless the other Party from any
claims, expenses, costs or liabilities arising in connection with a breach of this warranty and
representation. The terms of this Section shall survive the expiration or earlier termination of
this Agreement.
17. 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.
18. Governing Law. This Agreement shall be governed by and construed in accordance with
the laws of the State of California.
SIGNATURES ON FOLLOWING PAGE.
Resolution No. 2004-068 N.C.S. Page 7
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first
written above.
CITY OF PETALUMA
By:
Name:
Title:
APPROVED AS TO FORM:
By:
City Attorney
ATTEST:
By:
City Clerk
REGENCY REALTY GROUP, INC.,
a Florida corporation
By:
Thomas K. Engberg,
Its: Senior Vice President
Resolution No. 2004-068 N.C.S. Page 8
Exhibit A
SWIM CENTER SITE
(Attach legal description of Swim Center Site.)
Resolution No. 2004-0G8 N.C.S. Page 9
4r. ~ 1 _
/ _ -
_ '
. i. r Y. ~
~ x ~ _ i
~ ~ I
- ~A\~~
~ _ sa
roc r~ ~
::4~}~~~~ % ,
\ ' ~ i
\ •~j /i
A ~ ~ ~ Skat~bo~rd + ' /
~ + Palk' + + + ~ r ,
' ~ _ _ / ,
t/ ~ + + +
_ /
i
r. " -
~~~~v
Exhibit A-~ i
s; ~ Petaluma Fairgrounds ~ ~
_ . ~ ~
I
` ~ . ~ Proposed Easement 'f I
~ Area
t ~
Total easement area is approx.
~r y-ti~. ; ~ ' _ . ~ 55, 500 sq ft or 1.27 acres ~ ~
,i
Skateboard Park and
+ + Solar.Panels
1
N Swim Center
Scale: 1" = 100' ~ ~i
April 29, 2004 - ~ ~
~ _ - - - - -
Resolution No. 2004-068 N.C.S. Page 10
Exhibit B
SKATEBOARD AND SOLAR COLLECTOR AREA
(Attach legal description of Skateboard and Solar Collector Area.)
Resolution No. 2004-068 N.C.S. Page 1 1
_ ~ ~ ~ ~
- ~ ~ ,
~ I
~ r f ~ %
r. ~A \V + + ``v+-
O - _t~~ + + ~
- / ~ + + +
j~
J,
~s Skal~bo~rd + ~ ~
" Palk + + + +
+ + + + +
~j +
l ~ ~ ~ v~ " + '
i~ ~
i
t.
/
- ~iX~ ~
,`~.5
- ~ _
Iti`, ry I
Exhibit
-
V Petaiurna Fairgr unds ~I
~ Sd~"~- b rya ~rc$ 95 a (0w`-~o j (c~ ~ ;'~3
E ~ ~ Proposed Easement '
f. >
Area ~
.
, Total easement area is approx.
f-; ~ 55,500 sq ft or 1.27 acres `
_
F ~
~ ~ Skateboard Park and
' + + Solar Panels
- !
Scale: 1" = 100' Swim Center
I, April 29, 2004 ~
i ~
Resolution No. 2004-068 N.C..S. Page 12
Exhibit C
EASEMENT AREA
(Attach legal description of Easement Area.)
Resolution No. 2004-068 N.C.S. Page 13
Y _
r~ ~..,__.,r.__r - _ _ _
l ~;1 ~y ~ ~ ~ ~
_ ~ _ ~t~
_ _ .
~ t. ~
w~,
i. r _
1 ~ "
`J - _ _ -
' _ ~ - ~ i _
k ~
_ ~°i',
O ~
~ ,
~ c - <
~ , ~ s - ~y, Petaluma ' ~ ~j ~ ~
r~ Q-. i j ~ i
_ ~ ~ ~ off'' ~ i~ ~i'
Fib- ~ ,G' ! ~ ,
((y~, /
j.
` ~ ~ Skatehoard ~ ~
Park ~
i %
~ ~
I~~
i ,
j j
/ /
,
1
-
,
R ~ /
~ :1.
~i h ~ - ~ Exhibit
;
' ~ ` ~ Petaluma Fairgrounds
~4-~ ~
Pro P
os .d asem i
E ent
P
r~
. ~ Area
r .
~ - Total easement area is approx. ~
53,000 sq ft or 1.2 ages
~ .
N
L • } ~ _ _ Scale: 1" = 100'
~ : ~ ' ~ April 27, 2004
- ,
I - _ - - -
- - _ - -
- _ ltesoiui~u~ ivu. ~u0-1-UG8-i
' `~.-C:S. - - = - - - ' masc.{