CRA/lA 8uilding r;ommunitfes

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1 CRA/lA 8uilding r;ommunitfes Community Redevelopment Agency of the CITY OF LOS ANGELES DATE/ FILE CODE / 354 South Spring Street; Suite 800 los Angeles 1 California T IF Honorable Council of the City of Los Angeles John Ferraro Council Chamber 200 N. Spring Street Room 340, City Hall Los Angeles, CA CRA File No. Lf'iOCj Council District: Contact Person: William Chun (213) COUNCIL TRANSMITTAL: Transmitted herewith, is a Board Memorandum adopted by the Agency Board on June 3, 2010, for City Council review and approval in accordance with the "Community Redevelopment Agency Oversight Ordinance" entitled: VARIOUS ACTIONS RELATED TO: EXCLUSIVE NEGOTIATING AGREEMENT WITH ROLAND HARRIS FOR PROPOSED REDEVELOPMENT OF CRAILA OWNED PROPERTY AT 1636 WEST MANCHESTER AVENUE WITHIN THE VERMONT MANCHESTER REDEVELOPMENT PROJECT AREA RECOMMENDATION That City Council approve(s) recommendation(s) on the attached Board Memorandum. ENVIRONMENTAL REVIEW The proposed action does not constitute a project according to the California Environmental Quality Act ("CEQA"). If a DDA results from the proposed ENA, appropriate site-specific environmental review documents meeting CEQA requirements will be completed for CRA/LA consideration and action prior to entering into any formal agreements. FISCAL IMPACT STATEMENT There is no fiscal impact to the City's General Fund, as a result of this action. cc: Alan Alietti, Office of the City Clerk (Original & 3 Copies on 3-hole punch) Lisa Johnson Smith, Office of the GAO lvania Sobalvarro, Office of the CLA Steve Ongele, Office of the Mayor Noreen Vincent, Office of the City Attorney

2 THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF LOS ANGELES, CA MEMORANDUM 7 DATE: JUNE 3, 2010 VM2060 TO: FROM: RESPONSIBLE PARTIES: SUBJECT: CRA!LA BOARD OF COMMISSIONERS CHRISTINE ESSEL, CHIEF EXECUTIVE OFFICER CAROLYN HULL, REGIONAL ADMINISTRATOR WILLIAM CHUN, PROJECT MANAGER EXCLUSIVE NEGOTIATING AGREEMENT WITH ROLAND HARRIS FOR PROPOSED REDEVELOPMENT OF CRA/LA OWNED PROPERTY AT 1636 WEST MANCHESTER AVENUE WITHIN THE VERMONT MANCHESTER REDEVELOPMENT PROJECT AREA SOUTH LOS ANGELES REGION (CD 8) RECOMMENDATIONS That the CRAILA Board of Commissioners, subject to City Council review and approval: 1. Authorize the Chief Executive Officer or designee, to execute an Exclusive Negotiating Agreement ("ENA") with Roland Harris, an individual ("Developer") for the proposed redevelopment of CRAILA-owned property located at 1636 West Manchester Avenue (and adjoining Developer-owned property) within the Vermont Manchester Redevelopment Project Area ("Project Area') for a one year term with two ninety-(90) day extensions of the ENA; and 2. Amend the FY1 0 Budget to recognize a Developer deposit in the amount of $25,000 to be deposited into budgeted line item "Commercial and Industrial" to fund CRAILA consultant expenses related to redevelopment of said two properties. SUMMARY The recommended actions seek authorization for staff to execute the ENA in order to begin negotiations with Developer of a Disposition and Development Agreement ("DDA") for redevelopment of an opportunity site bounded by Manchester Avenue to the north, Harvard Boulevard to the west, Denker Avenue to the east, and an alley to the south ("Opportunity Site"). CRA!LA and Developer own real property within the Opportunity Site known, respectively, as 1636 West Manchester Avenue ("CRAILA Site") and 1610, 1616, 1620, and 1626 West Manchester Avenue ("Developer Site"). A map of the Opportunity Site showing the locations of the CRAILA Site and the adjacent Developer Site is on Attachment "A" hereto.

3 ENA W. MANCHESTER AVENUE Page 2 May 3, Various Actions Related to Agency Purchase of a Former Public Library Site Located at 1636 W. Manchester Avenue for the Sum of $1,097,000 located in the Vermont Manchester Redevelopment Project Area November 6, Report to CRAILA Board of Commissioners on Intent to Issue Statements of Interest to Property Owners and Occupants for Redevelopment of an Opportunity Site at Manchester Avenue between Harvard Boulevard and Denker Avenue SOURCE OF FUNDS Developer Deposit ($25,000). PROGRAM AND BUDGET IMPACT This action will amend the FY1 0 Budget to recognize a Developer Deposit and add $25,000 to budgeted line item "Commercial and Industrial" to fund consultant expenses. ENVIRONMENTAL REVIEW The proposed action does not constitute a project according to the California Environmental Quality Act ("CEQA"). If a DDA results from the proposed ENA, appropriate site-specific environmental review documents meeting CEQA requirements will be completed for CRAILA consideration and action prior to entering into any formal agreements. BACKGROUND The Opportunity Site The Opportunity Site is located on Manchester Avenue, a major commercial corridor in the South Los Angeles Region that has been a focus of staff's revitalization efforts. This corridor is largely characterized by single-story retail uses consisting of smaller inline shops and by other demand drivers such as churches and County of Los Angeles offices. The real estate market along the corridor has been stagnant with very little inventory growth in residential and commercial uses. In 2007, CRAILA invested in the Opportunity Site through acquisition of a former Los Angeles Public Library building for $1,097,000. Located at 1636 W. Manchester Avenue (now, the CRAILA Site), the former Bookmobile Library building was vacated and declared surplus subsequent to the Los Angeles Public Library's construction of a new regional library facility at another location. CRAILA's acquisition of this Site presented an opportunity for staff to initiate catalytic redevelopment along Manchester Avenue (at the Opportunity Site) as the first step in redevelopment of the corridor. To further staff's efforts in revitalizing the corridor, it commissioned CB Richard Ellis ("CBRE"), an economic consultant, to evaluate the economic conditions and potential revitalization of the corridor, between Vermont and Western Avenues. In November 2008 and January 2009, CRAILA staff issued Statement of Interest ("SOl") letters to the property owners and businesses within the Opportunity Site. In March 2009, CRAILA received twb responses to the SOl letters. Only one response (that submitted by Developer) fit the objectives of the Vermont Manchester Redevelopment Plan ("Redevelopment Plan"). CRAJLA staff wishes to enter exclusive negotiations with the Developer to redevelop the described CRAILA and Developer Sites within the Opportunity Site.

4 ENA W. MANCHESTER AVENUE Page 3 The Development Program The proposed development program consists of redeveloping the two Sites into a mixed-use building with potential for housing units and commercial/office space (collectively "Project"). The Developer will seek health/medical businesses as tenants for the Project's office space to provide preventative and care management programs for the local community. Nearby, Kaiser Permanente is building a $10 million, 10,000 square foot, two-story medical office building that will provide primary care services with 8 to 10 providers, limited x-ray facilities, laboratory and pharmacy services. Located at 1550 W. Manchester Avenue, the new Kaiser Permanente South Los Angeles Medical Office is scheduled to open in mid The Developer wishes to develop the Project with a health care focus to complement the new Kaiser Permanente building. The Exclusive Negotiating Agreement Key provisions of the ENA are: 1. Term of the Agreement is one year (365 days) from date of execution by CRA/LA. 2. Developer will deposit $25,000 with CRA/LA to pay for CRA/LA consultant costs. 3. Developer will participate with CRA/LA in periodic public meetings to keep the community updated on Project's progress and any changes in its scope or schedule. The Developer Roland Harris has been involved in real estate sales, investments and development in Los Angeles since Some of the projects that the Developer has worked on include a 105 unit senior apartment project, commercial retail developments, 8.8 acre residential development site, and an ambulatory surgery center and medical office building. The Community Benefits As required by State law, the DDA to be negotiated will require all on-site construction to be at Prevailing Wages. It will also require Developer to comply with CRA/LA's Construction Careers Policy, Living Wage Policy, Art Policy and other adopted programs and policies. The Vermont Manchester Redevelopment Community Advisory Committee ("CAC") and Councilmember Bernard Parks (CD8) support these recommendations and the Project. Christine Essel Chief Executive Officer nn F. Wasserman Ch.ef Operating Officer

5 ENA W. MANCHESTER AVENUE Page 4 There is no conflict of interest known to me, which exists with regard to any CRAILA officer or employee concerning this action. Attachments: A- Site Map

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