|
CITY COMMISSION AGENDA ITEM |
|
|
Department: |
City Manager’s Office |
Commission Meeting Date: July 18, 2017 |
||
|
Staff Contacts: |
Diane Stoddard, Assistant City Manager Britt Crum-Cano, Economic Development Coordinator |
|||
|
Requested Action: |
|
|||
|
Conduct a public hearing for VanTrust Real Estate, LLC Catalyst incentive package and consider the following items related to the request:
· Adopt Resolution No. 7210, a Resolution of Intent to issue industrial revenue bonds in one or more series in the aggregate principal amount of approximately $31,000,000 to support a three-phased development project in Lawrence VenturePark.
· Adopt Resolution No. 7211, a Resolution of Intent to issue industrial revenue bonds not to exceed $10,200,000 and grant a 10 year fifty percent (50%) or seventy percent (70%) (if constructed to LEED Silver equivalency) property tax abatement for Phase I development on Block B, Lot 1 in Lawrence VenturePark.
· Authorize the Mayor and City Clerk to execute a Land Transfer and Development Agreement with VanTrust Real Estate, LLC., setting forth the requirements for transfer of Lawrence VenturePark lots to accommodate project phased development.
|
|
|||
|
Executive Summary: |
In April 2017, the City Commission approved the Catalyst Program, a program aimed at spurring economic development in East Hills Business Park and Lawrence VenturePark.
In May 2017, the City received an application from VanTrust Real Estate, LLC for participation in the City’s Catalyst Incentive Program. Headquartered in Kansas City and with regional offices in Columbus, Dallas, Phoenix, and Jacksonville, VanTrust is a full service real estate development company providing acquisition, development, asset management, and construction management for the office, industrial, multifamily, retail, institutional, governmental, hospitality, and recreational real estate markets. Staff has confidence that the VanTrust team has the experience and resources necessary to deliver a successful project.
At the June 6, 2017 public meeting, the City Commission publicly received the VanTrust application and set a public hearing date for consideration of the incentive package. The public hearing is scheduled for July 18, 2017, at which time the City Commission will consider the application and if appropriate, authorize the project to receive incentives under the Catalyst Program.
Project overview: The company is proposing a total project of 555,284 square feet of industrial spec space to be constructed in three development phases at Lawrence VenturePark. Total construction investment is estimated at $31 million.
Phase I: 152,250 square foot spec building on Lot B1 Phase II: 152,250 square foot spec building on Lot B2 Phase III: 250,784 square foot spec building on Lots A1, A4, A5, & A6
The VanTrust Phase I plan calls for ground breaking within six (6) months of award notification and an additional 10 months for construction finish. Additional phases are anticipated to break ground in nine (9) month intervals, following the construction completion of the previous phase. The company plans to build to LEED certification equivalent and potentially to LEED silver equivalent, depending on an evaluation of costs and returns.
Next Steps: If the City Commission approves Catalyst incentives for the three-phased development project, a Master Industrial Revenue Bond (IRB) Resolution of Intent would be executed at this time. Additional IRB documents would be required for each development phase (building) as they proceed. As each phase is completed, an IRB ordinance would be authorized by the City Commission. Because at that point the value of the project and whether or not the project met LEED Silver equivalency will be known, the bond ordinance will contain a PILOT (payment in lieu of taxes) payment schedule equivalent to either a fifty percent (50%) or seventy percent (70%) 10-year property tax abatement. The seventy percent (70%) abatement level will be offered if the LEED Silver equivalency is met. With fixed PILOT payments, all of the taxing jurisdictions will know the annual payments over the duration of the 10-year period. Fixed PILOTs have the advantage of allowing the developer to know expenses up front for property marketing. They also work well for taxing jurisdictions in reducing administrative processing time, and lock in a fixed 10-year schedule.
Land Transfer and Development Agreement: At the July 18, 2017 meeting, the City Commission will consider authorizing the Mayor to execute a Land Transfer and Development Agreement for the VanTrust Catalyst project. This agreement specifies the conditions that must be met for the City to transfer ownership of Lawrence VenturePark property to VanTrust Real Estate, LLC. for the three (3) phases of the development and a timeline for the phases to occur. An outline of the agreement provides a summary of its terms. As this is a Catalyst project, there will be no ongoing performance requirements for the project in terms of job creation, except to deliver a completed building and incentives will require tax and special assessment payments to be paid. There are significant market incentives for the developer to get the buildings leased and occupied as soon as possible.
|
|||
|
Strategic Plan Critical Success Factor |
Economic Growth and Security |
|||
|
Fiscal Impact (Amount/Source): |
The fiscal impact of the project is positive, but the exact amount is unknown until the buildings are constructed. Because the maximum abatement on each building is seventy percent (70%), each phase will generate additional property tax value. Also, the developer will be fully responsible for the payment of special assessments on each tract once the property is transferred. |
|||
|
Attachments: |
Catalyst Program Eligibility Sheet Phased Development Map (Lawrence VenturePark) Development Site Plans (preliminary)
Resolution 7210: IRB Master Resolution of Intent Resolution 7211: Building #1 IRB Resolution of Intent
VanTrust Land Transfer and Development Agreement Outline - Added 07/17/17 |
|||
|
Reviewed By: (for CMO use only) |
☐TM ☒DS ☐CT ☐BM |
|||