City of Culver City, California
Redevelopment Agency Agenda Item Report
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RECOMMENDATION:
Staff recommends the Culver City Redevelopment Agency (the “Agency”) approve
the Addendum to the Environmental Impact Report for the Culver City
Redevelopment Project, approve an Amendment to the Corporate Pointe Design For
Development and approve the proposed Twelfth Amendment to the Corporate
Pointe Disposition and Development Agreement (the “12
th
Amendment”) for the
development of 700 Corporate Pointe (the “Site”.)
BACKGROUND:
In 1981, the Agency approved a Disposition and Development Agreement (DDA)
with Edward C. Ellis Company and Bramalea, Inc., for development of Corporate
Pointe on a 34-acre parcel of land that was previously owned by the State of
California. Pursuant to the DDA, the Agency purchased the land from the State and
sold it to Ellis/Bramalea for development. The DDA provided for the construction of
1,550,000 square feet of office/commercial space in nine (9) buildings and 65
condominium residential units. By 1993 Ellis/Bramalea completed the residential
units, six (6) office buildings and two and one half parking structures for an
approximate total of 778,000 square feet of development. Economic and financial
problems delayed build-out to completion and also resulted in the lender, The Bank
of Montreal became the owner through foreclosure of the undeveloped parcels. The
undeveloped parcels were 700, 800 and 900 Corporate Pointe. In 2003, The Bank
Meeting Date: 11/5/07 Item Number: A-3
AGENDA ITEM: Consideration of: (1) Approval of an Addendum to the Culver City
Redevelopment Plan Amendment and Merger Final Subsequent Environmental
Impact Report; (2) a Twelfth Amendment to the Corporate Pointe Disposition and
Development Agreement for the Development of 700 Corporate Pointe; and (3) an
Amendment to the Corporate Pointe Design For Development.
Contact Person/Dept.: John Fisanotti Phone Number: (310) 253-5767
Fiscal Impact: Yes [X] No [] General Fund: Yes [] No [X]
Public Hearing: [] Action Item: [X] Attachments: [X]
Public Notification: The Fox Hills Neighborhood Association, the President of the Ladera
Heights Neighborhood Association and all property owners and occupants within a 300
foot radius of the property at 700 Corporate Pointe (10/22/07); Master Notification List
(10/31/07).
Department Approval:
Sol Blumenfeld (10/25/07)
Executive Director Approval:
Jerry B. Fulwood (10/31/07)
Fiscal Impact Review:
Marlee Chang (by N. Kimball)(10/25/07)
City of Culver City, California
Redevelopment Agency Agenda Item Report
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of Montreal sold 800 and 900 Corporate Pointe to the Symantec Corporation, which
is currently constructing two office buildings and a parking structure on the parcel.
The Site at 700 Corporate Pointe remains the last undeveloped parcel in the master
plan for the development of Corporate Pointe. Since 1981, the Agency has modified
the DDA with either Ellis/Bramelea or various successors in interest 11 times.
The Bank of Montreal holds title to the Site as the entity known as Bay Street
Number 29, Ltd (hereinafter, “Bay Street 29”.) Several years ago, Bay Street 29 and
the IDS Real Estate Group (hereinafter, “IDS”) contacted staff in regards to a
purchase of the Site by IDS from Bay Street 29 to construct a 11 story office building
and complete the other half of the parking structure which is to be shared with 600
Corporate Pointe. This project would complete the build out of the Corporate Pointe
development as provided for in the governing documents (i.e. the Corporate Pointe
DDA and DFD).
A copy of the Notice, which was sent on October 22, 2007 to the parties listed above
in Public Notification, is included as Attachment No. 1 to this staff report
DISCUSSION:
The primary purpose of the 12th Amendment is to interpret and provide appropriate
modifications to the DDA in order to obtain IDS's written commitment to acquire
the property involved and develop it in conformance with the DDA and DFD. A copy
of the proposed 12
th
Amendment is included as Attachment No. 2 to this staff report.
There are several important points the Agency should consider when evaluating the
proposed 12
th
Amendment. They are listed below with a reference to the section of
the 12
th
Amendment in which the applicable language is located:
• IDS may assign its position to another entity so long as the new entity is
controlled by IDS (Section 2)
• The non-discrimination covenants remain in effect. The existing Agency
approvals for development of the Site are still in effect and that the proposed
development is in conformity with those approvals. (Section 3)
• Based upon prior City and Agency approvals, no additional entitlements are
needed and IDS may proceed with development by applying to the City for a
Building Permit. (Section 4)
• In lieu of the typical detailed Schedule of Performance found in most of the
Agency’s DDAs, it is replaced with a schedule with few milestones. The City of Culver City, California
Redevelopment Agency Agenda Item Report
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critical one is to complete construction of the Site no later than five (5) years
after the day IDS purchases the Site. Furthermore, if IDS determines it will
not meet that completion date, it is to notify the Agency no later than four (4)
years after the day IDS purchases the Site. (Section 5 and Attachment No. 4)
The effective date of the 12
th
Amendment is the date IDS acquires the Site
(Section 11). If IDS does not acquire the Site, then the 12
th
Amendment is
not effective and the pre-existing DDA remains in full force and effect,
unchanged.
• The Agency gives up its Right of Reverter to the Site. (Section 6) In return,
for giving up the Right of Reverter, IDS has agreed to a proposed change in
the Agency’s DFD for the Site. If IDS does not complete construction within
five years of the Effective Date of the 12
th
Amendment, then the DFD, shall
expire, unless the Agency agrees in writing to grant IDS more time to finish.
An extension in time will be at the Agency’s discretion.
• IDS shall contribute $35,000 to the Agency to extend the Culver City signage
program to include the Corporate Pointe area and also participate in a
landscaping program in the vicinity of the Corporate Pointe area. (Section 7)
It is noted that to implement the provisions of the 4
th
bullet point, having to do with
the schedule of performance, a revision to the existing Design For Development will
be necessary. The proposed “Amendment to Design For Development for the
‘Caltrans Property’ Located in Component Area 1 of the Culver City Redevelopment
Project (Formerly the Slauson-Sepulveda Redevelopment Project No. 1)” is included
as Attachment No. 3 to this report.
Before the Agency considers the 12
th
Amendment and the Amendment to the DFD,
the Agency must consider the Addendum to the Environmental Impact Report for the
Culver City Redevelopment Project, which addresses the proposed development for
the Site. The addendum contains information for the review and consideration of the
Agency which supports the conclusion that there have been no significant changes
to the project, and no new significant environmental impacts beyond those already
analyzed under procedures required by the California Environmental Quality Act,
and that the Agency, in considering and taking action on the proposed 12th
Amendment to the DDA, may rely on existing certified environmental impact reports
which have been performed for the Culver City Redevelopment Project.
City of Culver City, California
Redevelopment Agency Agenda Item Report
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FISCAL ANALYSIS:
The proposed project is projected to generate the following revenue to the
City/Agency:
TO CITY:
Construction of an 11-story, 287,399 square foot office building with an approximate
construction cost of $35 million and completion of the shared parking structure with
an approximate construction cost of $12 million is estimated to generate one-time
fees of approximately $1,715,000. This includes Building Permits and Issuance
Fees, Plan Check Fees, Seismic Fees, Art in Public Places Fee, Commercial Tax,
and Technology Surcharge.
In addition to these one-time fees, the City will receive on-going Business License
and Utility tax revenues of approximately $180,000 per year (see NOTE below).
TO AGENCY:
Based on a total estimated construction cost of $47 million, the projected gross tax
increment revenues generated when this project is completed is $470,000* per year,
increasing by 2% per year.
*subject to statutory pass through payments and statutorily required transfer to the Low/Moderate
Income Housing fund.
NOTE: The tax revenue projections provided in this fiscal analysis represent
estimated full year receipts in current dollars (2007$). The City and Agency will
begin collecting tax revenues related to this project upon completion of construction,
lease of available office space, and update of the County tax rolls. Revenues from
this project have not been included in the adopted budget. If the project is approved
and a construction timeline is provided, staff will adjust the budget projections
accordingly.
ATTACHMENTS:
1. Sample Public Notification, dated October 22, 2007
2. Twelfth Amendment to the Disposition and Development Agreement
3. Amendment to the Corporate Pointe Design for Development;
4. Addendum to the Environmental Impact Report for the Culver City
Redevelopment Project;
City of Culver City, California
Redevelopment Agency Agenda Item Report
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MOTION:
That the Agency:
1. Approve the “Addendum to the Culver City Redevelopment Plan Amendment
and Merger Final Subsequent Environmental Impact Report”; then
2. Approve the “Amendment to Design For Development for the ‘Caltrans
Property’ Located in Component Area 1 of the Culver City Redevelopment
Project (Formerly the Slauson-Sepulveda Redevelopment Project No. 1”);
and
3. Approve the “Twelfth Amendment To The Disposition and Development
Agreement Between The Culver City Redevelopment Agency, Bay Street
Number Twenty-Nine, Ltd., and IDS Realty JV, LLC” and
4. Authorize the Agency Counsel to review/prepare the Twelfth Amendment and
authorize the Executive Director to execute the Twelfth Amendment on behalf
of the Agency.