Title
Unsolicited Development Proposal for City-Owned Property Located at 1515 E. Indian School Road
Description
Request to authorize the City Manager, or his designee, to deny an unsolicited development proposal for the City-owned property located at 1515 E. Indian School Road, and request staff to explore the potential of an annual lease option for 1515 E. Indian School Road.
Report
Summary
On Dec. 13, 2017, the City Council authorized the City Manager to implement a policy to allow developers to submit unsolicited proposals for City-owned parcels for which the City had not announced its intention to issue a solicitation. The City's Unsolicited Development Proposal Policy, Procedure, and Submittal Instructions have been posted on the City's website at https://www.phoenix.gov/econdev/unsolicited-proposal.
When an unsolicited development proposal is received, City staff conduct due diligence research and present the proposal concept and research before the applicable City Council Subcommittee and Formal Council. If directed by City Council to compete an unsolicited development proposal, staff follow the Unsolicited Development Proposal Procedure to conduct a competitive and transparent process.
The City's Solicitation Transparency Policy was triggered when a proposal, along with the required non-refundable review fee of $7,500, was submitted on July 16, 2018 by CSDCPC Self-Development, LLC, a wholly owned subsidiary of Charter Schools Development Corporation, and applies to all its partners, representatives and affiliates.
Property Information
This City-owned property is located between 16th Street and the Longview Neighborhood Recreation Center, adjacent to the Grand Canal Trail with Arizona State Route 51 (SR 51) in close proximity. The site was previously improved into a parking lot and utilized by students and faculty of the former High-Tech Institute. The development of this site was permitted pursuant to Contract 52380, authorized by Ordinance S-19339 and amended by Ordinance S-18376.
Overview of Proposal
The unsolicited development proposal seeks to utilize the property in its current condition for additional parent and staff parking, and a second recreational area.
Due Diligence Research
Per the Unsolicited Development Proposal Policy, staff reviewed the unsolicited development proposal submitted by CSDCPC Self-Development, LLC to determine compliance with the Unsolicited Development Proposal Submittal Instructions, ordered an appraisal, and researched possible restrictions that may limit the City's options for disposing of and or developing the property.
Appraisal
The subject property had an appraisal completed on Dec. 6, 2018, which was certified on Dec. 27, 2018 with a value of $672,000.
Economic Development Information
Community and Economic Development staff provided information about renewal occurring along the Indian School corridor. This corridor has experienced significant investment, including the expansion and remodel of the VA Healthcare System, improvements to Longview Park, the Grand Canalscape, and a major project located at the northeast corner of Central Avenue and Indian School Road, known as Central Park. Additionally, the close access to the SR 51 puts this site one stop away from the Phoenix Children's Hospital to the south and the Biltmore area to the north. Staff recommends not moving forward with a solicitation at this time but waiting until projects underway are closer to completion before identifying the property's potential highest and best use.
Financial Impact
The review fees received with this proposal were used to conduct the necessary due diligence, including appraisal and environmental reviews.
Public Outreach
Staff held two community meetings on March 12 and May 9, 2019 at the Longview Recreation Center where residents and businesses located within the Longview Neighborhood Initiative Area were invited to attend. Both community meetings were held to explain the unsolicited development proposal process, provide information about the City-owned property, and solicit general feedback regarding a potential solicitation of this property. The community expressed an interest in development that would increase property values, provide the City with appropriate return on value, reduce blight around the vacant parcel, and maintain the character of the area.
Concurrence/Previous Council Action
This item was recommended for approval as amended by the Land Use and Livability Subcommittee at the Sept. 24, 2019 meeting by a vote of 4-0.
Location
1515 E. Indian School Road
Council District: 4
Department
Responsible Department
This item is submitted by Assistant City Manager Deanna Jonovich, Deputy City Manager Mario Paniagua, and the Neighborhood Services and Community and Economic Development departments.