Title
(CONTINUED FROM FEB. 5, 2020) - Authorization to Issue Request for Proposals for Lease and Redevelopment of City-Owned Property Located at 1414 E. Jefferson St.
Description
Request City Council authorization for staff to issue a Request for Proposals (RFP) for the lease and redevelopment of City-owned property located at 1414, 1418, 1422, 1426, 1430, 1434 and 1442 E. Jefferson St. for a mixed-use, mixed-income residential project, and authorization to begin negotiations with the recommended proposer. There is no impact to the General Fund as a result of this action.
Report
Summary
The City owns approximately 1.1 acres of vacant land at 1414, 1418, 1422, 1426, 1430, 1434 and 1442 E. Jefferson St. (Site). The Site is located on the north side of Jefferson Street between 14th and 15th streets. Between 2002-16, these properties were acquired by the Aviation Department under the Voluntary Acquisition and Relocation Services Program.
The Site is within the Eastlake-Garfield Transit-Oriented Development (TOD) District, approximately 1,100 feet east of the 12th and Jefferson streets light rail station. In 2015, City Council adopted the Eastlake-Garfield Policy Plan (TOD Plan), a guide for transforming the district into a walkable, opportunity-rich community. The TOD Plan calls for the Site to be rezoned from R-5 to the Walkable Urban Code: T5:7, allowing for building height up to 56 feet. The successful proposer will be required to rezone the Site.
The Site is also located within the study boundary for the Aviation Department’s Land Reuse Strategy (LRS). The LRS is focused on redeveloping properties west of Phoenix Sky Harbor International Airport. Its goals include stabilizing and strengthening neighborhoods, creating a sense of identity for and elevating perceptions of the study area, and expanding economic opportunity. The LRS has identified the Site as a key location (referred to in the LRS as Spark Area 1) that can further these goals and inspire the development of privately owned vacant land along Jefferson Street. The LRS envisions the following for the Site:
- A mixed-use project primarily consisting of residential use.
- Mixed-income residential units, consisting of both market-rate units and non-market rate units (affordable and workforce).
- Consistency with TOD Development Standards and Guidelines.
- Amenities and uses that enhance the neighborhood and honor its history.
With approval, and consistent with the Implementation Phase of the LRS, the Community and Economic Development Department will issue an RFP seeking offers to lease and redevelop the Site into a mixed-use, mixed-income residential project. Proposals to purchase the Site will not be accepted. Proposers will be required to:
- A member of the proposer's team must demonstrate experience successfully completing at least one vertical mixed-use development of at least three stories in the last five years.
- Project must be mixed-income and offer both affordable and workforce housing units, which in aggregate must represent at least 50 percent of all units proposed.
- Offer fair market value for the Site over the term of the lease.
Affordable housing units will be made available to households earning incomes of no more than 60 percent of the Area Median Income (AMI), while workforce units will be available to households earning incomes between 80 percent and 120 percent of AMI.
The final negotiated project will incorporate the following:
- A variety of unit sizes across all proposed classifications of unit types (affordable, workforce and market-rate).
- If multiple buildings are proposed, each building must include a mix of all proposed classifications of unit types.
- Housing units across all proposed classifications of unit types must be available for occupancy within 36 months of escrow closing.
- No demarcation between, or segregation of, proposed unit-type classifications.
The Site was appraised in January 2020 with an annual lease value of $24,000. While the appraisal establishes the Site's fair market value, in order to facilitate construction of non-market rate housing units, the ultimate return to the City will include both cash and other value to the City.
The RFP will include standard terms, conditions, and other necessary requirements, and the RFP will be evaluated according to the following evaluation criteria (1,000 possible points):
- Return to the City (0-375 points)
- Concept to Redevelop the Site (0-325 points)
- Proposer's Qualifications and Experience (0-300 points).
Staff anticipates that the RFP will be issued in Spring 2020 and that it will remain open for at least 60 days. Responsive proposals will be evaluated by a panel that includes City staff and community representatives. Following negotiations with the recommended proposer, business terms will be brought to the Transportation, Infrastructure and Innovation Subcommittee for information, the Workforce and Economic Development Subcommittee for review and recommendation, and then to the full City Council for consideration.
Financial Impact
There is no impact to the General Fund as a result of this action.
Public Outreach
Staff notified residents and the community of the potential RFP through presentations at the City's Central City Village Planning Committee on Dec. 9, 2019 and the Eastlake Park Neighborhood Association on Dec. 17, 2019.
Location
The Site includes seven individual parcels, collectively known as 1414 E. Jefferson St. The parcel addresses range from 1414 through 1434 E. Jefferson St. and a non-contiguous parcel at 1442 E. Jefferson St.
Council District: 8
Previous Council Action
This item was recommended for approval by the Workforce and Economic Development Subcommittee at the Jan. 22, 2020 meeting by a vote of 3 to 1.
Department
Responsible Department
This item is submitted by Assistant City Manager Deanna Jonovich and the Community and Economic Development and Aviation departments.