Title
Amend Ordinance - Disposition and Purchase Agreement with Metrowest Development, LLC (Ordinance S-47867)
Description
Request to authorize the City Manager, or his designee, to amend Ordinance S-42761, to modify performance benchmarks as needed to allow for the completion of three City-owned parcels located between 2nd and 3rd avenues, on the north side of McKinley Street in downtown Phoenix.
Report
Summary
In June 2015, the Community and Economic Development Department issued a Request for Proposals (RFP) for the disposition and redevelopment of three Neighborhood Services Department-owned parcels located between 2nd and 3rd avenues, on the north side of McKinley Street (Site). Metrowest Development, LLC (Developer) was the successful proposer and was awarded the contract. The Developer chose to develop the site in two phases: the West Phase with approximately 94 market-rate units in a five-story podium apartment building with below grade parking, and the East Parcel with six for sale three-story townhomes.
On July 1, 2016, the City Council authorized the City Manager to enter into a development agreement (Agreement) for the sale and redevelopment of the Site through Ordinance S-42761 (Ordinance) and in August 2017 the Developer opened escrow for the transfer of the two parcels. In May 2017, the City Council authorized modifications to the Agreement to allow additional time to complete negotiations, and further granted an extension in October 2018 to modify the performance benchmarks of the Agreement. Staff finalized the disposition of the West Phase of the project in November 2018 through conveyance of the Special Warranty Deed.
The Developer has completed construction on the West Phase and has started the lease up phase of the project. Due to significant delays and interruptions from the COVID-19 pandemic, as well as extensive utility work related to the West Phase that prevented construction of the townhomes on the East Phase property, the Developer also has requested an extension for the commencement of construction of the East Phase. This amendment will extend the commencement of construction date to Feb. 25, 2022.
Furthermore, the amendment would extend the complete construction date, allowing 24 months to complete the project. Metrowest is an established local developer with approved building permits for the townhomes and is ready to begin construction upon the modification of the performance benchmarks.
Concurrence/Previous Council Action
City Council approved Ordinance S-42761 on July 1, 2016.
Location
The Site is located at 808 N. 2nd Ave. and 801 N. 3rd Ave. in downtown Phoenix.
Council District: 7
Department
Responsible Department
This item is submitted by Deputy City Managers Ginger Spencer and Gina Montes and the Community and Economic Development and Neighborhood Services departments.