OPTIONS

The Metro could choose not to enter into an ENA with Urban Partners and choose to work with one of the other development teams.  Although all the proposals meet some of the basic development requirements included in the RFP, the evaluation panel found that the Urban Partners team demonstrated the highest overall benefits to the Metro, the most feasible development, and assembled a strong development team.  The evaluation panel unanimously selected the Urban Partners proposal. 

The Metro could choose not to enter into an ENA with any of the development teams, and not proceed with any project at this time.  Under this option, under the revised Joint Development Policies and Procedures, staff would proceed to develop urban design guidelines and inform the development community of the availability of the site for development.

The Metro could choose one of the proposals without a school.  A second evaluation panel consisting of Metro staff, supported by consultants, reviewed the development proposals without a middle school and unanimously recommended Urban Partners. 

FINANCIAL IMPACT

The recommended action will not impact the Metro’s FY02 budget.  Ultimately, development of the Metro-owned properties will result in revenues to the Metro. 

BACKGROUND

On June 1, 2001, the Metro in cooperation with LAUSD issued a Request for Proposals (RFP) for the joint development of 7 acres of land above and adjacent to the Metro Red Line Wilshire/Vermont Station.  To advertise the RFP, the Metro sent more than 300 postcards to developers, contractors, architects and real estate firms.  In addition, staff placed advertisements in the Daily News, the Los Angeles Times, The Wall Street Journal, and several local newspapers. 

The RFP requested two development proposals from each team: a proposal incorporating a public middle school into the northeastern 2.6 acres of the site, and a proposal with no school.  The RFP requested proposals that: 

• Are financially feasible without Metro subsidy;

• Enhance and increase transit ridership of the Metro Bus and Rail System;

• Provide transportation-related services and conveniences;

• Enhance the transfer connection between bus and rail passengers and other transportation services;

• Are pedestrian oriented;

• Provide an 800-student public middle school to serve the local community;

• Continue the revitalization of Wilshire Boulevard and the entire redevelopment area in conformance with the Wilshire District Plan and the Wilshire Center and Koreatown Redevelopment Plan;

• Create a project that responds to the social and design context of the local community, including the Metro Rail station;

• Evidence high-quality design; and,

• Achieve transit, land use, economic development and urban planning goals while maximizing revenues generated to Metro.

On the August 15, 2001 submittal deadline, Metro received proposals from five development teams.  As requested in the RFP, each team submitted at least two proposals: one with a middle school and one without.  Four major criteria were used to evaluate all of the proposals: 1) Responsiveness of the development concept, 2) Financial feasibility and preliminary ground lease offer to Metro, 3) Development team qualifications and financial capacity, and 4) Site control, project preparedness, and schedule. 

An evaluation panel consisting of Metro staff and LAUSD representatives reviewed the proposals that included a middle school.  Consultants engaged by the Metro and LAUSD supported the panel.  Following a review of the initial submittals and two sets of written questions, the panel identified three proposals that best fulfilled the minimum requirements stated in the RFP.  The evaluation panel next individually interviewed groups representing each of the three top proposals.  

The evaluation panel recommended Urban Partners as the preferred developer for the development option with a middle school on the northern portion of the site.  The Metro portion of the proposed project will contain 380 apartment units, 700 parking spaces, 30,000 square feet of commercial space and a childcare center.  The LAUSD portion of the project will contain a three-story middle school for approximately 800 students.  Attachment A contains Urban Partners renderings and site plans.  The proposal also includes:

§         A shared, park-like buffer between the school and commercial development;

§         Two independent garages, one for the school and one for the commercial portion, and; 

§         A new (replacement) Metro bus plaza on the one-acre Metro parcel across Shatto Place. 

The evaluation panel and Metro Operations Department staff strongly preferred placing the bus plaza across Shatto Place to the locations shown in other submittals.  Metro staff believes that this design separating the bus plaza from the school and the commercial development is extremely desirable for safety, security, and health reasons.

Urban Partners, is a California Limited Liability Company headquartered in Los Angeles and will develop all aspects of the project.  The Principals of Urban Partners are Ira Yellin, Paul Keller, Dan Rosenfeld and Nick Patsaouras.  Urban Partners and/or its principals have developed, high-quality, transit-oriented projects. 

Arquitectonica will provide architectural and urban planning for the project.  It is an established firm with offices in Los Angeles, Miami, New York and Washington, D.C. and has experience in a variety of project types, including housing, schools, recreational and entertainment facilities, mixed-use and corporate projects.  Oaktree Capital Management is Urban Partners’ capital partner.  Oaktree currently manages over $21 billion in assets, is headquartered in Los Angeles, and has experience working with Urban Partners on other projects.

Comparison of Proposals Relative to Revised Joint Development Policy

Metro staff reviewed the Urban Partners development proposal as well as all qualified proposals in light of the new Joint Development Policies and Procedures.  The recently adopted Joint Development Policies and Procedures added emphasis on the overall quality of the development concept and its potential ability in enhancing transit and community needs as well as developer qualifications.  Urban Partners’ proposed mixed-use project is consistent with surrounding and planned land uses in the area.  Attachment B contains a comparison of the three top proposals.

NEXT STEPS

After execution of an Exclusive Negotiation Agreement with Urban Partners, Metro and LAUSD staff will negotiate in good faith over a six-month period to determine the specific financial arrangements and schedules for this development. (Please see Attachment C, Draft Exclusive Negotiation Agreement.)   At the end of the negotiation period, Metro staff anticipates presenting a draft Development Agreement and Ground Lease for Board approval. 

Once the Board approves the Development Agreement, LAUSD would acquire the fee interest in the school site, and the developer would start final design, entitlement and construction of the projects. 

ATTACHMENTS

A.    Urban Partners Site Plans and Renderings

B.   Summary of Three Top Proposals with Middle School

C.    Draft Exclusive Negotiation Agreement

Prepared by:     Phil Ganezer

Project Manager - Rail, Busway, Bikeway Planning and Joint Development

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James L. de la Loza

Executive Officer

Countywide Planning & Development

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Roger Snoble

Chief Executive Officer