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HomeMy Public PortalAboutORD14300 BILL NO. 2007-129 SPONSORED BY COUNCILMAN CRANE ORDINANCE NO. 12+ 30 AN ORDINANCE OF THE CITY OF JEFFERSON, MISSOURI, AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE AN PRE-DEVELOPMENT AGREEMENT WITH JFCHC, LLC. NOW, THEREFORE, BE IT ENACTED BY THE COUNCIL OF THE CITY OF JEFFERSON, MISSOURI AS FOLLOWS: Section 1. The Mayor and City Clerk are hereby authorized to execute an pre- development agreement with JFCHC, LLC for the proposed conference center. Section 2. The agreement shall be substantially the same in form and content as the agreement attached hereto as Exhibit A. Section 3. This Ordinance shall be in full force and effect from and after the date of its pass a and approval. Passed: 7 Approv Presiding Officer IMayor ATT ST: AP ED S TO FORM: City C! , k Y City Couns elor • PRE-DEVELOPMENT SERVICES AGREEMENT HOTEL AND CONFERENCE CENTER JEFFERSON CITY, MISSOURI This Pre-Development Services Agreement ("Agreement") dated as of January 18, 2008 (`Effective Date"), is entered into by and between Jefferson City, Missouri ("City"), and JFCHC, LLC, a Missouri limited liability company ("JFCHC"), in connection with the proposed development of a conference center and hotel, parking garage, ground floor retail and possible office building(the "Project")on West McCarty Street, Jefferson City, Missouri. WHEREAS City is contemplating the potential construction of a garage, conference center and hotel and other related development on a site controlled by the City on West McCarty Street to serve the needs of the general public; WHEREAS, the City is now considering ownership and financing structures, development costs and operating revenue and costs for the Project and has selected JFCHC (i) to study the funding and ownership options for the Project and to provide the City with a business plan detailing the size, building program, conceptual design, estimated development costs, operating pro forma, and funding, operating and ownership alternatives for the Project; and (ii) such other services necessary and incidental to the foregoing as the City may reasonably request and approve subject to an understanding and agreement between the City and JFCHC of possible additional fees for such services, and WHEREAS, the City contemplates the possible engagement of JFCHC as the developer of the Project or any portion thereof or in another appropriate role in the event that the City elects to proceed with the Project or any portion thereof. In consideration of the mutual promises and covenants herein contained, the parties hereto agree as follows: Section 1. Pre-Development Scope of Services and Schedule. (a) City will provide to JFCHC any currently existing studies and other documents pertaining to the Project. The materials may include a summary of zoning and land use issues related to the Project as they currently exist, provided, however, that the alternatives to be proposed by JFCHC need not take into account existing zoning. (b) JFCHC contemplates engaging the services of a hotel operator("Hotel Operator") and parking consultant ("Parking Consultant") and/or convention and hotel consulting firm (b) JFCHC contemplates engaging the services of a hotel operator("Hotel Operator") • and parking consultant ("Parking Consultant") and/or convention and hotel consulting firm ("CH Firm"), mutually acceptable to the City and JFCHC, to provide consulting services with respect to the hotel, conference center, and the garage and/or surface parking for the Project. Notwithstanding the use of the Parking Consultant, JFCHC acknowledges that the City may elect to handle the management and operation of the parking itself or may elect to hire an outside firm of its sole choice. (c) JFCHC will, if it recognizes the need for third-party retail consultation, engage the services of a qualified retail consultant ("Retail Consultant"), mutually acceptable to the City and JFCHC, to analyze the market for retail and service uses on a portion of the ground floor of the Project and to furnish projected rents obtainable therefrom. (d) JFCHC will engage the services of DLR Group ("Architect") to prepare a preliminary site plan and other preliminary program and design analysis ("Preliminary Project Design") for the Project. (e) Based on the Preliminary Project Design, JFCHC will engage a construction company ("Contractor"), mutually acceptable to the City and JFCHC, to prepare a preliminary estimate of the total Project construction costs ("Preliminary Project Pricing"). • (f) JFCHC will work with the Hotel Operator, the Parking Consultant, the CH Firm, and/or the Retail Consultant to create a profit and loss statement for the Project ("Preliminary Project Operating Pro Forma"). (g) Based on the Preliminary Project Pricing and Preliminary Project Operating Pro Forma, JFCHC with input from an investment banker or mortgage banker ("Banker"), mutually acceptable to the City and JFCHC, will prepare financial models for potential ownership structures for the Project. (h) Simultaneously with the above tasks, JFCHC will diligently investigate financing and ownership options for the Project. (i) JFCHC will use its good faith best efforts to deliver its final report on the Project ("Final Report") to the City within one hundred eighty (180) days of the Effective Date. It is understood that JFCHC cannot be held responsible for the timely delivery of documents from, or the scheduling of meetings with, the City, state or other public entities. In the event that the City fails to deliver to JFCHC any data, information, studies, or other details in its possession or control relative to the Project within the first thirty days following the Effective Date, the time Pre-Development Services Agreement—Page 2 1/16/200812:34:21 PM for delivery of the Final Report shall be extended for a period equal to the number of days such • delivery is delayed beyond said initial 30-day period. Notwithstanding anything to the contrary herein, in the event that the Final Report has not been delivered to the City within two hundred ten (210) days of the Effective Date, the City shall have the right to terminate this Agreement and JFCHC shall provide to the City all information it has developed to date in support of the Final Report. (j) JFCHC shall report on the status of its efforts relating to the Project on a monthly basis or more often if required. The meetings shall be held by conference call or in person. (k) All plans, reports, studies, etc. prepared, received or commissioned by JFCHC in connection with the Project shall be deemed the property of the City once full payment for the services are received by JFCHC, provided that ownership of the design plans and construction drawings will be subject to the industry standard conditions and restrictions on liability with regard to any unrelated use of such architectural plan s and drawings. Section 2. Development of the Project. (a) If the City determines to proceed with the development and construction of the Project, JFCHC and the City, in accordance with the laws of the State of Missouri, shall • negotiate and execute a form of "Development Management Agreement" with respect to the Project (the "DMA"), pursuant to which JFCHC shall continue to be the exclusive developer for the Project. (b) In the event the DMA is not executed within one hundred twenty (120) days following the date of delivery of the Final Report, this Agreement shall terminate and be of no further force and effect. Provided, however, notwithstanding the previous sentence, (i) if the reason that the DMA is not executed within such 120-day period is that the City has decided, as provided in Section 4(c)(ii), that the Project is not legally or economically feasible, then, in the event the City were to elect to proceed with the Project within twenty-four (24) months following the aforesaid 120-day period, the City shall negotiate and execute a DMA in accordance with Section 2(a) hereof. The City agrees that JFCHC is relying on this covenant of the City in entering into this Agreement. (c) Prior to the execution of the DMA, the relationship between JFCHC and the City shall be governed solely by the terms of this Agreement. (d) The development "turn-key" services anticipated to be provided under the terms of the DMA shall be fully transparent to the City throughout the development process and may • Pre-Development Services Agreement—Page 3 1/16/2008 12:34:21 PM include, but are not to be limited to, oversight of any site acquisition required, directing the • application of all permits and approvals, overseeing the drafting of all agreements, overseeing the design, value-engineering, bidding and construction, contracting with Project professionals and contractors, coordinating pre-opening services of the Project, and directing the financing and ownership structure of the Project. Section 3. Compensation. The City agrees to compensate JFCHC as follows: (a) The City will pay JFCHC a fee of Two Hundred Thousand Dollars ($200,000) for the Pre-Development Services for the Project outlined in Section 1 above. (b) An initial payment of One Hundred Thousand Dollars ($100,000) will be due upon signing of this Agreement. A second payment of Fifty Thousand Dollars ($50,000) will be due upon delivery and acceptance of the Preliminary Project Pricing and Preliminary Project Operating Pro Forma. A final payment of Fifty Thousand Dollars ($50,000) will be due upon completion of the Final Report. (c) This fee will include all out-of-pocket expenses for JFCHC and compensation • paid by JFCHC for any consulting services of the Hotel Operator, Parking Consultant, CH Firm, Retail Consultant, Contractor, Banker and Architect, or similarly qualified consultant, to be selected. If JFCHC determines that additional consultants are required for currently unforeseen circumstances relating to the Project (for example, environmental engineers, hydrologists, etc.) and if the City approves in writing the engagement of the additional consultants, the costs for those additional consultants will be added to the fee outlined in Section 3(a) above and will be paid by JFCHC under the payment terms of the additional consultants pursuant to agreements that have been approved by the City. (d) If the City determines to proceed on the development and construction of any of the Project components, it is anticipated that the fees outlined in Section 3(a) above shall be reimbursed to the City out of the proceeds from the funding of the Project. (e) It is anticipated that the "turn-key" development services under the DMA outlined in Section 2(d) above shall be performed by JFCHC for a Development Management Fee of five percent (5%) of the Project's total development budget calculated to include all planning, permits, design, supervision, construction, construction management, furniture, fixtures and equipment, and pre-opening expenses of the Project. is Pre-Development Services Agreement—Page 4 1/16/2008 12:34:21 PM Section 4. Additional Provisions. (a) The City is relying on the experience, skill, judgment and qualifications of JFCHC. JFCHC may not assign their rights nor delegate obligations under this Agreement, other than those noted in this Agreement, without the prior written consent of the City. Any attempted assignment or delegation by JFCHC shall be void. JFCHC represents that its component entities are Garfield Traub Development LLC and BBC, LLC and that the principals and responsible individuals thereof for whom experience and background information has been provided to the City will maintain their roles in operating JFCHC. (b) A fundamental basis underlying the City decision to select JFCHC to collaborate with the City on the Project is the past experience of the constituent entities of JFCHC in developing financing structures for public entities. By executing this Agreement, JFCHC agrees to and acknowledges its fiduciary obligation to the City to diligently and fully investigate financing and ownership options for the Project, it being the intent and goal of the City to identify the structure that results inter alia, in the most favorable outcome to the City in the City's discretion. (c) This Agreement shall be terminable by either party at any time for good cause. As used in the Agreement, "good cause" means (i) the gross negligence or willful misconduct • under, or the material breach (after a ten (10) day cure period) of, this Agreement by the non- terminating party or(ii) the good faith decision of either party following the delivery of the Final Report that the Project is not legally or economically feasible. . (d) All day-to-day contacts with JFCHC shall be made through Steve Moffett or, in his absence, Raymond Garfield. All contacts with the City shall be made through Steve Rasmussen, City Administrator or the designated acting City Administrator in his absence. (e) All notices and other communications hereunder shall be in writing, shall become effective when delivered to the addressee, and may be transmitted by certified mail (return receipt requested), telegram, telex, overnight courier service, or other commercially reasonable and customary means, addressed to the party at the address listed beneath that party's signature below, or at such other address as the party shall have furnished to the other party in writing. (0 This Agreement shall be construed and enforced in accordance with and governed by the laws of the State of Missouri applicable to contracts made and to be performed entirely within such state. • Pre-Development Services Agreement—Page S 1/16/2008 12:34:21 PM (g) Any acceptance, signature, execution or validation of this Agreement or any • communication or notice required hereunder shall be mutually signed and delivered by hard copy or by fax. No purported offer, acceptance or contract, amendment, or binding agreement in connection with this transaction shall be made by automated agent, electronic agent, electronic mail, electronic signature, telephonic voice mail, sound recording, or other electronic means of any kind. This Section cannot be waived except by mutually signed, written consent of both parties. (h) JFCHC shall act as an independent contractor in the performance of its responsibilities and this Agreement shall not be deemed to create an employer-employee or joint venture relationship, either express or implied, between JFCHC and the City. (i) This Agreement sets forth the entire understanding of the parties with respect to the subject matter hereof, and all prior agreements, whether written or oral, are deemed to be merged herein. This Agreement is entered into as of the Effective Date. JFCHC,LLC, a Missouri-li ited liabilit m • Address: 13455 Noel Road, Suite 2150 By: Dallas, TX 75240 Name: Raym d ar ield Facsimile: 972-991-5150 Title: Principal Telephone: 972-716-3838 JEFFERSON CITY, MISSOURI Address: 3_�p / -�e ►^snn 0'I:w.rm tbl D I B Facsimile: 573-L 'q-l"C)D ( Name: ,1� e ko Telephone: 5 73--10,34-1-dif Title: f11 ED rA ORM: AP ity ttorney Pre-Development Services Agreement—Page 6 1/16/2008 12:34:21 PM