Date: December 4, 2012
Prepared by: Jason Stilwell
City Council
Agenda Item Summary
Description: On June 14, 2012, the City prepared a Recirculated Draft Environmental Impact Report (RDEIR) for the Sale of the Flanders Mansion Property that included an updated analysis of Alternatives. One Alternative includes the lease of the property as a single-family residence. Council will consider whether to initiate a process to consider the lease of Flanders, including retaining the services of a real estate professional. The real estate professional would solicit and evaluate lease proposals using criteria considered by the Council during its December 4, 2012 meeting.
Overall Cost: City Funds: N/A
Grant Funds: N/A
Staff Recommendation: Initiate a process to utilize a real estate professional to solicit and evaluate lease proposals.
Important Considerations: The Council may consider whether to sell or lease the Flanders Mansion. There has been unsolicited interest by the private sector in a potential lease agreement. A real estate professional would assist in identifying and evaluating any forthcoming proposals.
Decision Record: None
Reviewed by:
___________________________ __________________
Jason Stilwell, City Administrator Date
CITY OF CARMEL-BY-THE-SEA
STAFF REPORT
THROUGH: JASON STILWELL, CITY ADMINISTRATOR
DATE: 4 DECEMBER 2012
SUBJECT: FLANDERS MANSION LEASE PROCESS
RECOMMENDED MOTION
Receive an update on the environmental review process; consider the process for the potential lease of Flanders Mansion; provide direction to staff to initiate a process to retain the services of a real estate professional; authorize the City Administrator to enter into an agreement with a real estate professional and direct staff to return with options.
BACKGROUND
On June 14, 2012, the City prepared a Recirculated Draft Environmental Impact Report (RDEIR) for the Sale of the Flanders Mansion Property that included an updated analysis of Alternatives. The release of the 2012 Final Environmental Impact Report (FEIR) for the Flanders Mansion is scheduled for December 4, 2012. Subsequent to the release, it will be presented to the Forest and Beach Commission, the Historic Resources Board, the Planning Commission, and then City Council in January 2013.
City Council will review the FEIR and provide direction regarding alternatives at its January 2013 meeting. Once the City Council certifies the EIR, they could initiate a process to sell/lease the Mansion. The sale process would occur from January to August and culminate in the placement of a ballot measure on the November 5, 2013 election. Or, Council could consider leasing the Flanders Mansion as a parallel effort to the process of selling the Mansion.
Should Council consider the possibility of leasing the Flanders Mansion, staff recommends that a process be established to use a real estate professional to solicit and review lease proposals.
STAFF REVIEW
The Proposed Project is the sale of the Flanders Mansion property. The 2012 RDEIR also considers the lease of Flanders Mansion for single-family residential use and for public or quasi-public use as project alternatives. According to the 2012 DEIR, the single family residential use lease alternative has an impact comparable to the Proposed Project in relation to aesthetics, biological resources and cultural resources and an impact less than the Proposed Project related to land use and planning, parks and recreation and traffic.
Should Council pursue leasing the Flanders Mansion, staff recommends that a Request for Proposals (“RFP”) process be used to obtain the services of a real estate professional interested in soliciting proposals on behalf of the City regarding the lease of the Flanders Mansion. Staff is seeking direction regarding the criteria to use in a RFP as noted below:
1. Property Use by Proposed Tenant
a. Intended use of the property as a single-family residence, including proposed tenant’s reason for interest in leasing the Mansion
b. The proposed tenant’s experience with historic properties and/or plan to ensure historic features are preserved
c. The proposed tenant’s plan to allow public access to the Mission Trail Nature Preserve and the Lester Rowntree Arboretum
2. Proposed Terms of the Lease
a. Proposed length of time of lease
b. Proposed amount of rent per month
c. Amount of funding the proposed tenant is willing to invest to restore the property and plan for completion of repairs to building and property
d. Proposed tenant will be responsible for utilities and building and ground maintenance
e. Proposed tenant will comply with mitigated measures contained within the final certified EIR and other planning conditions
3. Financial Commitment by Proposed Tenant
a. Ability of proposed tenant to establish bond or escrow account to cover cost of restoration of property, estimated at $1.2 million
b. Ability of proposed tenant to provide escrow account for the lease amount
c. Ability of proposed tenant to provide liability insurance estimated at $2.8 million
Based upon Council direction to initiate the process to solicit lease proposals, staff would issue a RFP that includes the criteria included above as well as instructions to applicants regarding proposal length, format and submission requirements. Staff would then evaluate proposals received and the City Administrator would enter into agreement with a real estate professional to solicit and review proposals and return to Council with lease options at a later date
FISCAL IMPACT
The leasing of Flanders Mansion does not divest the City of the property. However, it provides an alternative that allows the City to receive revenue for the use of the property and may allow the City to transfers costs associated with building restoration and maintenance to a potential tenant.
ATTACHMENTS
Draft Flanders Mansion Project and EIR schedule
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