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<br />/0-8:1. <br /> <br /> <br />R E P ()R;t~""<Lc,~ . <br /> <br />To the Honorable Mayor and City Council <br />From the City Manager <br /> <br />Date <br />November 13,2000 <br /> <br />Subject <br />CHILDCARE FACILITY ON CITY-OWNED LAND IN REDWOOD SHORES <br />ADJACENT TO WATER TANK "A" AND PROPOSED RESIDENTIAL SUITES <br />HOTEL AT THE SOUTHERN TERMINUS TO TWIN DOLPHIN DRIVE. <br /> <br />Recommendation <br />It is recommended that the Council, by motion: <br />1 . approve the basic business terms of a site lease and financial arrangement, <br />as summarized in this report and in Attachment 2 Term Sheets for Land <br />Lease and Financing, for development of a childcare facility on the water tank <br />"A" parcel; <br />approve the transaction amount at the requested $3.2 million; <br />direct staff to continue negotiations and prepare a site lease and related <br />documents for public bidding of the transaction. <br />These actions will make it possible for the developer to proceed with his final <br />assessment of financial feasibility, obtain closure as soon as possible on all <br />business terms and proceed with the project. <br /> <br />2. <br />3. <br /> <br />Executive Summary <br />Staff has tentatively negotiated the development of a 10,000 to 12,000 square foot <br />childcare facility with space for approximately 150 to 160 children on a 1.2 acre City- <br />owned parcel adjacent to water tank "A". The project will additionally include 5,000 <br />square feet of office above the childcare facility. The office use must be compatible <br />with the childcare facility. <br /> <br />Staff has negotiated the following basic terms, which we submit for your <br />consideration: <br /> <br />1. <br /> <br />The City owns the land and will lease it to a developer for an initial 31-year <br />term at a nominal rate of $1,000 per year. The lease will have successive <br />renewal options at then-prevailing market rates out to a final term of 49 years. <br />The developer will build a 15,000 to 17,000 square foot facility, 5,000 square <br />feet of which must be leased for a use that is compatible with its location <br />above a childcare facility. Possible uses may include for-profit tutorial <br />companies or commercial office. The City will have the ability to determine <br />compatible uses. <br />The developer will construct and initially own the improvements. The City will <br />agree to provide long term financing in the amount equal to the lesser of $3.2 <br /> <br />2. <br /> <br />3. <br /> <br />~r-- ... ---T . <br />