HomeMy WebLinkAboutPO 5865: OAKMONT PROPERTIES & STONE CREEK APARTMENTS - DEVELOPER PARTICIPATION CONTRACTinteroffice
MEMORANDUM
To: Mayor, City Council, yand CityyMan ger ?'~/~"'~ - -
From: Mark T. Sokolow, Cit Attorne ~~,„,yyLLff..~/`~~ _
Date: April 4, 2008
Subject: P. O_ No. 5865; Council Meeting April 8, 2008
Attached is P. O. No. 5865 as it. pertains to a Developer
Participation Contract with Oakmont Properties, Inc. and Stone
Creek Apartments, Ltd. as to extend Anchor Drive, which will
provide an incentive for a new 246 unit, up-scale, market-rate
apartment complex. This was tabled at the March 25, 2008 Council
Meeting. The Developer Participation Contract was been changed
and updated.
MTS:ts
Attachment
cc: VIA FACSIMILE (409) 895-0047
Jim Hendricks
JIM HENDRICKS PROPERTIES
VIA FACSIMILE (713) 681-7774
William M. Burney, III
President
OAKMONT PROPERTIES, INC.
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P. O. No. 5865
04/04/08 is updated
ORDINANCE NO.
AN ORDINANCE AS IT PERTAINS TO A DEVELOPER
PARTICIPATION CONTRACT WITH OAKMONT
PROPERTIES, INC. AND STONE CREEK APARTMENTS,
LTD. AS TO EXTEND ANCHOR DRIVE AS TO PROVIDE
AN INCENTIVE FOR A NEW 246 UNIT UP-SCALE',
MARKET-RATE APARTMENT COMPLEX
WHEREAS, it is deemed in the public interest to enter into a
Developer Participation Contract with Oakmont Properties, Inc. and
Stone Creek Apartments, Ltd. as to extend Anchor Drive as to
provide an incentive for a new 246 unit up-scale, market-rate
apartment complex,- in substantially the, same form as attached
hereto as Exhibit °A".
NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
OF PORT ARTHUR:
Section 1. That the facts and opinions in the preamble
are true and correct.
Section 2. That the City Manager is herein authorized to
enter into a Developer Participation Agreement with Oakmont
Properties, Inc. and Stone Creek Apartments, Ltd. as to extend
Anchor Drive as to provide an incentive for a new 246 unit up-
scale, market-rate apartment complex, in substantially the same
form as attached hereto as Exhibit "A".
Section 3. That a copy of the caption of this Ordinance
be spread upon the Minutes of the City Council.
READ, ADOPTED AND APPROVED on this day of
A.D., 2008, at a Council Meeting of the City Council of the City
z.po5865_updated
of Port Arthur, Texas, by the following vote:
AYES: Mayor
City Council
NOES:
MAYOR
ATTEST:
ACTING CITY SECRETARY
APPROVED AS TO FORM:
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CITY ATTORNEY
APPROVED FOR ADMINISTRATION:
CITY MANAGER
PROVED AS TO THE AVAILABILITY OF FUNDS:
DIRECTOR OF FINANCE
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EXHIBIT "A"
STATE OF TEXAS §
COUNTY OF JEFFERSON §
DEVELOPER PARTICIPATION CONTRACT
WHEREAS, the City of Port Arthur, a~ Oakmont Properties,
Inc. and Stone Creek Apartments, Ltd. desire enter into a
Developer Participation Contract, pursuant to Sections 212.071
to 212.074 Local Government Code, V.T.C.A.; and
WHEREAS, Oakmont Properties, -Inc. has indicated that it or-
an affiliated limited partnership, Stone Creek Apartments, Ltd.
will purchase a tract of land adjacent to Lake Arthur, as
denoted in Exhibit "A", as to construct a 246 unit, up-scale, ----
market-rate apartment complex that will stay on the tax rolls; _ _
and
WHEREAS, Oakmont Properties, Inc. and the affiliated
limited partnership, Stone Creek Apartments, Ltd. are herein
referred to as the Developer; and
WHEREAS, the improvements to be constructed by Developer
will be the extension of Anchor Drive, with the ancillary
extension of sidewalks, water, drainage, and sewer as is
required by City Code and professional engineering analysis; and
WHEREAS, once these improvements are constructed to City
specifications, they will be deeded to the City of Port Arthur
as public improvements without any liens or encumbrances; and
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WHEREAS, n-,,,m..~~ Prepe~t~es, Tne Developer is requesting
the City participate in the cost of some of the improvements as
to develop this tract so that at least a 246 unit up-scale,
market-rate apartment complex will be built in the area, as
denoted in Exhibit "A", with a deadline of ~?.gr~1T, 2~0 August
1, 2009.
NOW THEREFORE, the City of Port Arthur and Oakmont
Properties, Inc. agree to the following:
Section 1: The facts and opinions in the preamble are
true and correct.
Section 2: Timetable for purchase of the tract for
development:
• n,,""^~~ ^"ep~e~ies~SIe er ~ is a€€: , ;aced camp
Developer will provide documentation that it has
purchased the land, as described in Exhibit "A", by
May 15, 2008. As a part of said purchase, any and all
delinquent taxes, if any, on said property will be
paid by the original owner, or by Oa;::;ont ^r~p~eT
3~e Developer.
Section 3. Once the developer purchases the property,.
the developer will immediately commence construction and
immediately clear and grub the site. The developer will also
take such action as to maintain the progress of the construction
without delay and stoppages.
Section 4: Oa3.m..~~ P~epert`es, Tne Developer will
execute a performance bond for the construction of the
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improvements (extension of Anchor Drive and ancillary sidewalks,
water, drainage, and sewer improvements) to ensure completion of
the project. The performance bond will be in the amount of the
construction contract for said public improvements which is
estimated at $700,000. The bond must be executed by a corporate
surety in accordance with Chapter 2253 of the Government Code.
The-City will be a.beneficiary of said performance bond. ^~~
~rep~e~ties~r Developer will have liability insurance of
$1,000,000, and hold the City harmless from its construction
activities.
Section 5: The City of Port Arthur will pay for 29°s of
the following costs, with the total reimbursement by the City
not to exceed $200,000 out of a projected cost for the public
improvements of $700,000 on the following:
• ~ Engineering design and construction of an
extension of Anchor Drive, sewer lines, water
lines, and drainage lines and ancillary
improvements as described in Exhibit "A"~
The City's share of these costs of up to $100,000 will be
paid within thirty (30) days after the completion of these
improvements, in accordance with the City's Code of Ordinances
and the public improvements have been accepted by the City. The
City will receive a copy of all of the engineering and geo-
technical studies. Aa#rnc~t P-r-ape~t~es, Ise. Developer will
complete these improvements by Beeembe~3z,-~~o February 28,
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2009. The City will pay its 'remaining share of these public
improvement costs up to $100,000 when the apartment complex has
been substantially completed and has received a certificate of
occupancy.
Section 6. 9a]~~,r~}~opert~es~~ Developer will
enter into construction agreements to perform the improvements
delineated in this agreement. If 9akmen€ Prepertaes~r~
Developer uses its own resources or a related construction
company, it must provide information and, documentation that the
costs thereof are equal to or less than if it was bid out, as to
avoid the undue loading of costs, collusion, or .fraud, as
prohibited by Section 212.074 Local Government Code. Also, all
plans and specifications for public improvements will need to be
approved by the City as is required of other developers. The
City has the option to construct the public improvements, with
^~''m~^~ Prope°t'es, ne Developer reimbursing the City for its
share of the costs.
Section 7. If 9a~me~tt Prepe-€~es ne e a€ '''a€ed
een+pa~e~ Developer does not build (construction completed and
certificate of occupancy issued) at least a 246 unit, up-scale,
market-rate apartment complex on the tract, as denoted in
Exhibit "A", by } August 1, 2009, then Oakmont Properties,
Inc. and Stone Creek Apartments, Ltd. wi1T repay the City as
follows:.
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"Amount to be repaid equals the number of apartment units
not built divided by 246 times the amount of moneys that
the City has paid for improvements."
Section 8: Pursuant to Section 212.072 Local Government
Code, the total cash participation of the City shall not exceed
thirty percent (30°a) of the total contract price for the
proposed public improvements, as described in Exhibit "A", and
this agreement provides a total incentive of less than 30°s.
Oa~~P~opert~es~- Developer estimates the total contract
price for the proposed public improvements to be over $700,000.
Notwithstanding, the City's total reimbursement shall not exceed
$200,000 in cash reimbursements.
Section 9: All of Oa~aont-P~epert~s~ne.'s
Developer's books and other records, as they pertain to this
project and public improvements that the City participates in,
shall be available for inspection by the City, all as provided
for by Section 212.074 (b) Local Government Code.
Section 10: This agreement will be construed in
accordance with the laws of Texas, as well as the Ordinances of
the City of Port Arthur.
Section 11: The venue of all causes of action will be in
Jefferson County, Texas.
Section 12: The apartment units to be built shall be
leased to renters without regard to race, religion or national
origin, and' 9ad~xtent Preperties, one Developer will comply with
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the fair housing laws, as delineated under Chapter 46 of the Code
of Ordinances of the City of Port Arthur and as described by
State and Federal Law.
Section 13: Reasonable delays (not to exceed thirty(30)
days) in the performance of this agreement may be approved by
the City Manager, so long as the delays are not caused by the
acts or omissions of 9ad.ment P~egc_~es~~ Developer.
Section 14:
Notice to the parties shall be as follows:
TO: CITY OF PORT ARTHUR
ATTN: Stephen Fitzgibbons
City Manager
444 Fourth Street
P. O. Box 1089
Port Arthur, TX 77641-1089
TO: DEVELOPER
ATTN: William M. Burney, III
109 North Post Oak Lane, Suite 400
Houston, TX 77024
(713) 681-5566
(713) 681-7774 (FAX)
Section 15: The. City makes no representation..as to the
marketability of said tract or the suitability of them as an
apartment complex. Oakme~~ies, ~. Developer has
relied on its own feasibility studies thereon and its own
inspection as to the condition and existence of the utilities on
or adjacent to the property.
Section 16: If the City does not comply with the terms
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of this Agreement, then 9a'-T_~~t,~-P,rcpcr-ties, Inc. Developer may
terminate this agreement with thirty (30) days written notice..
If 9aU~t-T-r~~~es~~ Developer does not comply with the
terms of this Agreement, then the City may terminate this
agreement with thirty (30) days written notice.
Section 17. It is an essential term of this agreement
that the apartment complex shall stay on the tax rolls for a
period of 10 years from the date of that the apartment complex
receives its certificate of occupancy from the City of Port=
Arthur and a covenant thereon shall be filed in the deed records
by the Developer.
.Section 18 The Developer further agrees to provide
opportunities to Port Arthur contractors to bid on or to provide
quotes for the building of the public improvements
Section 19 The Developer further agrees to provide
opportunities to Port Arthur subcontractors to bid on or to
provide quotes for the building of the apartment complex-since
the Developer plans to use Camden Builders as the general
contractor who has experience in building 'the type of up-scale
apartment complex that will be built.
Section 20 The Developer, with thirty (30) days written
notice to the City may prior to commencement of construction of
the improvements described in Section 5, terminate this
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agreement with the City.
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SIGNED AND AGREED TO on this the -day of
2008. ..
OARMONT PROPERTIES, INC.
"DEVELOPER" - -
By:
(Printed Name)
ACKNOWLEDGMENT
STATE OF TEXAS § -°
§
COUNTY OF §
BEFORE ME, the undersigned Notary Public, on this day,
personally appeared known to me to be the person
whose name is described in the foregoing instrument., and
acknowledged to me that he/she executed the same as the act and
deed of Oakmont Properties, Inc., for the purposes and
considerations therein expressed, and the capacities therein
stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the day of
2008.
Notary Public, State of Texas
d ~
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,. ,
STONE CREEK APARTMENTS, LTD
"DEVELOPER"
By:
(Printed Name)
ACKNOWLEDGMENT
STATE OF TEXAS ~
COUNTY OF ~
BEFORE ME, .the undersigned Notary Public, on this day,
personally appeared .known to me to be the person
whose name is described in the foregoing instrument, and
acknowledged to me that he/she executed the same as the act and
deed of Stone Creek Apartments, Ltd., for the purposes and
considerations therein expressed, and the capacities therein
stated..
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the day of
2008.
Notary Public, State of Texas
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SIGNED AND AGREED TO on this the day of
2008.
CITY OF PORT ARTHUR.
By:
STEPHEN FITZGIBBONS, CITY MANAGER
ACKNOWLEDGMENT
STATE OF TEXAS 5
COUNTY OF JEFFERSON 5
BEFORE ME, the undersigned Notary Public, on this day,
personally appeared Stephen Fitzgibbons, City Manager,' known to
me to be the person whose name is described in the foregoing
instrument, and acknowledged to me that he/she executed the same
as the act and deed of the City of Port Arthur, for the purposes
and considerations therein expressed, and the capacities therein
stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the day
of
2008.
Notary Public, State of Texas
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EXHIBIT "A"
TO THE AGREEMENT
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Extensi®n
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Jirn Hendricks
Jim Hendricks. Properties
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What do we want to do?
Extend Anchor Drive
• Improve Access to Lake Arthur Drive
• Improve safety in the area (U-Turns on 69)
• Improve School Access (age 4 to 18 yrs)
• Return on investment to Port Arthur by
way of new development
• Immediate up Scale Apartment Complex
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What will it look like ?
Up Scale
Market Rent
Apartment complex
Immediate Im
act
• Improved Area access.. & Safety,
• New up scale Market, Rate Apartrinent
Complex with 246 Units
$~1million to Tax rolls + More in Future
• $85,000+ per year to Port Arthur
• Proven History for Additional Development
Overview
• Total cost to extend Anchor Dr $700,000
( includes road with sidewalks, water,
drainage & sewer).
• Apartment Development project brings
$500,000 of that cost
• .:.Requesting from .Port Arthur $200,000 to
Extend Anchor Dr to Lake Arthur Dr.
Return on Investment
• $200,000 Pay Back Less Than Three Yrs.
Improved Safety
Improved community Access