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CONTRACT 6017 Reimbursement Agreement CLOSEDAgreement No. 6017 REIMBURSEMENT AGREEMENT This Reimbursement Agreement ("Agreement") is entered into as of December 1 2020, by and between the City of El Segundo, a general law city and municipal corporation ("City"), and 1960 Grand Office Owner 2 LP, a Delaware Limited Partnership ("Applicant/Developee'). The parties agree as follows: 1. Recitals. This Agreement is made with reference to the following facts and circumstances: a. Applicant/Developer is the owner of that property located at 1950 East Grand Avenue in El Segundo (APN 4138-007-065) (the "Property") which is currently developed with a 9-level parking structure and a surface parking lot. A related entity owns the 12-story office building on the adjacent parcel, immediately to the east, located at 1960 East Grand Avenue (APN 4138-007- 066). b. Applicant/Developer is preparing an application for the development that would: 1) demolish the existing surface parking lot, add an approximately 93,500 square -foot office building (4 stories with mezzanine) and a 23-space surface parking lot, and retain the existing 9-level parking structure at 1950 East Grand Avenue, and 2) add a 4-level parking structure that includes 285 parking spaces and retain the existing 12-story office building at 1960 East Grand Avenue (the "Project") and desires to enter into this Reimbursement Agreement ahead of the application being submitted and actual costs determined. C. The Project requires environmental review, preparation of environmental technical reports and documents under the California Environmental Quality Act ("CEQA"); the retention of costs of attorneys' fees; the retention and costs of professional consultants; the costs of work performed by City staff and contract planners to complete a number of tasks including environmental review, zoning review, plans review for compliance with City standards, building code compliance, preparation of reports, and project management duties; the reasonable processing costs related to review and inspection of the Project; and the costs of implementing the conditions of approval (collectively, "Project Costs"). d. City believes it is in the public interest for Applicant/Developer to pay such Project Costs. Applicant/Developer understands that all work performed by the City related to the Project will be under the direction of City, but at Applicant/Developer's expense. e. Applicant/Developer understands that at this time the Project Costs are unknown. 2. City Reimbursement. Applicant/Developer agrees to fully reimburse the City for the Project Costs. Agreement No. 6017 a. City Administrative Costs are initially estimated to be $50,000 and environmental consulting costs are initially estimated to be no less than $125,000. b. Applicant/Developer acknowledges that the actual amount of such Project Costs will be different. Nonetheless, even though the actual amount of such Project Costs are unknown at this time and will be different, Applicant/Developer agrees to reimburse the City for the full amount of the actual costs of such Project Costs in the manner provided in this Agreement. C. Once a formal application is submitted, City intends on entering into consulting agreements for environmental consulting services and contract planning services. City will provide copies of these proposals and agreements to Applicant/Developer and an Amendment to this Agreement will be entered into prior to City entering into the consulting agreements. d. City will provide Applicant/Developer with an accounting of the Project Costs on a monthly basis, which accounting the Applicant/Developer agrees will be conclusive, in the absence of manifest error. The total cost of the Project Costs, as stated in the accounting, is called the "Reimbursement Amount." a. Initial Deposit. Except as provided below, upon execution of this Agreement, Applicant/Developer agrees to deposit with City $25,000 ("Deposit Amount"). Costs associated with the Project will be charged against the Deposit Amount. b. The Deposit Amount will be placed in a non -interest bearing trust account established by the City Manager. Applicant/Developer understands and agrees that City will not pay interest to Applicant/Developer on the Deposit Amount and Applicant/Developer will not seek such interest payments from City. C. Su lemental Deposits. After City enters into consultant agreements for environmental services and contract planners, Applicant/Developer shall make additional deposits as follows- 1 . Applicant/Developer shall make two deposits in equal amounts to cover the entire cost of the environmental consultant. The first payment shall be made within ten business days from the date of the City's request and the second payment shall be made no later than three months after the date of the first payment. 2. Applicant/Developer shall deposit an additional $25,000 to cover the Administrative Costs concurrent with the first payment for the environmental consultant. d. Replenishment, Deposit. Whenever the Deposit Amount balance falls below $10,000, the City may request the Applicant/Developer to replenish the amount ("Replenishment Deposit"). Applicant/Developer agrees to deliver a 2 Agreement No. 6017 Replenishment Deposit to City within 10 business days following the City's request. e. Should the Reimbursement Amount exceed the Deposit Amount, Applicant/Developer agrees to promptly pay City any difference. Should the Reimbursement Amount be less than the Deposit Amount, City will refund Applicant/Developer any remaining Deposit Amount to Applicant/Developer within 30 days after determining the Reimbursement Amount. 4. City Administrative Costs. Administrative costs incurred by City, including, without limitation, staff time, contract planner time, legal costs, fees and services, must be reimbursed on a time and materials basis based on current City reimbursement rates. As described in Section 2 above, it is currently estimated that such administrative costs will total $50,000.00. Applicant/Developer acknowledges that such amount is an estimate only and that the actual administrative costs may be more or less than such amount. Such costs will be deducted by City from the Deposit Amount on a monthly basis. Applicant/Developer shall be provided with monthly statements, with the exception of any attomey-client privileged matters. 5. A licant/Develo er Default. Should Applicant/Developer fail to perform any of its obligations under this Agreement, then City may, at its option, pursue any one or more or all of the remedies available to it under this Agreement, at law or in equity. Without limiting any other remedy which may be available to it, if Applicant/Developer fails to pay either the Deposit Amount or a Replenishment Deposit, or fails to fully reimburse the City for the Project Costs, City may cease performing its obligations under this Agreement and may bring an action to recover all costs and expenses incurred by the City in completing the studies, together with interest thereon from the date incurred at the rate of 10% per annum. 6. Term. This Agreement will terminate either (1) 12 months froM the date A licant/Develo er"s aRp,lication, has been approved by the Ci building ermit issugace or building ermit final; or (ii) when the Project has been disapproved or the application has been formally withdrawn. Disapproval of the Project or the Applicant/Developer's withdrawal of the application does not excuse Applicant/Developer from reimbursing the City for the Project Costs incurred up to such date of disapproval or withdrawal pursuant to this Agreement. 7. Conflicts of Interest. a. Consultants Work for Ci City has sole discretion to direct the work and evaluate the performance of the employees and contractors assigned to work on the Project, and City retains the sole right to terminate or replace any such employees or contractors. Notwithstanding the fact that Applicant/Developer provides funding for the performance of the reports and studies provided hereunder, such documents prepared hereunder or any approvals granted reflect the City's independent judgment, and City has no obligation to approve the Project. b. No Employment by A icant/Develo er. Applicant/Developer represents and warrants that: Agreement No. 6017 For the 12-month period preceding the submission of its application for the Project, it has not entered into any arrangement to pay finance consideration to, and has not made any payment to, the City's consultants retained for the Project. ii. For a period of 12 months after final resolution of Applicant/Developer's application for the Project, neither Applicant/Developer, nor any of its representatives, agents or other persons acting in concert with Applicant/Developer, shall enter into any financial relationship with any consultants, or with any City official, agent or employee. Nor, during such period, shall Applicant/Developer propose to enter into any future relationship with the consultants, or with any City official, agent or employee. iii. It has not entered into any arrangement to pay financial consideration to, and has not made any payment to, any City official, agent or employee that would create a legally cognizable conflict of interest as defined in the Political Reform Act (California Government Code §§ 87100 et seq.). C. Communications with Consultants. Applicant/Developer may only communicate with consultants retained hereunder with the permission of the City's Director of Planning and Building Safety. In no case may Applicant/Developer direct consultant as to how to undertake or prepare consultant's work product. 8, tom liance with Law. Applicant/Developer will, at its sole cost and expense, comply with all of the requirements of all federal, state, and local authorities now in force, or which may hereafter be in force, pertaining to this Agreement. 9, "waiver of Breach. Any express or implied waiver of a breach of any term of this Agreement will not constitute a waiver of any further breach of the same or other term of this Agreement. 10. Insolvency; Receiver. Either the appointment of a receiver to take possession of all or substantially all of the assets of Applicant/Developer, or a general assignment by Applicant/Developer for the benefit of creditors, or any action taken or offered by Applicant/Developer under any insolvency or bankruptcy action, will constitute a breach of this Agreement by Applicant/Developer, and in such event this Agreement will automatically cease and terminate if Applicant/Developer or its successor or assign cease or fails to timely pay any amount due and payable by Applicant/Developer (or its successor or assign) under this Agreement. Notices. Except as otherwise expressly provided by law, all notices or other communications required or permitted by this Agreement or by law to be served on or given to either party to this Agreement by the other party will be in writing and will be deemed served when personally delivered to the party to whom they are directed, or in lieu of the personal service, upon deposit in the United States Mail, certified or registered mail, return receipt requested, postage prepaid, addressed to: 11 4 Agreement No. 6017 Applicant/ Developer at: 1960 Grand Office Owner 2, L.P,. c/o Starwood Capital Group 100 Pine Street, Suite 3000 San Francisco, California 94111 Attention: Andrew Wong with a copy to: 1960 Grand Office Owner 2, L.P. c/o Starwood Capital Group 591 West Putnam Avenue Greenwich, Connecticut 06830 Attention: General Counsel and 1960 Grand Office Owner 2, L.P. c/o Artisan Realty Advisors LLC 3000 Olympic Boulevard, Suite 1255 Santa Monica, California 90404 Attention: Mark Laderman & Collin Komae and Allen Matkins Leck Gamble Mallory & Natsis LLP 1901 Avenue of the Stars, Suite 1800 Los Angeles, California 90067 Attention: John M. Tipton, Esq. City at: City of El Segundo Attn: Sam Lee, Director of Development Services 350 Main Street El Segundo, CA 90245 310-524-2393 Either party may change its address for the purpose of this Section by giving written notice of the change to the other party. 11. Acce tance of Electronic Signatures, The Parties agree that agreements ancillary to this Agreement and related documents to be entered into in connection with this Agreement will be considered signed when the signature of a party is delivered by electronic mail in "portable document format" (i.e., .pdD form, or by facsimile transmission. Such signature will be deemed to be and treated in all respects as an original signature. 12. Governing Law. This Agreement is made in and will be construed in accordance with the laws of the State of California, and exclusive venue for any action involving this Agreement will be in Los Angeles County. Agreement No. 6017 13. Partial Invalidly. Should any provision of this Agreement be held by a court of competent jurisdiction to be either invalid or unenforceable, the remaining provisions of this Agreement will remain in effect, unimpaired by the holding. 14. Integration. This instrument and its attachments constitute the sole agreement between City and Applicant/Developer respecting the matters above and correctly sets forth the obligations of City and Applicant/Developer. 15, Construction. The language of each part of this Agreement will be construed simply and according to its fair meaning, and this Agreement will never be construed either for or against either party. 16. Authority/Modification. The Parties represent and warrant that all necessary action has been taken by the Parties to authorize the undersigned to execute this Agreement and to engage in the actions described herein. This Agreement may be modified by written amendment. The City's manager, or designee, may execute any such amendment on behalf of City. 17. Counterparts. This Agreement may be executed in any number of counterparts, each of which will be an original, but all of which together will constitute one instrument executed on the same date. [Signatures on following page] 91 Agreement No. 6017 IN WITNESS WHEREOF the parties hereto have executed this Agreement the day and year first hereinabove written. CITY OF EL SEGUNDO, A rnunliaal corporation. 40Xcif S ott Mitnick, City Manager ATTEST: Tracy Weaver, City Clerk APPROVED AS TO FORM: V A � L<�� Q1 Mark D. Hensley, 00kitorney 7 1960 GRAND OFFICE OWNER 2, LP A Delaware prnited Partnership -51 : Authorized Signatory