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HomeMy WebLinkAbout12 - Alternatives for City Hall Relocation During Construction of New City HallCITY OF NEWPORT BEACH CITY COUNCIL STAFF REPORT Agenda Item No. 12 June 14, 2005 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Office of the City Manager Homer L. Bludau, City Manager, 949 - 644 -3000 hbludau @city.newport- beach.ca.us SUBJECT: RETAIN THE FIRM OF CB RICHARD ELLIS, INC. OF NEWPORT BEACH TO PROVIDE LEASE LOCATION ALTERNATIVES FOR THE RELOCATION OF CITY HALL DURING THE POTENTIAL CONSTRUCTION OF A NEW CITY HALL ISSUE: Does the City Council approve the City Manager's recommendation to retain the exclusive services of CB Richard Ellis, at no cost to the City, to locate and evaluate lease alternatives for the potential relocation of City Hall, if required by a construction project on the existing site? RECOMMENDATION: Approve the letter agreement to retain the relocation services of CB Richard Ellis, Inc. and authorize the City Manager to sign the agreement. DISCUSSION: Background: At its May 10th meeting, the City Council made the decision to focus on the City Hall complex option of constructing a new city hall, building a 3 -story parking structure and replacing the existing fire station. That decision means Griffin Structures will prepare schematic drawings and determine a final cost estimate for the 3- building project; it will bring that cost estimate and renderings to the City Council this Fall for the decision of whether to proceed with the project. Components of that decision will include the financing methodology recommended by staff and a relocation plan for the operation of the city hall functions during the demolition and construction process. Retain the Firm of CB Richard Ellis, Inc. of Newport Beach June 14, 2005 Page 2 The City Manager will be responsible for developing the financing and relocation recommendations that will be presented to the City Council. One relocation option the City Manager wants to evaluate is the leasing of property elsewhere in the City to conduct the city hall functions while the current site is undergoing construction. The City Manger believes the best way to weigh the merits of leasing property is to hire a firm that specializes in the leasing of commercial property and put them to work finding potential sites that can be evaluated for usefulness, timeliness and affordability. The City Manager has met with Dean Chandler (Sr. VP of Brokerage Services) and Jeff Morgan (First VP of Brokerage Services) of CB Richard Ellis, Inc., of Newport Beach to determine this firm's interest in providing these services. Both Mr. Chandler and Mr. Morgan have agreed to provide these services at no cost to the City, as the property owner would pay all fees earned by the CB Richard Ellis company if a lease was entered into by the City. Since the City is not obligated to pay any fees, this agreement for services is prepared as a simple letter agreement. The relocation of the fire station would not be a part of the services being provided under this agreement. Should the City Manager believe a suitable temporary location has been found under this agreement, the City Council would need to approve that lease agreement. Submitted by: cr/ omer L. Blud City Manager CITY OF NEWPORT BEACH June 14, 2005 Dean Chandler Jeff Morgan CB Richard Ellis, Inc. 3501 Jamboree Road, Suite 100 Newport Beach, CA 92660 Gentlemen: This is to acknowledge that the City of Newport Beach has retained your firm CB Richard Ellis, Inc. as exclusive agent to represent the city's interest in evaluating lease alternatives in the Newport Beach area, for available property to accommodate temporary office needs for city hall operations while the current facilities undergo reconstruction. We have requested that you search for and evaluate existing buildings in the City of Newport Beach where appropriate space may be available. In addition to your normal services, you will provide us with the following: Market knowledge research •:• Availabilities Physical economic analysis Negotiations Financial analysis You are authorized, on our behalf, to meet with owners, developers, brokers and interested parties to explore real estate situations sufficient to accommodate our needs. We request that all such meetings be held in a confidential manner. It is to be understood and agreed, that CB Richard Ellis' negotiations and representation of our interest are subject to in all cases, to the approval of proposals, leases and related documents by our appropriate city staff and city council. It is also understood and agreed that the City will incur no fees for the services provided. Any commissions and fees, to which CB Richard Ellis may be entitled, shall be the sole responsibility of the owners and /or developers. This agreement shall be in effect until June 30, 2006, unless terminated by either party upon thirty (30) day written notice. Sincerely, Homer L. Bludau City Manager City Hall • 3300 Newport Boulevard • Post Office Box 1768 Newport Beach Califomia 92658 -8915 • www.city.newport- beach.ca.us