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HomeMy WebLinkAbout04_Annual Review of the North Newport Center DA_PA2009-023CITY OF NEWPORT BEACH ZONING ADMINISTRATOR STAFF REPORT September 30, 2021 Agenda Item No. 4 SUBJECT: Annual Review of the North Newport Center Development Agreement (PA2009-023) ▪Development Agreement No. DA2007-002 SITE LOCATION: Fashion Island; Block 100, Block 400, Block 500, Block 600, and Block 800 of Newport Center Drive; and San Joaquin Plaza APPLICANT/OWNER: Irvine Company PLANNER: Joselyn Perez, Assistant Planner 949-644-3312, jperez@newportbeachca.gov LAND USE AND ZONING •General Plan: Regional Commercial (CR), Regional Commercial Office (CO-R), Medical Commercial Office (CO-M), Multiple Unit Residential (RM), and Mixed-Use Horizontal (MU-H3) •Zoning District: North Newport Center Planned Community (PC-56) PROJECT SUMMARY An annual review of the Zoning Implementation and Public Benefit Agreement for North Newport Center, pursuant to Newport Beach Municipal Code (NBMC) Section 15.45.080 (Periodic Review) and Section 65865.1 of the California Government Code. RECOMMENDATION 1)Conduct a public hearing; 2)Find the review exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15321 (Class 21 – Enforcement Actions by Regulatory Agencies) of the CEQA Guidelines, California Code of Regulations, Title 14, Division 6, Chapter 3, because it has no potential to have a significant effect on the environment; 3)Find that the applicant has demonstrated good faith compliance with the terms of the Zoning Implementation and Public Benefit Agreement; and 4)Receive and file the North Newport Center Zoning Implementation and Public Benefit Agreement Annual Report Year 2020 (Attachment No. ZA 2). 1 Annual Review of the North Newport Center Development Agreement (PA2009-023) Zoning Administrator, September 30, 2021 Page 2 Tmplt: 07/25/19 DISCUSSION NBMC Section 15.45.080 (Periodic Review) requires the City to periodically review development agreements to determine if the applicant has complied with the terms of the agreement. This review should be conducted at least once every 12 months. The applicant is required to demonstrate good faith compliance with the terms of the agreement, and should the Zoning Administrator believe the applicant has not complied in good faith with the agreement, the Zoning Administrator should refer the matter to the City Council. Background On December 18, 2007, the City Council adopted Ordinance No. 2007-21 approving Development Agreement No. DA2007-002 (“DA”) between the City and Irvine Company. The DA granted Irvine Company entitlement and transfer rights within the North Newport Center Planned Community (NNCPC). At the time the DA was approved, NNCPC consisted of Fashion Island, Block 600, portions of Block 500 and San Joaquin Plaza. Since then, portions of Block 100, Block 400, and the entirety of Block 800 have been incorporated into the NNCPC. On June 6, 2012, the City Council approved an amendment to the DA, which incorporated these additional remaining sub-areas into the NNCPC. On November 10, 2015, the North Newport Center Planned Community was expanded to include two existing buildings within the 500 block of Newport Center Drive; however, the DA was not amended to include the expanded area. The DA specifies the permitted uses, density and intensity of development through the application of the NNCPC text, circulation improvements, public benefits, and dedication of street rights-of-way and open space. The DA vests Irvine Company’s right to develop regional commercial, office, mixed-use, and residential uses in North Newport Center as depicted in Table 1. The term of the DA is 25 years, and it expires in 2032. The DA is available online at http://www.newportbeachca.gov/developmentagreements. The last annual review, conducted on May 14, 2020, covered activities occurring in 2019, and the Zoning Administrator found Irvine Company to be in good faith compliance with the agreement. This review is for activities occurring during the 2020 calendar year. 2020 Development Activity Table 1 summarizes the entitlement and building activity for the NNCPC that occurred in 2020. Several projects are under construction within the NNCPC, but only completed activities with certificates of occupancy are included in Table 1. In total, 36 building permits for tenant improvements or landlord work were issued in 2020. Nineteen building permits originally issued in 2019 were finalized in 2020. None of the building permits issued or finalized in 2020 resulted in changes to gross floor area. 2 Annual Review of the North Newport Center Development Agreement (PA2009-023) Zoning Administrator, September 30, 2021 Page 3 Tmplt: 07/25/19 Development Discrepancies On June 22, 2021, CAA Planning sent a letter to City staff on behalf of the Irvine Company (Attachment No. ZA 2) requesting to reconcile differences in reported building area and gross floor area (GFA), as defined in the NNCPC development plan. The request included the following properties: 450 Newport Center Drive (NCD), Block 800 NCD, 101 NCD (Macy’s), 601 NCD (Neiman Marcus), and 701 NCD (Bloomingdale’s). Research by CAA Planning suggested certain building areas that do not meet the definition of GFA were mistakenly included in the reported building area totals for the specified buildings. The areas in question include mechanical penthouses, repeating stairways, repeating elevators, and unenclosed covered areas. City staff reviewed each building in detail and agreed with CAA Planning’s research on all requests with exception of Block 800 NCD (Attachment No. ZA 3). The reported floor area totals are reflected in the table below and in Attachment No. ZA 4. 2020 Development Activity Summary Sub-Area Entitlement Existing Development (as of 12/31/2020) Remaining Entitlement (as of 12/31/2020) Fashion Island 1,523,416 sq. ft. of regional commercial 1,470,097 sq. ft.1 53,319 sq. ft. 680 theater seats 450 theater seats 230 theater seats Block 100 121,114 sq. ft. of office/commercial 121,114 sq. ft. 0 sq. ft. Block 400 91,727 sq. ft. of office/commercial 88,173 sq. ft.2 3,554 sq. ft. Block 500 623,525 sq. ft. of mixed use 622,622 sq. ft. 903 sq. ft. Block 600 1,310,899 sq. ft. of office only 1,310,899 sq. ft. 0 sq. ft. 295 hotel rooms 295 hotel rooms 0 hotel rooms Block 800 286,166 sq. ft. of office/commercial 286,166 sq. ft. 0 sq. ft. 245 residential units 245 residential units 0 residential units San Joaquin Plaza 95,550 sq. ft. of office/commercial 95,550 sq. ft. 0 sq. ft. 524 residential units 524 residential units 0 residential units 1 29,523 sq. ft. removed from Macy’s, 4,669 sq. ft. removed from Neiman Marcus, and 14,934 sq. ft. removed from Bloomingdale’s for a total of 49,126 square feet removed from the existing development total as it did not meet the definition of gross floor area (GFA). 2 3,554 square feet removed from the existing development total as it did not meet the definition of GFA. 3 Annual Review of the North Newport Center Development Agreement (PA2009-023) Zoning Administrator, September 30, 2021 Page 4 Tmplt: 07/25/19 Future Activities Any remaining terms and conditions shall be completed pursuant to the timing or milestone requirements depicted in the Annual Report. After reviewing the Annual Report and applicable documents, staff believes that Irvine Company has complied in good faith with terms and conditions of the DA. ENVIRONMENTAL REVIEW This project is exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15321 (Class 21 – Enforcement Actions by Regulatory Agencies) of the CEQA Guidelines, California Code of Regulations, Title 14, Division 6, Chapter 3, because it has no potential to have a significant effect on the environment. This section exempts actions by regulatory agencies to enforce or revoke a lease, permit, license, certificate, or other entitlement for use issued, adopted, or prescribed by the regulatory agency or enforcement of a law, general rule, standard, or objective, administered or adopted by the regulatory agency. PUBLIC NOTICE Notice of this review was published in the Daily Pilot, mailed to all owners of property within 300 feet of the boundaries of the site (excluding intervening rights-of-way and waterways), including the applicant, and posted on the subject property at least 10 days before the scheduled hearing, consistent with the provisions of the Municipal Code. Additionally, the item appeared on the agenda for this meeting, which was posted at City Hall and on the City website. APPEAL PERIOD An appeal or call for review may be filed with the City Clerk within 14 days following the date of action. For additional information on filing an appeal, contact the Planning Division at 949- 644-3200. Prepared by: BMZ/jp 4 Annual Review of the North Newport Center Development Agreement (PA2009-023) Zoning Administrator, September 30, 2021 Page 5 Tmplt: 07/25/19 Attachments: ZA 1 Vicinity Map ZA 2 North Newport Center Planned Community Development Plan, Annual Monitoring Report – Square Footage Reconciliation Request Letter ZA 3 City Response Letter Dated August 27, 2021 ZA 4 Annual Report (January 2020 – December 2020) 5 Attachment No. ZA 1 Vicinity Map 6 MACARTHURBLVDDRIVE SAL T A I R C I RSURFLINEDRIVE SA ND POINT WAYCROWN WINDO V E R STARBOARDWA YPORTSIDEWAY WAVECREST (PVT)DRIVE BL UE DRIVE HA R B O R PO I N T E ISLA N D VI E W HILLS SAN JOAQUIN SALT AI R DRIVEHARBO RPOI N T E (PV T ) SAN MIGUEL DRIVE LIGHTHOUSE LAN E PACIFIC HARBOR WOODS PL CR EST CROWN DRIVEMARITIMEDR (PVT)JASMINE CREEK DR (PVT)JETTYAVENUEDRIVE AVOCADO(PVT)RUESAINTCLOUDCANY O N C T (PVT) RUEMARSEILLE(PVT) CANYON FAIRWAY (PVT)BIGCANYONDR(PVT)HILL S SAN JOAQ U I N DRIVE(PVT) SEA RIDGE DRIV E(PVT)OCEANVISTAHIGHBLUFFDRIVE WAY NEWPOR TER(PVT) (PVT)JAMBOREE (PVT) SEA VISTA DR (PVT) DRIVE SP RIN G TIDE DRIVE ROADSANTA BARBARADR (PV T ) BAY HILL DRI VE (PVT) (PVT) (PVT) JAMBOREECANYONCAN NES (PV T )SAN J O A Q U I N H I L L S R O A D RUE VALBONNERUECHATEAUROYALRU E M O N TR E U X RUECHAM O N I X BURNING TREE CIR (PVT) (PVT)RU EGRAND DU C A L (PVT)RUEFO N T A I N E B L E A U(PVT) (PVT) (PVT) (PVT) RUESAINT CLOUD(PVT)RUECHANTILLY(PVT) (PVT ) FONTAINEBLEAU RUE (PVT)ROADBIGDRIVE BU RN ING TREE ROADDEERWOODLANE(PVT) PEBBLE ROAD DRIVE ATOLLDRIVEDRVIEW DRIVEDR (PVT) SEAFA R I N G D R TIDEPOOLGOLDENRODAVE DRIVESETTI N G SU N SANDPIPEREBBTID E HARB O R (PVT)BEAC HCO MBER DR(PVT) BEACHCOMBERDR (PVT)JASMINE(PVT)CREEKDR(PVT) (PVT)SKYSAIL(PVT)BARRIER R EEF D R SKYSAILCURL (PVT)(PVT)DRIVE DRIVE DRIVE (PVT) SANDBAR (PVT)CREE KWHITECAPDR BREAKWA TERDRIVEJASMINE WATER DRIVE LIG HT H OU SE LA NE DRIVE NORTH(PVT)AVEN UEWAY ROAD GOLDENRO D (PVT) AVEN UEAVOCADOHIGHWAY THI R D AVEN UEAN GELI 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OWPLSEA LNS E A LN SA B R I N A T E RSABRINATER KEWAMEEDRBAYADERETEROCEANVISTABACKBAYDRTAH U N A T E R 0 500 1,000FeetIPA2009-023DA2007-002 - North Newport CenterDevelopment Agreement Annual ReviewMailing Radius Map Date: 05/12/2015Document Name: PA2009-023_North_Newport_PC PA2009-023 7 Attachment No. ZA 2 North Newport Center Planned Community Development Plan, Annual Monitoring Report – Square Footage Reconciliation Request Letter 8 30900 Rancho Viejo Road, Suite 285 San Juan Capistrano, CA 92675 (949) 581-2888 Fax (949) 581-3599 June 22, 2021 Mr. Jim Campbell Deputy Community Development Director City of Newport Beach 100 Civic Center Drive Newport Beach, CA 92660 Subject: North Newport Center Planned Community Development Plan, Annual Monitoring Report – Additional Building Permit Research Dear Mr. Campbell: On behalf of Irvine Company, CAA Planning, Inc. (CAA) has prepared an annual monitoring report (AMR) in compliance with the North Newport Center Planned Community Development Plan (PC). The 2020 AMR was submitted in January 2021, for the 2020 annual review in compliance with the requirements of the PC. CAA has prepared these AMRs annually following approval of the PC in 2007. The AMR is the method for tracking ongoing development within the PC boundary and for reporting on ongoing obligations, fee payments, etc. as required by the development agreement. Following submittal of the 2020 AMR, CAA conducted research on the existing gross floor area (GFA) for certain large buildings within Fashion Island, Block 400, and Block 800. This ongoing research has identified discrepancies between the GFA identified on the City’s building inventory for Newport Center, and that identified on City-approved building plans and building permits. Generally, it appears that area that is not considered GFA, such as mechanical penthouses, loading docks, and unenclosed covered areas, has in fact been counted as GFA. Similar square footage reconciliations were conducted in association with the 2012 and 2015 AMRs (included as Attachment 1). Consistent with these prior AMR reconciliations, CAA requests that the City conduct an additional review of building intensity within Fashion Island, Block 400, and Block 800. Historically, the City’s building permit and plan records were on microfiche and the review of them on the microfiche reader was cumbersome and tedious. However, the City’s plan records have now been digitized and the ability to review the plans is much easier and less time consuming, which is why we have continued to review historic plans and update our records. This year, we conducted a preliminary review of Fashion Island, Block 400, and Block 800. In Fashion Island, we reviewed only three large anchor buildings including Bloomingdale’s, Niemann Marcus, and Macy’s. For these three buildings, we found that the GFA is less than the numbers assigned to them in the City’s Newport Center building intensity worksheet. The following table summarizes the difference between the City’s summary and the as-built GFA. 9 Mr. Jim Campbell June 22, 2021 Page 2 of 3 Store City Summary Table (square feet) As-Built Plan (square feet) Difference (square feet) Bloomingdale’s 1 187,534 172,600 14,934 Nieman Marcus 158,929 154,260 4,669 Macy’s 234,314 204,791 29,523 TOTAL 49,126 1 Bloomingdale’s total does not include the loading dock area identified in Attachment 2. This area will be determined by field measurement. A detailed breakdown of these buildings is included as Attachment 2, Fashion Island Reconciliation. The difference between the City’s summary and the as-built plans is generally attributable to including areas that are not considered GFA, such as a basement loading dock and large unenclosed overhangs. There also appears to be discrepancies in how building additions were tracked over time, resulting in an overstatement of the actual GFA. Based on review of these buildings, there is 49,126 square feet currently identified as GFA that does not meet the definition of GFA. During our review of the Block 400 sub-area, we found the GFA identified in the PC for 450 Newport Center Drive is 91,727 square feet (page 12). This includes 3,554 square feet of mechanical penthouse located on the roof, as shown on the construction drawing for 450 Newport Center Drive, included as Attachment 3. We note that according to the PC text, “Mechanical spaces on roofs, which are inaccessible to tenants, are not counted as square footage” (page 13); and therefore, it is appropriate to remove the 3,554 square feet of mechanical area from the total GFA for 450 Newport Center Drive. Similarly, for the Block 800 sub-area, the same issue was identified related to mechanical penthouses. The as-built GFA shown on the construction drawing for 800 and 840 Newport Center Drive includes the mechanical rooms on the roofs, which are approximately 7,270 square feet. Pages from these drawings are included as Attachment 4. Because the PC specifically excludes mechanical spaces on roofs, these areas should not be included in the square footage calculation for Block 800. However, only 4,174 square feet of the 7,270 square feet of GFA is eligible to be recovered because a restaurant building located 880 Newport Center Drive, and which was included in the construction of 800 and 840 Newport Center Drive was overbuilt by 3,096 square feet as shown on Attachment 5. That restaurant has now been replaced by an office use. The following table summarizes our findings regarding the commercial sub-areas of Block 400 and Block 800. Commercial Office City Summary Table (square feet) As-Built Plan (square feet) Difference (square feet) 450 Newport Center 91,727 88,173 3,554 800, 840, and 880 Newport Center 286,166 281,992 4,174 TOTAL 7,728 10 Mr. Jim Campbell June 22, 2021 Page 3 of 3 Based on review of these buildings, there is 7,728 square feet currently identified as GFA within Blocks 400 and 800 that does not meet the definition of GFA. Together with Fashion Island, there is 56,854 square feet that should not be counted as development intensity within the PC boundary. The 2020 AMR has been updated for your review, to reflect this reconciliation. The updated AMR is provided as Attachment 6. We appreciate your review of our preliminary findings and look forward to reconciling our 2021 research with the City’s records for the purpose of accurately tracking GFA within the AMR. As detailed above, the AMR is the method by which square footage has been reconciled in the past. We look forward to the City’s review of this reconciliation effort. Please do not hesitate to contact me with any questions. Sincerely, CAA PLANNING, INC. Shawna L. Schaffner Chief Executive Officer c: Joselyn Perez, City Newport Beach Chase Gilmore, Irvine Company Attachments: 1. Pages from 2012, 2015 AMR 2. Fashion Island Reconciliation 3. Drawing for 450 Newport Center Drive 4. Drawings for 800-840 Newport Center Drive 5. Building Permits for 880 Newport Center Drive 6. 2020 AMR - Updated 11 Tmplt: 07/25/19 Attachment No. ZA 3 City Response Letter Dated August 27, 2021 12 COMMUNITY DEVELOPMENT DEPARTMENT PLANNING DIVISION 100 Civic Center Drive, Newport Beach, CA 92660 (949) 644-3200 Fax: (949) 644-3229 www.newportbeachca.gov VIA EMAIL August 27, 2021 Chase Gilmore Director, Development & Acquisitions Irvine Company Retail Properties cgilmore@irvinecompany.com Re: North Newport Center Planned Community Development Plan, Annual Monitoring Report – Square Footage Reconciliation Dear Mr. Gilmore, This letter is in response to CAA Planning’s June 22, 2021 letter sent on behalf of the Irvine Company to reconcile the differences in reported building area and gross floor area (GFA) as defined by the North Newport Center Planned Community (PC56) development plan. The request includes the following properties: 450 Newport Center Drive (NCD), Block 800 NCD, 101 NCD (Macy’s), 601 NCD (Neiman Marcus), and 701 NCD (Bloomingdale’s). Research by CAA Planning suggests certain areas within these buildings such as mechanical penthouses, repeating stairways, repeating elevators, and unenclosed covered areas have been included in reported building area totals whereas they should not be as they do not meet the definition of GFA. City staff reviewed each building in detail and the research findings are summarized below: 450 Newport Center Drive Irvine Company has requested to reduce the reported building area from 91,727 square feet to 88,173 square feet by excluding 3,554 square feet of mechanical penthouse area. The reported building area is taken from plan check number 204-74. Plan check number 204-74 provides a breakdown of square footage for each floor as well as the overall building area. A 3,554-square-foot mechanical penthouse space appears to be erroneously included in the City’s reported building area of 91,727 square feet. 13 North Newport Center Planned Community Square Footage Reconciliation August 27, 2021 Because the penthouse is for the purpose of housing mechanical equipment only, it does not count toward GFA and should be excluded. Staff agrees with CAA Planning’s finding that the GFA of 450 Newport Center Drive should be 88,173 square feet. Block 800 Newport Center Drive Irvine Company has requested to reduce the reported building area of Block 800 NCD from 286,166 square feet to 281,992 based on the assertion that mechanical penthouse space was erroneously included in the total. The 800 block of NCD consists of three buildings with the addresses 800, 840, and 880 NCD. 800 NCD and 840 NCD have been referred to as Tower 1 and Tower 2 in historic plan check documents. The original reported building area for these three buildings is 286,166 square feet and taken from the gross floor areas listed in Plan Check No. 676- 80. City staff performed an area takeoff for Tower 1 and found that the mechanical penthouse was in fact already excluded from the floor area tabulations. Staff disagrees with CAA Planning’s finding and the GFA of Block 800 Newport Center Drive remains at 286,166 square feet. Macy’s (101 Newport Center Drive) Irvine Company has requested to reduce the reported building area of Macy’s from 234,314 square feet to 204,791 square feet based on Plan Check No. 1921-2018. It is unclear where the reported building area for Macy’s originated from, as this number does not appear on City-approved plan checks. Staff reviewed historic plan checks including Plan Check Nos. 451-97, 0743-2006, 0195-2017, and 1921-2018. Staff found no significant alterations to the Macy’s floor plan to explain the discrepancy in reported building areas. Staff performed area takeoffs to exclude repeating staircases, mechanical rooms, and covered entryways, and determined it is likely these covered areas were erroneously included in the reported building area. Staff agrees with CAA Planning’s finding that the GFA of 101 Newport Center Drive should be 204,791 square feet. Neiman Marcus (601 Newport Center Drive) Irvine Company has requested to reduce the reported building area of Neiman Marcus from 158,929 square feet to 154,260 square feet based off the original 1977 building permit (B9302978) listing the original floor area as 120,000 square feet and a subsequent addition in 2001 of 34,260 square feet, totaling 154,260 square feet for the building. 14 North Newport Center Planned Community Square Footage Reconciliation August 27, 2021 The reported building area for Neiman Marcus of 158,929 square feet is taken from Plan Check No. 0065-2001. Staff performed area takeoffs of said plan check and found sufficient evidence to support CAA Planning’s request. Staff agrees with CAA Planning’s finding that the GFA of 601 Newport Center Drive should be 154,260 square feet. Bloomingdale’s (701 Newport Center Drive) Irvine Company has requested to reduce the reported building area of Bloomingdale’s from 187,534 square feet to 172,600 square feet. The record is not clear where the reported building area originated from as there are no historic plan checks utilizing this number. A tenant improvement for the building was submitted in 1996 under Plan Check No. 607- 96. This plan check provides a breakdown of floor area for each level of the building. The total floor area listed is 172,600 square feet, which supports CAA Planning’s research. Staff agrees with CAA Planning’s finding that the GFA of 701 Newport Center drive should be 172,600 square feet. Conclusion In the above cases where Staff agrees with CAA’s square footage determination, the record should be reconciled in the 2020 Annual Monitoring Report to reflect the correct square figures. This practice is consistent with cases in 2012 and 2015 that dealt with record discrepancies. For additional information on this matter, please do not hesitate to contact Joselyn Perez, Assistant Planer, at jperez@newportbeachca.gov or 949-644-3312. Sincerely, On behalf of Seimone Jurjis, PE, CBO, Community Development Director By: 15 North Newport Center Planned Community Square Footage Reconciliation August 27, 2021 Attachments: 1) CAA Planning Letter dated June 22, 2021 cc: Shawna L. Schaffner CEO of CAA Planning sschaffner@caaplanning.com 16 Tmplt: 07/25/19 Attachment No. ZA 4 Annual Report (January 2020 – December 2020) 17 January 2021 North Newport Center Zoning Implementation and Public Benefit Agreement Annual Report Year 2020 (January 2020-December 2020) Prepared for: City of Newport Beach Planning Division Contact: Jim Campbell (949) 644-3210 Submitted by: Irvine Company 550 Newport Center Drive Newport Beach, CA 92660 Contact: Jeff Davis (949) 720-2409 Prepared by: CAA Planning, Inc. 30900 Rancho Viejo Road, Suite 285 San Juan Capistrano, CA 92675 Contact: Shawna Schaffner (949) 581-2888 18 Annual Report – 2020 (January 2021) iii North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Contents Introduction ............................................................................................................................................... 1 Figure 1 – Sub-Areas in North Newport Center Planned Community ............................................. 1 Summary Table – North Newport Center as of December 31, 2019 ............................................... 2 Development Summary ............................................................................................................................. 2 Fashion Island .................................................................................................................................. 5 Block 100 .......................................................................................................................................... 5 Block 400 .......................................................................................................................................... 5 Block 500 .......................................................................................................................................... 5 Block 600 .......................................................................................................................................... 5 Block 800 .......................................................................................................................................... 5 San Joaquin Plaza ............................................................................................................................. 6 Public Benefits ........................................................................................................................................... 7 Public Benefits Table ........................................................................................................................ 7 Ongoing Obligations and Public Benefits ................................................................................................ 15 City Concurrence ..................................................................................................................................... 17 Annual Report Distribution ...................................................................................................................... 17 4.4 Circulation Enhancements to Public Right of Way – Completed 2013 .............................................. 18 4.9 B. Fashion Island Water Quality Enhancements – Fashion Island Parking Areas .............................. 19 Fashion Island Non-Development Water Quality Treatment – Completed 2014 ......................... 19 Compliance to Date, Section 4.9, Paragraph B – Development Agreement ................................. 19 19 Annual Report – 2020 (January 2021) 1 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Introduction The purpose of the 2020 Annual Report (AR) for North Newport Center is to provide an accurate record of the development that has occurred within North Newport Center during 2020. The North Newport Center Planned Community Development Plan (NNCPC) as approved in 2007 included the following sub-areas: Fashion Island, Block 500, Block 600 and San Joaquin Plaza. The NNCPC was subsequently amended in November 2009 to include portions of Blocks 100, 400, 800 and an open space parcel from the Newport Village Planned Community. The NNCPC was amended again in 2011 to expand Block 800 to include the Pacific Mutual Financial Center. Subsequently in 2012, the NNCPC was amended to increase the allowable residential development intensity by a total of 94 units and allocating the 94 units plus the 430 residential units already allocated to the MU-H3 portions of the NNCPC solely to San Joaquin Plaza. In connection with the amendment to the NNCPC, an amend- ment to the Zoning Implementation and Public Benefit Agreement DA2007-002 (Development Agreement) was approved. The Development Agreement amendment included the incorporation of portions of Blocks 100, 400, the open space parcel in Newport Village, Block 800 in its entirety, as well as the additional 94 residential units. In 2015, the NNCPC was amended for a fourth time to allow for a transfer of development intensity from outside the NNCPC, to include a portion of Block 500, and to update various regulations. This AR contains several tables that show development within North Newport Center as a whole and development by sub-area. The tables provide a comprehensive review of the development within North Newport Center in terms of existing development, maximum development (allowed by the General Plan) and development that has occurred during 2020. The tables break down each sub-area of North Newport Center individually and track the area developed by land use, as applicable. A map that depicts the sub-areas within the NNCPC covered by this AR is shown as Figure 1. Figure 1 – Sub-Areas in North Newport Center Planned Community 20 Annual Report – 2020 (January 2021) 2 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Summary Table – North Newport Center as of December 31, 2020 Sub-Area Entitlement Existing Development Development during 2020 Remaining Entitlement Fashion Island 1,523,416 1,470,097 – 53,319 680 theater seats 450 theater seats – 230 theater seats or 3,720 s.f. 1 Block 100 121,114 121,114 – 0 Block 400 91,727 88,173 – 3,554 Block 500 623,525 622,622 – 903 Block 600 1,605,899 2 1,310,899 – 0 295 hotel rooms 295 hotel rooms – 0 Block 800 286,166 245 residential units 286,166 245 residential units – 0 San Joaquin Plaza 95,550 95,550 – 0 524 residential units 524 residential units – 0 All numbers in this table are shown in square feet (s.f.) unless otherwise indicated. 1 The remaining entitlement is 230 seats, which has a gross floor area equivalent of 3,720 s.f. (16.1765 s.f./seat x 230 seats). 2 The General Plan entitlement figure includes allocations for hotel square footage, which is not represented in the Existing Development or Remaining Entitlement columns. Development Summary Annual monitoring of development is required by Development Agreement 2007-002 between the City of Newport Beach and Irvine Company as part of the North Newport Center Project which is in effect until 2032. Below is a list of permits that were issued within North Newport Center between January and December 2020. Not included in the list are accessory permits such as those for signs, cell sites, ADA upgrades, mechanical equipment or elevator repairs, or repairs and upgrades within the Villas at Fashion Island and The Colony residential developments. Note that the City bases the building permit gross floor area (g.f.a.) calculations on the Building Code definition and not the entitlement g.f.a. on the definition contained in the NNCPC, 4th Amendment, which is slightly different from the Building Code and excludes support uses (Section II.3). There were no permits issued or finalized in 2020 that resulted in changes to the gross floor area entitlement. A review the g.f.a. of some of the older buildings in Fashion Island and Block 400 identified discrepancies between the g.f.a. identified on the City’s building inventory for North Newport Center, and that identified on the City-approved building plans and building permits. The difference between the City’s building inventory for North Newport Center and the as-built plans is generally attributable to areas that are not considered g.f.a., such as mechanical penthouses and large unenclosed overhangs. However, there are also discrepancies in how building additions were tracked over time, resulting in an overstatement of the actual g.f.a. The subject buildings in Fashion Island are 101, 601, and 701 Newport Center Drive and in the subject building in Block 400 is 450 Newport Center Drive. Based on the review of these buildings, 52,680 square feet was identified as g.f.a. that does not meet the definition of g.f.a. and has been shown as recovered in the Summary Table (Page 2) and the Development Summary (Page 4). The City has conducted its own analysis and is in concurrence with these g.f.a. numbers as being recoverable. Similar square footage reconciliations were conducted in association with the 2012 and 2015 AMRs. 21 Annual Report – 2020 (January 2021) 3 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Date Sub-Area Summary of Action Feb 2019 Nov 2019 Jan 2020 Feb 2020 Jun 2020 Jun 2020 Aug 2020 Sept 2020 Sept 2020 Sept 2020 Oct 2020 Oct 2020 Dec 2020 Fashion Island (Issued) (Issued) (Final) (Issued) (Final) (Final) (Final) (Issued) (Issued) (Issued) (Issued) (Final) (Issued) 811 Newport Center Drive (X2019-0035) 957/953 Newport Center Drive (X2019-3700) 807 Newport Center Drive (X2019-2510) 957 Newport Center Drive (X2019-4026) 809 Newport Center Drive (X2019-0769) 907 Newport Center Drive (X2020-0292) 143 Newport Center Drive (X2020-0521) 579 Newport Center Drive (X2019-3235) 579 Newport Center Drive (X2019-3236) 517 Newport Center Drive (X2019-3237) 415 Newport Center Drive (X2020-2061) 1085 Newport Center Drive (X2020-1467) 1065 Newport Center Drive (X2020-0413) Jan 2020 May 2020 Jul 2020 Jul 2020 Aug 2020 Sept 2020 Block 400 (Issued) (Final) (Final) (Final) (Final) (Final) 450 Newport Center Drive (X2019-2818) 450 Newport Center Drive (X2019-1015) 450 Newport Center Drive (X2020-0496) 450 Newport Center Drive (X2020-1043) 450 Newport Center Drive X2020-0961) 450 Newport Center Drive X2020-0957) 22 Annual Report – 2020 (January 2021) 4 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Date Sub-Area Summary of Action Mar 2020 Jul 2020 Sept 2020 Oct 2020 Oct 2020 Dec 2020 Dec 2020 Block 500 (Final) (Final) (Final) (Issued) (Final) (Issued) (Issued) 520 Newport Center Drive (X2019-3427) 520 Newport Center Drive (X2020-0313) 520 Newport Center Drive (X2020-1270) 520 Newport Center Drive (X2020-1998) 520 Newport Center Drive (X2020-1332) 2071 San Joaquin Hills Road (X2020-2556) 2071 San Joaquin Hills Road (X2020-2542) Jan 2020 Jan 2020 Jan 2020 Mar 2020 Apr 2020 Apr 2020 Apr 2020 Apr 2020 Jun 2020 Jun 2020 Jun 2020 Jun 2020 Jul 2020 Jul 2020 Aug 2020 Aug 2020 Aug 2020 Aug 2020 Sept 2020 Sept 2020 Oct 2020 Oct 2020 Oct 2020 Oct 2020 Oct 2020 Nov 2020 Block 600 (Final) (Issued) (Issued) (Final) (Final) (Issued) (Final) (Issued) (Issued) (Issued) (Issued) (Issued) (Issued) (Final) (Final) (Final) (Issued) (Issued) (Issued) (Issued) (Final) (Issued) (Issued) (Issued) (Issued) (Issued) 610 Newport Center Drive (X2019-1651) 610 Newport Center Drive (X2019-3833) 660 Newport Center Drive (X2019-4140) 610 Newport Center Drive (X2019-1649) 610 Newport Center Drive (X2020-0504) 610 Newport Center Drive (X2020-0675) 610 Newport Center Drive (X2019-1547) 660 Newport Center Drive (X2019-3900) 620 Newport Center Drive (X2020-1070) 610 Newport Center Drive (X2020-0743) 610 Newport Center Drive (X2020-0382) 610 Newport Center Drive (X2020-0561) 660 Newport Center Drive (X2019-4107) 660 Newport Center Drive (X2020-0890) 610 Newport Center Drive (X2020-0573) 660 Newport Center Drive (X2020-0726) 660 Newport Center Drive (X2020-1519) 660 Newport Center Drive (X2020-1520) 610 Newport Center Drive (X2020-1838) 610 Newport Center Drive (X2020-1997) 660 Newport Center Drive (X2020-0164) 650 Newport Center Drive (X2020-1333) 650 Newport Center Drive (X2020-1334) 650 Newport Center Drive (X2020-1335) 620 Newport Center Drive (X2020-1946) 620 Newport Center Drive (X2020-0456) Aug 2020 Aug 2020 Block 800 (Final) (Final) 840 Newport Center Drive (X2020-0155) 840 Newport Center Drive (X2020-0443) Dec 2019 San Joaquin Plaza (Issued) 888 San Clemente Drive (X2019-3920) The tables below show development within North Newport Center by sub-area. All numbers are shown in gross square feet unless otherwise indicated. The tables are intended to track development annually and provide a comprehensive listing of development by land use. The “Demolished” column reflects the final square footage demolished, not the square footage stated in a demolition permit. Similarly, the “Built” column reflects the square footage provided in a Certificate of Use and Occupancy and not the square footage stated in a building permit. There were no permits issued or finalized in 2020 that resulted in changes to the gross floor area entitlement. 23 Annual Report – 2020 (January 2021) 5 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Fashion Island Entitlement January 2020 Existing Development January 2020 Recovered Demolished Permitted (Demo/New) Built Tracking Number Existing Development December 2020 Entitlement December 2020 Land Use Regional Commercial 1,523,416 1,519,223 49,126 1,470,097 1,523,416 Theater Seats 680 450 450 680 Block 100 Entitlement January 2020 Existing Development January 2020 Transferred/ Converted Demolished Permitted (Demo/New) Built Tracking Number Existing Development December 2020 Entitlement December 2020 Land Use Office/Commercial 121,114 121,114 121,114 121,114 Block 400 Entitlement January 2020 Existing Development January 2020 Recovered Demolished Permitted (Demo/New) Built Tracking Number Existing Development December 2020 Entitlement December 2020 Land Use Office/Commercial 91,727 91,727 3,554 88,173 91,727 Block 500 Entitlement January 2020 Existing Development January 2020 Transferred/ Converted Demolished Permitted (Demo/New) Built Tracking Number Existing Development December 2020 Entitlement December 2020 Land Use Mixed Use Horizontal 3 (MU-H3) 623,525 622,622 622,622 623,525 Residential Units 0 0 0 0 Block 600 Entitlement January 2020 Existing Development January 200 Transferred/ Recovered Demolished Permitted (Demo/New) Built/ C of O Tracking Number Existing Development December 2020 Entitlement December 2020 Land Use Mixed Use Horizontal 3 (MU-H3) 1,310,8993 1,310,899 1,310,899 1,310,899* Residential Units 0 0 0 0 Hotel Rooms 295 295 295 295 3 Reflects only Office Entitlement. Block 800 Entitlement January 2020 Existing Development January 2020 Transferred /Converted Demolished Permitted (Demo/New) Built Tracking Number Existing Development December 2020 Entitlement December 2020 Land Use Office/Commercial 286,166 286,166 286,166 286,166 Residential Units 245 245 245 245 24 Annual Report – 2020 (January 2021) 6 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 San Joaquin Plaza Entitlement January 2020 Existing Development January 2020 Transferred/ Converted Demolished Permitted (Demo/New) Built Tracking Number Existing Development December 2020 Entitlement December 2020 Land Use Mixed Use Horizontal 3 (MU-H3) 95,550 95,550 95,550 95,550 Residential Units 524 524 524 524 25 Annual Report – 2020 (January 2021) 7 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Public Benefits The Public Benefits Table below lists all of the public benefits resulting from Development Agreement No. DA2007-002 entitled The Zoning Implementation and Public Benefit Agreement (Agreement) between the City of Newport Beach and Irvine Company Concerning North Newport Center and the Amendment to the Agreement approved in August 2012 (herein referred to as the Development Agreement). Public benefits are listed in Section 4 of the development agreement. Items that have been completed in previous reporting years are shown as Year Complete. Items completed in the current year are shaded. Traffic fair-share fees and in-lieu park fees are the sole remaining Development Agreement obligations. Public Benefits Table Type of Fee, Contribution or Dedication Development Agreement Reference Timing/Milestone Payment/Contribution/Dedication Status In-Lieu Park Fees for Renovation of Oasis Senior Center and for Park Uses Section 4.1 Paragraphs 1-2 Regardless of whether a subdivision map is approved for any or all of the residential units, and prior to and as a condition to City’s issuance of the First Residential Building Permit (but in no event earlier than the Effective Date) Landowner shall pay to City the greater of (i) the sum of $3,733,333.33 (which is 1/3 of the total Park Fees to be paid to City under this Agreement) (the “Initial Park Fee”) or (ii) the applicable Per Unit Park Fees (if the First Residential Building Permit includes more than one hundred forty-three (143) residential units). Landowner’s payment of the Initial Park Fee shall entitle Landowner to a credit against payment of the Per Unit Park Fees for the first one hundred forty-three (143) residential units to be developed on the Property. Total payment as of December 31, 2014: $3,733,333.33 Responsible party: Irvine Company Completed Date: November 3, 2014 Section 4.1 Paragraph 2 Prior to and as a condition to City’s issuance of a building permit for development of the one hundred forty-fourth (144th) residential unit on any portion of the Property located in Newport Center Block 500, Newport Center Block 600, or San Joaquin Plaza Landowner shall pay to City the sum of $17,364.11 (the difference between the Initial Park Fee and the total Per Unit Park Fees for 144 residential units) Total payment as of December 31, 2014: $17,364.11 Responsible party: Irvine Company Completed Date: November 3, 2014 In-Lieu Park Fees for Renovation of Oasis Senior Center and for Park Uses Section 4.1 Paragraph 2 Prior to and as a condition to City’s issuance of each subsequent building permit for residential development within that portion of the Property Landowner shall pay to City the sum of $26,046.51 per unit (“Per Unit Park Fees”) * Less $5,600,000.00 paid on 3/10/09 per Section 4.1, Paragraph 4 (See Page 6 of Annual Report) Number of units as of December 31, 2014: 286 Per unit: $26,046.51 * Total payment: $1,849,302.56 Responsible party: Irvine Company Completed Date: November 3, 2014 26 Annual Report – 2020 (January 2021) 8 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Type of Fee, Contribution or Dedication Development Agreement Reference Timing/Milestone Payment/Contribution/Dedication Status In-Lieu Park Fees for Renovation of Oasis Senior Center and for Park Uses Section 4.1 Paragraph 3 If Landowner sells any residential unit developed within the Property to a third-party purchaser in other than a bulk sale of all of the units in a single residential building Landowner shall pay to City at the time of such sale of an individual residential unit the then-applicable park fee for such unit as may be in effect at that time within the City of Newport Beach, less a credit for the amount of the Per Unit Park Fee paid prior to that time. Please see Section 4.1, paragraph 3 for additional information regarding Landowner’s obligation to pay fees and memorandums to be recorded against the title of each unit. Number of units sold as of December 31, 2020: (units) 0 Park fee per unit: $ Total payment: $ 0 Responsible party: Irvine Company Completed In-Lieu Park Fees for Renovation of Oasis Senior Center and for Park Uses Section 4.1 Paragraph 4 If, on the date that City awards a contract for renovation of the Oasis Senior Center, the total sum of both the Initial Park Fee and the Per Unit Park Fees paid by Landowner to City to date is less than the sum of $5,600,000 Within five (5) days after City’s award of the contract, Landowner shall pay to City the difference (“Park Fee Advancement”). Landowner’s payment of the Park Fee Advancement shall entitle Landowner to a credit against the Initial Park Fee (if not paid by the time the Park Fee Advancement is paid) and against the next Per Unit Park Fees that otherwise would be due and payable to City until the entire credit is exhausted. After such credit is exhausted, prior to and as a condition to City’s issuance of each subsequent building permit for residential development of any portion of the Property located in Newport Center Block 500, Newport Center Block 600, or San Joaquin Plaza, Landowner shall continue to pay the Per Unit Park Fees as residential building permits are issued. Date that City awards a contract for renovation of the Oasis Senior Center 3/10/2009 Check below if answer is “yes.” The total sum of both the Initial Park Fee and the Per Unit Park Fees paid by Landowner to City is less than the sum of $5,600,000 (as of date above) If box above is checked, then Landowner shall pay to City “Park Fee Advancement” in the amount of: $5,600,000 No initial park fees paid. Lump sum payment to City: $5,600,000 Responsible party: Irvine Company Completed Date: 3/10/ 2009 In-Lieu Park Fees for Renovation of Oasis Senior Center and for Park Uses Section 4.1 Paragraph 5 Not specified City shall earmark $5,600,000 of the Park Fees to be paid by Landowner (one-half of the total Park Fees) as a matching challenge grant to apply toward contributions to the renovation of the Oasis Senior Center. Responsible party: City of Newport Beach Completed date: Early 2009 (prior to construction) In-Lieu Park Fees for Renovation of Oasis Senior Center and for Park Uses Section 4.1 Paragraph 5 Not Specified City shall apply any Park Fees not spent by City on the renovation of the Oasis Senior Center to any park use as determined by City. Landowner acknowledges that the actual amount of funds raised through the matching challenge may be less than $5,600,000 and that the amount raised shall not affect the amount of Park Fees payable by Landowner to City. Responsible party: City of Newport Beach Completed date: Early 2009 (prior to construction) 27 Annual Report – 2020 (January 2021) 9 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Type of Fee, Contribution or Dedication Development Agreement Reference Timing/Milestone Payment/Contribution/Dedication Status Public Benefit Fee Section 4.2 Paragraph 1 Not specified Landowner shall pay to City the sum of $27,090,000 as set forth in Section 4.2 (“Public Benefit Fee”), of the Development Agreement. Payment in the sum of $27,090,000 paid in full as of November 3, 2014 Responsible party: Irvine Company Completed (7/26/11 and 11/3/14 as indicated below) Section 4.2 Paragraph 1 Prior to and as a condition to the issuance of the First Building Permit – 650 Newport Center Drive Landowner shall pay to City the sum of $13,545,000, which is one-half of the Public Benefit Fee (“Initial Public Benefit Fee”). Payment: as of July 26, 2011 $13,545,000 Responsible party: Irvine Company Completed Section 4.2 Paragraph 1 Upon the issuance of building permits for the 430 residential units authorized for development within the Property. The balance of the Public Benefit Fee shall be paid to City. The amount payable by Landowner to City for each such residential unit shall be the sum of $31,500. Building permits have been issued for 430 residential units as of November 3, 2014 Total payment (balance of the Public Benefit Fee): $13,545,000 This equates to $31,500 per unit for 430 units. Total payment as of November 3, 2014 Responsible party: Irvine Company Completed Fair Share Traffic Fees Section 4.3 Paragraph 1 The Property is subject to City’s Fair Share Traffic Contribution Ordinance, which requires the payment of certain fair share traffic fees for development (“Fair Share Traffic Fees”). The City is in the process of considering updates and amendments to its Fair Share Traffic Contribution Ordinance and its Fair Share Traffic Fees and that as a result of such updates and amendments the Fair Share Traffic Fee charged by City may be increased (the “Initial Fee Increase”). Notwithstanding any other provision set forth in the Development Agreement to the contrary, Landowner agrees that Landowner and the Property shall be subject to the modified Fair Share Traffic Contribution Ordinance including the increased fees payable pursuant to the Initial Fee Increase. This applies to square footage that was newly entitled under this agreement. Please see Section 4.3 of the Development Agreement for additional detailed information pertaining to fees. Fair Share Traffic Fees paid for 2020: $ None Required Responsible party: Irvine Company 28 Annual Report – 2020 (January 2021) 10 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Type of Fee, Contribution or Dedication Development Agreement Reference Timing/Milestone Payment/Contribution/Dedication Status Circulation Enhancements to Public Right of Way Section 4.4 Paragraph 1 “Circulation Enhancement Contribution” to reimburse City for City’s expenses incurred for the design and construction of one or more of the circulation improvements listed in Section 4.4 of the Development Agreement, as determined by the City’s Director of Public Works, should City choose to approve the circulation enhancements after its environmental review and approval process and in compliance with CEQA. Please refer to Section 4.4, paragraph 1 of the Development Agreement for the list of circulation enhancements. Landowner shall contribute to City the sum of Two Million Five Hundred Thousand Dollars ($2,500,000.00) (“Circulation Enhancement Contribution”). Check below if answer is “yes.” The City choses to approve, design and construct one or more of the circulation enhancements listed in Section 4.4 of the Development Agreement Date: See note below Note: See page 18 for additional information. If box above is checked, then Landowner shall contribute up to $2,500,000.00 based on actual costs requested by the City and the amount spent by Irvine Company on those projects the City agreed could be built by Irvine Company. Responsible party: Irvine Company Completed Date: 12/31/13 Circulation Enhancements to Public Right of Way Section 4.4 Paragraph 2 Landowner shall pay the Circulation Enhancement Contribution to City from time to time after the Effective Date, within thirty (30) days after receipt of written request for reimbursement from City, with any balance to be paid to City on the date that is sixty (60) months after the Effective Date (the Effective Date is January 18, 2008) regardless of whether City has incurred the cost for the foregoing improvements. Alternatively, Landowner and City may mutually agree upon arrangements for Landowner to use the Circulation Enhancement Contribution to construct the foregoing improvements subject to City’s approval. Landowner shall pay the Circulation Enhancement Contribution to City from time to time after the Effective Date and Landowner will pay any balance to the City up to a maximum contribution of $2,500,000.00 less the cost for any improvements constructed by Landowner. Contributions shall be paid by Landowner upon receipt of invoices from the City. Indicate payment(s) below (if applicable): Amount paid by Landowner to City for Circulation Enhancement Contribution as of December 31, 2013 $1,905,803 Date that is 60 months after the Effective Date: January 18, 2013 Amount of balance paid by Landowner to City as of ___________ (date) Responsible party: Irvine Company Completed or Check this box if Landowner and City mutually agree for Landowner to use contribution to construct improvements. Date: ________________ Amount used to construct improvements as of December 31, 2013: $676,222 Responsible party: Irvine Company Completed 29 Annual Report – 2020 (January 2021) 11 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Type of Fee, Contribution or Dedication Development Agreement Reference Timing/Milestone Payment/Contribution/Dedication Status Dedication of Public Rights of Way Section 4.5 Paragraph 1 At such time as City provides legal descriptions for the public rights of way, which descriptions shall be consistent with the design of the circulation improvements for said public right of way. Landowner shall provide an offer of dedication to City for the additional public rights of way necessary for circulation improvements on the north side of San Miguel Drive between MacArthur Boulevard and Avocado Avenue and on Avocado Avenue between San Nicolas Drive and San Miguel Drive. Please see Section 4.5 of the Development Agreement for additional information. Responsible party: Irvine Company Completed No longer applicable due to dedication of Avocado parcel on October 17, 2008, as described in Section 4.6 Paragraph 1 below. Avocado parcel dedication documented in 2008 Annual Report. Dedication of Public Rights of Way Section 4.5 Paragraph 1 At such time as City provides legal descriptions for the public rights of way, which descriptions shall be consistent with the design of the circulation improvements for said public right of way. Landowner shall convey the public right of way to City (through the recordation of an offer of dedication without any restrictions or qualifications) free and clear of all recorded and unrecorded monetary liens, any delinquent property taxes or assessments, and all tenancies, lessees, occupants, licensees, and all possessory rights of any kind or nature. In addition, upon the conveyance, there shall not be any violation of any law, rule, or regulation affecting the public right of way or its use, including any environmental law or regulation, and Landowner shall be responsible for causing said condition to be satisfied. Check this box if the Landowner has recorded an offer of dedication to the City without any restrictions or qualifications. Responsible party: Irvine Company Completed No longer applicable due to dedication of Avocado parcel on October 17, 2008, as described in Section 4.6 Paragraph 1 below. Avocado parcel dedication documented in 2008 Annual Report. Open Space Dedication Section 4.6 Paragraph 1 Landowner shall dedicate to City (through the recordation of a grant deed) the open space parcel in Newport Center comprised of approximately 3.18 acres of land area, bounded on the north by the Orange County Transportation Authority site, the east by MacArthur Boulevard, the south by San Miguel Drive, and the west by Avocado Avenue (“Open Space Parcel”),within thirty (30) days after the earliest of the following: (i) City has awarded a construction contract for the construction of City Hall at any location within the City or (ii) the option to purchase the Option Site has terminated as provided in Section 4.8.1 of Development Agreement No. DA2007-002. Landowner shall convey the Open Space Parcel for open space or public facilities purposes, to City free and clear of all recorded and unrecorded monetary liens, any delinquent property taxes or assessments, and all tenancies, lessees, occupants, licensees, and all possessory rights of any kind or nature. Check below if the answer to (i) or (ii) is “yes.” (i) City has awarded a construction contract for the construction of City Hall at any location within the City Date: Not Applicable (ii) the option to purchase the Option Site has terminated as provided in Section 4.8.1 of Development Agreement No. DA2007-002. Date: May 27, 2008 Within 30 days after the earliest of one of the two events listed above, Landowner shall dedicate to City (through the recordation of a grant deed) the open space parcel in Newport Center comprised of approximately 3.18 acres of land area Check this box once the grant deed has been recorded. Date: October 17, 2008 30 Annual Report – 2020 (January 2021) 12 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Type of Fee, Contribution or Dedication Development Agreement Reference Timing/Milestone Payment/Contribution/Dedication Status Open Space Dedication Section 4.6 Paragraph 1 Not specified Landowner shall, at its sole cost and expense, cause a title company selected by City to issue to City an owner’s policy of title insurance for the Open Space Parcel with liability in an amount reasonably determined by City (but not exceeding the fair market value of the Open Space Parcel) showing fee title to the Open Space Parcel vested in City, free and clear of the liens, rights, and encumbrances referred to in Section 4.6 of Development Agreement No. DA2007-002. Check this box once Landowner, at its sole cost and expense, has caused a title company selected by City to issue to City an owner’s policy of title insurance for the Open Space Parcel Date: October 17, 2008 Responsible party: Irvine Company Retrofit Sprinkler Systems Section 4.9 Paragraph A The Newport Center Drive system retrofit shall be completed by June 2008. Landowner shall retrofit the existing sprinkler systems in the Newport Center Drive parkways and medians to low flow technology with the following specifications: (1) The control system must monitor and adjust itself not less than daily, using either evapotranspiration rates for the Corona del Mar microclimate or soil moisture levels monitored at enough locations in the irrigation area as to cover each soil and slope type in Newport Center. (2) The control system must adjust to rain conditions to limit or eliminate watering during rain events. (3) The sprinkler heads must eliminate overspray onto roads, sidewalks, and other hardscape either by using highly targeted heads that only water the plant material or by using a sprinkler-like wicking system, such as the Jardinière system (4) The performance of the sprinkler systems must be monitored on a regular basis. Landowner agrees to install flow meters to detect line and/or sprinkler head breaks when wireless flow meter technology is proven and commercially available. Check each box below upon implementation of the corresponding low flow technology listed to the left. (1) (2) (3) (4) Check this box once the Newport Center Drive system retrofit is completed. Date: November 1, 2008 Responsible party: Irvine Company 31 Annual Report – 2020 (January 2021) 13 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Type of Fee, Contribution or Dedication Development Agreement Reference Timing/Milestone Payment/Contribution/Dedication Status Retrofit Sprinkler Systems Section 4.9 Paragraph A The Fashion Island retrofit shall be completed in phases in conjunction with the water quality enhancements in Section 4.9B of the Development Agreement. Landowner shall retrofit the existing sprinkler systems in the landscape areas within Fashion Island to low flow technology with the following specifications: (1) The control system must monitor and adjust itself not less than daily, using either evapotranspiration rates for the Corona del Mar microclimate or soil moisture levels monitored at enough locations in the irrigation area as to cover each soil and slope type in Newport Center. (2) The control system must adjust to rain conditions to limit or eliminate watering during rain events. (3) The sprinkler heads must eliminate overspray onto roads, sidewalks, and other hardscape either by using highly targeted heads that only water the plant material or by using a sprinkler-like wicking system, such as the Jardinière system (4) The performance of the sprinkler systems must be monitored on a regular basis. Landowner agrees to install flow meters to detect line and/or sprinkler head breaks when wireless flow meter technology is proven and commercially available. Check each box below upon implementation of the corresponding low flow technology specification listed to the left. (1) (2) (3) (4) Check this box once the Fashion Island retrofit is completed Date: December 2009 Sprinkler retrofit is 100% complete. Responsible party: Irvine Company Fashion Island Water Quality Enhancements Section 4.9 Paragraph B Not specified Landowner commits to expend a minimum of $1 million to enhance the water quality treatment (which could include bio-filtration, media filtration or other technology) of those surface parking areas of Fashion Island which are not otherwise included within the new development or redevelopment projects. Landowner has full discretion as to the treatment methods utilized and improvement phasing, to ensure that the improvements integrate with the water quality treatment plans of the new development areas. For the year 2014, indicate the amount expended to enhance the water quality treatment of those surface parking areas in Fashion Island: For 2014 $47,300 Cumulative Total – see page 19 for additional information $1,030,674 Completed The amount spent above is as of December 31, 2014. Responsible party: Irvine Company 32 Annual Report – 2020 (January 2021) 14 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Type of Fee, Contribution or Dedication Development Agreement Reference Timing/Milestone Payment/Contribution/Dedication Status Fashion Island Water Quality Enhancements Section 4.9 Paragraph B Annually. The first report is due by January 18, 2009 (one year after the Effective Date of January 18, 2008). Landowner agrees to make annual reports to the City regarding the progress of these enhancements including the work performed and the amount expended. Check this box when the 2014 Annual Report is submitted to the City. Date: January 16, 2015 Maintenance was conducted on the water quality treatment systems. See page 19 for additional information for year 2014. Responsible party: Irvine Company Cooperation of Landowner if City Hall Constructed on Property North of Library Section 4.10 Paragraph 1 If City elects to construct a new City Hall on the property located on the east side of Avocado Avenue, north of the Central Library Landowner shall cooperate in good faith with City to implement any necessary land use regulations, including zoning amendments, and to release and terminate the use restrictions contained in the deed for the property to allow for and accommodate construction of a new City Hall on that site. Check this box if the City elects to construct a new City Hall on the site north of the Central Library. Check this box once Landowner has cooperated in good faith with the City and has released and terminated the use restrictions contained in the deed for the property. Date: May 20, 2008 Responsible party: Irvine Company Dedication of Lower Castaways Section 4.11 Paragraph 1 Upon issuance of the First Building Permit Landowner shall dedicate to City the Lower Castaways site for municipal or municipally sponsored uses allowed under the General Plan’s Recreational Marine Commercial designation, such as park, marine educational facility, marine research and conservation facility, or marine and harbor dependent service and support uses and other similar uses in furtherance of the Tidelands Trust. Check this box once the first building permit has been issued. Date: Not Applicable Check this box once the Lower Castaways site has been dedicated to the City Date: October 17, 2008 Responsible party: Irvine Company Dedication of Lower Castaways Section 4.11 Paragraph 1 Not specified The property shall have a deed restriction in favor of Landowner which shall restrict the City’s use of the property to such uses (listed in the row above), and allow the City to contract with a for profit or non-profit entity to operate certain municipal facilities or to use the property in furtherance of such uses; provided that the City may not transfer the property, by sale or long-term lease to any private, for-profit company for any commercial boat marina. Check this box once a deed restriction has been issued in favor of the Land-owner for the Lower Castaways site Date: October 17, 2008 Responsible parties: Irvine Company and the City of Newport Beach 33 Annual Report – 2020 (January 2021) 15 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Ongoing Obligations and Public Benefits The table below lists ongoing obligations from Irvine Company and additional public benefits resulting from Development Agreement No. DA2007-002 referenced above and as amended in August 2012. Ongoing obligations and public benefits listed in the table below are from various sections of the Development Agreement, not including Section 4, Public Benefits. Type of Fee, Contribution or Dedication Development Agreement Reference Timing/Milestone Payment/Contribution/Dedication Status Implement and Document Compliance with AHIP Section 3 Implementation schedule: * Certificate of use and occupancy for 100th market rate unit / one-third of required units. * Certificate of use and occupancy for 200th market rate unit / one-third of required units. * Certificate of use and occupancy for 300th market rate unit / one-third of required units. Affordable housing agreement will be executed and recorded for designated affordable units in The Bays apartment complex before the point where a certificate of use and occupancy is issued for the related market rate units. TIC must implement and document compliance with the Affordable Housing Implementation Plan (“AHIP”) as amended and adopted in August 2012. Check the appropriate box once an affordable housing agreement has been executed and recorded for each phase below. Affordable Housing Agreement Executed: August 5, 2015 Recorded: September 15, 2015 100th market rate unit Date: October 6, 2017 200th market rate unit Date: October 6, 2017 300th market rate unit Date: October 6, 2017 Responsible party: Irvine Company Pubic Benefit Fee Section 6 (Amendment) A fee shall be paid for the 431st unit and all subsequent units at the time the building permit is issued A total of $63,000.00 per unit for the additional 94 units approved in 2012 shall be paid. The total payment is $5,922,000.00 Building permit issuance for units 431 through 524. Date: November 3, 2014 Payment: $5,922,000.000 Responsible party: Irvine Company Public Benefit Fee for Parks Section 7 (Amendment) Prior to issuance of each building permit a Public Benefit Fee for parks shall be paid on or before July 1, 2013. TIC shall pay $26,046.51 per unit for each of the additional 94 residential units added to the NNCPC. Amount paid by TIC to City for Public Benefit Fee for Parks: $2,448,371.94 Date: July 1, 2013 Responsible party: Irvine Company Complete* *Amount was paid on or before July 1, 2013 but not reported in the 2013 Annual Report 34 Annual Report – 2020 (January 2021) 16 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires August 2032 Type of Fee, Contribution or Dedication Development Agreement Reference Timing/Milestone Payment/Contribution/Dedication Status Development of Option Site with 72,000 Square Feet of office use Sections 6.7 and 7.1 TPO approval and compliance with the fair share traffic fee requirements must occur before TIC can develop the Option Site. Since the City will not be developing the Option Site with 72,000 square feet: TIC must conduct a traffic analysis, provide traffic mitigation in compliance with the Traffic Phasing Ordinance (“TPO”), pay the applicable Fair Share Traffic Fees, and obtain TPO approval from the Planning Commission (appeal goes to City Council) before it can develop the Option Site with 72,000 square feet of office use. Check this box when TPO approval and compliance is attainted Date: August 7, 2008 Responsible party: Irvine Company Complete Construction of a Third Eastbound Left Turn Lane at the Intersection of MacArthur Blvd. and San Joaquin Hills Road Section 7.3 No later than the earlier of: (1) the date the City issues the certificate of occupancy for any new development under the First Building Permit (but specifically excluding the building permit for the Parking Structure), or (2) the date that is 60 months after the Effective Date. 60 months after the Effective Date is January 18, 2013 (60 months after January 18, 2008). Complete construction of a third eastbound left turn lane at the intersection of MacArthur Boulevard and San Joaquin Hills Road (within the existing right of way except for any needed dedication at the southwest corner). Check this box once lane construction is complete Date: October 2012 Responsible party: Irvine Company Reimbursement for Bayside Walkway Connection Section 8 (Amendment) Payment by Landowner to City within 90 days after receipt of written notice that contract for project construction has been awarded. No more than $200,000.00 reimbursement for actual costs for plans, specifications, permits and/or construction. Amount paid by Landowner to City: $152,257.22 Date: July 5, 2014 Responsible party: Irvine Company Complete Annual Review of Compliance with Code Sections Section 14 First annual review (including an updated tracking chart of built intensity and provision of public benefits) must take place by January 18, 2009 (one year after the Effective Date of January 18, 2008). The parties must conduct annual review of compliance with California Government Code sections 65865 and 65865.1 and City of Newport Beach Municipal Code §15.45.070. TIC must document the current status of its entitlement use (i.e., a tracking chart of built intensity) and its provision of the public benefits identified in Section 4 of the Development Agreement. Check this box once the first annual review has taken place Date: January 16, 2009 (City Council approval February 24, 2009) Responsible party: Irvine Company 35 Annual Report – 2020 (January 2021) 17 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires 2032 City Concurrence By signing below, the City acknowledges its concurrence with the information presented in the Annual Report. City Acknowledgement Signature Date Title Annual Report Distribution A complete Annual Report for North Newport Center shall be completed and distributed no later than January 18 following each prior year to the individuals listed below. City of Newport Beach 100 Civic Center Drive Post Office Box 1768 Newport Beach, California 92658-8915 Attn: City Manager City of Newport Beach 100 Civic Center Drive Post Office Box 1768 Newport Beach, California 92658-8915 Attn: City Attorney Irvine Company 550 Newport Center Drive Newport Beach, California 92660-0015 Attn: Jeff Davis Latham & Watkins LLP 600 West Broadway, Suite 1800 San Diego, California 92101-3375 Attn: Christopher W. Garrett 36 Annual Report – 2020 (January 2021) 18 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires 2032 4.4 Circulation Enhancements to Public Right of Way – Completed 2013 Section 4.4 of the North Newport Center Zoning Implementation and public Benefit Agreement requires that individual enhancement projects be established through discussion with the City of Newport Beach Director of Public Works. The table below lists the individual projects resulting from those discussions and the actual or estimated cost for individual project components as of December 31, 2013. Projects 1-4 were completed in 2012. Project 5 was completed in 2013. As shown in the table, the total Irvine Company contribution through a combination of direct construction costs and reimbursement to the city exceeded the established maximum requirement of $2,500,000. North Newport Center – Circulation Enhancements to Public Right of Way Transportation Improvements Program Completed December 31, 2013 Project Estimated Project Cost1 Potential CEC Contribution Cumulative CEC Total Potential Contribution (Maximum Contribution Limited To $2,500,000)2 Remaining CEC Commitment 1. San Miguel Widening and Intersection Improvements (MacArthur to west of Avocado) including: - Signal modifications at MacArthur and Avocado - Relocation of NW corner entry monument and pine tree replacement (Complete 2012) Contract Cost = $ 1,355,6503 CIOSA Funding = $ 450,330 Remaining Cost = $ 905,320 City Reimbursement = $ 905,320 Additional Costs = $ 42,8884 Total Contribution = $ 948,208 $948,208 $1,551,792 2. Upgrade Existing Newport Center Traffic Signals (City Project No. C3002009) including: - Interconnection of Signals - Traffic Signal @ Anacapa/Newport Center Drive (Partial) - Signal Modifications @ San Miguel/Newport Center Drive (Complete) (Complete 2012) $920,9645 $910,4836 $1,858,691 $641,309 3. Newport Center Drive Parking Revisions (Complete 2012) $90,000 $90,0007 $1,948,691 $551,309 4. Add fourth leg to Center Drive intersection with Newport Center Drive and signalize (Complete 2012) $300,0008 $354,4969 $2,303,187 $196,813 5. Operational Improvements to streets adjacent to Blocks 500 and 600 of Newport Center Drive (Santa Rosa Revisions - Built by Irvine Company) (Complete 2013) $240,828 $278,83810 $2,582,02511 -0- 1 As established in Section 4.4 of the 2011 North Newport Center Annual Report 2 Per North Newport Center, “Zoning Implementation and Public Benefit Agreement” – Section 4.4 (December 18, 2007) 3 Excluding City contributions of $125,000 (City Hall costs for Farallon City Hall site entry) 4 Direct costs to Irvine Company incurred outside of City Contract 5 Based on Contract awarded (6/14/11) including $51,000 of contingencies 6 Per Tony Brine’s September 13, 2013 e-mail 7 Per $90,000 final cost, consisting of $51,200 in contractor costs (per 9/13/13 e-mail from Tony Brine) and $38,800 spent by Irvine Company on project development and design 8 Per Irvine Company documentation 9 Per final contract costs provided by Irvine Company 10 Per Irvine Company’s final project cost for design and construction 11 The total amount paid/contribute by Irvine Company, therefore, exceeds the Maximum Contribution by $85,025. 37 Annual Report – 2020 (January 2021) 19 North Newport Center Zoning Implementation and Public Benefit Agreement – Expires 2032 4.9 B. Fashion Island Water Quality Enhancements – Fashion Island Parking Areas Fashion Island WQMP Master Plan and Treatment - A master treatment plan has been created for all parking lot surface areas in Fashion Island, taking into consideration timing of development phasing, maximizing treatment potential for non-development areas and implementing construction efficiencies for cost minimization. Technical oversight on treatment design and selection to meet State Water Quality Treatment requirements utilizing bio-retention, media filtration and other technology was provided by Stantec Civil Engineering, NMG Soil Engineering and Geosyntec Engineering, a leading bio-retention engineering company. The proposed treatment plan when fully implemented would treat 95% of the parking lot surface areas and 95% of building and hardscape areas. The treatment design will include four bio-retention systems and six media cartridge vault systems designed to treat a total tributary area of 1,687,617 square feet of surface parking area, including 1,539,099 square feet of Non-Development area. An additional 1,283,180 square feet of retail building area, including 1,096,658 square feet of Non-Development area, will be treated as a result of utilization of existing storm line systems. Nineteen percent of non-development tributary area will be treated by bio-retention systems with the remaining 81% treated by media cartridge vault. Additional water quality improvements will occur in future years. The following tables identify the Non-Development Water Quality Treatment from 2008 through December 31, 2014, and the compliance to date with Section 4.9, Paragraph B of the Development Agreement. Water quality treatment costs in 2014 include maintenance of the water quality treatment systems. Fashion Island Non-Development Water Quality Treatment – Completed 2014 Location/Name Tributary Area (sf)1 Non- Development Area (sf)2 Installation Cost Operational Cost Total Cost Total Cost 2008 Total Cost 2009 Total Cost 2010 Total Cost 2011 Total Cost 2012 Total Cost 2013 Total Cost 2014 1 Bldg. B and C 299,623 174,240 $121,709 - $121,709 - - - - $121,709 - 3 PS2 Frontage 324,251 16,273 $10,932 - $10,932 - $10,932 - - - - 3 Bldg. D 58,735 4,000 $88,748 - $88,748 - - - - $88,748 4 PS2 160,453 102,727 $99,020 - $99,020 - $99,020 - - - - 5,6 Center Drive 406,642 349,787 $217,957 - $217,957 - - - - $217,957 - 7,8 Eastside 871,133 432,234 $282,158 $250 $282,408 $112,961 $169,447 - - - - Maintenance - - - - - - - $34,000 $34,000 $47,300 $47,300 $47,300 Total $731,776 $250 $732,026 $112,961 $279,399 $34,000 $34,000 $386,966 $136,048 $47,300 1 This figure represents the total area treated and includes Development and Non-Development areas. 2 This figure represents only the Non-Development parking lot surface areas treated. Compliance to Date, Section 4.9, Paragraph B – Development Agreement Commitment Existing Enhancement 2014 Enhancement Commitment To-Date Remaining Commitment $1,000,000 $983,374 $47,300 $1,030,674 $0 38