Public hearing today for Rhode Island Ave. development

Mount Rainier will hold a public hearing on the three proposals for development of a part of Rhode Island Ave. today at 7 p.m. at 1 Municipal Place Mount Rainier, MD 20712.

An article in the Gazette describes the three proposals briefly. My representative in the City Council, Jimmy Tarlau, provided a detailed memo from the Council Liaisons for Development to his constituents, which I will paste below. I will try to make it look good. Please excuse any formatting issues.

The mayor and council will vote on the proposals after the hearing.

 

MEMORANDUM

TO:                 MAYOR AND COUNCIL & MOUNT RAINIER RESIDENTS

FROM:           Council Liaisons for Development –

Ivy R. Thompson, Ward 2

            Brent C. Bolin, Ward 2

DATE:                        August 7, 2012

SUBJECT:      Recommendation to Council for City Issued RFP for Development of Rhode Island Avenue and Eastern Avenue

BACKGROUND

Council Liaisons for Development      

After the 2011 elections, committee assignments were revised and Ward 2 Councilmembers Ivy Thompson and Brent Bolin were designated by colleagues to serve as the development committee of the council. Mayor Miles and Councilmember Thompson previously served as the leads for this committee.

Request for Proposals

The City Council voted to reissue the Request for Proposals (RFP) and to hire the Holman Group to facilitate the reissuance of the RFP for the development of the 3200 block of Rhode Island Avenue. The criteria for submissions and the timelines for review were established within the RFP, which required that the City respond to the developers within a 45-day timeframe.

The City of Mount Rainier received three (3) proposals in response to the RFP issued for the development of the 3200 block of Rhode Island Avenue, Mount Rainier, Maryland 20712.  All of the proposals were received (hand delivered) prior to the 4:00pm deadline on May 30, 2012.  The responders were as follows in order of receipt:

·                     STREETSENSE – BETHESDA, MARYLAND

·                     DR. JAMAL FADUL MED-PED, LLC, COLLEGE PARK, MARYLAND

·                     AHC, INC., BALTIMORE, MARYLAND

Per consultation with the city’s development consultant, Mr. Kwasi Holman, on May 31, 2012, the following schedule was proposed as a next step action schedule:

Ø    May 31, 2012 – June 13, 2012, Proposals  reviewed by council liaisons for development Brent Bolin and Ivy Thompson, City Manager Jeannelle Wallace, Assistant City Manager Michael Jackson and Development Consultant Kwasi Holman .  Interview questions submitted for developers. .  . 

Ø    June 14-15, 2012 – Council liaisons, staff and Mr. Holman met with each responder on June 14, 2012 and June 15, 2012 (2 hour interviews) allowing the responders to answer questions and clarify financing options and scheduled payments to the city.

Ø    June 18, 2012- Council liaisons, staff and Mr. Holman met to discuss Assessment based on criteria provided in RFP announcement.

Ø    June 19, 2012 – Special Executive Session of the Mayor and Council to discuss/review recommendations of the council liaisons for development. Liaisons make recommendation to council in closed executive session. Council authorizes development liaisons to conduct further conversations.

Ø    July 10, 2012 – Special Executive Session of the Mayor and Council to discuss short list recommendations of the council liaisons for development; Additional financial info requested of all three developers. Council decides to extend the deadline for the city to respond to developers concerning proposal submission to August 15, 2012.

Ø    August 8, 2012 – Public Hearing concerning proposal submissions; council liaisons make recommendation to Mayor and Council and residents for development; summary of proposals provided by council liaisons for development.

Ø    August 9, 2012 – Special Meeting of the Mayor and Council concerning the RFP submissions for Rhode Island Avenue development.

Ø    August 15, 2012 – Notify respondents of City Council decision.

This process delineated was an aggressive time frame due to the MML Conference scheduled June 24-27, 2012. The Mayor and Council added an additional 30 days, after the July 10, 2012, Executive Session Meeting, due to the complexity of the financing of the City property. (The city purchased these properties with tax-exempt municipal bonds, significantly complicating potential financing options. The city subsequently asked each developer to consider purchasing the land up front to avoid legal technicalities.)

EVALUATION:

The three proposals were reviewed by council liaisons for development Ivy R. Thompson and Brent C. Bolin, City Manager Jeannelle Wallace, Assistant City Manager Michael Jackson, and Development Consultant Kwasi Holman and scored based upon the evaluation criteria as cited in the RFP.  The proposals were evaluated using the following criteria:

v  40% Design:   Strength of the Site Plan and Design based on aesthetic appeal, perceived ability to promote additional quality development

v  40% Ability to Implement Project:    This element of consideration evaluates the developer’s ability to complete the project as promised. It includes:

o   Strength of the letter from a financial institution indicating willingness to finance project

o   Proof of equity by the developer.

o   Experience of the developer in financing, implementing and constructing projects of similar size and scope.

o   Marketing plan

v  10% Land Price

v  10% Use of Sustainable and/or Environmentally Responsible (Green) Construction Standards and Products

v  Inclusion of Minority, Women and/or Local owned Businesses will be a consideration in the evaluation process but it is not a requirement

Evaluation Criteria	Streetsense	Med-Ped	AHC
Design	Contemporary look.  Incorporates property not owned by city. No retail tenant commitments, Structured parking was a plus, though primarily dedicated to residential.	Has that medical office building look. Green elements are a plus. Major additional parking need a serious concern. Will project have spillover effects?	Design is central to their process. Strong plan to seek community input. Universal design concept. Strong LEED commitment. All parking on site, though variance needed.
Ability to Implement	Good financials, experienced team. Hyattsville retail project experience. Requested $7 million gap financing.	Strong financials, experienced team No previous projects completed.	Very strong financials, experienced team Dozens of similar projects financed and completed.
Land Price	Proposed city donate land.	Offered $500,000 up front, the rest paid over time including from proposed EDI funds.	Offered 10% of the land value up front, the rest paid over time by AHC.
Sustainability/Green	Yes at least LEED Silver	Yes, LEED Silver or Gold	Yes, LEED Gold or ideally Platinum
Inclusion	Yes	Yes	Yes

Each of the proposals referenced the Mixed Use Town Center Plan and included elements highlighting the site as a “gateway”.

RECOMMENDATION

Therefore, based upon the evaluation criteria and additional financial information obtained from each of the organizations the Development Committee recommends that the City Council vote to contract with AHC, Inc. to purchase and develop the 3200 Block of Rhode Island Avenue.

Proposal  Highlights In Order Of Receipt:

STREETSENSE – BETHESDA, MARYLAND

Proposes a 5-story mixed-use urban infill development. Ground floor retail space – proposes retail,  restaurants, small café. Above the ground level retail would be four levels of loft style residential apartments. This project incorporates the entire block in development, including properties not owned by the city and therefore outside the scope of the RFP.The proposal did not include letters of commitment from adjoining property owners.  The architecture will have a contemporary styling that is reflective of the loft industrial look. The historic gas station would be repurposed for a small neighborhood retail use.

210 Residential Units; market rate rents:

            21 efficiencies, 700 sf, $1300/month

            105 1-bedroom, 850 sf, $1513/month

            84 2-bedroom, 1000 sf, 1825/month

Parking: structured 2-3 levels, 210 spaces residential- fee based, limited retail and visitor parking

Retail: 18,225 s. f.

Open space: interior pocket park and interior courtyard, public sidewalks

Green Elements/Sustainability: green roofs, dark-sky lighting, recycled materials

Public Art: interior and exterior public art

Target market: 20’s -30’s with incomes of $50,000 - $100,000

Comments: Weak financial proposal to the city – asked for city to donate the land, includes payment to L.S. adjacent property owner, and also identified the need for $7 million of gap financing. The revised financial offer indicates Street Sense is “prepared to retire the debt in full upon closing on the property” A proposed date for closing was not given, but per the proposal the estimate for closing to occur is in 2015. The proposal contemplates developing the entire 3200 block, including land not owned by the city and therefore outside the scope of the RFP. Street Sense indicated that they have had discussions with the owner of Thrifty Truck Rental, but did not supply a letter of commitment. Proposal also contemplates purchase and demolition of owner occupied homes on Eastern Ave, again, without letters of commitment or contact with the current property owners.

DR. JAMAL FADUL, MED-PED, LLC, COLLEGE PARK, MARYLAND

Proposes a four story, steel frame, 44,000 s.f. Health Care Center, retail pharmacy and restaurant, office and a 24 hour Urgent Care facility. Each floor will be about 11,000 s.f.. The development proposal stayed within the scope of the RFP and included city owned property only. The first level will be dedicated to retail uses with the second and third floors comprising the medical center and the fourth floor dedicated to general or doctor’s offices. The Proposed Health Center:

Specialty Medical – 12,000

            General storage & technology – 1,000

Multi-purpose Office & other – 4,000

Urgent Care – 4,000 s.f.

Retail & Office – 23, 000 s.f.

Parking: 50 spaces on site, will need to work with City to address significant additional parking need

Green elements/Sustainability: LEED certified, solar generator and panels, rainwater cistern

Public Arts: incorporates artistic elements into design

Target Market: Services for patients within 1- 5(average 3) mile radius and households with incomes of $50,000 -$67,000

Comments: Offered $500,000 down payment to the city, with the rest of the land price to be repaid over time or as county funds developed. Due to the tax-exempt bond issue this proposal would not work. Med-Ped has requested the city’s help to find several hundred additional parking spaces to meet their customer volume; the city has serious doubts about its ability to find those spaces and/or prevent negative effects on residential parking on the city.

AHC, INC., BALTIMORE, MARYLAND

Proposes a four story, L-shaped building approximately 58,000 sf, residential development. The proposal is limited to the RFP City owned property. The development proposes 62 residential units that are accessible or readily adaptable. 10 units are to be fully equipped for use by the physically disables and 2 units will be equipped for sight and hearing disabled residents. Offers traditional and opens space floor plans, workforce housing:

42 1-bedroom, 672 sf, $1008/month

            20 2-bedroom, 962 sf, 1210/month

Parking provided (residential): 46 spaces, L-shaped parking loop in rear

Retail/Office: TBD – none proposed

Green Elements/Sustainability: LEED requirements, materials, construction and quality requirements, green roof

Landscaping of public spaces, incorporates green amenity roof, interior and exterior art, community spaces on each floor

Target market: workforce households with incomes $38,000-64,500 for 1-4 person households

Comments: Initial financial offer was for 10% down payment on land with the rest paid back in installments over the 15-year life of the tax credit financing arrangement. When presented with the tax-exempt bond issue and the city’s need to divest the properties, AHC worked to meet the city’s needs . AHC now proposes to pay 10% down in fall 2012 and complete purchase of the properties by March 2013 for the full value of the city’s bonds. Other concerns include making sure the marketing plan distinguishes this workforce housing from the significant number of low-income housing units already existing in Mount Rainier. AHC proposes to contain all parking on site, but will require a parking reduction departure from the county.