dekalb gm vote info for aug24

8/9/2019 DeKalb GM Vote Info for Aug24

1/11

Heneghan

Action

DEKALB COUNTYBOARD OF COMMISSIONERS

BUSLNESS AGENDA / MINUTESMEETING DATE: August 24,2010

ITEM NO.

ACTION TYPEResolotion1

SUBJECT: Develop~nentAgreem ent behveen DeKalb C ounty, the City of Doraville, New B roadstreet,LLC and othe r equity partners.

1 DEPARTMENT: CEO I PUBLIC NEARING: YES ElNO-

PURPOSE:To adopt a Develop~nentAgseernent behveen DeKalb County, Georgia, the City of Doraville, NewBroadstreet, LLC and other equity partners.

(To be provided)PAGES:

Thi s agreement specifies the terms and conditions of developtnent behveen DeK alb County, Georgia, theCity o f Doraville, New Broadstreet, L LC and other equity paltners.

INFORlMATION W. Bu~rell llis, Jr .CONTACT: Chief Executive OfficerPHONENUMBER: 404-371-6301

RECOMMENDATION:

Normal Coursed 7/13/10; Deferred 7/27/10

Adopt the attached Developnlent Agreement behveen DeK alb County, Georgia, the Ci ty of Doraville,New Broadstreet, LLC and equity partners, and authorize the Chief Executive Officer to execute allnecessary docu~nents.


2/11

Heneghan

REV. 10/02

Action

DEKALB COUNTYBOARD OF COMM ISSIONERS

BUSINESS AGENDA I MINUTESME ETING DATE: August 24,2010

ITEM NO.

ACTION TYPEResolution1

SUBSTITUTESUBJECT: Second Intergovernm ental Agreemnent(s) authorizing the Dev eloptnent A uthority of D eKalbc Development Bonds.DEPARTMENT: CEO PUBLIC HEARING: YES mNO

W. Burrell Ellis, Jr.(to be provided) CONTACT: Chief Executive Officer

PHONE NUMBER: 404-371-6301Nornlal Coursed 7/13/10; Deferred 7/27/10PURPOSE:To adopt Second Intergovernmental Agreement(s) antliorizing tlie Development A uthority of DeKalb County (t he"Authority") to issue Recovery Zone Econonlic Developnient Bouds in an aggregate principal amount not toexceed $36.349,000.00.N E E D ~ I M ~ A C T :The Second Intergovernmental Agreement(s) authorize the Authority to issue Re co ve ~y Zone E conomicDevelop~nentBonds in all aggregate principal amount not to exceed $36,349,000.00. The Cou nty has designatedand intends for the Authority to issue Recove~y one Ecot~otnicDevelopnient Bonds in connectio~iwith the lai dacquisition, remediation, a t~d lor nfiastntcture i~nprovem ents for the redcveloptnent of the General MotorsDoraville site as a mixed-use development; a county convention cetlter; andtor a future project to be determilied at alater date. The Second Intergove rlunental Agreem ent shall describe with specificity the financial assistance to beprovided by DeKalb County atid the City of Doraville, at~dlor ther entities, to tlie Authority. Such financialassistance provided by the County and the City of Doraville at~dtor ther entities, respectively, to tlie Authority willbe in an amount sufficietit to pay the debt service on the Recovery Zone Economic D evel op~ nen t onds.Th e County tilay designate, with the approval of the County Governing Authority, one or more additional purposesfor tvliich Recovery Zoue Econom ic Develop met~tBonds may be issued by the Authority. If so designated for suchadditional purposes, the Seco~id~ n t e r ~ o v e m n e n t a l~r ee ;n en t( s) hal l describe with specificity the financialassistatlce to be provided by DeKalb C ou t~ tyo the Authority. S t ~ c l ~inancial assistance provided by the County totlie Autl~o ritywill be in an atnount sufficient to pay the debt service on the R ec ov e~ y one Econom ic DeveloptnentBonds.REC0M MEN DATION :Adopt the attached Second htergovernmenta1 Agreetnent(s) and authorize the ChiefExecutive Officer to execute all tiecessaiy documents.


3/11

Heneghan

Page 1o f 1

Wylie, Scott. .

From : Peeper, Blake [bpeeper@n ewbroadstreet.com]Se nt : Saturday, August 21, 2010 10:14 AMTo: McBride, Nancy J.SubJect: Thank you

Dear Commissioner Boyer,Thank you again for m aking time to m eet with m e and my colleagues yesterday am idst your busy schedule. It wasmeaningful to be able to meet with you personally regarding the Doraville TOD Project.This P roject will transform an environmentally contaminated site into a nationally-recognized development that willattract emp loyers, employees, and residents. We believe that a partnership with OeKalb is critical for this Projectto reach its full potential. We are comm itted to including D eKalb in the planning and design process, as well aspartne ring with the County in future econom ic development efforts in order to attract quality jobs to this site. Thefinancial benefit to the County is projected to far exceed its investment even under the most conservativeassumptions. Furthermore, the Developer has agreed to several terms that will protec t the County's investment.Again, thank you for making time to m eet with us. Please let us know if we can answ er any questions or provideyou with any information.Thank you,BlakeBlake PeeperVice President & Investment OfficeiNEW BROAD STREET COMPANIES0: 407.515.6990C: 321.278.7198E: [email protected] NOTICE: This e-mail, and any attachments or p revious e m ai l messages attached to it, are covered by the ElectronicComm unications Privacy Act, 18 U.S.C. Sections 2510-2521, and are legally privlieged, attorney work p roduct a ndlor confldential. It Isintended only for the individual(s) named above. If you are not the intende d recipient, or a person respo nsible for d elivering it to the intendedrecipient, you are hereby notified that any disclosure, copying, dlstributlon or use of any of the info rmatio n contained in or attached to thistransmission by anyone other than the reclpient(s) named above is unauthorized and strlctiy prohibited. If you have received thistfansm ission in error, please imme diately notify the sender by reply em ai l and delete the origlnai transmissionand its attachm ents wlthoutreading or sa ving in any manner. The Sender and New Broad Street Companies and thelr affiliates, do not guarantee tile integrity of any e-malls or attached files and are not respo nsible for any changes made to them by any other person.

CONFIDENTIALITY NOTICE: Th is e- ma i l , and any attachm ents o r prev iou s e-m ai l messages atta ch ed t o i t , a r ec ov e re d b y th e E l e c t r o n i c c o mm u nic at io ns P r i v a c y ~ c t , 8 U.S.C. s e c t i o n s 2 51 0 -2 5 21 a nd a r e l e g a l l yp r i v i l e g e d , a t t o r n e y wo rk p r od u c t a nd /o r c o n f i d e n t i a l . I t s i n t e n d e d o n1y f o r t h e ' i n d i v i d ua l ( s) named above .1f y ou a r e n o t th e ~ n t e n d e d e c i p i e n t , o r a pe rs o n r e s p o n si b le f o r d e l i v e r i n g i t t o t h e i n te n d ed r e c i p i e n t ,y ou a r e he re b y n o t i f i e d t h a t a ny d i s c lo s u r e , c op i n g , d i s t r i b u t i o n o r us e o f an y o f t h e i n f o r m a t i o n c o nt a in e dI n o r a t t a c h e d t o t h i s t r a n s m i s s i o n b y a ny on e o t x e r t h a n t h e r e c i p i e n t c s ) named a bo ve i s u n a u t h o r i z e d a nds t r i c t l y p ro h ib i t ed . 1f y ou h av e r e ce i v e d t h i s t r a ns m i s s io n i n e r r o r , p l ea s e i m m e d i a te l y n o t i f y t h e s en de r b yr e p l y e - m a i l a nd d e l e t e t h e o r i g i n a l t r a n s m i s s i o n a nd i t s a t ta c h m en t s w i t h o u t r e a d i n g o r s a v i ng i n an y ma nn er .The sende r and New Broad s t re e t compan ies and t h e i r a f f i l i a te s , do no t u a ra n te e t h e i n t e g r i t y o f a ny e - m a il so r a t t ach ed f i l e s and a re no t res pon s ib le f o r any changes made t o t hem %y any o th e r pe rson .


4/11

Heneghan

Preliminary Jobs Estima te forG M Site RcDeveloprnentNot bosedon IMPLAN

Land Use Square Feet Constr CostISF Direct CostsRotlil 1.120.000 $175 $196.000.000~~~. . . .Residential 1,800,000 $175 $315,000,000Oflice 2,280,000 $175 $399,000,000Hotel 400,000 $25 0 $100,000,000Total 5,600,000 $1,010,000,000

~onstructi on OneTime Impact 1Indirect& Induced Direct Em~io vmen t Indirect& Induced Indirect

Direct Cost Multiplie r indirect & Induced Total impact Multi plier Direct Employment Multi plier Employment Total EmploymentRetail 196,000,000 0.813532 159,452,199 355,452,199 0.0000109 2,137 0.0000 072 1,418 3,555Residential 315,000,000 0.7170 84 225,881,464 540,881,464 0.0000 089 2,815 0.0000065 2,050 4,855Oflice 399.000.000 0.789230 314.902.600 713,902,600 0.0000 104 4,137 0.00 000 71 2,818 6,956HotelTotal

1Annual Direct Indirect& Induced Direct Employment Indirect& induced indirect

Spending Multiplie r Indirect& Induced Total Impact Multi plier Direct Employment Multi plier Employment Total EmploymentRetail 392,000,000 0.766659 300,530,322 692,530,322 0.0000239 9,385 0.0000067 2,640 12,024Hotel 280,000,000 0.530000 148,400,000 428,400,000 0.0000199 5,580 0.0000073 2,047 7,627Oflice* 918,720,453 1.0300 00 946,282,066 1,865,002,519 0.0000 083 7,600 0.0000085 7,798 15,398Total 1,395,212,389 2,985,932,842 22,565 12,485 35,050

*Direct Employment bused on 30 0 employees persqft


5/11

Heneghan

Executive Summary


6/11

Heneghan

- 7~h o. m $o n- ~a w so n Gal Estate ServkcTs- '-- IDevelopment Auth ority of DeKalb County -GM Plant RedevelopmentSummary of Development Terms

Historical in September o f 2008, the General Motors Plant in Doraville closed its doors,Context: leaving over 3,000 workers out o f obs. At the same time, the City of Doravillewas left w ith an environmentally contaminated site on its hands.The 165 acre site sits in the hea rt o f Doraville, ad jacent to the Town's City Halland government complex. Local city residents and the city government, a l lunderstandably vested in m aintaining Doraville's small town appeal, have allspeculated and gu&sed a t what would.become of the site.In 2008, when speculations were confirmed tha t Sembler had its eyes on the siteas a poten tial re location site fo r the Atlanta Falcons, the City Council adamantlyopposed the proposed use. The Falcons relocation-efffort failed and the futureo f the site remained unclear.What became clear, in the mean time, however, is that the state o f the economy(and real estate in particular), was experiencing unprecedented downward'momentum . Redevelopments o f large sites like this one were no longer easilyfinanced and many developers had lost their ability and/or a ppetite to take o nsuch challenging sites.The unknowab le cost to rem ediate the site only made the site appear riskier andless attractive to potential developers. Accordingly, the previous price tag on t hesite of $140MM became a number that GM knew itwou ld never receive.

Opportunity In early 2010, Orlando based developer New Broad Street entere d in to aAnalysis: contract wi th General Motors to purchase the siteNBS is a very experienced developer wi th an impressive track record of largescale mixed use redevelopments, inc luding Celebration, Baldw in Park, and th eMem phis Ballpark Neighborhood. They proposed a very attractive mixed usedevelopment plan for thissite, including up to 5.6MM square feet o f office,retail, hospitality and residential.Their approach to addressing the environm ental and economic challenges ofdeveloping the site includes:

using the long lead time required by the de molition and rem ediationwork as a buffer to allow the economy to regain its strength;negotiatinga lower price tag ($60M M) with General Motors; andusing a new financing vehicle called Recovery Zone Bonds to defra ysom eof the early costs of acquisition, demo lition and remed iation.

The Recovery Zone bonds were introd uced as part o f President ,Obama1sAmerican Recovely and Reinvestment Act (ARRA). DeKalb County was awarde dS36.4MM (con firm) of.the Economic Development variety o f the bonds, w hichwould receive a4 5% rebate from the Federal government on the interest

Page 1 f 6


7/11

Heneghan

Thornwon-Dawson R eiF Et ate Servlces .Development Author ity of DeKalb County-G M Plant Redevelopment

&. Summary of Development Termspayments. The bonds would be repa id by the County, e ffectively creating asubsidy or gra nt for NBS.In exchange for the subsidy on the development, the County has demanded thatNBS conform the development to certain standards that will justify th e publicinvestment.The County i s also in negotiations with the City of.Do raville to hatie the City sharein the financial burden of the bon d repayment, given that the de velopm ent wil ltake place with in Dorav iile city lim its and Doraville wi ll receive trem end ousbene fit from the redevelopm ent.

Overview of The development is currently proposed to become a mixed-use developme ntDevelopinent: focused on attracting corpo rate headquarters tena ntsan d bringing high payingjobs to the site. The inte ntion of this "purpose driven" d evelopn ient approach isto create an economic ripple effect throu gho ut the site tha t spreads on t oDorav ille, the en tire County and the State:

This development, w ith i ts widespread impact, w ill requ ire a coordinated effo rton the parts of the City of Doraville, DeKalb County, and the Georgia Office ofEconomic Development (among other mu lti-jurisdictional state entities) tobecome one of the to p sites tha t the state prom otes when recruitingcorpora tions to re locate to Georgia.The decisive step to allow the d evelopm ent to mo ve forward as planned is th e"Green Light" vote from County Commissioners and Issuance of the bon ds. Thlsinvolves multiple steps that are all required in order fo r the developm ent tomove forward, including:

Execution o f the Ma ster Development Agreement (MDA) wit h NBS;Execution of an lnterg ove rnm enta ~ greement (IGA) wit h D oravilleagreeing to financial p articipation; andApprop riate extensions from DCA

DevelopmentTirtzelirte:DeKalb BOC.votes to issue the bonds gu aranteed by a millage pledge,wi th th e debt service costs to be pa id from cost savings attained b y th e .County.. NBS, th e County, and the City of Doraville agree t o a "Guiding Vision" fo rthe development.NBS will subm it its Maste r Developm ent Plan and Ma ster DesignGuidelines, agreed to be approved by the C ounty and Doraville.NBS agrees no t to requ est aba tements of taxes, impact fees, etc.NBS com mits to use DeKalb's LSBE Program and its First Source Jobs

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8/11

Heneghan

T ~ O ~ ~ ! ~ O ~ - U ~ W S O A R M ~ W ~ Bervices-- IDevelopment Auth ority of DeKalb County-G M Plant Redevelopmente . Summary of Development Terms

Program.A Youth Development and Educatlon Fund (working name o r entlty) isestablished to benefit the neighborhoods of DeKalb County benefittingthe least from this development.

o The Fund wi ll be funded by fees imposed upon each trans fer ofland or vertical improvements (with the transfer fee requirementto run wi th the land and to be included as part o f the groundlease); ..25bps of transferred value up t o $ 20MM12.5bpsof transferred value above $20MMo The board of the Fund would consist of a combination of personsappointed by the governing authorities and independent. appointees.o Community organizations would submit a standardized "Requestfor Funding" form t o the YDEF outlining their proposed use ofgrant funds fro m the YDEF.Doraville up-front paymen t o f $3,500 (potentlolly high er -s til l beingnegotla ed)A Single Purpose Entity (SPE) of the Deve lopment Au tho rity w ill beformed for the purposes of buying the majority of the land from G M andground leasing It to NBSfor a "de minimus" amount. This ground leasestructure is dictated by the bond stipulations.

New Broad Street and the ~ e v e l o ~ m e n tutho rity SPE buy the land fi o mGM for $60MM.Entity Acreage CostNBS : 69 $25MM (42%)Development Authority SPE: .9 6 $35M M (58%)

165 $60MM* An interest bearing escrow account will be funded wi th $5M M t o bedrawn down in case NBS misses one o f i ts vertica l thresho lddevelopments. Assuming a 3% interest rate, the amount of the escrowaccount will be $6.3MM by the end of year 8.

The amount to be drawn down as a result of NBS missing a milestone wi llbe calculated as a percentage of the debt service for the year o f themissed milestone:

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9/11

Heneghan

~ h & p G 3 5 i G K ~ G F G t a t eervices 1Development Auth ority of DeKaib County- GM Plant Redevelopment.. Summary o f Development Terms

. Percentage ofMilestone : Debt Service:250K SF by end of year 8 25%500K SF by end of year 10 50%750K SF by end o f year 12 75%1M M SF by end of year 15 100%

NBS wiii also provide seed funding o f $150K (o f a to ta i $2 50 ~)or theYouth Developmen t and Educatlon Fund, as an aduance against futurefunding fr om transfer fees.

NBS uses additionai equity fr om it s $50M M total (including acquisition)funding commitment from Stratford Land to begin demolition o f thebuildings on the site. Dem olition wi ll be completed by the end o f Year 2.Ini tial debt service payment on the bonds (on an interest only basis)comes due at approximately $1MM per year.Doraville pays 1% (potentlally higher-st111 being negotiated) o f th e debtservice due on the bondsAt the end of Year 1,NBS depos its another S l O O K (o f a totai $250K) intothe You th Developm ent and Education Fund, as an advance againstfuture funding from trans fer fees.

NBS uses additionai equity funding fro m Stratford Land to comp lete thedemolition of the site and to perform th e environmental clean up of thesite.(This obligation w ill be backed by an $11MM bond and a $25MMEnvironm ental nsurance Policy wi th the County named as an.addlt1onolinsured,)i f NBS does not meet the Dem olition and Remediation milestones by theend o f year 3, then the Development ~ u th o ri tv PE wiii have the rinh t toterm inate the ground lease.

0 NBS begins to sub-divide he sit e- mak ing a deposit to the YDEF wit hevery transfer of the property to a separate entity.Debt service on the bonds remains interest-only.

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10/11

Heneghan

ThompJii^n-Dawson Real Estate Services .Developm ent Autho rity o f DeKalb County -GM Plant Redevelopment-.- . Summarv of Devebmment Terms

NBS uses additiona l equity funding from Stratfo rd t o insta ll the"Required Horizontal infrastructure", includ ing ut il ity trunk lines, p rimaryspine roads, mass grading and earthwork, etc...Horizontal Milestones = 50% of the Required Horizontal Infrastructurewill be Insta lled by Year 5, and 100% wi ll be ins talled by Year 8.o Prior to closing, Stratford Land wi ll have joined the execution ofthe MDA for th e purpose of guaranteeing the com pletion of theHorizontal Milestones, allowing the County to include StratfordLand in its pursuit o f financial remedies for missing horizontalmilestones.o , If NBS misses the Horizontal Milestones, the County (through theDevelopment Authority SPE) can seek to recover damages or sueStratfo rd Land for specific performance.o Additionally, th e County can terminate the ground lease andreclaim i ts land if the Required Horlzontai infrastructure is notcompleted.Bonds begin to amortize i n year 4 and debt service increases toapproximately $2MM per year.

NBS faces its firs t vertical development milestone. i f NBS has no tcompleted a t least 250K SF of development on th e site by Year 8(referenced as a "Vertical Improvement Deficiency"), then 25% of thedebt service payment for Year 8will be drawn dow n from the escrowaccount and deposited in to the Community Reinvestment Fund. Year 9works exactly the sameway.if N8S misses the milestone, then the County w il l begin to have a higherlevel of input and oversight over the developm ent of the project(referenced as a "County Input Step-Up"). If.th e milestone issubsequently reached, then the County's level of input and oversightreturns to its previous level.

Vertical milestone = 500K SF. If missed lie Vertical lm ~ro ve m en tDeficiency), then NBS pays 50% of the debt service fo; the year.0 If N8S misses the threshold, then the County has the r igh t to take o nadditional control of the development on the site (ie County input Step-

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11/11

Heneghan

Thompldii-Dawson RGiEStates e m e sDevelopment Authority of DeKalb County- G M Plant Redevelopment-.. Summary of Deveiopment Terms

up). If the threshold is subsequently reached, then the County's cont rolreturns to its prevlous level.

Vertical m ilestone = 7SOKSF. If missed (ie Vertical lmprovementDeficlency), then NBS pays 75% of the debt service fo r the year.e - If NBS misses the threshold, then the County has th e right to take onadditional control of the development on th e site (ie County lnput Step-up), if the threshold is subsequently reached, then the County's co ntro lreturns t o Its previous level.

Vertical milestone= 1MM SF. If missed (ie "Vertical lmprovementDeficiency"), then NBS pays100% of th e debt service for the year unt ilthe threshold Is met o r the escrow funds are depleted.If NBS misses the threshold, then the County has th e right to take onadditional control of th e development on the site (ie County lnput Step-up). If the threshold i s subsequently reached, then the County's co ntro lreturns to its prevlous level.*** I f at any point, NBS misses itsver tica l deve lopment milestone and there is noadditional money in the escrow, then the County has the righ t to forcest ratfordLand t o replace NBS as the developer of the site w it h a developer of the County'schoosing.The above course of action (County forcing Stratford Land to replace NBS as thedeveloper) is also wha t happens in the case that NBS goes bankrupt or breachessome other condition of Default.

dekalb gm vote info for aug24

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