SUBJECT: AUTHORIZATION FOR APPRAISAL CONSULTING SERVICES IN CONNECTION WITH TYCOM TRANSPACIFIC CABLE PROJECT

 

Recommendation:

That the City Council:

1. Direct staff to retain Lea Associates to provide an appraisal to determine the value for leasing City owned property for the beach landing of the TyCom project.
2. Authorize the City Manager to execute the attached appraisal agreement with fee of $9,500 and to obtain additional services if required, to evaluate the economic benefit of the proposed project cable station. Additional work on a time and material basis in an amount not to exceed $6,500.

 

Background:

The City Council previously authorized TyCom to submit an application to process a Precise Development Plan and conduct related environmental study of the proposed submarine cable landing project. On May 8, 2001 the City Council awarded contract to E & E to conduct all environmental review of the project and to prepare an environmental impact report. The project requires leasing two beach landing sites within the City which must be appraised. The project developer will reimburse the City for the cost of the appraisals.

 

Analysis:

Staff has requested a proposal from Lea Associates, a qualified property appraiser and real estate financial consultant to value the lease of City owned property for the beach landing sites. Lea Associates previously prepared the appraisal for the ground lease of city owned property to develop the 1303 Hermosa Avenue retail building adjacent the parking structure. The work includes:

• Market value appraisal of the beach landing sites at 2 ^nd Street and Longfellow Avenue.
• Preparation of summary report summarizing the details of the valuation and appraisals.
• Supporting comparative documentation and presentation of findings to City Council.

The fee for the appraisal is $9,500. An additional appraisal of the economic benefit of locating the cable switching station in the City may also be warranted and is proposed in an amount not to exceed $6,500. The proposal also provides for additional services subject to Council review and approval. The appraisal will be used in negotiating the lease terms for the project. Approval of the lease will be scheduled concurrently with the final project hearings. The project final EIR and Precise Development Plan hearings are scheduled for Planning Commission and City Council at the end of the year or early in 2002.

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