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File #: 2016-3267 (30 minutes)   
Type: Regular Agenda Item
Body: City Council
On agenda: 9/20/2016
Title: Recommendation to Provide Direction on the Approach to Phasing and Disposition of Development in the Main Street Neighborhood (MSN) at Alameda Point, including Review of the Draft Phasing Chapter in the MSN Specific Plan. (Base Reuse 819099)
Attachments: 1. Exhibit 1 - Alameda Point Zoning Map, 2. Exhibit 2 - Collaborating Partners Preferred Location, 3. Exhibit 3 - Draft Phasing Chapter, 4. Exhibit 4 - MSN Overlay Constraints, 5. Exhibit 5 - MSN Geotechnical Overlay Only, 6. Presentation, 7. Presentation - REVISED

Title

Recommendation to Provide Direction on the Approach to Phasing and Disposition of Development in the Main Street Neighborhood (MSN) at Alameda Point, including Review of the Draft Phasing Chapter in the MSN Specific Plan. (Base Reuse 819099)

Body

To:                     Honorable Mayor and Members of the City Council

From:                      Jill Keimach, City Manager

 

Re:                     Recommendation to Provide Direction on the Approach to Phasing and Disposition of Development in the Main Street Neighborhood at Alameda Point, including Review of the Draft Phasing Chapter in the Main Street Neighborhood Specific Plan

BACKGROUND

 

On March 3, 2015, Council approved a contract with Urban Planning Partners (UPP) to draft a Specific Plan for the Main Street Neighborhood within Alameda Point (Main Street Plan). The contract with UPP is funded, in part, by a grant in the amount of $250,000 from the Metropolitan Transportation Commission (MTC). An approved Specific Plan is required before new development can occur in the Main Street Neighborhood Sub-district per the Alameda Point Zoning Ordinance (Alameda Municipal Code 30-4.24), which was approved by City Council on February 4, 2014 (Exhibit 1).

The focus of the Main Street Plan is to determine the regulations under which future development of both the public and private areas in the Main Street Neighborhood could occur. The Main Street Plan would adopt form-based, transit supportive standards and regulations for the arrangement of public and private streets, public open space and parks, infrastructure, and associated private development consistent with the City’s existing plan and policies for Alameda Point and comparable to the already approved Waterfront and Town Center Plan. The Main Street Plan will also address how development within the Main Street Neighborhood will allow for the preservation and integration of historic structures - such as the former senior officer housing known as the “Big Whites” and help guide and facilitate the relocation and consolidation of the three existing supportive housing providers into new facilities at Alameda Point.   At the time the UPP contract was approved, the City Council provided key feedback regarding the Main Street Plan including

                     Create a phasing plan for the Main Street Neighborhood that prioritizes the near-term consolidation of the existing supportive housing providers into new state-of-the-art facilities (as described in greater detail below) and minimizes the amount of new market rate housing needed to help finance the new facility.

 

                     Evaluate an approach to phasing that preserves the existing resources and housing, including the historic “Big Whites” in the northern area of the Main Street Neighborhood for the foreseeable future.

 

                     Return to the City Council before finalizing the Main Street Plan to discuss phasing and disposition strategies for the Main Street Neighborhood, especially in light of the 1,425-unit cap on housing at Alameda Point.

As directed by the City Council, a primary objective of the Main Street Plan is to develop the planning framework and regulations necessary to cohesively redevelop and consolidate the three existing supportive housing organizations currently occupying former Navy housing in the Main Street Neighborhood (Alameda Point Collaborative, Building Futures with Women and Children, and Operation Dignity, together referred to as the Collaborating Partners) and enable their plans for a new consolidated facility to come to fruition as soon as possible.

Over the last five years, the Collaborating Partners have been working closely with City staff to prepare a plan that consolidates their existing campus of 200 units spread out on 34 acres to a smaller, more cohesive footprint with new state-of-the-art supportive housing facilities as quickly as possible.  In 2015, they partnered with MidPen Housing, a highly qualified and successful Bay Area-based nonprofit affordable housing developer, to design and build new facilities that better serve their community. Over the summer/fall of 2015, the Collaborating Partners and MidPen embarked on an intensive community outreach process with their own residents and communities to identify a location and design for their future new facilities. To compete for the Low-Income Housing Tax Credits (Tax Credits) needed to finance the new supportive housing, the site had to be within 1/2 mile from an existing public park (Bayport Park), within 3/4 miles from an existing public school (Ruby Bridge Elementary School), within 1/2 mile from an existing grocery store/pharmacy (Safeway) and a within a 1/4 mile from an AC transit bus stop. Based on the extensive outreach process, the Collaborating Partners, in collaboration with the City, selected the approximately 10-acre area bounded by Main Street to the east and W. Midway to the north primarily due to the site’s proximity to future Site A amenities and new infrastructure and other infrastructure efficiencies, as well as, its proximity to existing off-site amenities needed to be competitive for Tax Credits.  This location is also adjacent to the existing Ploughshares Nursery and associated farm, both of which will be enhanced by the new community, creating a visible urban agriculture identity on Main Street and West Midway (Exhibit 2).

In December 2015, the City Council approved entering into an Exclusive Negotiating Agreement (ENA) with the Collaborating Partners and MidPen for their preferred site to enable MidPen to apply for a loan from the Alameda County Affordable Housing Trust Fund for pre-development costs. While they were not successful in receiving the very competitive funding from the Housing Trust Fund above, MidPen has been given $150,000 in seed funding from the Successor Agency of the City of Alameda for pre-development work.  The ENA with MidPen will expire at the end of the year.  While the implementation term sheet required by the ENA will be complete by the end of the year, staff will be requesting an extension of the ENA from the City Council later this year to allow for more time for the Collaborating Partners and City staff to complete a detailed development plan based on an approved Main Street Plan.

The draft Main Street Plan (Exhibit 3) is being circulated to various groups and organizations for review, including the Collaborating Partners and their residents, Alameda Architectural Preservation Society (AAPS), Alameda Point Partners (APP), Bike/Walk Alameda, and existing residents in the Main Street market rate housing.  A public hearing before the Planning Board is scheduled for October 10, 2016 to review the draft and provide comments, and present any comments provided this evening from the City Council.  City staff will bring a final draft for approval to the Planning Board and the City Council in November and December, respectively.

As discussed with the City Council in February, one of the key aspects of facilitating new development in the Main Street Neighborhood is the phasing and disposition of development.  This staff report and presentation is in response to City Council direction from February and is intended to seek direction from the City Council on the approach to phasing and disposition of the Main Street Neighborhood before finalizing the Main Street Plan. 

DISCUSSION

While one of the key chapters of the Main Street Plan is the Phasing Chapter, the ultimate decisions regarding disposition and phasing of new development in the Main Street Neighborhood will be made by the City Council as land owner through a separate (yet linked) process from the Main Street planning process. For instance, while the Waterfront and Town Center Plan discusses phasing ideas, it is a regulatory document and does not determine how many units will be allocated to a given phase or how the exact phasing and disposition will occur within the Waterfront Town Center area.  These detailed disposition decisions were made separately by the City Council as part of a Request for Qualifications (RFQ) from developers for the Site A property. 

Similar to the Waterfront and Town Center Plan, the Phasing Chapter of the Main Street Plan intends to guide future decisions about phasing and disposition with phasing principles and high-level conceptual plans, but will not predetermine the ultimate decisions made by the City Council.  As a result, the Phasing Chapter includes key principles that will enable the vision for the development of the neighborhood to evolve in a cohesive manner consistent with the General Plan, zoning, Master Infrastructure Plan (MIP), and other Alameda Point planning documents, but does not include detailed disposition recommendations. 

The phasing principles and plan are based on three primary goals of the Main Street Plan: (1) consolidation and construction of the Collaborating Partners’ campus; (2) preservation and maintenance of the historic structures (i.e., the Big Whites); and (3) building the necessary infrastructure to support and implement the vision for the neighborhood and Alameda Point as a whole. 

The following sections provide (1) an overview of the housing cap at Alameda Point and staff, consultant’s and MidPen’s initial thoughts about the allocation of remaining units within the Main Street Neighborhood; (2) a description of the Main Street Plan’s phasing principles; and (3) a summary of the Main Street Plan’s high-level phasing plan.

Preliminary Main Street Neighborhood Housing Allocation

One overarching consideration in the disposition of land at Alameda Point is the limit on the number of residential units allowed by the City’s General Plan (1,425 units), which provides an important context for any of the City Council’s future disposition decisions regarding housing and mixed-use development at Alameda Point.  Within this context, the Collaborating Partners and MidPen have been working closely with City staff to develop a feasible financial plan for constructing their proposed future campus and its required infrastructure.  The financial plan evaluated traditional sources of funds for affordable housing, such as Tax Credits, and estimated that MidPen could finance new building construction from these sources, but not the significant site preparation and backbone infrastructure required by Alameda Point.  As a result, it was determined that there was a need for new market rate housing development to pay for and build these infrastructure needs. The total infrastructure contribution needed for the entire 33-acre south of Midway area, including the Collaborating Partners’ site and the adjacent site required for new market rate housing, is estimated at $37 million for utility and street improvements and fair-share contributions of site-wide obligations  and $16.5 million for on-site improvements (i.e. grading, demolition) for a total of $53 million. 

Additionally, the Collaborating Partners, in conjunction with MidPen, have determined that they will need around 267 units to satisfy their space and funding needs, which is 67 additional very-low income units over and above the existing 200 units.  This was determined based on occupancy requirements and the need to create more one- and two bedroom units in-lieu of too many three- and four-bedroom units to better serve the residents.  The number of total bedrooms in the existing 200 units will be the same number of bedrooms in the 267 units.  It is assumed that these additional units will help the City meet the low and very-low income affordable housing obligations for any market rate housing built to finance the Collaborating Partners’ infrastructure and for any new housing development elsewhere in the Main Street Neighborhood, as the existing 200 units do not count towards satisfying the 25 percent affordable housing requirement (9 percent moderate and 16 percent low and very-low income) for Alameda Point.

A preliminary feasibility analysis prepared by the City’s financial consultant, Willdan Financial Services, determined that approximately 200-235 market rate and moderate income units would be needed to pay for the infrastructure costs for the entire South of Midway property, assuming that the majority of the new additional Collaborating Partners’ units (approximately 44 units) count towards the low- and very-low affordable housing requirements for the new market rate development. 

The table below helps summarize this breakdown and how many units would remain within the 1,425-unit cap based on the units contemplated for the Collaborating Partners project and the market rate units needed to pay for infrastructure. 


    Preliminary Main Street Neighborhood Housing Allocation

 

# of units

Alameda Point Total Housing Allocation

1,425

Less Site A

(800)

Less Existing Supportive Housing Units

(200)

                                                                        Sub-total

425

Less Additional Units Needed by Collaborating Partners (including 44 low/very-low units (16% requirement) needed for South of Midway market rate units)

(67)

                                                                        Sub-total

358

 

 

Less Market Rate Units Needed to Fund Infrastructure (estimated)

(208)

Less Moderate Income Affordable Units   (9% requirement)    

(25)

Remaining Units

125

 

The estimated remaining units would be available for future infill development of the North of Midway area in the Main Street Neighborhood.  In previous discussions, it has been assumed that housing units could be reserved for the Adaptive Reuse area, specifically at the Bachelor Enlisted Quarters (BEQ) buildings.  However, based on the popularity of unique and distinctive spaces desirable among office high tech campuses, like Airbnb and Twitter, staff believes marketing these unique buildings for high-tech office campus uses may be the City’s best opportunity to capture this type of use in the near-term, especially given the site’s proximity to the existing Main Street ferry terminal and the unique and eclectic uses located nearby along Spirits Alley.  At a later date, staff will return to the City Council to discuss ways to position the BEQ for a high tech campus use and request Council approval of an RFP process to identify potential users. 

Phasing Principles

The following summarizes the Phasing Principles currently discussed in the draft Main Street Plan that are intended to help guide, not predetermine, the City Council’s future decisions on the disposition and development of the land in Main Street neighborhood and help achieve the vision presented in the Main Street Plan. 

Staff is presenting the draft Development Phasing Principles Chapter (Exhibit 4) to the City Council for direction before proceeding with approval of the draft Main Street Plan.

                     Principle 1: Maximize infrastructure efficiencies

Infrastructure needs in Main Street Neighborhood are significant and increasingly challenging as one moves from south to north (Exhibits 5 and 6).  New development in the southern portion of the neighborhood would benefit by taking advantage of near-term utility upgrades at Site A and avoiding major infrastructure requirements north of Midway to minimize cost.

                     Principle 2: Use market rate housing to finance infrastructure improvements to facilitate the build-out of the Collaborating Partner’s new campus.

 

Prioritizing the construction of the new campus for the Collaborating Partners south of W. Midway necessitates allowing a sufficient amount of market rate housing to pay for all of the infrastructure south of W. Midway, including for the Collaborating Partners preferred site. 

 

                     Principle 3: Ensure cohesive infrastructure implementation

 

Deteriorating and inadequate systems, such as stormwater, flood protection, sanitary sewer, water, electrical, telecommunication and natural gas must be addressed comprehensively and cohesively consistent with the MIP, including existing residential areas proposed for rehabilitation.

 

                     Principle 4: Maintain and preserve existing uses and historic resources to the extent feasible.

Preservation of existing neighborhood assets, such as the historic beehive homes and landscaped areas, non-historic leased housing, APC’s urban farm and Ploughshares Nursery help create unique character-defining features and, in some cases, revenue that helps maintain and operate Alameda Point.

                     Principle 5:  Allow for future transitional and compatible commercial uses, especially along the Adaptive Reuse edge.

 

Light-industrial and other commercial uses compatible with adjacent residential uses within the Main Street Neighborhood will take advantage of the success of those uses in the adjacent Adaptive Reuse area and create a truly unique mixed-use neighborhood that incorporates all uses and adds jobs to the area. 

 

Phasing Plan

The phasing plan proposed in the Main Street Plan offers a general guide to the flow of future development in the Main Street neighborhood.  It is a flexible plan that recognizes that the ultimate decision for disposition of land is determined as part of a more detailed process directed by the City Council.  The two phased approach to development of the neighborhood is described below:

Phase 1: South of Midway Development

The goal of this phase is to facilitate the development of the Collaborating Partner’s consolidated campus through the development of market rate housing.  This phase will include finalizing the feasibility analysis to determine the appropriate number and mix of market rate housing necessary to support infrastructure development for the south of Midway area.  Staff with City Council approval would then issue an RFQ, similar to the Site A/B process to solicit interested, qualified developers to prepare proposals for the acquisition and development of the site, including infrastructure for the entire south of Midway area. 

Phase 2: Future Phases (North of Midway Development)

The long-term goal of the future phase is to create a balanced mix of existing historic uses and new compatible mixed-use infill development to pay for cohesive infrastructure development, potentially in multiple phases over a 5- to 15-year horizon.  The assumption is that this phase will take advantage of completed Phase 1 infrastructure improvements and potentially improvements from the Department of Veteran’s Affairs outpatient clinic development.  Until then, leasing of existing residential units (i.e. Big Whites, bungalows) would continue. Similar to the Phase 1, at a time decided by the City Council, staff will issue an RFQ or possibly multiple RFQs to solicit interested, qualified developers to prepare proposals for acquisition of designated land areas, including necessary infrastructure.

                     

FINANCIAL IMPACT 

There is no financial impact to the City’s General Fund or Base Reuse Department budgets related to this item.

ENVIRONMENTAL REVIEW

On February 4, 2014, the City Council certified a Final Environmental Impact Report (State Clearinghouse No. 2013012043) for the Alameda Point project (including the Main Street Neighborhood), in compliance with the California Environmental Quality Act (CEQA).

RECOMMENDATION

Provide direction on the approach to phasing and disposition of development in the Main Street Neighborhood at Alameda Point, including review of the draft Phasing Chapter in the Main Street Neighborhood Specific Plan.

 

Respectfully submitted,

Jennifer Ott, Base Reuse Director

 

By,

Michelle Giles, Redevelopment Project Manager

 

Exhibits:

 

1.                     Alameda Point Zoning Map

2.                     Collaborating Partners Preferred Location

3.                     Draft Main Street Neighborhood Specific Plan

4.                     Draft Development Phasing Principles Chapter

5.                     Constraints Overlay Map

6.                     Geotechnical Overlay Map