City of Dallas Request for Competitive Sealed Proposals Mixed-Use Development for the Buckner DART Station

Area BDZ1333
Development/Ground Lease Opportunity

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Overview The City of Dallas Office of Economic Development (City), in partnership with Dallas Area Rapid Transit (DART), is issuing this Request for Competitive Sealed Proposals (RFCSP) for qualified parties interested in developing a new mixed-use development in the heart of the Buckner DART Station area. The project is envisioned to include a mixed-use development with residential, retail, office and/or medical uses. The Proposer that presents the best overall vision for the development project, the strongest business proposal, best complements the surrounding environment, provides maximum activation of the space, and provides the maximum financial benefit per the below evaluation criteria to the City and DART will be selected for further negotiations. The successful Proposer will also be able to coordinate design and expenditure of grant funds related to pre-construction work on the project. The preferred site is a DART-owned one-acre lot at the southwest corner of Buckner Blvd. (Loop 12) and Elam Rd., just north of US-175 (C.F. Hawn Freeway) adjacent to approximately eight acres developed as transit parking, bus and auto circulation and drop-off lanes. The development site is a vacant parcel that has been reserved for future transit oriented development (TOD) and was designed for the use of existing available station parking (see attached Exhibit A: Buckner Station Area Map). The City and DART are seeking a private or non-profit partner to develop the vacant parcel. Responses for TOD-style development may also be submitted for other sites located within a quarter mile of Buckner Station. The City received a U.S. Department of Housing & Urban Development (HUD) Community Challenge Planning Grant in 2010 to improve links between housing and employment centers along the DART light rail network. The federal grant offers funds for planning and pre-construction costs including, but not limited to, architectural and engineering services, surveying, permitting and zoning. Dallas TOD, the city-initiated land use process funded by the grant, includes a catalyst development concept at each of the five study areas: Vickery Meadow, MLK Station, Hatcher Station, Buckner Station and the Lancaster Corridor. This RFCSP seeks partners for development consistent with the Buckner Station plan. While the preferred response will be a mixed-use project on the DART-owned vacant property, responses that are located on other sites within a quarter mile radius of the Buckner Station will be considered, provided the Proposer either owns the site or has an option to purchase or lease the site. The intent of the TOD project is to provide new housing, office, and retail opportunities for local residents, create a new center of the local community and generate additional investor interest in improving the neighborhood. The proposal submissions shall provide the following: 1. Project Concept Plan – The Proposal shall include a preliminary site plan illustrating its preferred development concept including proposed
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development uses, parking and circulation, landscaping and other site improvements, and relationship to surrounding land uses. The Proposal should also include project renderings with images of proposed building elevations and façades and a development program delineating the square footage of commercial uses and the number and size of housing units by tenure. 2. Financing Plan – For the Park & Ride lot, DART anticipates the successful Proposer will enter into a long-term land lease for the development project. The lease value will be based on the current appraised value of the property based on an independent appraisal conducted by DART at the time of a contract. The actual lease rate is negotiable based on verification of project feasibility and the developer’s ability to receive a fair and equitable return for developing and operating the project. For all sites, the proposal shall include a development pro forma for at least a ten-year period, sources and uses of finances, and an ongoing investment program for capital expenditures, if applicable. 3. Relevant Project Experience – The City and DART are seeking a developer with experience developing TOD or other mixed-use infill development projects. 4. Developer Qualifications – The City and DART will require the Proposer to provide evidence of its capability to develop the proposed project including a summary of previous projects, references, history of litigation, and existing and prior contracts with the City of Dallas and DART, if applicable. 5. Financial Statements – The Proposal shall provide evidence of the Proposer’s financial capability to develop, finance and operate the proposed project, including a description of the entity’s type of business, references from banks or lenders, history of litigation and audited financial statements. 6. Transit Operations Plan, If Applicable – If the Proposal includes DARTowned property (including the development pad site and/or existing DART Park & Ride lot), the Proposal shall include a plan to address the provision of safe and efficient transit operations during both project construction and upon project completion. 7. Parking Replacement, If Applicable – If the Proposal includes DART owned property (including the development pad site and/or existing DART Park & Ride lot), the Proposal shall include a plan to replace any Park & Ride spaces lost for development determined by DART to be needed for future transit service.

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Background Buckner Station is the terminal station of DART’s Green Line, which became fully operational in 2010. The surrounding area is primarily single-family housing, with auto-oriented retail along Buckner Blvd. and industrial operations to the south and east. The DART Park & Ride lot is located at a prominent corner near Dal Tile’s company headquarters. About 3,500 people live within one mile of the station, with another 3,500 people employed in about 350 businesses in the same area. Dallas County Community College District (DCCCD) operates a satellite campus of Eastfield College about 0.75 miles north of Buckner Station. The station is the southern end of the largely Hispanic Pleasant Grove neighborhood of the City of Dallas. Most stations along the DART Green Line include Park & Ride lots that were designed with future development in mind. Buckner Station includes an unpaved development site at the corner of Buckner Blvd. and Elam Rd. and associated parking (see attached Exhibit B: Buckner Station Park & Ride Map ). DART is interested in proposals for joint development on its station properties that implement DART Board Policy IV.03, Transit Oriented Development Policy, August 2008 (see attached Exhibit C: DART Board TOD Policy). DART encourages proposals from public-private partnerships involving the DART service area city and the private development community. The City’s grant is part of the federal government’s Sustainable Communities Initiative. This joint partnership between HUD, the U.S. Department of Transportation, and the U.S. Environmental Protection Agency places emphasis on good planning and community revitalization. The City’s grant offers funds for planning and pre-development work around five DART-served areas to better link workforce housing with employment opportunities. The City contracted with Fregonese & Associates in Fall 2011 as the lead of a team to create area plans and catalyst development concepts, in an effort known as Dallas TOD. The planning process commenced in January 2012 and concluded with adoption of the final plans by Dallas City Council in April 2013. One of five planning areas, Buckner Station was selected for study due to a mixture of underutilized retail properties, vacant land, poor pedestrian connections to DART stations and the opportunity to test new development opportunities in an underserved neighborhood. The planning process identified the Park & Ride site as a key opportunity to kick-start redevelopment of the Buckner Blvd. corridor, improve connectivity to Eastfield College and leverage DART-owned property for the neighborhood’s first vertical mixed-use development. A public-private partnership was recommended to facilitate construction. A “proof of concept” development plan and pro forma was created that illustrates the type and density of development that could occur at this location consistent with area market and economic conditions (see attached Exhibit D: Dallas TOD Buckner
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Station Area Plan Catalyst Development Program Pro Forma ). The Proposer is not expected to replicate the scale of the Area Plan development program or financing structure and is encouraged to submit its own development concept consistent with City and/or DART goals. However, the response should have a project that contains at least one of the following uses (or a combination thereof): multi-family housing, retail, office and/or medical. The project can be vertical or horizontal mixed-use in form. The successful Proposer will be allowed to negotiate with DART for a ground-lease agreement for the Park & Ride lot property, if applicable. The successful Proposer will design and construct a development that will draw residents, workers, and visitors to Buckner Station and the surrounding area.

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RFCSP Minimum Requirements 1. Experience in developing and managing TOD or other urban infill mixed-use development projects. Preference will be given to developers within the Dallas-Fort Worth area and with public-private development partnerships. 2. Proven financial capacity of the developer and project team to develop projects of a similar size and complexity.

3. Inclusion of team members with proven experience in redevelopment activities in culturally and ethnically diverse neighborhoods, including verbal and written fluency in Spanish. Submittal Requirements Sealed proposals shall be delivered in person or by mail at Dallas City Hall, (1500 Marilla St. #3FN, Dallas, TX 75201) by 2:00 p.m. on the due date. Starting at 2:01 p.m. on the due date, submissions will not be accepted and will be returned to the Proposer unopened. All submissions should include the firm name, address, telephone number, and designated contact person regarding the submission. The proposal should be a comprehensive, accurate and effective submission. One (1) original, ten (10) copies and two (2) electronic documents (flash drive or CD only) of the proposal and relevant documentation shall be submitted to: Michelle Charnoski, Sr. Buyer Business Development & Procurement 1500 Marilla St. #3FN Dallas, TX 75201 The proposal shall be prepared on 8 1/2” x 11” paper; 11” x 17” foldouts for graphics may be required. The proposals shall be bound by wire, 3-ring or GBC along the left side and tabbed with numbered separators for each section. The proposal submission should be organized in the following manner: A. Cover Letter 1. An overview of the proposal, including an introduction to the proposer, team experience and vision for the project. 2. Contact information, including a primary contact name, mailing address, phone number and email address.

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3. A statement stating the development entity has the financial capacity and experience to develop the proposed project. 4. Identification of the entity, or person who will guarantee the performance of the development project sponsor, should an agreement be successfully negotiated. 5. A statement that all the information contained in the cover letter and the proposal is true and correct. B. Project Concept and Plan Using narrative, maps, tables and other graphics, this section should describe the proposed development concept and plan. The following elements should be included: 1. A site plan showing the proposed development uses, parking and circulation, landscaping and other site improvements, and relationship to surrounding land uses. The site plan should clearly identify areas to be used for parking, residential uses, office uses, retail uses and/or medical office or clinic uses. For a project proposed on the DART Park and Ride lot, the plan should also include details on streetscape improvements along Buckner Blvd., Elam Rd. and any proposed internal streets. It should also identify how the proposed development would strengthen connections to adjacent properties. 2. Project renderings with images of proposed building elevations and façades. 3. The development program in tabular form delineating the amount and mix of development uses by type including square feet of retail, office, medical and residential development. For residential uses, also provide the number of units, average size, and tenure. C. Financing Plan The Proposer shall provide documentation on sources and uses of funds, financial feasibility and proposed lease terms as follows: 1. Source and Uses – the Proposal will include a balance statement showing sources of funds including all debt and equity and any proposed public financing and grants, and all fund uses including predevelopment, development, construction, financing, and operations.
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2. Feasibility Analysis – The Proposer will also provide a leveraged and unleveraged project-specific financial pro forma analysis including all project development and construction costs and a 10-year operating cash flow with project returns in Excel format (see attached Exhibit E: DART Draft Pro Forma Requirements). 3. Lease Terms – The Proposal should contain a preliminary outline of the proposed financing terms for the project including lease or sale terms. D. Relevant Experience The Proposer shall provide a specific description of its most recent successfully undertaken projects that demonstrate its experience and capabilities to proceed with the project. Particular emphasis should be placed on those projects performed by Proposer’s staff to be assigned to the project. The Proposer’s actual role in the development shall be clearly described. The experience record should only include relevant work and should and include the following: 1. Name, address and telephone number of the client’s project manager or contracting officer and authorization for the City to contact the client; 2. Status of the contract, including dates of project completion, and of the Proposer’s work on the contract; 3. The Proposer’s specific involvement in the contract; 4. The Proposer’s Project Manager and staff on the identified projects; 5. The approximate development value of the identified projects, location and size in total land and building area;

6. Photos of the completed project and project plans and other images. E. Developer Qualifications This section should provide relevant information on the Proposer, its development entity and key members of the development entity, as well as key members of the project team: 1. Identify the key development team members including each individual’s responsibility, name, address, telephone number and email address. Identify a member of the team who will act as a
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single point of contact and with whom the City of Dallas and/or DART will negotiate. 2. Describe the qualifications of the development team, including but not limited to the length of time the team and each of its members have been in the real estate development business. 3. Describe previous experience with developments of a similar nature and scale undertaken by the development entity or members of the development entity. 4. Identify any key consultants who will be involved in the project and their anticipated roles and responsibilities. 5. References, including contact names, phone numbers and email addresses. F. Financial Statements The Proposal shall provide evidence of the Proposer’s financial capability to develop and operate the proposed project including the following: 1. Description of the entity’s type of business organization and a list of the owners of the organization showing percent of ownership by each. 2. Three references from banks or lenders that have financed similar or larger projects for the entity or related entity in the past five years. 3. Provide a history of litigation with public agencies within the last five years both against and initiated by the development entity, principals of the development entity, and/or their related persons or entities. 4. Under a separate cover marked Confidential Financial Information, provide current audited financial statements of the proposing entity (or of the organizations that will complete the business entity formed for this project). Indicate available equity capital and available lines of credit from each of the financing sources proposed for the project. G. Transit Operations Plan If the Proposal is for the DART Park & Ride lot beyond the one-acre vacant lot, the Proposal shall include a plan to address ongoing transit operations
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during project construction and future operations, as well as the proposal for replacing any DART parking spaces determined to be needed. There are currently 536 Park & Ride spaces at the station; however, current utilization rates indicate that not all of this parking needs to be replaced. A negotiated set-aside of DART Park & Ride parking will need to be included in the development plan (the exact number of spaces to be determined by a DART parking study). Evaluation Criteria The following parameters will be used to evaluate the submitted Proposals: A. Proven track record of bidder to build and operate TOD or other urban infill developments. Experience with this type of project within Dallas-Fort Worth is preferred. (20 points) B. The strength of the financial proposal including Project Financial Feasibility, DART ground lease revenues if applicable, and the financial soundness and strength of the Proposer including its ability to obtain private financing for the project. (25 points) C. The ability of the proposed project to generate economic benefits to the City and DART including increase City revenues (new property taxes, sales taxes), increase DART revenues (sales tax, fares, ground lease revenue) and minimize the need for public financial incentives. A project located on a site other than the DART vacant lot can earn no more than 15 points on this criterion. (25 points) D. Compatibility and response to adopted City and DART planning goals including the Dallas TOD Buckner Station Area Plan, forwardDallas!, and DART Board Policy IV.03, Transit Oriented Development Policy, August 2008. (15 points) E. Experience working in culturally and/or ethnically diverse neighborhoods. (10 points) F. Proposed project makes use of, and proposed site plan is compatible with, a zoning designation of Walkable Urban Mixed-Use-3 District (WMU-3) with a Shop Front overlay, in Chapter 51A Article XIII: Dallas Form Districts, as recommended in the Dallas TOD Buckner Station Area Plan. (5 points)

Evaluation Process As appropriate, the City and DART intend to jointly select the highest ranked development proposal and entity for further negotiations. The selection committee
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will include City and DART employees with specific knowledge of the Dallas TOD planning process and DART operational requirements if applicable. The Selection Committee will evaluate the submitted proposals and make a recommendation to the City Council and DART Board. Interviews with the highest ranked Proposers may be required. If the proposed development is sited on the Park & Ride lot, DART and the Proposer will enter into a Memorandum of Understanding (MOU) to negotiate the business terms and conditions and development agreement, after receipt of City of Dallas and DART Board approvals to move forward (see attached Exhibit F: DART Draft MOU Process). The MOU sets out agreement on a process and estimated time schedule for negotiations. 1. Station Access and Land Use Plan – DART and the Proposer will enter into a process to develop the access needs of the station and land use parameters around the station, pursuant to the terms of the MOU. 2. Appraisal – Based on the results of the station access and land use process, DART staff will order an appraisal of the property development rights. The appraisal should reflect the costs of the station access needs that are intended to become a cost to the developer. 3. Term Sheet – DART staff will negotiate a term sheet that outlines the major business terms of the project including the price to be paid for development rights. The TOD Evaluation Team will forward a recommendation and term sheet to the Board for approval. The term sheet entered into with the developer is non-binding and does not constitute a contract. 4. Development Agreement – If the term sheet is approved, staff will negotiate a joint development agreement with the developer that incorporates the terms of the term sheet. A summary of the joint development agreement, including any new terms or material changes from the term sheet, will be forwarded to the DART Board for approval. 5. Federal Transit Authority (FTA) Approval – Station area changes and terms of the Joint Development Agreement will be submitted to FTA for approval under FTA requirements. The Proposer will be required to submit a non-refundable deposit (amount to be determined) applied to project costs to cover the costs of project review and due diligence. The estimated schedule for negotiation of a Term Sheet and Development Agreement is approximately 160 days. The timeline can be extended as necessary by mutual agreement.

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Additional discussion of City incentives may occur following the approval of the MOU. If the preferred Proposal is not located on the DART Park & Ride lot, negotiations on a development agreement with the City will begin after selection and DART will not have further involvement in the process. Preliminary Timeline The City and DART intend to select a firm to enter into negotiations for a development agreement including a refined plan, and long-term land lease for the DART property in November 2013. Unexpected factors may cause the date to be revised.

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