Home » City of Concord Set to Talk Term Sheet for Naval Weapons Station Project

City of Concord Set to Talk Term Sheet for Naval Weapons Station Project

by CC News
Concord Base Reuse Project

Now that two meetings are complete, the City of Concord announced that both presentation videos on the term sheet for the Naval Weapons Station Project are now available.

In December, the Concord First Partners and Local Reuse Authority (LRA) staff hosted two community meetings in December to discuss and present the proposed Term Sheet. The proposed Term Sheet will go before the City Council for its consideration during a special meeting on Saturday, January 7, 2023 at 9 a.m.

The meeting will be held in person at the Concord Senior Center located at 2727 Parkside Circle, and can be viewed on Concord TV (Astound/Wave 1026, Comcast 28, AT&T U-verse 99) or streamed online through the City’s website.


Previously posted on Dec 3

The January 7 Staff Report (61 pages)

The CFP Term Sheet differs from the previous master developer Term Sheet with Lennar Concord, LLC in that it covers the entire project area (2,275 acres) rather than a first phase of development (500 acres). The CFP Term Sheet also differs from the adopted Reuse Area Plan (2012) with a higher residential unit count (15,595 vs. 12,2721) and an affordable housing strategy that addresses the additional units, both changes improve the financial feasibility of the project.

CFP proposes direct project contributions of several hundred million dollars in identified community benefits in the CFP Term Sheet. CFP also agreed to an 18% annual internal rate of return (IRR) threshold (which reflects the average annual return on total capital invested) that will trigger profit participation with the City/LRA. CFP also increased the City’s share (compared to the previous master developer’s Term Sheet) of the annual profit in excess of the cumulative IRR threshold.

Note – The 12,272 units planned in the CRP Area Plan included/assumed the development of 360 units on the 18-acre BART property, adjacent to the North Concord/Martinez BART Station. The CFP Term Sheet does not address development on the 18-acres BART property, which would be developed separately but coordinated with BART.

Recommended Action
Accept the CFP Term Sheet for the development of 2,275 acres (“the property”) at the former Concord Naval Weapons Station (CNWS) and direct staff to proceed to the DDA Stage of the Negotiation Period (as defined in the Exclusive Agreement to Negotiate (ENA) between the LRA and CFP) and make the CEQA determinations as provided in this staff report.

Background
On August 21, 2021, the City Council, sitting as the LRA selected the CFP team as the potential Master Developer of the former CNWS property, subject to successful negotiation and LRA approval of an ENA.

The City Council approved the ENA after public consideration at its meeting held on October 26, 2021. The ENA outlines the negotiation steps and performance timelines for considering a Term Sheet and subsequent actions necessary to implement the project. On May 24, 2022, the LRA extended the ENA’s Preliminary Stage for consideration of a Term Sheet to January 31, 2023.

Community Benefits Cited:

CFP has also proposed a developer’s investment return threshold of 18% (IRR) for the combined phases of the project; this is within the range of real estate industry expectations for a project of this scope and complexity and lower than the prior master developer threshold of 20%. This CFP IRR threshold is the basis for annual calculation of future City participation in profit sharing as the project exceeds financial return expectations. CFP is also proposing Open Book Accounting to make the project financially transparent. Any City profit participation amounts would be reinvested in the project under the terms of the EDC agreement and could be used for enhancement or completion of community benefit projects

Community Benefits
The following is a summary of priority community benefits included in the Term Sheet:

  1. CFP has entered into a Project Labor Agreement (PLA) with the Contra Costa Building and Construction Trades for all project construction. The Term Sheet also has provisions for local hiring priorities, training programs and opportunities for local businesses.
  2. A commitment ensuring at least 50% of the market-rate residential units will be offered to third party builders not affiliated with CFP.
  3. Implementation of the Legally Binding Agreements regarding the provision of housing for the homeless and land for future Food Bank expansion.
  4. Contribution of land (4 acres in Phase 1) for a future Veterans Hall.
  5. Provision of an Affordable Housing Goal of 25% including:
    • Balanced delivery of building pads and infrastructure at an estimated value of $187 million through all 5 phases to provide the opportunity for 3,020 affordable units for low income households (80% or below Area Median Income).
    • Contribution of $50 million towards Affordable Housing projects – ($10 million per Phase).
    • Contribution of 879 Junior Accessory Dwelling Units (JADU) incorporated into Market Rate Units with regulatory agreements regarding affordability.
    • Partnership with Related California and non-profits to promote successful implementation of the affordable housing strategy.
  6. Provision of 856.6 acres of Parks, Recreations and Trails delivered by phase.
  7. Contribution $100 million towards the Tournament Sports Park – $5 million in Phase 1 and $95 million in Phases 2-4
  8. Contribution $65 million towards a Campus District Community Center/Library in Phases 2 & 3.
  9. Provision of expedited repayment of City Loans to the LRA of approximately $15 million in Phases 1 & 2.
  10. Provision of an interim Delta-DeAnza trail connection in Phase 1.
  11. Restoration of Mount Diablo Creek Corridor and trail creation over 5 phases, consistent with adjacent phased development.

CFP Corporate Structure & Capitalization of Developer
CFP is a Delaware Limited Liability Corporation. CFP’s members are Discovery Builders, Inc.; Lewis Concord Member, LLC; and California Capital & Investment Group. Lewis Concord Member is the managing member of CFP. The members have capital interest in CFP and will contribute equity towards project related costs/expenditures as
follows:

  • Discovery Builders, Inc. – 45%
  • Lewis Concord Member – 45%
  • California Capital & Investment Group – 10%

Development Phases & Project Summary.

The Project is proposed to be developed in five Phases as depicted in Exhibit A; each Phase will have multiple sub-phases.

Phase 1:

  • Innovation District – 88 acres of non-residential uses
  • 2,873 total dwelling units comprised of:
    • 2,180 market-rate units, and
    • 693 affordable units
  • Veterans Land Set-Aside – 4 acres
  • PG&E substation – 5 acres
  • Parks/Greenways – 79.7 acres
  • Diablo Creek Restoration – 38.5 acres
  • Phase One component of Tournament Sports Park/Citywide Park to be more fully described in the Specific Plan with Developer committing $5 Million to such work

Phase 2:

  • 4,945 total dwelling units comprised of:
    • 3,777 market-rate units, including:
      • 385 market-rate units in the Transit Oriented Development(“TOD”) neighborhood, and
      • 513 market-rate residential units in the TOD core; and
    • 1,168 affordable units, including:
      • 570 TOD neighborhood affordable units;
    •                                513 TOD core affordable units;
      • Transitional housing, 4 acres (65 affordable units); and
      • Habitat for Humanity, 2 acres (20 affordable units)
    • TOD Core District – a mixed use district that will include, among other uses, the market rate and affordable dwelling units noted in A. above,as further described in the Specific Plan
    • Campus District – a mixed use district as further described in the Specific Plan
    • Food bank – 10 acres
    • Phase Two component of Library/Community Center to be more fully described in the Specific Plan, with Developer committing $25Million1 to such work
    • Phase Two component of Tournament Sports Park/Citywide Park to be more fully described in the Specific Plan with Developer committing $35 Million1 to such work
    • Fire Station – 2 acres
    • Parks/Greenways – 82.56 acres.
    • Diablo Creek Restoration – 46.08 acres

Phase 3

  • 2,345 total dwelling units comprised of:
    • 1,980 market-rate units, and
    • 365 affordable units, including:
      • Transitional housing, 4 acres (65 affordable units)
    • Village center – 6 acres
    • Mid-rise hotel – 2 acres
    • School sites – 15 acres
    • Phase Three component of Library/Community Center to be more
      fully described in the Specific Plan, with Developer committing $40
      Million1 to such work
    • Phase Three component of Tournament Sports Park/Citywide Parkto be more fully described in the Specific Plan, with Developer committing $40 Million1 to such work
    • Parks/Greenways – 89.95 acres
    • Wetland Preservation – 35 acres2
    • Diablo Creek Restoration – 25 acres

Phase 4:

  • 2,927 total dwelling units comprised of:
    • 2,530 market-rate residential units, and
    • 397 affordable units, including:
      • Transitional housing, 4 acres (65 affordable units)
    • Phase Four component of Tournament Sports Park/Citywide Park to be more fully described in the Specific Plan, with Developer committing $20 Million1 to such work
    • School sites – 10 acres
    • Parks/Greenways – 37.39 acres
    • Diablo Creek Restoration – 31.79 acres
    • Green Frame Park – 41 acres

Phase 5:

  • 2,505 total dwelling units comprised of:
    • 2,108 market-rate units, and
    • 397 affordable units, including:
      • Transitional housing, 4 acres (65 affordable units)
    • Village Center – 3.5 acres
    • Phase Five component of the City-Wide Park to be more fully described in the Specific Plan
    • School sites – 15 acres
    • Parks/Greenways – 97 acres
    • Diablo Creek Restoration – 37.65 acres
    • Green Frame Park – 41 acres
    • Fire Station – 2 acres

Term Sheet links:

For those with questions, you may contact the Economic Development and Base Reuse department at 925-671-3001.

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2 comments

MRS December 20, 2022 - 8:57 pm

Just what we need, more traffic on already slammed highways.

Concord Set to Talk Term Sheet for Naval Weapons Station Project January 6, 2023 - 12:36 am

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