Ordinance No. 13,504ORDINANCE NO. 13,504
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS,
AUTHORIZING THE CITY MANAGER TO EXECUTE A PRE -DEVELOPMENT
SERVICES AGREEMENT FOR A CONVENTION CENTER & HEADQUARTERS
HOTEL WITH GARFIELD PUBLIC/PRIVATE LLC; AUTHORIZING PAYMENT IN
AN AMOUNT NOT TO EXCEED FORTY THOUSAND AND NO/100 DOLLARS
($40,000.00); MAKING OTHER PROVISIONS RELATED THERETO; AND
PROVIDING FOR THE EFFECTIVE DATE THEREOF.
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BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS:
Section 1: That the City Council of the City of Baytown, Texas, hereby authorizes the City
Manager to execute a Pre -Development Services Agreement for a Convention Center & Headquarters
Hotel with Garfield Public/Private LLC. A copy of said agreement is attached hereto as Exhibit "A," and
incorporated herein for all intents and purposes.
Section 2: That the City Council of the City of Baytown authorizes payment in the amount
not to exceed FORTY THOUSAND AND NO/100 DOLLARS ($40,000.00) in accordance with the
agreement authorized in Section 1 hereinabove.
Section 3: That pursuant to the provisions of Texas Local Government Code Annotated
§252.048, the City Manager is hereby granted general authority to approve any change order involving a
decrease or an increase in costs of FIFTY THOUSAND AND N0/100 DOLLARS ($50,000.00) or less,
subject to the provision that the original contract price may not be increased by more than twenty-five
percent (25%) or decreased by more than twenty-five percent (25%) without the consent of the contractor
to such decrease.
Section 4: This ordinance shall take effect immediately from after its passage by the
City Council of the City of Baytown.
INTRODUCED, READ and PASSED by the affirmative vote of e ty Council of the City of
Baytown this the 13th day of July, 2017. AA
ATTEST:
k'
hEIC&IABRY SCH, City Clerk
APPROVED AS TO FORM:
H. DONCARLOS, Mayor
1iCt }
e-RINACIO RAMIREZ, SR., City AVorriey
cobfs0lVegal\Karen\Files%%CityCounci1\0rdi ces\2017\Ju1y 131GarfieldPreDevelopmentAgreement.doc
0
H. DONCARLOS, Mayor
1iCt }
e-RINACIO RAMIREZ, SR., City AVorriey
cobfs0lVegal\Karen\Files%%CityCounci1\0rdi ces\2017\Ju1y 131GarfieldPreDevelopmentAgreement.doc
Exhibit "A"
PRE -DEVELOPMENT SERVICES AGREEMENT
CONVENTION CENTER HEADQUARTERS HOTEL
Baytown, Texas
This Pre -Development Services Agreement ("Agreement") dated as of
2017 ("Effective Date"), is entered into by and between the City of
Baytown, Texas ("City"), and Garfield Public, Private LLC, a Texas limited liability company
("GPP"), in connection with the planning, design and construction of a hotel and conference
center to serve the citizens and businesses of the City.
WHEREAS, City of Baytown issued a request for qualifications and a subsequent request
for proposals (collectively "RFP") for a design -build services for a conference center with
ongoing operation and maintenance services for a hotel and convention center; and
WHEREAS, as a result thereof, the City of Baytown desires to enter into a pre -
development agreement for the planning, design, construction, and commissioning of a full-
service, nationally branded hotel, meeting space and parking (the "Project") that will function as
the Baytown conference center and hotel; and
WHEREAS, GPP submitted a proposal (the "Proposal') in response to the RFP, which
received the highest ranking based upon the published selection criteria and the ranking
evaluations; and
WHEREAS, the City and GPP wish to negotiate the terms and conditions of a master
development agreement (the "MDA") that will provide for (i) the funding and ownership
structures for the Project (ii) a business plan detailing the building program, conceptual design,
estimated development cost, development schedule, operating pro forma, and funding, operating
and ownership alternatives for the Project; and (iii) such other services necessary and incidental
to the foregoing as the parties may reasonably approve.
In consideration of the mutual promises and covenants herein contained, the parties agree
as follows:
Section 1. Pre -Development Scope of Services and Schedule.
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(a) The "Pre -Development Period" is the time from the Effective Date to delivery of
the Final Report described in Section 1(h). City will provide to GPP any currently existing
survey, studies, documents and agreements, plans and specifications and other documents
pertaining to the Project, within 30 days of the Effective Date.
(b) City and GPP will negotiate the terms of the MDA for the Project, and all other
documents necessary to begin the design phase of the Project during the Pre -Development
Period.
(c) GPP will engage the services of CallisonRTKL Incorporated and/or another
architect acceptable to the City (the "Architect") to prepare a conceptual design package, to
include a building program, site plan, floor plans, elevations, section drawings, renderings, with
architectural and engineering narratives ("Conceptual Design") for the Project. GPP shall
contractually obligate Architect to indemnify the City and GPP, as joint indemnitees, consistent
with the provisions of Chapter 130, TEXAS CrviL PRACTICES AND REMEDIES CODE, and Section
271.904, TEXAS LOCAL GOVERNMENT CODE, and to maintain insurance (including errors and
omissions coverage) for the benefit of the City and GPP as additional insureds, in each case in
form and substance not less than is customary for a City -operated design project with a similar
scope.
The conceptual design package will conform in all material respects with the RFP and the
following requirements:
i. Nationally branded full-service hotel
ii. Approximately 200 guestrooms and suites
iii. Approximately 20,000 net square feet of meeting space
iv. Three -meal restaurant
v. Lobby bar/lounge
vi. Grab & go coffee stand
vii. Sundry shop
viii. Business center
ix. Fitness center
x. Swimming pool
(d) GPP will engage DPR Construction Inc. or another contractor acceptable to the
City ("Contractor"), to collaborate with GPP in the preparation of a preliminary estimate of the
total construction costs for the Project based on the Conceptual Design, in sufficient detail to
show construction costs, draw -down schedules, FF&E, OS&E, IT, soft costs and professional
fees ("Preliminary Project Pricing"), and a Project development and construction schedule from
completion of the pre -development assessment period through Project opening ("Preliminary
Project Schedule") with input as appropriate from the City, GPP and other team members. The
form of construction contract shall provide protections to the City that are not less than the
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protections in the comparable documents typically used by the City for similar projects in terms
of size, scope and cost.
(e) GPP will engage an entity acceptable to the City ("Hotel Operator") to analyze
the operation of the hotel as a full-service. nationally branded headquarters hotel of a
DoubleTree, Marriott, Sheraton, or a similar quality flag. GPP will negotiate with the Hotel
Operator a letter of intent that will be the basis on which Hotel Operator and the Hotel owner are
willing to enter into negotiations with respect to the definitive form of agreements for Hotel
Operator to operate the Project under the selected brand. Hotel Operator will provide input as to
the Conceptual Design, the Preliminary Project Pricing and the Preliminary Project Schedule and
will prepare a financial pro forma for 10 (ten) years of operations for the Project.
(f) GPP will advise the City in the City's engagement, if necessary, of third party
consultants to provide a survey, geotechnical report and an environmental phase I report. The
market study previously prepared for the City by CBRE Inc., which includes a profit and loss
statement for the Project to show the first 10 years of operations including underlying
assumptions of occupancy, average daily rates, operating revenue, operating expenses, and net
operating income ("Preliminary Project Operating Pro Forma"), may need to be updated to
include the Hotel Operator's input, as set forth in Section 1(e) above, as determined by the
Parties.
(g) GPP will prepare a public/private financing model for the Project identifying
anticipated sources of private capital and the anticipated amount of City participation to
complete the Project capitalization ("Preliminary Capital Plan of Finance").
(h) GPP will deliver its final report on the Project ("Final Report") to the City within
one hundred and twenty (120) days of the Effective Date, which end date may be extended for up
to thirty (30) days with the consent of the City, which consent will not be unreasonably withheld,
if GPP is working diligently to deliver the Final Report. The Final Report shall consist of the
Conceptual Design, the Preliminary Project Pricing, the Preliminary Project Schedule, a tenn
sheet of an operating agreement with the Hotel Operator, the Preliminary Project Operating Pro
Forma, and the Preliminary Capital Plan of Finance, including a preliminary draw -down
schedule. Notwithstanding anything to the contrary in this Section 1(h), in the event that the
Final Report has not been delivered to the City within the aforesaid time period through the sole
fault or delay of GPP, the City shall have the right to terminate this Agreement and GPP shall
provide to the City all information it has developed to date in support of the Final Report and
shall refund all monies paid to GPP as its fee for services pursuant to Section 3 hereinbelow
within thirty (30) days of notice of GPP's receipt of the City's notice of termination. The
repayment of GPP's fee to City shall be the sole remedy of City for GPP's failure to deliver the
Final Report on time.
(i) GAP shall update the City on the status of its efforts relating to the Project on a
monthly basis or more often if requested. The meetings may be held by conference call or in
person.
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Section 2. Development of the Project.
(a) Upon delivery of the Final Report, the parties will conclude the negotiations of
the Master Development Agreement.
(b) If within 90 days after the approval of the Final Report by the City (the "City's
Approval Date"), the parties are unable to negotiate a satisfactory Master Development
Agreement, then on the 90th day after the City's Approval Date, this Agreement shall
automatically terminate and be of no further force and effect, and the City may formally end all
negotiations with GPP. The City acknowledges that (i) GPP will not have control over the
review and response time of the City and its advisors with regard to the Master Development
Agreement and (ii) work on the Master Development Agreement will not begin until the City's
Approval Date. Thus, GPP believes from experience that at least 90 days will be needed to
finalize a Master Development Agreement. If no Master Development Agreement is
successfully negotiated within the above-described time frame (as same may be extended for up
to 30 days with the consent of the City, which consent will not be unreasonably withheld if GPP
is working diligently to meet its obligations), the City may end all negotiations with GPP and
terminate this Agreement. If GPP has negotiated with the City in good faith, GPP will not be
obligated to return any of its fee for services to the City even if the Parties are unable to agree
upon a Master Development Agreement, but the City shall receive copies of all records and
reports prepared by or for GPP hereunder.
(c) Prior to the execution of the MDA, the relationship between GPP and the City
shall be governed solely by the terms of this Agreement, the RFP and the Proposal. If there is
any conflict among the provisions of this Agreement, the RFP and Proposal, then the order of
precedence shall be first this Agreement, second the Proposal and third the RFP.
Section 3. Costs.
City acknowledges that GPP will incur costs in connection with the services of the
Architect, Contractor, Hotel Operator and the other third party consultants hereunder. GPP will
be paid a fee of $10,000.00 per month during the term of this Agreement (not to exceed in the
aggregate $40,000.00), to cover a portion of its overhead costs hereunder. In the event the City
and GPP mutually agree that any or all of the "if necessary" items on Exhibit A described as (i)
the Market Study Update, (ii) Survey, (iii) Geotech (soils) Report and or (iv) Environmental
Phase I Report are required for GPP to provide its Final Report to the City and in the event the
City approves the cost of such items, as applicable, City will pay for such items as part of the
City's share of predevelopment costs as noted in Exhibit A. City will have the right to access
and copy any documents supporting the services provided by GPP, Architect, Contractor, Hotel
Operator and third party consultants pursuant to this Agreement. GPP will retain for review by
the City for a period of thirty-six (36) months following the termination of this Agreement the
financial records and reports regarding the work performed by GPP and the Architect,
Contractor, Hotel Operator and third party consultants under this Agreement. All of the
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aforesaid costs and fees will be included in the final budget for the Project, to be approved by the
City. In the event GPP requires any or all of the "if necessary" items noted above and the City
refuses to provide such items, the City acknowledges and agrees that the Final Report will be
subject to and conditioned upon the absence of the information that should have been included in
such items.
Section 4. Additional Provisions.
(a) Term. This Agreement shall be effective as of the Effective Date, and expire upon
the earlier of the execution of the Master Development Agreement or such earlier date as
provided herein above. This Agreement shall be subject to termination upon a five (5) business
day written notice at any time by either party. Upon termination or expiration of this Agreement,
GPP shall return to City any and all equipment, documents, or materials, and all copies made
thereof, which GPP received from, and/or developed for City for the purposes of this Agreement.
Upon termination by the City for any reason other than a default by GPP under this Agreement,
City will pay or reimburse GPP for any costs and fees incurred or earned by GPP prior to the
date of termination within thirty (30) days of the City's receipt all information GPP has
developed to date in support of the Final Report or the City's receipt of an invoice therefor,
whichever is later. Upon termination by GPP for any reason other than a default by the City
under this Agreement, GPP shall refund the fee for its services paid to it pursuant to Section 3
within thirty (30) days of such termination.
(b) Assignment. The City is relying on the experience, skill, judgment and
qualifications of GPP. GPP may not assign its rights nor delegate its obligations under this
Agreement, other than those noted in this Agreement, without the prior written consent of the
City. Any attempted assigmnent or delegation by GPP shall be void and a breach of this
Agreement. GPP represents that the principals and responsible individuals of GPP for whom
experience and background information has been provided to the City will maintain their roles in
operating GPP.
(c) Representative. All day-to-day contacts with GPP shall be made through Steve
Galbreath or, in his absence, Greg Garfield, with a copy to Glenn Garfield of any written
communication. All contacts with the City shall be made through the City Manager or such
other person(s) designated by the City in writing. Points of contact may be delegated by the
parties, with notice to the other party.
(d) Notices. All notices and other communications hereunder shall be in writing, shall
become effective when delivered to the addressee, and may be transmitted by certified mail
(return receipt requested), overnight courier service, or other commercially reasonable and
customary means, addressed to the party at the address listed below, or at such other address as
the party shall have furnished to the other party in writing.
If to the City:
City of Baytown
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With copies to:
If to GPP:
With Copies to:
2401 Market Street
Baytown, TX 77520
Attention: City Manager
City of Baytown
2401 Market Street
Baytown, TX 77520
Attention: City Attorney
Garfield Public/Private LLC
14785 Preston Road
Suite 480
Dallas, TX 75254
Attention: Steve Galbreath
Telephone: 214-289-7820
Garfield Public/Private LLC
14785 Preston Road
Suite 480
Dallas, TX 75254
Attention: Daniel K. Hennessy, Esq.
Telephone: 469-607-1704
(e) Governing Law. This Agreement is a contract made under, and shall be construed
in accordance with and governed by, the laws of the United States of America and the State of
Texas. Any actions concerning this Agreement shall be brought in either the Texas State Courts
of Harris County, Texas, or the United States District Court for the Southern District of Texas.
(f) Limited Waiver of Immunity. Notwithstanding anything to the contrary herein,
the City and GPP hereby acknowledge and agree that to the extent this Agreement is subject to
the provisions of Subchapter I of Chapter 271, TEXAS LOCAL GOVERNMENT CODE, as amended,
the City's immunity from suit is waived only as set forth in Subchapter I of Chapter 271, TEXAS
LOCAL GovERNMENT CODE, if applicable.
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(g) Amendment and Waiver. A provision of this Agreement may be amended or
waived if such amendment or waiver is in writing and is approved by GPP and the City. No
course of dealing on the part of GPP or the City, nor any failure or delay by GPP or the City with
respect to exercising any right, power or privilege pursuant to this Agreement, shall operate as a
waiver thereof, except as otherwise provided herein.
(h) Independent Parties. Nothing herein shall be construed as creating a partnership
or joint enterprise between the City and GPP. Furthermore, the Parties acknowledge and agree
that the doctrine of respondeat superior shall not apply between the City and GPP, nor between
the City and any officer, director, member, agent, employee, contractor, subcontractor, licensee,
or invitee of GPP.
(i) Counterparts. This Agreement may be executed in multiple counterparts, each of
which shall be deemed an original and all of which shall constitute the same agreement.
0) Interpretation. This Agreement has been negotiated jointly by the Parties and
shall not be construed against a Party because that Party may have assumed primary
responsibility for the drafting of this Agreement.
(k) This Agreement sets forth the entire understanding of the parties with respect to
the subject matter hereof, and all prior agreements, whether written or oral, are deemed to be
merged herein.
This Agreement is entered into as of the Effective Date.
Garfield Pubtic/Private LLC,
a Texas limited liability company
Address:
By:
Facsimile. 972-692-0887 Name: Greg G e d
Telephone. 469-607-1703 Title: President
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CITY OF BAYTOWN:
RICHARD L. DAVIS, City Manager
ATTEST/SEAL:
LETICIA BRYSCH, City Secretary
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Date Signed:
APPROVED AS TO FORM:
IGNACIO RAMIREZ, SR., City Attorney
EXHIBIT A
TO PRE -DEVELOPMENT SERVICES
MEMORANDUM OF UNDERSTANDING
Pre -Development Period Budget and Private: Public Allocation
* if Necessary
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Prig ate
City
Description
Share
Share
TOTAL
Garfield Public Private
$65,000.00
$40,000.00
$105,000.00
Market Study Update (CBRE) *
-
[TBD]
-
Geotech (Soils) Report *
-
[TBD]
Environmental - Phase I Report *
-
[IBD]
Conceptual Design and Programming
50,000.00
-
50,000.00
Development Budget and Schedule
12,500.00
-
12,500.00
Out of Pocket Expenses
5,000.00
-
5,000.00
'I otal Costs
$132,500.00
$40,000.00
$172,500.00
* if Necessary
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