The URL can be used to link to this page

Home My WebLink AboutStaff Report 2405-2978 - Amended ReportCITY OF PALO ALTO CITY COUNCIL Special Meeting Monday, June 03, 2024 Council Chambers & Hybrid 4:00 PM Agenda Item 18.Approval to Operate the City-owned Building at 445 Bryant Street as a Community Center with Part-Time Use by La Comida de California for a Senior Nutrition Program; CEQA Status – Not a Project Late Packet Report added City Council Staff Report From: City Manager Report Type: ACTION ITEMS Lead Department: Administrative Services Meeting Date: June 3, 2024 Report #:2405-2978 TITLE Approval to Operate the City-owned Building at 445 Bryant Street as a Community Center with Part-Time Use by La Comida de California for a Senior Nutrition Program; CEQA Status – Not a Project RECOMMENDATION Staff recommends the City Council direct staff to operate the City-owned building at 445 Bryant Street as a community center and also allow part-time use by La Comida de California for a senior nutrition program. EXECUTIVE SUMMARY The City-owned building at 445 Bryant Street was vacated by its former tenant in January 2023 and has been marketed for lease since that time. Approximately 30 parties have expressed interest in the building and four submitted proposals. Alternatively, the City’s Community Services Department (CSD) can operate the entire building and make a portion of the building available for shared use with third party compatible users. The Council held a closed session conference with real property negotiators, on March 11, 2024, to discuss lease price and terms of payment1. Staff has evaluated the proposed uses for the building and recommends activating the building as a City operated community center and authorizing La Comida de California (La Comida) to operate a senior nutrition program in a portion of the ground floor on the weekdays from 10:00 A.M. to 2:00 P.M. 1 City Council, March 11, 2024, Item #3: https://cityofpaloalto.primegov.com/meetings/ItemWithTemplateType?id=4467&meetingTemplateType=2&comp iledMeetingDocumentId=9319 BACKGROUND The City-owned building at 445 Bryant Street is approximately 7,410 square feet with two- stories, including an elevator. The building was constructed in 2002 and financed through $3.6 million in 2002B Downtown Parking Improvement Project Certificates of Participation (COPs) as part of the Bryant/Lytton garage project. The amount attributable to the building was paid off in November 2022 and there is no longer any outstanding debt through a refinancing completed in 2018. The building is a second-generation retail space that was previously used as a health and fitness center from 2005 until January 2023 (CMR 411:042). The space is built out with two sets of locker rooms, a few small private rooms on the ground level, and larger rooms on the upper level. The building is currently in overall good condition with a few deferred maintenance items, most notably the HVAC system which is estimated to cost $375,000 to replace with electrical systems. Both HVAC and electrical systems projects are included in the FY 2025 Capital Improvement Program budget and repairs can be addressed, subject to ability to use restricted funding, before facility reactivation and reoccupancy. Any renovation or tenant improvements completed to the property is expected to comply with all applicable laws, including The Americans with Disabilities Act (ADA). The property’s zoning is Planned Community (PC-4611)3. Permitted uses include ground floor retail or other pedestrian-oriented use, a teen center, and office use on the upper floors. The recommendation to operate the building as a City operated community center and the proposed operation of a senior nutrition program is generally consistent with prior uses of the site and the provisions of the planned community zoning ordinance. ANALYSIS Staff received approximately 30 inquiries, and four parties submitted proposals expressing interest in the 445 Bryant Street space. This included for-profit and nonprofit organizations. The for-profit proposals were for fitness center uses. These proposals included rental rates ranging from approximately $1.75 to $3.44 per square foot per month, and would require exclusive use of the two-story facility. Staff investigated the potential for shared-use with the proposers, and confirmed that both required exclusive use of the facility. The nonprofit proposals included rental rates ranging from roughly $0.03 to $0.75 per square foot. While the nonprofit organizations expressed willingness to share space with other organizations, staff anticipates that many organizations would be interested in the space if the City were to agree to lease at such a discounted rate. If the City Council wishes to pursue leasing the facility to one or more nonprofits, a nonprofit-focused Request For Proposals should be issued. 2City Council, September 13, 2004, Item #7: https://recordsportal.paloalto.gov/Weblink/DocView.aspx?id=77506 3City Council, March 20, 2000, Item #10: https://www.cityofpaloalto.org/files/assets/public/v/1/city- clerk/ordinances/ordinances-1909-to-present/ordinances-by-number/ord-4611.pdf Alternatively, the building can be activated as a City community center to be operated by CSD. This location can provide new and expanded popular programs, classes, and summer camps. The building can also be a safe place for teens to gather after school and on weekends, and can be used to host pop up events (such as art events and parents’ night out). Additional uses could include room rentals when spaces are not being programmed. When necessary, it may be flexed as a temporary Palo Alto community Overnight Warming Location (“OWL”) for community response and support during inclement weather events. FISCAL/RESOURCE IMPACT improvements are made) prorating the costs/budget proposal for 25% in FY 2025. Prorated year one revenue is estimated at $55,800 and expenditure at $118,400, resulting in a projected net cost to the General Fund of $62,600 in FY 2025. Ongoing program revenue is projected at $225,000 per year while ongoing program expenses are estimated at $490,000, resulting in an annual General Fund net expense of $265,000. 4 The adopted FY 2024 budget included $173,000 for teen programming, effectively decoupling these two programs since the period of lower rent payments and vacancy of the space. Staff is assuming that teen programming funding will continue irrespective of decisions on Bryant space lease. In FY 2025, the budget is expected to maintain the funding levels for teen programming and if approved for reappropriation from FY 2024 to FY 2025 the remaining reserved one-time funding of $216,000 that was generated to support teen services. STAKEHOLDER ENGAGEMENT ENVIRONMENTAL REVIEW 4 City Council, December 10, 2001, Item #2: https://www.cityofpaloalto.org/files/assets/public/v/1/agendas- minutes-reports/reports/city-manager-reports-cmrs/year-archive/2001/444-01.pdf activity that will not result in direct or indirect physical changes to the environment. CEQA Guidelines section 15378(b)(5). ATTACHMENTS APPROVED BY: