ADMINISTRATIVE REPORT

Date: May 27, 1999
Author/Local: Jim Lowden/8487
RTS No. 00713

CC File No.1203

CS&B: July 22, 1999

TO:	Standing Committee on City Services and Budgets
FROM:	General Manager of Parks and Recreation
SUBJECT:	Bayshore Parkade Lease Proceeds Distribution

RECOMMENDATION

A. THAT Council designate $650,000 of the lease prepayment funds received by the City from Caesar Park Hotels and Resorts Company Ltd. under the Bayshore Parkade Construction Modification Agreement for parks use by the Park Board.

B. THAT Council approve the development of the demonstration salmon stream in Stanley Park as a capital project to be funded by the lease payment.

CITY MANAGER'S COMMENTS

On June 16, 1998 Council approved that $250,000, of the $1 million Bayshore parking lease payment, be used by the Parks Board for a playground at Lord Roberts School. This was approximately the value of the long-term lease of 75 marina parking spaces originally contemplated in the Bayshore rezoning.

In June 1996, Council approved leasing the balance of the garage space to Bayshore to meet their hotel by-law parking obligations. Therefore, surplus public parking was no longer available, however, the hotel parking is for public use also.

When the hotel is re-developed the developer will be required to meet the full by-law required parking.

If the developer wishes to use the leased parking spaces as by-law required parking, re-negotiation of the lease terms are necessary as outlined in Item 6 on Page 2 of the report dated June 26, 1996. The $1 million prepaid lease will be a factor in the negotiation of a pay-in-lieu amount for permanent by-law parking in the garage under the park.

The rezoning accomplished the park development program and the use of the parking is still on an hourly basis. The reason additional lease funds were collected relates to provision of bylaw parking. Ultimately, however, the lands on which the parking is developed will become dedicated park.

Therefore the City Manager recommends that in addition to Recommendations A and B, that Council approve the following:

C. That the remaining $100,000 of the prepaid lease payment be transferred to general City revenue.

D. That any funds generated by future lease negotiations, when the hotel re-development occurs, are to be allocated by City Council.

COUNCIL POLICY

On June 16, 1998 Council approved the Park Board expenditure of $250,000 of lease prepayment for the upgrading of Lord Roberts schoolyard.

BACKGROUND

In the late 1980's as part of the overall design process for the redevelopment of the Bayshore Hotel site, two parksites were identified as being required to meet the developer's population increase responsibilities.

The Terms of Instrument of the 1993 Bayshore Parks Agreement refers to the transfer of lands to the City on the mutual agreement "...that the park will be sited on and contained within Lots K and R of these areas...". Hence, under the Vancouver Charter Section 488-(5)(e) the resultant parksite will become a permanent park.

The design contemplated placing the 75 parking stalls required for the adjacent marina beneath the central parksite.

This structure was to be leased back to the developer by the Park Board.

Prior to the site rezoning in 1991, the developer requested that the parking garage be substantially expanded to provide public parking during the redevelopment phases of the overall project. Park Board and City staff agreed to this request and it was reflected in the rezoning report quoted below.

The 1991 Council report for the rezoning of the Bayshore site included the following sections related to creating a parking garage beneath the proposed central park site.

"Parking

By-law requirements for parking will be met, consisting of approximately 2,186 spaces for the site. The developer has also proposed to provide 200 additional public parking spaces under the central park space, at no cost to the City, provided subterranean rights are leased back to the developer at market value. Parking at this location would be convenient for the marina, and for visitors to the park and the seawall. This proposal could be supported, provided:

- it does not produce undue constraints on the design of the park;
- it is independent from on-site parking requirements;
- access can be successfully integrated with the park and street design; and
- an agreement can be reached to the satisfaction of the Park Board regarding leasing and operation."

The importance of this section is that Council acknowledged the Park Board's interest in the "...200 additional parking spaces under the central park space..." in that they could only be built if "...an agreement can be reached to the satisfaction of the Park Board regarding leasing and operation." Therefore it anticipated a Park Board interest in the lease income from this additional parking above and beyond the proposed 75 stalls to serve the existing marina adjacent to the park.

In 1993 an agreement was signed with the developer whereby a formula was established for the prepayment of parking spaces within the garage that were required for the marina. This prepayment was negotiated by Park Board staff. The value at that time was approximately $239,000. This was done in accordance with the Boards' 1991,08,07 concurrence report on the Bayshore rezoning which in part noted, "The associated air space requirement for the parking would be leased to the developer by the Park Board at market rates for this type of facility in this area".

In 1995, the developer determined that he would require additional dedicated parking stalls within the garage beyond the marina requirement to temporarily accommodate the hotel parking bylaw requirement during construction. Park Board staff initially renegotiated an additional prepayment for a six year period. This was subsequently negotiated to a $1,000,000 prepayment for the entire garage for 50 years. This agreement was finalized in the report to Council entitled Central Parksite Parking Garage Agreement - June 26, 1996. (Attached)

The $1,000,000. has been paid to the City, the garage is open, part of the parksite is completed and the remainder will be built and dedicated with the completion of the adjacent seawall.

DISCUSSION

The Park Board is now requesting access to $650,000 of the remaining funds derived from the developer's use of parkspace to fund park projects within the City. The first project which the Board undertook with Council's support was the refurbishment of the Lord Roberts School playground area, to serve West End families. This has been successfully completed and is proving very popular with neighbour families who lack a convenient playsite for their children.

The second project which the Board wishes to undertake is the development of a demonstration salmon stream in Stanley Park on the site of the old zoo. The Board has partnered with the Aquarium and B.C. Hydro on this project. This is the second of three construction phases to reprogram and relandscape the site of the former Stanley Park zoo. The concept is to naturalize the area and introduce an interpretive and educational element related to the environment as a counterpoint to the old zoo. The existing partial stream system now drops into a storm sewer 250 meters from Coal Harbour. In partnership with the Aquarium and B.C. Hydro, our intent is to create in its place a salmon spawning demonstration feature and related interpretive material on a site readily accessible to the millions of annual visitors to the Park. B.C. Hydro has donated $1.5 million towards this $2 million project. The Board has agreed to contribute $500,000 towards the project and is looking to direct a portion of the Bayshore prepaid lease funds to this end. With Hydro's donation, the timing of the project has been moved ahead with the construction start anticipated this autumn.

The Board wishes to also close, demolish and relandscape the Stanley Park concession building adjacent to the duck pond. Also, the redevelopment plan envisages the greening and reduction of the old lower zoo parking lot and the Board wishes to combine this work with the creation of the stream. These works, estimated at $150,000, along with the salmon stream will complete phase 2 of the Stanley Park zoo area redevelopment.

CONCLUSION

Approval of the recommendations will allow the salmon stream proposal and the remainder of phase 2 replacement work to move forward to construction. This project is within the general vicinity of the Bayshore site and is considered appropriate use of the funds by the Park Board.

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ADMINISTRATIVE REPORT

Date: June 26, 1996

Dept. File No.

TO: Vancouver City Council

FROM: Deputy City Engineer and General Manager of Board of Parks and Recreation

SUBJECT: Bayshore Redevelopment - Central Park site Parking Garage Agreement

RECOMMENDATION

THAT Council endorse an agreement with the Bayshore Gardens Development Limited Partnership to lease the public parking garage beneath the Marina Square Park on terms and conditions outlined in this report.

COUNCIL POLICY

The City currently holds an agreement with Westin Hotels Limited to lease the parking garage under the park for 50 years for a current prepaid lease value of approximately $247,000. Seventy-five of these stalls are to serve the by-law required marina parking. In addition 142 parking stalls were to be constructed and available for public parking.

PURPOSE

This report recommends changes to the existing 1993 agreement concerning the eventual lease of the parking garage site by the City to the developer.

BACKGROUND

The Bayshore redevelopment project includes a 150 berth private marina for which 75 parking stalls are required. At rezoning, this parking was proposed to be placed below the future dedicated central park space, based on an acceptable lease with the Park Board. The rezoning report noted that this was the only by-law requirement parking to be included in an otherwise public parking garage. As a result, a legal agreement to cover the above was registered in October 1993.

DISCUSSION

The developer wishes to broaden the proviso limiting by-law required parking, to include his hotel needs during the redevelopment period.

After considerable negotiation the following arrangements are recommended by staff, and are acceptable to the developer.

1. The entire garage be leased to the developer for 50 years with a 25 year renewal option.
2. The lease amount is to be $1 million prepaid - half at building permit and half at occupancy of the garage.
3. The parking stalls will be increased to 246 and be available on a first come basis to marina patrons, hotel patrons and the general public.
4. The hourly rate will not exceed comparable hotel parking in this portion of the downtown peninsula.
5. Prior to build-out of the whole site, including the hotel, the developer will make provision, outside of this garage, for the stalls required by by-law (currently 521) for the existing hotel area.
6. If the hotel site is re-developed, it is intended that the total by-law required parking be located other than in the central park parkade. The developer may request a portion of the central park parkade spaces to be used to meet the permanent hotel by-law requirement. If Council and Park Board permit this use, then the lease terms would need to be re-negotiated. Such re-negotiating shall take into account a number of factors, including the initial lease payment, cost savings to the developer, the need for additional parking and the time remaining on the lease, among other things.

CONCLUSION

Staff recommend entering a lease agreement based on the above terms for the following reasons.

1. It represents a fair market value payment to the City for the volumetric lease space involved.
2. It insures in the long run that 170 public parking stalls will be available beyond by-law requirements to serve Stanley Park and seawall users.
3. It leaves room for future options for the developer if a larger hotel replacement is contemplated, and for Council to decide whether the public parking needs are of greater importance than a different arrangement.

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(c) 1998 City of Vancouver