►
Description
San Bruno City Council Meeting 12/10/2013
10b. Development Agreement on Crestmoor Lots
B
Good
evening,
mr.
mayor
and
members
of
the
City
Council
I'm
Harry
burrows
and
I'm
the
city's
project
manager
for
the
crestmore
reconstruction
project,
the
item
before
you
tonight
is
the
recommendation
of
a
home
builder
for
the
ten
vacant
lots
in
the
crestmore
neighborhood
the
map.
That's
before
you
shows
the
current
ownership
of
the
vacant
lots
within
the
neighborhood.
The
lots
of
PG
neons
are
shown
in
green
outlined
in
green.
B
The
lots
of
the
city
or
owned
and
shown
in
red
city
currently
owns
five
lots,
two
of
which
the
ones
that
are
shaded
there
with
the
solid
shading
are
envisioned
for
future
public
purposes,
one
for
a
potential
expansion
of
the
park
and
the
other
for
a
public
open
space.
So
the
three
city
lots
and
the
seven
PG
neon
lots
total
total.
The
ten
lots
of
the
subject
of
this
item
tonight.
On
april
9th
of
2013,
the
city
council
directed
the
staff
to
coordinate
with
pge
and
package.
There.
B
Seven
lots
with
the
three
city-owned
lots
and
solicit
proposals
from
qualified
home
builder
developers
to
construct
homes
on
those
Lots.
The
issues
that
were
discussed
by
the
city
council
at
that
time
included
included
the
desire
to
avoid
a
fragmented
build-out
of
the
remaining
lots
to
seek
a
single
qualified
home
builder
developer,
who
possess
the
financial
and
operational
capacity
to
guarantee
the
time
of
completion
and
occupancy
of
the
homes
and
to
avoid
some
of
the
potential
challenges
of
selling
to
individual
individual
Lots,
some
of
which
would
include
how
to
select
a
purchaser
there's.
B
Multiple
parties
that
want
to
purchase
a
single
lot.
Other
issues
discussed
were
potential
financial
complications
when
an
individual
owner
doesn't
have
the
financial
capability
to
get
a
construction
loan,
as
well
as
the
purchase
of
the
lot.
So
those
were
some
of
the
items
that
were
discussed
subsequent
to
that
direction.
The
city
entered
into
an
agreement
with
PG&E.
Had
appraisals
performed
an
issue
to
request
for
proposals
in
August
of
2013.
B
The
RP
was
sent
out
to
over
fifty
home
builders
contractors
and
other
interested
parties.
The
RP
specified
certain
criteria
and
spelled
out
the
requirements
that
the
successful
builder
would
be
subject
to
these
criteria
included
developer
qualifications
and
experience
in
constructing
multiple
units
at
once.
The
financial
capacity
to
purchase
all
of
the
lots
and
finance
the
simultaneous
construction
of
ten
homes.
We
looked
at
operational
capability
in
the
structure
of
the
company,
as
well
as
their
proposed
architecture
and
design.
The
purchase
price
was
not
the
sole
and
primary
criteria
for
selection,
but
obviously
was
an
important
factor.
B
So
the
city
received
six
proposals,
for
the
proposals
were
from
what
we
call
merchant
home
builders,
traditional
home
builders
and
two
proposals
were
from
investor
builder
groups,
staff,
ranked
the
proposals
based
upon
the
criteria
that
I
just
described,
with
particular
emphasis
on
the
operational
and
financial
capabilities
to
deliver
the
ten
constructed
homes
within
the
next
12
to
14
months.
Hopefully,
concurrent
with
the
completion
of
the
rebuild
of
the
infrastructure
in
the
neighborhood
to
the
proposals
were
ranked
essentially.
Equally,
those
were
the
castle
companies
and
anova
homes
listed
there.
All
of
the
proposals
were
deemed
responsive.
B
With
the
exception
of
dr
horton
DR
horton,
you
can
see
submitted
the
highest
purchase
price.
However,
they
did
not
submit
a
proposal
only
a
letter
of
interest,
so
their
proposal
was
or
their
their
response
was
disqualified.
Otherwise
all
of
the
teams
submitted
very
solid
proposals.
However,
the
lesser
ranked
teams
that
ranking
reflects
both
the
lack
of
extensive
experience
of
their
team,
their
lesser
financial
capability
and
or
lower
purchase
price.
B
So
staff
then
asked
both
deneuve
and
castles
met
additional
information
regarding
the
proposed
homes
they
would
construct,
including
examples
of
their
fit
and
finish,
make
sure
the
interiors
we're
comparing
apples
to
apples
and
other
assumptions
that
they
put
into
their
proposals
both
companies
after
this
analysis
were
deemed
again.
Equally
capable
staff
gave
the
nod
to
castle
based
upon
this
final
review
and
the
higher
purchase
price,
their
their
purchase
prices,
eighty-five
thousand
dollars
per
lot
average
higher,
so
staff
recommends
a
selection
of
Castle
companies.
As
the
builder
of
these
ten
vacant
lots
very
quickly.
B
So
the
council
concurs.
The
next
step
would
be
the
negotiation
of
a
development
agreement
and
then
the
design
and
approval
process
and
ultimately,
construction.
It's
anticipated
that
if
the
selection
occurs
tonight
that
the
design
process
can
occur
during
the
spring,
we
start
construction
in
the
summer
and
home
sales
and
occupancy
can
occur
late
this
year
and
into
the
first
quarter
of
2015
mr.
Steve
Garrett.
The
president
of
Castle
companies
is
here
in
the
audience
tonight.
Should
the
council
have
any
questions
and
staff
is
also
available
to
answer
any
questions
you
may
have
any.
A
C
B
C
My
other
question
is
that
when
you
say
that
they'll
come
then
the
review
process
through
san
berdo
Planning
Commission
sin
city
staff.
He
say
there
won't
be
any
variances.
It's
my
understanding
that
there
were
a
majority
of
the
new
homes
sought,
increased
fa,
ours
I
mean:
are
you
saying
that
they
will
not
be
able
to
or
they
will
they
have
to
conform
to
the
threshold
figures?
C
B
C
B
C
So
semantics
aside,
I
mean
variance,
is
one
thing
but
and
maybe
the
community
development
direction
could
we
have
an
fa
fa?
Our
threshold
of
fifty
five
percent
and
projects
were
approved
at
sixty-two
percent.
Okay,
are
we
saying
that
they
won't?
They
will
have
to
conform
to
the
fifty
five
percent
on
every
single
lot.
D
Real
quickly,
because
it
goes
forward,
I
would
just
hope
been
encouraged
that,
as
far
as
the
development
and
the
even
the
selling
of
the
homes
be
thought
of
as
far
as
prevailing
wage
Union
and
as
far
as
local
and
I'd
like
to
see
that
being
in
strong
consideration
as
this
project
goes
forward.
If
awarded.
E
E
E
E
Our
understanding
that
I'm
sorry
through
that,
you
sure
that
you,
through
the
city
canceled
they
it's
our
understanding
that
pge
does
not
intend
to
receive
any
net
proceeds
over
the
cost
that
they
incurred
in
purchasing
the
lots
and
that
any
at
least
net
revenues
would
be
donated.
It's
what
we've
been
told
to
charity
or
some
other
purpose
that
is
not
a
prophet
to
PG,
be
okay,.
F
G
I'm
Chris,
chair
and
barrel
I
live
at
971
glenview,
dr.
I
have
empty
lots
on
both
sides
of
my
house,
and
I
also
have
expressed
interest
in
buying
a
lot
we'd
like
to
buy
a
house
or
build
a
house
for
our
daughters
so
that
they
could
live
in
our
neighborhood
live
next
door
to
us.
They
may
not
like
that
now,
but
they
will
later
so
so.
H
Good
evening
mera,
when
members
of
the
council,
I'm
Steve
gear
and
I'm
a
partner
with
the
castle,
companies
I'll
try
to
keep
my
comments.
Brief
I
just
want
to
thank
the
staff
for
their
analysis
and
the
presentation.
We
were
pleased
to
participate
in
the
process.
We
thought
it
was
well
conducted
and
that
the
playing
field
was
level
and
we
rarely
see
of
the
opportunity
to
build
new
homes
in
a
community
along
the
peninsula
and
we're
very
much
looking
forward
to
this
opportunity.
H
A
large
portion
we've
been
in
business
for
40
years,
that's
a
family
owned
business
and
we
are
I'd
say
more
than
half
of
our
business.
Now
is
smaller
infill,
home
building
or
we're
working
with
neighbors
and
working
with
the
community,
and
this
this
fits
very
well
in
in
the
types
of
opportunities
and
things
that
we
are
pursuing
nowadays
after
the
the
real
estate
crash
and
we're
very
much
looking
forward
to
this.
H
H
There
are
employees
and
they
have
been
on
the
the
folks
who
are
our
superintendents
have
been
with
us
for
about
20
years
typically,
so
we
were
a
long-term
relationship,
oriented
kind
of
a
business,
and
then
we
also
typically
try
to
employ
a
union
subcontractors
that
are
local
and
close
to
where
the
homebuilding
occurs,
for
the
natural
reason
that
if
there
are
service
requirements
or
something
goes
wrong
in
a
house,
occasionally
does
it's
easier
to
call
a
subcontractor.
That's
a
few
miles
away
than
one
that's
a
long
distance
away.
H
We
we
do
not
employ
soup-to-nuts
Union
contractors.
In
some
cases,
some
of
those
trades
simply
are
not
for
a
home
building.
There's,
not
unions
that
are
really
active
for
things
like
building
fences
and
things
of
that
nature,
so
we
don't
always
employ
them
and
then
another
with
respect
to
working
with
local
people.
We
did
do
our
market
analysis
locally
and
we
used
a
local
agent
and
we
would
definitely
be
talking
with
with
her
about
considering
to
work
with
us.
You
know
if
we
are
selected
and
if
we
move
forward
with
this
opportunity.
A
H
H
A
A
Maybe
I
can't
get
the
financing
we're
going
to
wait
another
year
and
have
this
neighborhood
continually
impacted
your
you're
really
impacted
now
with
what's
happening
up
there
as
far
as
the
storm
drains
and
the
laterals
coming
up
in
traffic
and
the
streets,
and-
and
we
want
it
to
minimize
that
as
much
as
possible,
but
there's
nothing
to
to
preclude
any
of
you
from
you
know
going
forward
and
talking
to
that
particular
agent.
Whenever
that
agent
is
hired,
you
know
to
get
in
line.
H
We
provided
mr.
Burroughs
and
his
team
financial
information
and
references
from
money
center
banks
that
you've
all
heard
of
without
naming
names
and
those
references
are
there
and
they
are
financed
us
in
this
type
of
project
and
this
size
project
in
the
past
and
they're
more
than
capable
and
willing
to
do
it
here.
Thank
you
very
much.
Karen.
C
Katz
one
last
question,
sir:
with
the
economy
of
scale
10
homes,
all
at
once,
plus
you
you
just
bought
the
dirt
for
400
over
four
hundred
thousand
dollars,
and
I
know
I
don't
think
you
can
sell
these
homes,
for
you
know
1.5
2
million
dollars
apiece.
I
grew
up
hello,
you
tell
you
lie
you.
Could
I
break?
C
H
So
we
have
that
advantage,
but
the
disadvantage
sometimes
with
the
10
homes
would
be
for
us
to
finish
10
homes
simultaneously
and
then
sell
and
close
them
simultaneously.
That's
a
disadvantage
because
you
realistically
aren't
going
to
close
10
homes
all
in
the
same
30
days
span,
so
we're
going
to
some
carrying
costs
there.
There
a
disadvantage.
I,
don't
think
that's
great,
especially
in
the
interest
rate
environment.
H
We're
in
today,
to
get
more
specifically
to
answering
your
question
councilman,
to
borrow
what
I
am
accustomed
to
seeing
is
if
a
homeowner
comes
to
build
us
a
nicely
finished
home
of
this
size,
they
could
expect
to
pay,
maybe
300
to
400
dollars
a
foot
to
build
that
house
in
today's
environment,
with
a
builder
with
our
economies
of
scale
and
our
relationships
and
the
different
things
that
we
can.
You
know,
for
example,
you
know
architectural
costs
are
lower.
H
Structural
engineering
is
lower
because
we're
building
a
very
similar
home
in
the
same
neighborhood
with
the
same
soils
conditions.
So
we
have
all
those
advantages
in
lowering
our
costs.
I
would
think
that
we
could
probably
do
it
for
half
of
that,
or
maybe
a
little
more
than
half
so
hope
that
answers.
Thank.