Agenda #6

memorandum

to:                  Mayor and Town Council

from:            W. Calvin Horton, Town Manager

subject:      Downtown Economic Development Initiative: Update on Ram Development Design Proposal

date:            February 27, 2006

Tonight Marvin Malecha, Dean of the College of Design at North Carolina State University, will report to the Council on the peer review design process being undertaken in conjunction with the Ram Development Company’s design team for the Downtown Economic Development Initiative.

Dean Malecha is a fellow of the American Institute of Architects, which, along with the Association of Collegiate Schools of Architecture, awarded him its highest honor, the Topaz Medallion for Excellence in 2003. He has served as the dean of the College of Design since 1994.

BACKGROUND

The Town Council has undertaken work on the Downtown Economic Development Initiative as follows:

• Citizens began by sketching their ideas for downtown at design workshops in 2002.
• The Downtown Chapel Hill Small Area Plan identified development of “opportunity areas,” including Town Parking Lot 2 and Town Parking Lot 5.
• The Town hired consultant John Stainback in October 2003 to help explore the financial feasibility of a potential downtown development.
• In June 2005, the Council authorized negotiations with a developer, Ram Development Company.
• The Council held a series of design work sessions with Ram Development Company in 2005.  At the conclusion of the last design session on September 19, 2005, the Manager proposed to ask for the assistance of Dean Marvin Malecha in reviewing the proposed concept plans and architectural designs.
• The Council authorized the Manager to execute a Memorandum of Understanding (basic terms and conditions) with Ram on October 24, 2005. The Council also directed the Manager to negotiate a Development Agreement for consideration by March 31, 2006.  Negotiations related to the Development Agreement are proceeding between the two parties.

Development Design

The Memorandum of Understanding sets out basic parameters for the development:

• Lot 5 will have 3 buildings: 124 residential units for sale and 24,000 square feet of net leasable retail.
• Wallace Deck Project will have 2 buildings: 109 residential units for sale and 6,000 square feet of retail.
• Preliminary design concepts identify general expectations for developing the sites in terms of building scale and use, arrangement of buildings and public spaces on the sites, and parking.
• The Council has a priority that a potential eventual design should include high-quality public space on Lot 5.

Proposed Town Investment

The Memorandum of Understanding sets out the basic terms of the Town’s proposed investment:

• Developer will pay the Town $7.9 million ($4.75 million for Lot 5 and $3.15 million for the Wallace Deck site) to lease the Town-owned property for 99 years.

• The Town will pay the developer a fixed amount of $7.9 million for the construction of the Lot 5 parking garage and other Town-owned improvements.
• The Town will pay an additional $500,000 to support parking for affordable housing units.
• Risks of cost overruns would be borne by Ram. The Town will continue to own both sites. 
• Town will provide 99-year leases for both sites to the developer, with option to extend for 25 years. 
• After the developer receives a 15 percent return on cost, the Town will receive 20 percent of the net profit. 

PURPOSE

The purpose of the report by Dean Marvin Malecha is to report to the Council on the status of his design discussions with the Ram Development Company design team.

DISCUSSION

The Council’s Negotiating Team sought a design advisor to make a constructive critique and provide feedback on preliminary architectural designs, and to provide design advice and criticism on the design of public space. Marvin Malecha, Dean of the College of Design at North Carolina State University, agreed to conduct a “peer review” process beginning in October 2005.  Dean Malecha’s work is being done on a pro bono basis.

Dean Malecha conducted three peer review design sessions on October 26, November 15, and December 15, 2005.  These meetings focused on the conceptual site plans and the design of the public space.  At the conclusion of this set of meetings, Dean Malecha reported the status of discussions to the Council Negotiating Team for the Downtown Initiative on January 4, 2006.  At that time, he expressed his desire to continue discussions in January and February 2006, focusing on the architectural design of the buildings.

Since that time, Dean Malecha has held five additional sessions with the Ram Development Company design team focusing on architectural design on January 13, January 25, February 6, February 15, and February 22, 2006.

Tonight’s report covers all these sessions, focusing both on the conceptual site plan and on the architectural design for the Lot 5 and the Wallace Deck sites.

CONCLUSION

We recommend that the Council receive Dean Malecha’s report and provide feedback to Ram Development Company for consideration as it prepares for a concept plan submittal to the Community Design Commission, Historic District Commission, and the Town Council.

ATTACHMENT

1. Letter to Dean Marvin Malecha from Calvin Horton, Town Manager, September 29, 2005 (p. 4).