HomeMy WebLinkAboutProfessional Services Contract with CTA Architects for Mandeville Properties Land Use Plan1
Commission Memorandum
REPORT TO: Honorable Mayor and City Commission
FROM: Brit Fontenot, Economic Development Director
SUBJECT: Professional services contract with CTA Architects Engineers of
Bozeman, Montana for the preparation of the Mandeville Properties Land
Use Plan
MEETING DATE: April 9, 2012
AGENDA ITEM TYPE: Consent
RECOMMENDATION: Authorize City Manager to sign a professional services contract
with CTA Architects Engineers of Bozeman, Montana for the preparation of the Mandeville
Properties Land Use Plan
BACKGROUND: The City of Bozeman (City) negotiated a Memorandum of Agreement
(MOA) with the Department of Natural Resources and Conservation (DNRC) in September,
2011 to partner on a land use plan for the properties collectively known as the Mandeville
properties. (Exhibit 1) The City-owned portion of the Mandeville properties is an 85.35-acre
tract of undeveloped land zoned M-2 for industrial development. The adjacent parcel to the south
is owned by the State of Montana and managed by the DNRC as school trust lands. The State-
owned portion of the Mandeville properties contains approximately 190 acres of developable
property. Both parcels are located roughly between the North 7th and North 19th Avenue
interchanges and are located within minutes of the Bozeman Yellowstone International Airport.
Additionally, the City-owned parcel has access to east/west rail service.
The City applied for and received a $25,000 CDBG grant for economic development from the
Montana Department of Commerce. (Exhibits 2, 3 & 4) As outlined in the MOA, the City and
the DNRC agreed to equally divide the match requirement in the amount of $12,500 each.
Once notified of the award, the City and DNRC proceeded to draft and publish an RFP for
professional services to produce a joint land use and marketing plan for the Mandeville
properties. The City and the DNRC received five (5) proposals, interviewed four (4) respondents
and chose CTA Architects Engineers as the project consultant.
The attached contract and scope of work is the result of mutual review and agreement between
the City, DNRC, CTA and the Montana Department of Commerce on the contract and scope
language.
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Once the contract is executed by both parties, work will begin in earnest on the land use and
marketing plan. On April 23, it is the intention of the City, DNRC and CTA to provide the
Commission with a special presentation outlining the goals and strategies of the project and plan.
The proposed schedule of work is included in the Scope of Work, Attachment A to the Contract.
UNRESOLVED ISSUES: There are no unresolved issues at this time.
ALTERNATIVES: As directed by the Commission.
FISCAL EFFECTS: The total contract amount is $50,000. The City was awarded a
CDBG planning grant in the amount of $25,000 to be matched dollar for dollar. The City
entered into an agreement with the DNRC to divide the total required match, $25,000, equally
and jointly participate in the Mandeville Properties Land Use planning project. The City and the
DNRC have agreed to fund up to $12,500 each to provide the required match. The City’s
portion of the match, $12,500, is identified and will be paid from funds budgeted in the City’s
Economic Development budget. The DNRC will contribute the balance of the required match or
$12,500.
Exhibits:
1. September 2, 2011 Memorandum of Agreement between the City of Bozeman and the
DNRC pledging and structuring the $25,000 in match funding for the CDBG grant;
2. September 19, 2011 City of Bozeman’s CDBG grant application;
3. November 1, 2011 CDBG Notice of Award letter from Montana Department of
Commerce; and
4. December 1, 2011 Montana Community Development Block Grant, Economic
Development Program Contract executed between the Montana Department of
Commerce and the City of Bozeman.
Report compiled on: March 27, 2012
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ATTACHMENT A
Scope of Work
Mandeville Properties Land Use Plan
CTA ARCHITECTS ENGINEERS and its’ consultant MXD DEVELOPMENT
STRATEGISTS, hereinafter referred to as “CTA”, will perform the following services in
accordance with the land use plan for the Mandeville Properties for the CITY OF BOZEMAN,
hereinafter referred to as the “CITY” and the MONTANA DEPARTMENT OF NATURAL
RESOURCES AND CONSERVATION hereinafter referred to as the “DNRC”,
1.1 Background Analysis
CTA will:
Participate in an internal kickoff workshop with the CITY and the DNRC to discuss the
project vision and timeline and gather all related background information as provided by the
CITY and the DNRC to understand the site history, characteristics and potential
development issues;
Discuss the overall strategy within its jurisdiction, the history and thought behind its vision
and strategy, and to identify specific implications for the development area;
Document and assess the region’s economic dynamics, population growth, employment
change, patterns of community development as well as major economic initiatives in the
local area. As necessary interview and reference local real estate professionals and
government sources to gather background market intelligence;
Identify “Economic Clusters” or prevailing economic niches that are either present in the
region and consider what the “Niche Economic Clusters” could be embraced to establish a
competitive framework for future employment growth and land use opportunities;
Prepare a macro overview of major commercial and residential development initiatives in
the CITY and region as well as documentation/evaluation of historic and forecasted
Construction Activity (e.g. Commercial & Residential Building Permits for the various
asset classes and overall development activity);
Coordinate with local, regional and state economic development entities (the CITY, DNRC,
Governor’s Office of Economic Development, Montana Department of Commerce,
Prospera, TechRanch, MMED, Port of Montana, Montana State University, Gallatin College
Programs, Montana State University Innovation Campus, et al) to identify and support
economic development strategies for the Mandeville parcels with the highest potential for
success (e.g. cluster development, HUB Zone designation and possibly the establishment of
a Foreign Trade Zone); and
Coordinate with local, regional and state human and community service providers (e.g.
HRDC, Bozeman Job Service, Montana State University, Gallatin College Programs et el)
to determine best approaches for enhancing the economic quality of life for area residents,
especially low and moderate income families.
1.2 Site Assessment
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CTA will:
Undertake Field Investigation & Site Evaluation to assess property’s development
viability and potential;
Prepare a SWOT (Strengths/Weaknesses/Opportunities/Threats) Assessment outlining
property's inherent potential for each type of land use development, using an Evaluation
Matrix;
Assess site qualities in relation to commercial and institutional development (office,
retail, light industrial/flex, hotel/accommodation). Consider major site criteria for each
potential commercial land use, including visibility from major transportation routes and
local thoroughfares, accessibility (regional, local and site access ), adjacent land uses,
strategic position, potential intervening competitive sites, and other important site factors;
Assess site qualities in relation to residential development. Consider major site criteria
for potential single and/or multi-family housing (e.g. proximity to schools, hospitals, transit
etc);
Identify optimal locations for recommended land uses within the proposed development
site that best capitalize upon inherent strengths and opportunities, and which mitigate
weaknesses and threats; and
Prepare Site Assessment Overview to summarize information gathered in Site Assessment,
identify its implications on the site, and to provide additional recommendations on the
development opportunity.
1.3 Retail Development Opportunity Assessment – Supply & Demand Analysis
CTA will:
Document current and proposed competitive retail facilities. Provide a summary of
format and performance characteristics including occupancy, rental rates, anchor tenants and
leasing activity (as available);
Prepare a Retailer and Merchandise Category Void/Opportunity Matrix to distinguish
potential retail offering from competition while providing compatibility to adjacent land
users;
Identify retailers (new & existing) looking to expand in the local/regional market;
Delineate a Retail Trade Area using an analysis of drive times, competitive retail locations
and local area demographics;
Analyze Trade Area’s demographic profile, including population growth, income levels,
and other data affecting retail as well as residential preferences;
Analyze Retail Trade Area’s retail expenditure profile on each of the major forms of
shopping, dining and entertainment;
Analyze Visitor Trends & Profile (if applicable) for local and regional area, and quantify
visitor retail expenditures;
Assess Residual Retail Demand, based on an evaluation of current city-wide retail
inventory (if available) to warranted city-wide retail inventory for current year to identify
inventory balance, surplus or lack thereof;
Prepare Warranted Retail Floorspace Allocation for the project site, with specific
floorspace recommendations regarding the amount, mix and competitive positioning of
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Convenience Shopping, Comparison Shopping, Food & Beverage and Entertainment;
Subdivide overall recommendation of floorspace through a Retail Capture Rate Analysis
to test and justify the recommended retail floorspace allocation based on 21 different
merchandise categories;
Identify forecasted absorption of retail space to identify feasible and realistic phasing
strategy; and
Identify estimated achievable retail lease rates for prospective tenants (anchor, sub-anchor
and in-line).
1.4 Office Development Opportunity Assessment – Supply & Demand Analysis
CTA will:
Identify competing office projects both built and in pipeline throughout region. Gather
information on size, positioning, amenities, timing and current leasing activity. Identify key
amenities to consider introducing in planning stages given the types of tenants/operations
moving to the area;
Define market area for likely office end-users and employees;
Analyze growth in employment (amount of jobs and type of employment) in the area to
provide a foundation for the demand for office space over the next 25 years;
Calculate growth in demand for office space by applying industry-standard benchmarks
on office space requirements (sf per employee) to the projected growth in office-related
jobs;
Refine the projections by studying local brokerage data, the location of offices and/or
office clusters and further documenting the sector metrics such as occupancy, inventory,
lease rates, property values, land values, cap rates, absorption of new space and tenant
profiles;
Calculate potential absorption of new office space at the development site, by applying an
Office Capture Rate Analysis to the office demand figures. Beginning with a “Fair Share”
approach, sensitize this forecast by the site’s inherent strengths and weaknesses vis-à-vis
competing office locations (current and future) within the local market;
Identify type, phasing, configuration and optimal location for office uses, if demand is
warranted; and
Identify estimated achievable office lease rates for prospective office tenants, as critical
inputs into Task 3 – Financial Feasibility Study.
1.5 Business Park/Light Industrial/Flex Business Units Development Opportunity
Assessment – Supply & Demand
CTA will:
Identify light industrial/flex projects in local area documenting rates of vacancy,
absorption and lease rates;
Identify Proposed or Planned New Projects in the Pipeline;
Prepare summary of light industrial/flex supply and identify implications on subject
development site;
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Identify major Employers and Companies in the Bozeman Region;
Quantify and forecast incremental demand by projecting employment growth and
economic development forecasts;
Capture Rate Analysis for New Space that could be garnered at Project;
Recommend Format, Positioning, Price Point, Lease Rates & Phasing; and
Recommend Amenities to Attract Targeted Business Park/Logisitics/Flex Tenants.
1.6 Hotel/Accommodation Development Opportunity Assessment – Supply & Demand
CTA will:
Document existing inventory and planned projects, including amenities, price point, location
and strengths/weaknesses;
Collect current performance data on the local and regional Hotel supply, including
Occupancy Rates, Average Daily Rate (ADR) and Revenue per Available Room (RevPAR);
Create Void/Opportunity Analysis Matrix for Hotel/ Accommodation in trade area, to
identify specific voids (unmet potential) that represent potential development opportunities to
pursue;
Conduct “Fair Share” Hotel Capture Rate Analysis to establish a baseline of market
support for Hotel/Accommodation in the project. Identify the likely occupancy, RevPAR and
other key operating metrics in order to gauge incremental demand for a potential
hotel/accommodation in the project; and
Identify amount, type, format, price point and optimal location for Hotel/Resort
Accommodation uses, if demand is warranted on subject property.
1.7 Institutional Development Opportunity Assessment – Supply & Demand
CTA will:
Document existing inventory and planned government-owned facilities; and
Identify, based on background research the need for new institutional facilities and
subsequently quantify the amount of floorspace and resulting land required to accommodate
demand, if and as warranted.
1.8 Single and Multi-Family Residential Development Opportunity Assessment
CTA will:
Identify notable single and multi-family residential projects in local area documenting
rates of home ownership, rental, development size, number of units, average unit sizes, price
point allocation, absorption of new units and significant amenities/features;
Examine MLS and other housing studies to gauge recent residential sector performance
and profile forecasts as provided b y economic and housing agencies;
Prepare summary of residential supply and identify the implications on subject
development site;
Document residential buyer profile to determine age profile, income levels and region of
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origin, where such information is available;
Quantify and forecast residential demand by projecting growth in local population,
employment and household composition;
Identify rate of annual demand and absorption at the subject development site for
single and multi-family residential uses by applying a Residential Capture Rate Analysis
to the local area’s recent (3 to 5 year) historical growth; and
Identify optimal mix of residential units, (unit size allocation, target market segments and
price points), based on identified demand segments, composition of successful competing
developments in the marketplace and demographic forecasts for local market.
CTA Fee for Task 1 Real Estate Market Analysis - $18,500
2.0 Conceptual Infrastructure (with cost estimate) and Site Plan
The objective of Task 2.0 would be to develop the optimal development site layout,
configuration and integration of the various land uses and the resulting economic development
benefits. To that end CTA will:
Identify potential locations of Key Functions & Districts;
Define allocation of recommended Land Uses and product types (Office, Light
Industrial/Flex, Hotel/Accommodation, Institutional, Retail and Residential) to specific
“zones” within the development site;
Provide Architectural Design Input as a precursor to developing specific architectural
guidelines. CTA will use our vast database of Case Study imagery from other projects
around North America to illustrate how the project’s vision or "look and feel" could be
defined in terms of its building architecture, recognizing that buildings increasingly require
a 360 degree architectural viewpoint;
Provide direction for the optimal Development Timing/Phasing Strategy to ensure the
project is “right-sized” to match the development opportunity as the local area builds out
and that the development components are “right-sized” to market demand positioned to
capture the target markets;
Document in tables the recommended project phasing strategy. For each phase of
development, identify warranted land use allocation program, and allocate to each district
within the project; and
Generate two (2) conceptual alternatives of the project that will include:
a. Detailed Color site plans;
b. Architectural Imagery of potential build-out including a branding theme;
c. Integration of existing and proposed transportation network;
d. Proposed infrastructure build-out of project including roads, curbs/gutters,
sidewalks, water, wastewater, stormwater, telecom and broadband connectivity,
natural gas, electricity and rail spur; and
e. Cost estimates of each conceptual alternative.
CTA Fee for Task 2 - $16,000
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3.0 Financial Feasibility Study
The objective of Task 3.0 would be to provide a pro forma analysis for two (2) development
scenarios for the Mandeville Properties utilizing the following methodology. To that end CTA
will:
Prepare and refine the Financial Model to test the potential financial returns for the Potential
two (2) Development Scenarios;
Input the recommended Development Program Mix & Assumptions into the model (from
the Task 1 Market Research);
Input other relevant assumptions into the model from the Preliminary Development Concept
Plans;
Integrate construction cost projections into the Financial Model;
Integrate Market Analysis findings for revenues generated by each Land Use into the
Financial Model;
Compare the revenues and costs to calculate Net Cash Flow for the project;
Estimate the Net Operating Income, Internal Rate of Return, Net Present Value, Applied
Capitalization Rate and other key financial metrics for the proposed project;
Present the initial Financial Model to the CITY in an Interactive Web Conference
Workshop Session where we would collectively sensitize the input assumptions to
understand the Project Value and other financial parameters;
Compare revenues and costs to calculate Net Cash Flow for the project;
Assess potential Financial Returns on Costs & Equity Investment;
Perform Financial Return Testing & Feedback Loop for up to two (2) scenarios; and
Recommend Iterative Refinement of the Preliminary Concept Plans based upon the
Financial Analysis findings to identify and define the HBU development scenario that yields
the maximum returns.
CTA Fee for Task 3 - $11,500
4.0 Scheduling
The objective of Task 4.0 is to provide advice and direction on the timing of additional work on
the on the Mandeville Properties Land Use Planning Project not included in the Scope of Work.
To that end CTA will:
Advise and prepare a list of tasks necessary to complete the sale, lease or build-out of the
Mandeville Properties which may or may not include such future tasks as:
a. Environmental Assessments (Prepared by CITY)
b. Negotiations with Montana Rail Link;
c. Change of Zoning of properties;
d. Preliminary Platting;
e. Infrastructure development/extension;
f. Other jurisdictional permitting that may arise out of design process; and
g. Other necessary items that may arise out of design process.
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CTA Fee for Task 4 - $2,500
5.0 Final Report
The objective of Task 5.0 would be to provide a summary final document of the project in a
bound report. To that end CTA will:
Prepare a final report that will include the Real Estate Market Analysis, Summary of
workshops and interim deliverables, Conceptual Infrastructure and Site Plan, Cost Summaries,
Financial Feasibility Study, and Scheduling of future tasks and build-out scenarios; and
Present project to steering committee and or the public.
CTA Fee for Task 5 - $1,500
Key Dates
Notice to Proceed April 9, 2012
Task 1 work period April 9, 2012 – May 30, 2012
Task 2 work period April 23, 2012 - July 20, 2012
Task 3 work period June 1, 2012 – July 15, 2012
Task 4 work period July 13, 2012 – July 27, 2012
Task 5 work period July 13, 2012 – July 27, 2012
Fees
The project scope of services will be completed on a lump sum basis of $50,000 broken into the
five (5) tasks as indicated and payable monthly based on a percentage of completion of the
project.
Contractor Hourly Fees
Wayne Freeman - $130/hr
Wes Baumgartner - $110/hr
Brent Moore - $106/hr
Todd Swinehart - $100/hr
Mark Westenskow - $100/hr
Kieron Hunt - $225/hr
Martin Anstey- $225/hr
Peter Short - $150/hr
###END OF SCOPE OF WORK###
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