HomeMy WebLinkAboutContract 27577CITY SEC��iARY
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EXCLUSTVE NEGOTIATING A1�iD PRE-DEVELOPMENT AGREEIVIEIVT
THIS EXCLUSTVE NEGOTIATING AI�iD PRE-DEVELOP1i�E1�TT AGREEMENT
("Agreement") is made and entered inta as of tb.is /�s day of March, ZOfl2, by and between
the CITY OF FORT WORTH, a Texas home-rule municipality (hereinafter called "City"}, and
PORTMAN DEVELOPMENT, LLC, a Georgia limi�ed liability cornpany, and PHELPS
PROGRAM MANAGEMENT, LLC, a Delawaxe limited liability company {hereinafter
collectively ealled "Develaper"}; and the City and Develop�r are collectively referred to herein
as the "Parties."
WITNESSETH:
WHEREAS, Developer has responded to that certain Request for Proposal dated June 13, 2001
("RFP") issued by the City for the Fort Worth Conventian Center Hoiel Proj�ct ("Project"),
situated on City�ovc+ned property bardered by Houston, Throckmortan, Eleventh, and Fourteenth
Streets in Fort Worth, Texas, as more particularly described and delineated on Exhibit A,
attached hereto and made a part hereoi {"Properfy"); and
WHEREAS, the City Cfluncil of Fort �Vorth by Resolution of September 18, 2001, has agreed
�at Developer's qualifications and approach are acceptable to the City; and
WAEREAS, the City has retained LTBS PaineW'ebber as underwriter {"Underwriter") for the
obligations to be issued pursuant to the City"s financing plan with respect ta the construction and
development of the Praject ("Bonds") and wi11 exert its reasonable efforts ta accomplish the
goals of said financing plan; and
WHEREAS, the City has r�tained HVS to prepare a market sizzdy ("Market Study"), the intent
of such study being to provide inforrnation to determine the viahility of construcking and
operating a hotel an the Property and the op�im�m quality Ievel and size of such hotel; and
WHEREAS, Dieveloper desir�s to negotiate a Developznent Management Agreemen� with
Corporatian iar Developer to develap the Project'on the Property for the Corporation {as defined
in Paragraph 1.2.13 below); anc� .
WUEREAS, Develop�aesires to negotiate a Qualified Managemen� Agreement and ii
applicabl�, a Parking Garage Management Agreement with the Carporation for Developer to
provide asset managemen.t services and to retain a mutually agreeabla operator or aperators to
operate the Praject an behalf of the Corporation far such period of tirne as may b� allowable
pursuant to the Internal Revenue Cod�; and
WHEREAS, in accordance wit� the terms of this Agreement the City is willing to exclusiveiy
negatiate with Developer to accomplish all of the foregoing;
NOW, THEREFORE, the Parties mutually agrae as follows:
ARTYCLE Y. AGREEMENT TO NEGOTIATE/PRE-DEVELOPMENT ACTIVYTIES.
1.1 Period of Ne�otiatians. Tha terrn of this Agreement {"Negotiating Period") shall
commence on the date of this Agreernent and shall end on �he earlier of (i} the execution of ti��
Development Management Agreement, Qualified Management Agr�ement and P�rk��� .C�� ��
Cor�vention Center Hote! MOiJ
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Managernent Agteement, if applicabl�, mutually acceptable to the Parties (collectively, the
"Agreement�s") as provided below, {ii} one hundred eighty (180) calendar days from the date of
this Agreement, or {iii) termination pursuant to Paragraph 1.5 below. If an agreement ca:nxiat he
reached by the Parties upan the �xpiration af the Negotiating Period, the Parties shall no longer
be restricted to negotiating exclusively with each other, except to th� extent tl�at the Parties
mutually agree ta extend the Negotiating Period. The Neg�tiating Periad may be extended
pursuant to Paragraph 1.6 below.
1.� PredeveIopment ��tivities. During ihe Negotiating Periad, City and Develaper wi11
use tbeir best reasonahle efforts to negotiate and execute the Agreements. Dev�eloper
acknawledges and agrees that City, in the perfarmance of its rights and duties hereunder, wil�
saek the advice and counsel of the consultants na�ned in the preamble to this Agreement, and
other advisars, attarneys and consultants so selected by City. Priar to the execution af the
Agreements, the Parties shall underta�e the following activities in connection with the
de�+elopment af the Project.
�.2.1 Par�in� and Tra#'�c Studies. City and Developer shall mutually determine if a
consultant should he employed to prepare a feasibility study with respect to the
parking component of the Project {the "Parking Study") and additionally, if a
consultant should be employed to cond�tct a study ta determine traffic impacts
#o existing stree�s and raads {the "Traffic Study") as a result of implementation
of th� Project and tk�e resultant required mitigation thereof. If a determinatian is
made that a Parldng Study and/ar a Traffic Study is required, City shall select a
cansultant(s) with the consent and advice af D�veloper and the City, ar
Developer, at City's expense, shall employ such consultant(s).
I.2.2 Pro�ram and Size. City, with the assistance of Developer, sY�all determine the
preliminary pro�ram for the Praject, including the size and expected ittnctions.
1.23 Conceqtual Plans and Develaned Cosi Estimate. Developer shall, pursuant to
the 1Vlarke# Study and Parking Study, if any, and the preliminary program
determined by City, prepare conceptual plans and a preliminary cost esiimate
for developfnent af t�e Project. Developer shail employ John Por�man &
Associat�es, Inc. _("Architect"} and Hensel Phe�ps Construction Co.
("Construction Manager"} in connection with the preparation of such conceptual
plans and cost astimat�s. City shall reimburse D�v�loper for the cost oi such
Architact and Construction Ma.nager as set %rtI� and limited by Exl�ibit B
herato.
1.2.4 Feasibilitv �tudv. Cify shall employ HVS to prepare a feasibility study for the
Project based upon the conceptual plans and preluninary cost estimate prepared
by Developer, Architect and Constructian Manager using work produc�
described in Paragraph 1.2.3.
1.2.5 Approval of Conceatual Design. City and Developer shall use reasonable besi
efforts to mutually agree on the conceptual glans and the preluninaty cost
estimate for the Project.
Convention Genter Hotel M0�1 2
1.2.6 Site Information. City wil� provide De�eloper with all of the relevant site
information reasonably needed to develop the plans for the Project, including
title, survey, topographical, soi1, geotechnical, and the location and possible
need to relocate uiiiities, easem�nts and infrastructure.
1.2.7 Environmental Assessrnent. City shall provide Developer with Phase I and if
n�cessary, Phase II enviranmental reports for the Property. City agrees to
provzde any necessary environmental rnitigation measures prior to delivery of
the Property to the Corporation.
1.2.8 Selee�ion of Hotel Ouerafor and Parking Operator. City and Developer
shall use reasonable best efforts to mutually select a qualified hotel operatar
("Hotel Operator"), and; if necessaty, a parking operator ("Parking Operator")
pursuant to the recommendations contained in the Market Study and Parking
Study, if any.
1.2.9 Technical Services A�reement for Hotel. Developer shall negatiate an
Operatar, Technical Ser�+ices and Pre-Opening Services Agreement with the
Hotel Operator an terms acceptable to City (the "Operatar Agreement") and
shall employ th� Hate1 Operator to provide such Technical Services as are
required to allow Developer anc� City to reach agreement on the fixed pric� to
be stipulated in the Development Managernent Agre�ment (s�e Paragraph
1.2.11 below). City shall reimburse Developer fo;r the cost of Hotel Operator's
Technical Serviees incurred by Developer prior to the execution of the
Development Managea�ent Agreement as set forth and limited by Exhibit B
hereto. Except as provided above, execution of the Operator Agreement shall
be sut�j ect ta ihe execution of ihe Qualif ed Management Agreernent (see
Paragraph 1.2.12).
1.2.10 Guaranteed 11�Iaximum Price for Constr�ction. After appraval by City vf the
conceptual plans and prelinainary cosfi estimate, Deve�oper sha.11 advance fihe
design for the Project to a state sufficient for Developer to obtain a Guaranteed
Maximum Price from Construction Manager. Developer shall employ Architect
and Constructian Manager in connection with such design development and
City shall r�imburse Developer for the cost oF such Architect and Canstruction
Manag�as se� �orth and limited by Exhibit B hereto.
1.2.11 Develonment 1Vlana�eu���� A�reemen� City and Developer shall use
reasonable best efforts to negotiate the Davelopment Manag�rnent Agreerrient,
which shall require Developer to deliver the Praject to Corpara,tion for a"not to
exce�d" price and on or before a particular point in time. The Dev�elopment
Management Agreement shall provide for {i) a fee to De�eloper far
develapment reiated services of 3.5% of the tatal de�elopment cast af the
Project (excluding financing costs and costs incurred by City which are not paid
for or reimbursed by Developer) (the "Develogment Cost'� pius reimbursement
of Developex's administration costs, including the salary and benefits of
D�valop�r's on-site manager, in an axnount not to exceed $450,000; {ii) at the
City's sole discretion, the pracuring, as a Project cost, of insura�ce against the
farce�majeure risks associated with the timely construction oi the Project, or
Convention Center Hotel MOU 3
such other protection against such risks; {City acknowledging that the foxce
majeure �isk 5hal1 be borne by the City} (iii) a f�:e to Developer of 1.5% o#' the
Development Cost for providing a cornpletion guaranty in connection with the
financing of the Project, or such oiher fee as may be agreed by the 1'arties in
connection wit� the shifting of all or part of such risk to a source other than
Developer; (iv) all savings associated wit� the deveiopment and construction of
the Proj ect to accrue to the benefit of the Proj ect or City, as City �nay determine
and as may be permitted by �he financing for the Pro�ect; (�) paym�nt by City,
out of sa�ings or other sources, for changes in the Project introducec� by City
after the Praject budget and schedule hav�; b�en agre�d by the Parties; (vi) ihe
right af City to audit and review the books and records of Develaper and
Construction Manager relating to the costs af deveiopment and eonstruction of
th� Project; (vii) a fee payable to Construction Manager of S% of the hard
construction cost of ihe Project (excludin� furniiure, �ixtures and equipment, the
pracurement of which is coordinated by Developer) for general and
adrriinistrative overhead and profit; and (viii) a MiWBE goal for City'S
participation in the Project as cantemplated in Section 2.6 of the RFP.
1.2.12 Quali�ied M$na�ement Agreement. City and Developer shall use reasonable
best efforts to negotiate the Qualified Management Agr�ement which in th�
opinion of the Co-Bond Couns�I far the City wiI! permit the issuance of tax-
exempt bonds for the construction of the Project. For this purpose, such
management agreement shall include any agreements entered into by the
Developer for the management of the Project, on behaliof the Developer.
1.2.13 Farmation a� Corporation. City shall prepare such resolutions, ordinances or
other dacumentation as may be required to form a Local Govem�nent
Carporation, pursuant to the authority granted the City under Subchapter D,
Chapter 431, Texas Transportatoin Coc�e {the "Cozporation"), and to authorize
�he financing for the Project, subject to the approval of the City Council.
1.2.14 Citv Assistance. City will use its reasonahle efforts, subject to applica�l� law,
and in accordance with a time schedule to be mutually agreed upon by the
Farties, ta reduce the costs of fhe Project by: (i) expediting required perm�ts
from local and state agencies; {ii) insuring the necessary utiiities are sxtended ta
the property line af the Project; {iii) providing City uifrastructure required for
the Praject; (iv) interfacing with all stat� and local agencies as to issu�s that
may arise relating to any, state rights-af way adjaining the site; and {�) assisting
the Developer in (a) identifying alI underground utilities and faci�.ties for nan-
owned �ttilities and (b) working with the appropriate entities in implementing
any relocations as may be necessary. City will seek any rezoning or variance
r�ecessary to develop the Pro�ect in accordance with the Agreements.
1.2.15 Other Actions. The Parties shall each take such oth�r reasonable actions as may
be necessary to enable the Praject to be financed; pravided that De�eloper shall
not be obligatec� ta incur any adcli�ional liability in connection with such
financing. The activities described above which are not completed prior to th�
e�piration af the Negotiating Period, if the Project is to cantinue to be
d�veloped, shall be pravzded far in the Agreements.
Canvention Centsr Hotel MOU 4
1.2.16 Bud�et. The predevelopment activities d�scribed above sha11 be performed in
accardance with the predeveloprneni �udget, �c�vhich sha11 be prepared by
Develoger together with the Preliminary Schedule (sae Paragraph 1.2.1'7
below}, a}�proved by City and a�taahed here#o as Exhibit B(tha
"Predevelopment Budget"}, Develflper shall not exceed the amounts provid�d
far in the Pr�develapment Budget without the prior written approval of City,
except as provided in Paragraph 1.3 belaw. City shall ad�a.nce funds to
Develop�r to pay for the items on Exhibit B within thirty (3Q) days after receipt
of an invoiGe with reasanable supporting docurnantation.
1.2.17 Prelimi�arv_5chedule. Attached herefo as Exhi�it C is a preliminary schedul�
("Prcliminary Schedule") outlining miiestones and other k�y timeframes for the
activities described to be completed under this Agreement,
1.3 Develo�er's Comnensation. As compensation for the predevelopment activities
described in this Agreament, City shall pay to Rattikin Title Company, 2Q1 Main Street, Suite
800, Fort VSTorth, Texas 76102 the amount of $41,Q00 per month during th�� term of this
Agreement (the "Develaper's Fee"). Such payrn�nt shall be due wzthin thirty (30} days af�er
receipt by City of an invoic� from Develaper. The Developer's Fee shall continue to be payable
each month if the Negatiatzt�g Period is extended as pravided herein. The Developer's Fee shall
be held by such title campany in escrow in an interest-bearing account until the �xpiratian of the
term of this Agreement as set forth in Paragraph 1.1 abave. At such expiz�ation, and
notwithstanding anything to the con�rary contau�ed herein, the title comparly sha11 disburse the
Devel�per's Fee (with any accrued interest) ei#her {i) to City, in the event the expiration of tlie
term of this Agreement is due to an uncured default by Develop�r hereund�r or Developer's
election to terminate this Agreement as allawed uz�der Paragraph l.5 hereQ£, or (ii) to Developer,
in the event the expiration of the term af �his Agreement is due to the execution by the Parties af
the Agreements or io an uz�cured default by City hereunder or to City's election to ternunate this
Agreement as allowed under Paragraph 1.5 hereof.
1.4 Exclusivitv. City agrees, during �he term of this Agre�m�nt, to negotiate and interact
exclusively with Developer, and the ather parties named in, or to be selected, pursuant ta this
Agreement and not wit�"any otl�er person or entity, wiYh regard ta the develagment of the
Pxoject.
1.5 Apu�o�val of A�reements. The Parties agree that this Agreement wi1� termina�e if either
Party, acting in its sole discretion, at any time during the Negotiating Period, deter�nines nat ta
enter into the Agreements, which determinatian must he evidenced by a wr�tten notice delivered
to the other Party. Yf the Parti�s da not exacute tha Agreements during the Negotiating Period, as
the sain� may be cxtended, this Agr�ement shalt auta�natically and immediately tern�inate. Upon
execution of the Agre�rnents by Develo�aer, the executed Agreements shal� expeditiously be
presented to the City Cauncil for review and approval.
Canvention Center Hotel MOU 5
1.6 Termination af A�reement, Unless earlier t�rminated pursuant to Paragraph 1.5 abo�e,
and except as this Agre�ment may be extended as oth�rwise pravided herein, if at the end of the
Negotiating Period, Develaper and City have not executed the Agreemenfs, then this Agreement
shall automatically tern�inate withaut further written notice. Upon termination of this Agreement
and subject to Paragraph 1.3 abo�e, City shall pay Deve�oper for all accrued but �npaid
Develop�r's F�e and neither Party shall hav� any further rights or remedies to the ather except as
may be provided in .Article 9. Natwithstanding the foregoing, the Negotiating ' Period may be
extended by the mutual agreement oF City and Developer, each acting in their sole discretion,
delivered ta each other in writing na later than seven (7) days after the end of the Negotiaking
Period. Tn the written notice agreeing to extend the N�gotiating Period, a new date shall be
establish�d to determi.ne the end of the Negotiating Periad, as extended. In the action taken by
tlie City Council approving this Agreement, it shall provide that the City Manager shall be
authorized to approve an extension af the Negotiating Period on b�half of the C:ity.
1.� Transfer oF Prope�rtct. City sha11 transfer the Property, by special warcanty deed or long-
term ground 1ea�e (at the sole discretion of City), to the Carporation in a man.ner that will
facilitate the financing for the Project.
ARTICLE 2. PROPOSED D�VELOPMENT.
The Proj ect shall consist of a hotel with resta�rants and cocktail launges, meeting and
conference faciiities, retail shops far hotel guests, on-site or adjacent parking, and customary
recreational facilities far hot�l guests such as a swirruning pool, all designed and constructed to
conform to the faciliti�s program and quality Ievel as recommended by the Market Study and
mutually agreed to by City and Developer. At Developer's option and with approva.l of City,
Developer may design and construct on-site or adjacent parking in exeess of that required for the
hotel in order to provide market-rate off-site parking far convention center patrans and other
local users. Should DeveIoper incux costs in connection with the design and development
of such exccss parking prior to the City's approval thereof, and shauld th�; City determine, in its
sole discretion, not to approve such excess parking, all such costs incurred shall be borne solely
by Developer.
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ARTICLE 3. DEVELOPER'S WORK PRODUCT.
D�veiaper agrees to malce monthly progress reports in a mutually agreed upon form
ac�vising City on alI matters related to the Project, including financial feasibility ana�yses,
�onsiructian cost estimates, marketing studies, and similar due-diligence matters� {"Developer's
Wark Product"). Provided City pays all of the costs for items on Exhibit B as provided in
Paxagraph 1.2.16 a�ove, then all of D�v�loper's Work Product shall prarnptly be deliver�d to
City (copies may be retainad by D�velaper) and will become tb.e sole property of City.
Convention Center Hatel MOiJ 6
ARTICLE 4. AGREEMENT and TRt�NSFER.
De�eioper may assign this Agreement to another entity owned and cantrolled by Portmau
Development, LLC and Phelps Program Management, LLC and their affiliates (a "Permitted
Assignee"). Any atiempt by Developer to transfer ar assign this Agreement oz any rights or
duties hereunder, whether by operation of law or otherwise, to anyone other than a Pernaitted
Assignee without the grior written consent of City shall constitute a c�efault by Developer under
Article S below which is subj�ct to cure within thirty {34) days after notice of default is received
by Developer. City may assign this Agreement and any and alI rights and duties of the City
hereunder, to Coaparation. Any attempt by City to transfer or assign this Agre�;ment ar any
ri��s or duties hereunder, whether by operation of law or otherwise, to anyona other than
Corporation v�ithaut the prior written consent of Developez� shall constitute a default by Ci#y
undex Artzcle $ below which is subjeci to cure within thirty {30) days after notice of defauit is
received by �City. �
ARTICLE 5. COSTS AND EXPENSES.
Except as otherwise provided herein, each Pa,rty shall be respar�sible 'for its own cost5 and
expen�es in eonnection with any activities and negotiations undertaken an connection with the
perforn�ance of its obligations under this Agreement.
ARTICLE 6. 1�TOTICE�,
Notices giv�n or to be given by City or Deveioper to #he other may b� personally served
upon City or Developer o:r any person hereafter authorized by either in writing to receive such
natice ar may be ser�+ed by avemight courier with written canfirmation addressed to the
appropriate address hereinafter set farth or to such oiher address as City and Developer may
hereaf�er designate by written natice. If served by overnight courier, service will be eonsidered
completed and binding nn khe other Party upon written confirmation of receipf. All notieas shail
be in writing and shall be made as follows:
6.1 All notices to Developer shall be given or sent to:
Portman Deveiapment, LLC
3Q3 Peachtree Street, NE
Suite 4600
A�nta, C�rA �0308
Attn: Mr. A. 7. Robinson
With capy
ta: Portman Developmenf, LLC
303 Peachtree Street, hTE
Suite 4600
Atlanta, GA 30308
Attn: General Counsel
And to: Phelps Pra�am Management, LLC
420 �ixth A�enue
Post Office Box 0
Greeley, co so�32-a� � o
Attn: Mr. Jerame M. Trammer
Convention Center Hotel MOU 7
With copy
to: Phelps Program Management, LLC
420 Sixtl� A�enue
Post Office Box Q
Greel�y, CO 80632-0710
Attn: Eric L. Wilson, Esq.
6.2 All notices to City shall be given ar sent to:
City of Fort Worth
City Manager
100Q Throclannrton Stre�t
Ft. Worth, TX 7610�
Wi.th copy
to: Kelly, Hart & Hallman
200 Main Street
�uite 25�0 .
Ft. Worth, TX 76102-3194
Attn: T. Andrew Rogers, Esq.
6.3 Any Party may designate a diffcrent address by giving wri�ten notic� as set forth in this
paragraph.
AR.TICLE 7. NEED FQR AGREEMENTS.
The Parties acicnowledge and agree that this Agreement is for the sole purpose of stating
the intention af the Partias to negotiate and enter info the Agreements and to �auidertake certain
predevelapment acti�ities in connection with the Pro�ect. Exc�:pt as otberwise pro�ided herein,
the Parties do not intend to be bound until Develaper and the City Manager execute and the City
Cnuncil approves the Agreements. City's acknawledgmen� af this Agreement indicates City's
commitment to perform only the actions req�ired of City as provided herein, reserving final
discretion and approval by City as ta any additional actions as may be r�quired.
.�, _. _
.ARTICLE S. . DEFAULT.
Failure by cither Party to negotiate in good faith or to perForm any other of its dutias as
provided in this Agreemenf shall constitute an event of default under this Agreement. The non-
defaulting Party sha11 gi�e written notice of a de�ault to the defaulting Party, specifying the
nature o� �.e default and the action required to cure the default. If the default rr;mains uncured
for thirty {30) days after the date of xeceipt of such notice, the non-d�faulting Party may exercise
the remedies set forth in Artic�e 9 of this 1�greement; provid�d that if tl�e de�'ault cannot
reasonab�y be cured in such ik�iz�y (34) day period, the deiauli7ng Party sha11 have such additianal
periad af tim� as the Parties subsequently and reasonably agree is necessary to cu�re such default.
Canvention Center Hote[ MOU 8
ARTICLE 9. REMEDIES FOR BREACH OF AGREEMENT.
In the event of an uncured default as provided in Article 8, th� non-d�faulting party may
terminate this Agreement upon written notice to the defaulting party, and sl�all have such ath�r
rights and remedies as may be pravided by law.
ARTICLE 1 Q. ATTORNEYS' FEE,S.
In the event of any dispute between the Parti�s h�reta involving the covenants or
conditions contained in this Agreement or arising out af the subject matter of this Agreement, the
prevailing Party shall be entitled to recover r�asonable expense�, including attorn�ys' fees and
costs,
ARTICLE 11. ENTTRE AGREEMENT.
This Agr�ement constitutes the entire understanding and agreement of the Parties
regarding the Project, integrates all of the terms and conditions m�ntioned herein or incidental
hereto, and supersedes all negotiations ar previous agreements hetween the Parties or their
predecessors in interest with respect to all or any part of the subject matter hereof.
ARTICLE 1�. TII�IE IS OF THE ESSENCE.
Tune is of the essence with respect to all of the express conditions contaisied herein. Th�
Parties aclmowledge that failure by either Party to perforrn their obligatians as set farth herein
within the time limits sta�ed may materially darnage the ability o£ the other Party ta ga forward
with the Project. Any failure to timely perform each Party's obligatians hereunder shall be
considered a breach of this Agreement and sha�l be dealt with pursuant to Articl� 8 hereof.
ARTYCLE 13. THIRD PART�ES.
Nothing in this Agreement, whather expressed or implied, is intended to confer any rights
or remedies under or by reason of this Agreernent on any persons other than Developer anc� City
and thair raspecti�e permitied successars and assigns, nor is anything in this Agreement intended
to relieve or discharg� the obliga�io� or liability of any third persons to any party to .this
Agrecmant, nor shall any, provisians give any third persons any right of subz`ogaiion or action
over ar against any party to this Agreement.
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ARTICLE I4. CONFIDENTYALITY OF AGREEMENTS.
The Parties acknowledge tha# once this Agr��ment is ex�cuted it becames a public record
subject to the �rovisions of Chapter SS2, Texas Government Code. Therefore, City has legal
canstraints as to the typ�; of information regarding the Project it may keep confidential if it
recei�es a request for information from a member of the general public. The Parties and their
duly acting representatives therefore agree to use alI reasonabie efforts, to the extent perrnitted
by Iaw, not to disclose or use to the detriment of any o�er party any Confidential Informatian (as
defined below) with respect to the Project furnishad by any other party or its r�spective
representatives at any time or in any manner other than in connection with the transactions
described in this Agreement. For purposes of this Agreement, "Canfidential Infarmation" means
any informatian aboui the Praject st�nped "confdential" or identified in writing as such to any
oth�r party promptly follovc�ing its disclosure, unless (i} such information is already knawn to the
Con�ention Cenker Ho#el MOU
party recei�ing suah informafiaon or to others noi bound by a duty of confidentiality or such
infarmation becomes publicly availabie, (ii) the use of such information is neces�aay or
appropriate in making any filing or abtaining any consent or approval reqwired for the
development of the Projeat, or (iii) #h� �urnisl�ing or use of such information is require� to be
disclosed by law. Pri�or to City making disc�osure of information regarding the Prajec� in
response to a formal request by a third party under Chapter 552, Texa� Government Code, City
will notify Developer that such information regarding the Project is to be disclosed to a mernber
of the general public and that such disclosure is required �y state law.
ARTICLE 1�. SECTIOi�T HEADINGS.
The s�ctian headings contained herein are for convenience of referez�ce and �e not
intended ta define ar limit the scope af any provision thereof.
A,RTICLE 16. GOVERNING LAW.
This Agreemen# is performable in Tarrant County, Texas, and all of the rights and
obligation� flf �ae Parties hereto and all of the terms and conditions hereof sha11. be construed,
interpreted and applied in accordance with and governed by and �nforced under the laws of the
State af Texas.
A,RTICLE 17. NO SiIRVIV.AL
Notwithstanding anything to the contrary contained herein, unless specifica�ly provided
ta the contrary, in the event the parties execute the Agreements, each and every right and
obligation of the Parties heretw.der, whether fully performed or not, shall be considered to have
merged into the Agreements, and sha�l not survive the termination of this AgreeFnent. Tn the
event this Agreement terminates without the execufion of the Agreements; the rights and
obligations of the Parties hereunder, wbether fii11y perforrr�ed or not, shall not survive such
termination, exce�t far tha rights of Developer under Paragraphs 1.2.16 and 1.3, and the rights of
�ie Parties under Article 14.
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Convention Center Hotel MOU 10
IN VVITNESS WHEREOF, the parties hereto have executed this Agreerr�ent as of �he ciay and
the year �irst ahove written.
CITY OF
By:�
City
��' W�RTH:
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ATTEST: V
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By: - _ ' �. �-:..:
�' • Cit Secretary
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APPROVED AS TQ FORM:
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�7,�ity Attorney
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DEVELOPER:
, LLC
EXCLIlSIVE NEGOTIATING 22702 final.doc
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PORT�VIA�DE-V.,E�MENT, ��
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EXHIBIT A
SITE PLAN AND DESCRIPTION
Sections 7 and 8, Tarrant County Convention Center Addition ia the City of Fort Worth, Tarrant
County, T�xas, accarding to plat recorded in Volume 388-59, Page 14, Deed Records of Tarrant
County, Texas �
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EXHIBIT B
PR�FDEVELOPMENT BT7DGET
Pre-Development Budget to he Developed
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EXHIBIT C
PRELIIVIINARY SCHEDULE
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���' "�" Pxelzminary Fort Worth Schedule
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76 Receive P�agrams Thu 2l21102 W� 312W02 � p - : ;
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24 StrucWrai Mon 9M102 Mon 719f0:i = -
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25 FaundaF�on Mon 9l7102 Fri 11li!(12 E �
26 Struclure Mon 11I4IO2 Mon 2+3J�3 ' . j �
27 lnterbr Design weA 316la2 Fri 217f03 � ' I . . . i r
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�x�IT "c�� Preliminary �ort Worth Schedule
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Page 4
C`iiy of �'a�t YVo��h, 2''exas
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bA7E REFERENCE iVUMB�R L.�G NAM�
3151�2 G-1 �9��
25PORTMAN
PAGE
1 af 3
SIfBJECT AGREEMENT WITH PORTMAN DEVELOPMENT, LLC AND PHEI.PS PROGRAM
MANAGEMENT, LLC FOR EXCLUSIV� NEGOTIATING AND PRE-DEVELOPMENT O�
A CONVENT[ON CENTER HOTEL AND ADOPTION OF' THE ATTACHED
APPROPRIATION 4RD�NANCE
RECO�JIMENDATION:
lt is recommer�ded that the City Council:
1. Autharize a non-interest bearing inter�fund loan from the General Fund to the Hotel De�eNopment
Fund in the amaun# of �2,580,414 far interim finartcing for pre-de��lopment of a Convention Center
hoiel pending the issuance of bands, notes, or ather obligations to fund the acquisitiort and
construction casts af #h� Can�ention Center Hotel; and
2. Adop# the attached appropriation ordinance increasing estimated receipts and appropriations in the
Hotel Develo�ment Fund ir� the amount of $2,580,494 from a�ailable funds; and
3. Authorize the City IWlanag�r ta ex�cute an Exclusir►e Negotiating and Pre-Deve[apment Agreement
{Agreement) with Portman Developmeni, LLC and Phelps Program Management, LLC for exclusive
negotiation and pre-d��elopment of a Canvention Center Hofal in substantial�y the same form as
that attached hereto as Exhibit "A".
DESCUSSION:
On June 13, 2D01, a Request for Proposals (RFP) was issued to obfain a�otel development company
to de�elop a hotel prop�rty adjacent to ihe newly expanded For� Worth Gon�ention Cer�ter. The
selection committee (comprised of City Cauncil members, City staff, and representatives from LJBS
Paina Webber, Firs# Southwest, Austin Commercial, anci the Fort Worth Convention & Visitors Bureau
Board of Directors), interviewed four development companies who responded fo the RFP. The
cammittee recommended that the City negotiate with Portman �evelapment, LLC for the development
af the new hatel.
On Septem�er 18, 2001, the City Cauncil issued a resolution and selected Portman Development, L.LC
and Phelps Program Managemen#, LLC to assist with the development of a Co�vention Center Hotel
and parking facility.
The City has retained UBS Paine Webber as underwriter for the obligations to be issued pursuant to the
City's financing pEan with respect to the constructian and development of the project.
The Ci#y has aEso retained HVS and C. H. Johnson to prepare market studies to determine the viabi[ity
of construction, operating a hot�l, aptimum quality level, and size of #he hotel. HVS has reported fhaf
the new[y expanded Fort Worth Convention Center and market dynamics will suppor� the establishment
af a campetitive, firs� class Convention Center Hvtel.
�'ity of �o�t �V'o�th, T'exas
- ,
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� O�i�li� 5L C�� 5L O 11
DATE REFERENCE NUMBER LOG NAME
�i��a2 C�7 �9��
25PORTMAN
PAGE
2of3
SUBJ�CT AGREEMENT INITH PORTMAN DEVELOPMENT, LLC AND PHELPS PROGRAfVI
MANAGEMENT, LLC �OR EXCLU5IVE NEGOTIATING AND PRE-DEVELOPMENT OF
A CONVENTION CENTER HOTEL AND ADOPTIQN �F THE ATTACHED
APPROPRIATION ORDINANCE
The propased Agreement provides �he framework for City staff fo exclusively negatiate with Portman
Devefopment, LLC and Phelps Program Management, �LC ta creat� a develapment and management
agreemeni #or the Convention Center Hotel and parking facility, The term of the Agreement will be � 80
days f�om the date o� executior�.
This Agreement wilE provide the basis for pre-development activities including: hote[ canceptual design,
selection of hot�1 operatar and parking operafor, feasibility studies, cost estimates, and guaranteed
maximum price. This will move the development to a posiiion where it can be marketed ta the
investment commur�ity.
Additianal services to be performed ar obtained by the City {and the estimatec� c�asts) include:
� Environmental testing
� Geotechnical
o Parking study
� Traffic evaluation
� Arcf�itectural topographic survey
� Contingency
$9 5,000
$25,�00
$15,aao
$15,000
�2�,oao
��o,oao
Austin Commercial, the program management company on the Fort Worth Canvention Center
ex�a�sian, will oversee the additional services on behalf of the City.
Additional professional services and estimated casts include:
� Architectural Services - HOK
� Consulting Services - C.H. Jahnson
� Project Management - Austin Commercial
� Contir�gency
The total estimated �udget for pre-development is $2,580,414.
$5Q,OOQ
$95,000
$60,000
$30,OD0
The City Council hereby finds, consid�rs, and declares that the reimbursement of the payment by the
City of such expenditures, will be ap�ropriate and consistent wi#h the lawful abjectives of the City, and
as such, chaoses to declare its intention, in accardance with the provisfons of Section 1.50-2 of fhe U.S.
Treasury Regulations, to reimburse itself for s�ch payments at such tEme as bonds, notes or other
obfigations are issued tia fund the ultimate acqu�sition and canstruction costs of the Canvention Center
Hotel.
�'i�y o, f �"ort Wo�ih, �exas
M �, � � � :�, ` � ; i � - --
Co�n�������or�
DA7E REFERENCE NUMBER LO� NAM�
3/5102 ��� �9��
25PORTMAN
PAGE
3of3
SUBJECT AGREEMENT WITH PORTMAN DEVELOPM�NT, LLC AND PHELPS PROGRAM
MANAGEMENT, LL.G FOR EXCL[JSIVE NEGOTIATING AND PRE-DEVELOPMENT OF
A CONVENTION CENTER HOTEL AND ADOPTION OF THE ATTACHED
APPROPRIATI4N ORDINANCE
All costs to be reimbursed as herein described, to the extent such expenditures constitute capital
expenditures, shall be funded by ban�s, notes or ofher obligatians to be issued within 1S months of the
lafier of (i) the date the expenditures are �aid or (ii) the date an which the praperty, with respect to which
such expenditures were made, is plaeed in service; and the foregoing notwithstanding, any such bonds,
notes ar other obligatians will nof be issued on a date that is more than t�ree years after the date any
expenditure which is �o be reimbursed is paid.
FISCAL INFORMATIONICERTIFICATfON:
The Finance Director certifies that upon approvaf of the abov� reeommendations and adoption of the
attached appropriatian ordinance, funds will be available in the current operating budget, as
ap�ro�riated, of the Hatel Development Fund. Upon the issuance of bands, nates or other obligations
to #�nd the acquisition and construction costs of the Convention Cer�ter Hotel, the inter-fund laan of
$2,580,414 wilf be returned ta fhe General Fund.
JP:n
Submittad for City Managar's
Office by:
doe Paniagua
Originaiing Department Head:
Kirk S[aughter
Additional Information Contach
Kirk Siaughter
FU�TD I ACCOUNT I C�NT�R
(to)
1)R194 220001 000194a25fl01
G 14� 2) R194 485XXX 0259 94025001
2) R194 539920 Q25994a25fl01
2561 (from)
1) GG09 136194
3) R194 539920
25Q1
000�000
025'194D25001
I AMQi7PIT
$2,58�,A�14,00
$2,580,414.00
$2, 58D,4'f 4.Op
$2,580,414.D0
$2,580.414.00
CITY S�CR�TARY
APPROVED AS AMENDED
ORD. #15dQ8 3f5102
�XFiIBTT' "C"
� Task NamC
36 BudgetApproval
-- . .. .. .. . - � -- --- - - -----
37 Cily Permk RetriewsAnkastrucfi+re
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39 Savelure
40 Bui�ng
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Page 2