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Item 4C4C-1 CITY OF SOUTHLAKE MEMORANDUM September 23, 2013 To: Shana Yelverton, City Manager From: Kari Happold, Deputy Director of Community Services Subject: Approve Third Amendment to the Commercial Developer Agreement with the Developer of the Brownstones, Cooper & Stebbins LP, and the Brownstones at Town Square Owners Association, Inc., for landscaping and related infrastructure in City right of way Action Requested: City Council approval of the proposed amendment to the Commercial Developer Agreement with the Developer of the Brownstones Phase I and Phase B (Brownstones At Town Square L.P.), Cooper & Stebbins L.P., and the Brownstones at Town Square Owners Association, Inc., to clarify responsibilities pertaining to landscaping and infrastructure located in public right of way as defined in the Agreement Background Information: The City, Developer, and Cooper & Stebbins previously entered into a Commercial Development Agreement for the Brownstones at Town Square (Phase I Addition), and a first amendment to provide for the installation of certain park facilities located within the Addition and City services. They also entered into a second amendment to the Commercial Developer Agreement to allow the issuance of certificates of occupancy prior to completion of all public infrastructures. Later, the City, Developer, and Cooper & Stebbins entered into a Commercial Development Agreement for the Brownstones at Town Square (Phase B Addition). Phase I and Phase B of the Brownstones at Town Square are collectively referred to as the Addition. The Addition has aesthetic amenities located in the public right-of- way, specifically, street trees, shrubs and other landscaping, and City of Southlake Values. - Integrity ♦ Innovation ♦ Accountability ♦ Commitment to Excellence ♦ Teamwork 4C - 2 Shana Yelverton, City Manager Meeting Date — October 15, 2013 Page 2 of 6 related infrastructure, specifically, sprinklers and water supply lines providing irrigation for such street trees, shrubs and other landscaping. Because of some uncertainty in the language in the previous developer agreements regarding which party had responsibility for maintenance and replacement of the street trees, shrubs and other landscaping and related infrastructure in the Addition, the Third Amendment to the commercial developer agreement is now proposed to clarify the ambiguous clauses and allow the orderly and consistent maintenance and replacement of the street trees, shrubs and other landscaping, and related infrastructure in the Addition. Included in the proposed Amendment to the Commercial Developer Agreement are the following provisions: ASSIGNMENT AND OWNERSHIP OF STREET TREES AND LANDSCAPING The City shall be the owner of all trees, shrubs and other landscaping, and sprinkler and water supply lines constructed to service such trees, shrubs and other landscaping located in the City right-of-way, and shall be authorized and responsible to maintain all items located in the City right-of-way, in a manner and at a level to be determined in the City's sole discretion. To the extent, if any, that any assignment of such items is necessary, the Developer, the Association, and Cooper and Stebbins hereby assign all right, title and interest they may have in and to such items to the City. REPLACEMENT AND MAINTENANCE OF STREET TREES LANDSCAPING, AND ASSOCIATED INFRASTRUCTURE 1. The City shall be authorized to replace any tree, shrub, or other landscaping located in the City right-of-way, if, in the City's sole discretion, such replacement is warranted. The City will not be obligated to replace any plant with a plant of the same size or species, if the City, in its sole discretion, determines that replacement of a tree of a different size and/or species is in the City's best interests and consistent with the general character of the Addition. City of Southlake Values. - Integrity ♦ Innovation ♦ Accountability ♦ Commitment to Excellence ♦ Teamwork 4C - 3 Shana Yelverton, City Manager Meeting Date — October 15, 2013 Page 3 of 6 2. The City may, at the City's option, permanently remove (and not replace) any dead or dying tree, shrub or other landscaping located in the City right-of-way if the City, in the City's sole discretion, determines that removal of such plant(s) is in the City's best interests. 3. Neither Developer nor Cooper & Stebbins shall have any ownership or right of control or authority over the trees, shrubs and landscaping located in the City right-of-way. 4. Notwithstanding the foregoing, The City will maintain and replace all trees, shrubs and other landscaping located in the public right-of-way to a level equal to or better than that which it does elsewhere in the Town Square area. For trees that area is defined as that bounded by Civic Place, Grand Avenue, Fountain Place and State Street. For shrubs, seasonal color and other landscaping that area is defined as the blocks occupied by Town Hall and by Summit Park. 5. The Association may enhance the landscape plantings in the public right-of-way only after receiving approval in writing from the city. IRRIGATION OF STREET TREES AND LANDSCAPING 1. The irrigation for the trees, shrubs and other landscaping located in the City right-of-way is currently part of the Association's irrigation system, which irrigates not only the trees, shrubs and other landscaping located in the City right- of-way, but also landscaping on the Association's property and the properties of its membership. The water meters for the Association's irrigation system are in the Association's name, and the invoices for such water service are currently paid by the Association. For this reason, the Association shall provide and pay for City -supplied irrigation water for all trees, shrubs and other landscaping located in the City right- of-way at a level and in sufficient quantities to maintain such plants in a healthy condition, and the City shall reimburse the Association for that portion of the irrigation water attributable to irrigation of the trees, shrubs and other landscaping located in the City right-of-way, upon agreement by the City of the water usage attributable to such use. However, the City may at any time, at the City's option, disconnect the City of Southlake Values: Integrity ♦ Innovation ♦ Accountability ♦ Commitment to Excellence ♦ Teamwork 4C -4 Shana Yelverton, City Manager Meeting Date — October 15, 2013 Page 4 of 6 irrigation infrastructure for the trees, shrubs and other landscaping located in the City right-of-way from the Association's water lines, and connect such irrigation infrastructure to water meters on the City's account, in which case the City shall assume responsibility for payment of such separately -metered water usage. The City shall be responsible for all costs associated with the separation of the irrigation system including leaving The Association system at an operating level at least equal to its state prior to the separation. 2. Until and unless the City elects to disconnect the irrigation infrastructure for the trees, shrubs and other landscaping located in the City right-of-way from the Association's water lines, and connect such irrigation infrastructure to water meters on the City's account, the Association shall maintain the water supply infrastructure providing water to the trees, shrubs and other landscaping located in the City right-of- way, and the City shall reimburse the Association for that portion of any expenses attributable to maintenance of such irrigation infrastructure, upon agreement by the City of the expenses attributable to such use. Except as provided herein, The Association shall continue to be responsible for all water usage and expenses for maintenance of the Association's water usage and maintenance of the Association's water supply infrastructure. 3. Neither Developer nor Cooper & Stebbins shall have any authority over nor responsibility for irrigation of the trees, shrubs and landscaping located in the City right-of-way so long as the system has not been separated. 4. Should the Association's irrigation system require replacement or major restructuring due to normal aging, further residential development, or changes to the landscape watering allowed by the City, the Association may require the City to separate the irrigation system as per the above The proposed Agreement has been reviewed and approved by the developer of the Brownstone Addition, Cooper & Stebbins LP, and the Brownstones at Town Square Owners Association. City of Southlake Values. - Integrity ♦ Innovation ♦ Accountability ♦ Commitment to Excellence ♦ Teamwork 4C - 5 Shana Yelverton, City Manager Meeting Date — October 15, 2013 Page 5 of 6 A copy of the amendment to the commercial developer agreement is attached for your consideration. Financial Considerations: Costs for consistent maintenance and replacement of landscaping and infrastructure in the public right of way locations described in the proposed amendment are funded in the general operating parks maintenance budget. Strategic Link: The Third Amendment to the Commercial Developer Agreement with the Developer of the Brownstones, Cooper & Stebbins LP, and the Brownstones at Town Square Owners Association for landscaping and related infrastructure in City right of way is linked to the City's Strategy Map relative to the focus area of Quality Development and addresses the corporate objectives to invest to provide and maintain high quality public assets. It also addresses the City's Critical Business Outcomes by continuing to implement South/ake 2030 Plan by focusing on short-term initiatives. Citizen Input/ Board Review: Review by developer of the Brownstones at Town Square Addition Phase I and Phase B (Brownstones At Town Square L.P.), Cooper & Stebbins L.P. and the Brownstones at Town Square Owners Association, Inc. City Council consideration October 15, 2013 Legal Review: Standard Commercial Developer Agreement originally drafted by the City Attorney Alternatives: Alternatives may include the following: • City Council approval of the amendment to the developer agreement as presented • City Council approval of the amendment to the developer agreement with input as desired • City Council decision not to approve the amendment to the developer agreement Supporting Documents: Amendment to the Commercial Developer Agreement with the Developer of the Brownstones (Brownstones At Town Square, L.P.), Cooper & Stebbins L.P., and the Brownstones at Town Square Owners Association, Inc. City of South/ake Values. - Integrity ♦ Innovation ♦ Accountability ♦ Commitment to Excellence ♦ Teamwork 4C - 6 Shana Yelverton, City Manager Meeting Date — October 15, 2013 Page 6 of 6 Recommendation: City Council approval of Amendment to the Commercial Developer Agreement with the Developer of the Brownstones, Cooper & Stebbins L.P., and the Brownstones at Town Square Owners Association, Inc., for landscaping and related infrastructure in City right of way City of Southlake Values. - Integrity ♦ Innovation ♦ Accountability ♦ Commitment to Excellence ♦ Teamwork 4C - 7 THIRD AMENDMENT TO BROWNSTONES AT TOWN SQUARE, PHASE I, CONIlOERCIAL DEVELOPER AGREEMENT AND FIRST AMENDMENT TO BROWNSTONES AT TOWN SQUARE, PHASE I, COMMERCIAL DEVELOPER AGREEMENT This Third Amendment to Brownstones at Town Square, Phase I Commercial Developer Agreement (the "Agreement") is entered into as of the day of , 2013, by and between the City of Southlake, a municipal corporation of Tarrant County and Denton County, Texas ("City"); Brownstones At Town Square, L.P., ("Developer"), , Cooper & Stebbins, L.P. ("Cooper & Stebbins"), and the Brownstones at Town Square Owners Association, Inc. ("the Association"). RECITALS WHEREAS, Developer is the developer of the Brownstones at Town Square Phase I, Addition to the City of Southlake, Tarrant County, Texas, and the Brownstones at Town Square, Phase B, Addition to the City of Southlake, Tarrant County, Texas, which additions are hereinafter collectively referred to as the Addition; and WHEREAS, the City, Developer, and Cooper & Stebbins have previously entered into a Commercial Development Agreement for the Brownstones at Town Square, Phase I (the "Phase I Agreement"), and a first amendment thereto providing for the installation of certain park facilities located within the Addition (and to the off -site improvements necessary to support the Addition), and to provide city services thereto (the "First Amendment"), and a second amendment thereto providing for the issuance of certificates of occupancy prior to completion of all public infrastructure (the "Second Amendment"); and WHEREAS, the City, Developer, and Cooper & Stebbins have also previously entered into a Commercial Development Agreement for the Brownstones at Town Square, Phase B (the "Phase B Agreement"), and WHEREAS, the Phase I Agreement and the Phase B Agreement collectively refer to and govern the parties' relationship regarding the Addition; and WHEREAS, the Addition has certain aesthetic amenities located in the public right-of-way, specifically, street trees, shrubs and other landscaping, and related infrastructure, specifically, sprinklers and water supply lines providing irrigation for such street trees, shrubs and other landscaping; and WHEREAS, the parties have determined that the previous agreements are ambiguous regarding which party has the responsibility for maintenance and replacement of the street trees, shrubs and other landscaping and related infrastructure in the Addition; and Third Amendment to Brownstones at Town Square Developers' Agreement Page 1 4C - 8 WHEREAS, the parties have jointly agreed that this Third Amendment to the Agreement is necessary and appropriate to allow the orderly and consistent maintenance and replacement of the street trees, shrubs and other landscaping, and related infrastructure in the Addition; NOW, THEREFORE, for the good and valuable consideration, the receipt of which the parties acknowledge receiving, the City, Developer, and Cooper & Stebbins, and the Association agree as follows: A. ASSIGNMENT AND OWNERSHIP OF STREET TREES AND LANDSCAPING The City shall be the owner of all trees, shrubs and other landscaping, and sprinkler and water supply lines constructed to service such trees, shrubs and other landscaping located in the City right-of-way, and shall be authorized and responsible to maintain all items located in the City right-of-way, in a manner and at a level to be determined in the City's sole discretion. To the extent, if any, that any assignment of such items is necessary, the Developer, the Association, and Cooper and Stebbins hereby assign all right, title and interest they may have in and to such items to the City. B. REPLACEMENT AND MAINTENANCE OF STREET TREES, LANDSCAPING, AND ASSOCIATED INFRASTRUCTURE. 1. The City shall be authorized to replace any tree, shrub, or other landscaping located in the City right-of-way, if, in the City's sole discretion, such replacement is warranted. The City will not be obligated to replace any plant with a plant of the same size or species, if the City, in its sole discretion, determines that replacement of a tree of a different size and/or species is in the City's best interests and consistent with the general character of the Addition. 2. The City may, at the City's option, permanently remove (and not replace) any dead or dying tree, shrub or other landscaping located in the City right-of-way if the City, in the City's sole discretion, determines that removal of such plant(s) is in the City's best interests. Developer, Cooper & Stebbins, and the Association shall have no ownership or right of control or authority over the trees, shrubs and landscaping located in the City right-of-way. 4. Notwithstanding the foregoing, The City will maintain and replace all trees, shrubs and other landscaping located in the public right-of-way to a level equal to or better than that which it does elsewhere in the Town Square area. For trees that area is defined as that bounded by Civic Place, Grand Avenue, Fountain Place and State Street. For shrubs, seasonal color and other landscaping that area is Third Amendment to Brownstones at Town Square Developers' Agreement Page 2 4C - 9 defined as the blocks occupied by Town Hall and by Summit Park. 5. The Association may enhance the landscape plantings in the public right-of-way only after receiving approval in writing from the city. C. IRRIGATION OF STREET TREES AND LANDSCAPING 1. The irrigation for the trees, shrubs and other landscaping located in the City right-of-way is currently part of the Association's irrigation system, which irrigates not only the trees, shrubs and other landscaping located in the City right-of-way, but also landscaping on the Association's property and the properties of its membership. The water meters for the Association's irrigation system are in the Association's name, and the invoices for such water service are currently paid by the Association. For this reason, the Association shall provide and pay for City -supplied irrigation water for all trees, shrubs and other landscaping located in the City right-of-way at a level and in sufficient quantities to maintain such plants in a healthy condition, and the City shall reimburse the Association for that portion of the irrigation water attributable to irrigation of the trees, shrubs and other landscaping located in the City right-of-way, upon agreement by the City of the water usage attributable to such use. However, the City may at any time, at the City's option, disconnect the irrigation infrastructure for the trees, shrubs and other landscaping located in the City right-of-way from the Association's water lines, and connect such irrigation infrastructure to water meters on the City's account, in which case the City shall assume responsibility for payment of such separately -metered water usage. The City shall be responsible for all costs associated with the separation of the irrigation system including leaving the Association system at an operating level at least equal to its state prior to the separation. 2. Until and unless the City elects to disconnect the irrigation infrastructure for the trees, shrubs and other landscaping located in the City right-of-way from the Association's water lines, and connect such irrigation infrastructure to water meters on the City's account, the Association shall maintain the water supply infrastructure providing water to the trees, shrubs and other landscaping located in the City right-of-way, and the City shall reimburse the Association for that portion of any expenses attributable to maintenance of such irrigation infrastructure, upon agreement by the City of the expenses attributable to such use. Except as provided herein, The Association shall continue to be responsible for all water usage and expenses for maintenance of the Association's water usage and maintenance of the Association's water supply infrastructure. 3. Developer and Cooper & Stebbins shall not have any authority over, or responsibility for, irrigation of the trees, shrubs and landscaping located in the Third Amendment to Brownstones at Town Square Developers' Agreement Page 3 4C-10 City right-of-way so long as the system has not been separated. 4. Should the Association's irrigation system require replacement or major restructuring due to normal aging, further residential development, or changes to the landscape watering allowed by the city, The Association may require the city to separate the irrigation system as provided in Paragraph 1 above. D. NHSCELLANEOUS PROVISIONS. 1. Effective Date of Contract. The term "effective date of this Contract" as used herein shall mean the day that this Contract has been: (1) approved by the City Council of the City in open meeting; and (2) signed by all the parties. 2. Notices. Any notice or communication required or permitted hereunder shall be deemed to be delivered, whether actually received or not, when deposited in the United States mail, postage fully prepaid, certified mail, addressed to the intended recipient at the addresses shown below, or faxed to the facsimile transmission numbers of such persons shown below. Any address for notice may be changed by written notice so given. Notices to be sent to: CITY: City Manager City of Southlake 1400 Main Street, Suite 460 Southlake, Texas 76092 DEVELOPER: COOPER & STEBBINS: ASSOCIATION: 3. Attorney's Fees. If either party shall be required to employ an attorney to enforce or defend the rights of such party hereunder, the prevailing party shall be entitled to recover reasonable attorney's fees. 4. Integration. This Contract contains the complete agreement between the parties and cannot be varied except by the written agreements of the parties. The parties agree that there are no oral agreements, understanding, representations or warranties which are not expressly set forth herein. Third Amendment to Brownstones at Town Square Developers' Agreement Page 4 4C-11 5. Rules of Construction. The parties acknowledge and agree that this Agreement is the product of negotiation and compromise, that the parties have had the opportunity to consult legal counsel in its negotiation, and that the Agreement shall not be construed against any party, but that all other rules of contract construction shall apply. 6. Choice of Law and Place of Performance and Venue. This Contract is to be construed under the substantive laws of the State of Texas, without regard to its choice of law rules. This Contract is to be performed entirely in Tarrant County, Texas, and in the event of any dispute, venue shall be in the state courts located in Tarrant County, Texas. REMAINDER OF PAGE INTENTIONALLY LEFT BLANK Third Amendment to Brownstones at Town Square Developers' Agreement Page 5 4C-12 Signed the day of , 2013. CITY OF SOUTHLAKE, TEXAS The Honorable John Terrell, Mayor ATTEST: Alicia Richardson, City Secretary Date: Approved as to form: City Attorney Third Amendment to Brownstones at Town Square Developers' Agreement Page 6 4C-13 Signed the day of , 2013. BROWNSTONES AT TOWN SQUARE, L.P., DEVELOPER By: Brownstone GP, LLC, a Texas Limited Liability Company, General Partner By: CLB Management, Ltd., a Texas Limited Partnership, Member By: CLB Holding, LLC, a Texas Limited Liability Company, General Partner By: Name: Title: Address: 16250 Dallas Parkway Suite 201 Dallas, Texas 75248 By: SLTS Brownstones, L.P. a Texas Limited Partnership, Member By: SLTS Brownstones Genpar, LLC a Texas Limited Liability Company, General Partner By: Cooper & Stebbins, L.P. a Texas Limited Partnership, Member By: Name: Title: Address: 1256 Main Street Suite 240 Southlake, Texas 76092 Third Amendment to Brownstones at Town Square Developers' Agreement Page 7 4C-14 Signed the day of , 2013. COOPER & STEBBINS, L.P., a Texas Limited Partnership By: CS Town Centers, LLC. a Texas Limited Liability Company, General Partner By: Name: Title: Address: 1256 Main Street Suite 240 Southlake, Texas 76092 Third Amendment to Brownstones at Town Square Developers' Agreement Page 8 4C-15 Signed the day of 52013. BROWNSTONES AT TOWN SQUARE OWNERS ASSOCIATION, INC. By: , President Name: Third Amendment to Brownstones at Town Square Developers' Agreement Page 9 4C-16 Exhibit "V Third Amendment to Brownstones at Town Square Developers' Agreement Page 10 ILI' i��