TO: Honorable Mayor and Members of the City Council
FROM: Tom Kisela, City Manager
1. Subject
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Public Hearing to consider introduction and First Reading of Ordinance No.16-24 approving a First Amendment to Development Agreement with Chapman Orange Holdings, LLC.
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2. Summary
The proposed First Amendment to Development Agreement with Chapman Orange Holdings, LLC would extend entitlements to build a Marriott Hotel at 3000 W. Chapman Avenue for an additional two and a half years.
3. Recommended Action
recommendation
1. Conduct and close Public Hearing.
2. Introduce and conduct First Reading of Ordinance No. 16-24. An Ordinance of the City Council of the City of Orange approving a First Amendment to Development Agreement No. 7204 by and between the City of Orange and Chapman Orange Holdings, LLC, a California Limited Liability Company.
3. Authorize the City Manager to execute a non-exclusive license in conformance with the provisions in Section 6.3 of the amended Development Agreement No. 7204.
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4. Fiscal Impact
None.
5. Strategic Plan Goals
Goal 2: Be a fiscally healthy community
b: Analyze future fiscal needs and potential revenue opportunities.
e: Create an environment to attract, retain, and expand economic opportunities.
6. Discussion and Background
In June 2018, the Planning Commission approved a new Marriott dual brand hotel to replace a Motel 6 and Denny’s restaurant at 3000 W. Chapman Avenue. In June 2020, the Planning Commission granted a one-year extension to the entitlements, and in June 2021, the City Council approved a Development Agreement to extend the entitlements for an additional three years.
The original development team was not able to develop the hotel project and so the property owner re-established control of the property development and is requesting a two and a half year extension to the Development Agreement. The two and a half year extension will allow the owner time to enter into an agreement with a new development team to develop the hotel, refine the number of hotel rooms to match existing market conditions, and determine if ancillary retail facilities are viable. City staff would review any proposed changes for substantial conformance with the approved entitlements. The additional time would also allow the development team flexibility to finance the project in a more favorable interest rate environment.
In exchange for the two and a half year extension as a public benefit, the owner has agreed to provide parking spaces for public use for the new park to be constructed adjacent to the hotel site along the Santa Ana River Trail. The six parking spaces would include one ADA accessible space and would allow for public parking at a park that would not otherwise provide that amenity. If approved, the First Amendment to the Development Agreement would start on July 13, 2024, and expire on December 31, 2026 if the entitlements are not utilized.
7. ATTACHMENTs
• Ordinance No. 16-24
• First Amendment to Development Agreement