By Susan Motander
The Station Square project, Monrovia’s single largest civic project, is nearing completion, but at its center, the historic Santa Fe Depot is still in disrepair. To remedy this, the Monrovia City Council entered into an agreement with Samuelson & Fetter (doing business as Daylight Limited, L.L.C.) on Tuesday to rehabilitate the Depot, while the city staff moves ahead with plans for the dedication of the park on Jan. 23, 2016.
The city’s agreement with the local developer gives Samuelson & Fetter a 55-year lease for the property and the $1.5 million necessary to rehab the building for use as a restaurant or café. In exchange, Daylight Limited will rehab the building to what is called a “warm shell,” meaning the exterior will be stabilized and the building made ready to have the improvements installed that a restaurant would need. Since a tenant has not yet been found for the site, the specific improvements necessary cannot yet be made.
To fund the rehabilitation, the city is using funds from a Gold Line Construction Authority (GLCA) grant. These monies must be spent by the end of this year as the GLCA is closing its books shortly and the funds would be lost to the city. Samuelson & Fetter has estimated the costs of the work will exceed the $1.5 million allotted, but the developer has agreed to bear those additional costs itself.
According to the agreement with the city, Samuelson & Fetter will rehabilitate the depot to “standards acceptable to the City or be required to pay the money back.” The agreement further stipulates that all improvements belong to the City. In exchange, the city waives all permit and development fees. A liaison relationship between the developer and the City’s Historic Preservation Commission will also be established. The Commission will in essence serve as both overseer and advisor to the project.
The agreement gives Samuelson & Fetter (acting as Daylight Limited) three years to find a tenant for the depot (with an extra year if a recession occurs during the first three year period). While there is no tenant, the lease provides for the developer to pay the city $2,500/year rent. Once there is a tenant, the rent would increase to an addition of 5% of the revenues the developer makes from the restaurant/café user.
During the discussion of the agreement at the City Council meeting on Tuesday evening, Councilmember Larry Spicer asked if these rent monies would need to be used to maintain the depot. City Manager Oliver Chi explained that per the agreement, the developer would bear the cost of maintaining the building, and that the rent would be paid into the city’s general fund.
Councilmember Becky Shevlin asked to be reassured that this was a ground lease only and that the city would still own the property in questions and she was assured that was the case.
Severe reservations were expressed by Councilmember Alex Blackburn over the 55 year length of the lease. Chi explained that this was necessary to allow the developer to obtain funding for the improvements that will be needed once a tenant is found. These improvements are not covered by the initial $1.5 million expenditure, but will need to be made before the building can be used as a restaurant or café.
Blackburn was also concerned about the lack of specificity in the contract as to the type of tenant the developer might procure. Again, Chi tried to reassure the council member that the city had approval of the tenant.
Ultimately the agreement was approved by a vote of 4 to 1 with Blackburn providing the dissenting vote.
