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HomeMy WebLinkAbout05/07/2002, 7 - GPA 57-02: REQUEST TO AMEND THE GENERAL PLAN LAND USE MAP TO CHANGE LAND USE FOR 13 ACRES NEAR THE council r^ N66, ;,02 acEnoA PepoRt Lnm�'vmLcr C I T Y O F SAN LU I S O B I S P O FROM: John Mandeville, Community Development Direct Prepared By: Jeff Hook, Associate Planner SUBJECT: GPA 57-02: REQUEST TO AMEND THE GENERAL PLAN LAND USE MAP TO CHANGE LAND USE FOR 13 ACRES NEAR THE SOUTHEAST CORNER OF ORCUTT ROAD AND BROAD STREET FROM SERVICES AND MANUFACTURING TO HIGH-DENSITY RESIDENTIAL, AND TO AMEND THE CIRCULATION ELEMENT TO DELETE THE SACRAMENTO DRIVE EXTENSION. CAO RECOMMENDATION Provide direction regarding further processing of the requested General Plan amendments. DISCUSSION Capstone West, a developer specializing in student housing, proposes development of a 200-unit, 800-bed student apartment complex on the south side of Orcutt Road, between Broad Street and the railroad tracks. The vacant, 13-acre site is designated for "Services and Manufacturing" uses in the General Plan Land Use Map, allowing a broad range of commercial and industrial uses. Residential uses, with the exception of caretaker's quarters, are not allowed. The site has been shown for service-commercial and manufacturing uses since it was annexed in 1960. The City has approved several commercial projects on this site since 1995, including an industrial subdivision, a business park, and fiber optic switching facility, but none of the projects were built and previous approvals have expired. Because the project would involve significant General Plan changes (change from commercial to High-Density Residential use and the possibility of deleting the Sacramento Drive Extension from the Circulation Element), Council direction is being sought before expending substantial private and public resources to process the request. In the attached letter and supporting materials, Capstone West describes the project and presents several key issues. Direction is sought on the following policy issues: I. Would Council consider amending the General Plan to allow residential uses on this site, assuming environmental and planning issues are adequately addressed in the development review process? 2. If high-density residential uses were found to be appropriate, would Council be willing to support student housing at this location, and if so, would it support an interpretation of density standards that would to allow Capstone West to achieve a "threshold requirement" of 800 student beds? 7-1 i Capstone West Student Housing Project Page 2 3. Would Council support long-term lease or use of part of the City-owned Orcutt Road railroad overpass right-of-way for overflow parking for the use? 4. Would Council consider relocation or deletion of the Sacramento Drive Extension required of a previously-approved but never built subdivision and shown in the General Plan Circulation Element? Unique Project Funding Proposed Although not specifically listed, the developer is also hoping for Council feedback on four financial options for funding and operating the project. As described in the letter, the developer proposes the formation of a 501(c)(3) not-for-profit corporation jointly established by Cal Poly Foundation and the Housing Authority of the City San Luis Obispo, with the assistance of Capstone West. The corporation receives the land as a donation, enabling the use of tax-exempt financing. Neither Cal Poly Foundation nor the Housing Authority of the City would be required to make any cash contributions, financial or operational commitments. Capstone would build and manage the project. The City may be asked to participate by authorizing the issuance of tax- exempt bonds or by providing financial incentives, including possible waivers or deferrals of impact or housing in-lieu fees. Project financing would be secured through the sale of tax- exempt bonds. Revenues from apartment leases would cover debt service, operating expenses, deferred costs and fees, and long-term maintenance costs, with a potential surplus cash flow available to fund affordable housing elsewhere in the City. The developer estimates this surplus cash flow in the range of$500,000 in the first few years of operation, with modest increases over time. Student Housing Needs Student housing is identified as a "special housing need" in the City's General Plan Housing Element. With an enrollment of over 16,000 full-time students at Cal Poly and another roughly 8,000 at Cuesta College, student housing needs dramatically influence city housing availability and cost. Housing studies prepared for both Cal Poly and Cuesta document serious housing shortages for students and forecast worsening shortages with anticipated enrollment increases at both campuses through 2010. City policies encourage the development of student housing in high-density residential zones close to Cal Poly University. There are, however, no large R-3 or R-4 zoned parcels available near Cal Poly University to implement this policy. And since the late 1980s, very few apartments of any type, including student apartments, have been built in San Luis Obispo. As a result, student-housing demand has increasingly been met through individual house rentals in low- and medium-density residential zones throughout the City, or by long commutes from outlying areas. This project would help reverse that trend. It is the largest single rental housing project in San Luis Obispo proposed since the 167-unit Park-wood Apartments was built in 1987. With 400 new student units now under construction on Cal Poly's campus, and an additional 1400 beds 7-2. Capstone West Student Housing Project Page 3 anticipated to come on line by 2006, this project could significantly add to our housing stock and help relieve pressure on traditional single-family housing neighborhoods where town-gown housing conflicts are most acute. Key Policy Issues During pre-application conferences with Capstone, staff identified key development issues to be addressed by the development: 1. Land use compatibility of housing with adjacent services and manufacturing uses. 2. Location of a major student housing project remote from the Cal Poly campus. 3. Possible transportation/circulation effects. 4. Creek setback and preservation requirements. 5. Police Department concerns with the location, size and design of student housing. Capstone's application addresses these issues in some detail. At a conceptual level, discussions also focused on possible measures to address these issues. In general, staff felt residential uses could be compatible with adjacent commercial land uses provided special design measures are implemented to address noise, access and creek protection. At about 2 % miles from Cal Poly, the project site does not follow established land use patterns of locating most R-4 in the City's northwest area, close to Cal Poly and State Highway 1. The General Plan requires a range of densities in the residential expansion areas, including the Orcutt Area near the proposed project site. Thus additional R-4 zoning will be located in other parts of the City. By providing strong transportation linkages through improved public transportation and extension of the railroad bikeway, concerns over the distance from the campus may be at least partially offset. Creek setbacks and preservation have been addressed in the developer's conceptual design. The project complies with creek setbacks and leaves channels undisturbed except in a few areas where bridging is necessary to meet circulation needs. Probably the most significant development issue is the project's possible effects on circulation. A detailed traffic study will be needed to address these sub-issues: A. Transportation demand created by student housing development remote from Cal Poly campus. B. Local area traffic impacts (intersections) and timing of the project relative to planned improvements on Orcutt Road. (Orcutt Road widening, at-grade RR crossing improvements, signalization, and realignment of Bullock Lane). C. Related area-wide traffic issues, including Sacramento Drive extension and Broad Street corridor issues By participating in street, public transportation and railroad bikeway improvements, the project may expedite projects already planned for the Orcutt Road area — benefits that could address identified traffic concerns and provide community-wide benefits. To what extent the project 7-3 Capstone West Student Housing Project Page 4 would help fund and incorporate these improvements would be determined during environmental and development review. What's Asked of Council General Plan amendment requests that raise significant policy issues are brought to Council for direction prior to complete processing. This early review step helps the applicant clarify the request and allows early City input before the significant commitment of public and private resources. The fundamental question regarding this proposal is whether or not the Council determines the proposed land use change merits additional consideration. The applicant is also seeking Council's general feedback on the project concept, to the extent the Council is comfortable at doing so at this early stage. Obviously, a project of this scope will require significant study and public review as a normal part of the City's development review process. At this point, information provided by the developer is preliminary and additional information on land use compatibility, traffic, archaeology, creek protection and other planning issues will be required. Until additional information is available and further evaluation done, specific Council member comments on setbacks, parking numbers, density or other similar details would probably not be productive or appropriate. Council may choose, but is not obligated to address general areas of concerns, broad policy considerations, and provide other feedback where possible without committing to particular positions or courses of action. ALTERNATIVES The Council can direct staff in one of three ways: 1. Determine that the proposed General Plan amendment merits additional study and direct staff to continue processing the proposed General Plan amendment; 2. Deny the proposed General Plan amendment and direct staff to terminate processing the application; and 3. Determine that the proposed General Plan amendment merits additional study and direct staff to continue processing the application, with direction regarding applicable policy issues. ATTACHMENT: Application packet for amendments to the City of San Luis Obispo General Plan JhIUCapstone/Cca-,rndarepons5-7-02 7-4 l Application for Amendment to the City of San Luis Obispo General Plan Submitted By: Capstone West 162 S. Rancho Santa Fe Road Suite B-30 Encinitas, CA 92024 7-5 f'r lm:W`-TOPE DEVELI)RAENT 760 E,:c s li a i7 i 141 . ,21-102" 15:11 #"11 R.i v i' III cagstonevvest, Ica S.%rdla sunafb Road April 10,2001 swte e-30 Enc nuns,Cacfvna ;2c*a John.Mandeville,Community Development Director 760'633'1006 760.633.1007 raw City of San Luis,Obispo �*caw^tc�paniss.com 990 Palm Street San Luis Obispo,CA 93401 RE: Request for Council Consideration of the Capstone Student Housing Project Dear Mr.Mandeville: As you are aware Capstone West is a provider of student housing throughout the United States. Capstone West has determined that a site on Oram Road(net 13 acres)between Broad Street and the tracks of the.Union.Pacific Railroad is large enough to provide for approximately 900 beds of student housing with good access to major arterials,the new railroad bicycle path and other appropriate community services. While:Capstone West has expended a considerable amount of time and funds to determine the feasibility of the site,it is clear that any such project must have the conceptual backing of the City Council before it becomes worth the effort to proceed through the general plan amendment,and the detailed and costly development plan and related FIR effort. Capstone West therefore requests a review hearing with the City Council on May 7th. The intends to obtain feedback on several large issues,most specifically whether the City feels it is in its best interests to change the land use.and zoning designations for the subject properties from commercial serviceman,ufacturing to high density residential. In order to focus the discussion,we have fratned several specific questions. The answers to them and the related discussion will-be very helpfni and determining the next steps to be taken and whether a reasonable schedule can be maintained to bring these units on line by Summer of 2005_ The questions are followed by a brief project overview. We have also included a general plan amendment application which includes analyses of the basic differences between the . current and proposed land uses. We.also wish to express appreciation to City staff in Planning,Engineering and Utilities departments.for the positive assistance and timely response to our requests for information. Thank you for your time. Sincerely, o Vawrer, Chief Operatingbfficer Capstone West Attachments Questions: 7-6 Questions: 1. Is the Council, as a matter of policy,willing to consider the project area for residential development? (Assumes environmental and planning issues are adequately addressed in the development planning and environmental review process.) • Discussion: A primary issue is whether the size and easy access to the site offset its distance from Cal Poly. Does the reallocation of land use impact the City's economic well being in providing jobs. Equivalent jobs can be located in the airport area. The reallocation of land use does improve the jobs/housing balance. • Also, based upon the concepts presented, can housing at this location be considered compatible with the adjacent uses. 2. Is the Council willing to support the concept of a density bonus or the definition of the four bed cluster around a kitchen and common area as the equivalent to a two bedroom apartment,which will enable Capstone West to achieve the necessary threshold requirement of 800 student beds? • Discussion:Neither the definition of a standard two bedroom apartment.nor the "group housing"definitions in the zoning ordinance precisely address the configuration of housing proposed in the Capstone West project. There are two options: 1)Define the project's unit layout design (of a four bed cluster around a common room and kitchen) as equivalent to a standard two bedroom apartment unit as defined in the zoning ordinance. The net result is that the project would contain approximately 200 units, or 2) allow Capstone West to utilize the"group housing"definition because of the nature of the project as related to Cal Poly and Cuesta(the project will be limited to students and spouses). In this scenario the base density of group housing in an R4 zone would allow 725 beds for the thirteen acre site. A 12%density bonus would enable Capstone West to achieve the necessary threshold density of 800 student beds. 3. Parking: Is the Council willing to allow a long term lease/utilization of part of the Orcutt Road railroad overpass dedication for parking? • Discussion: While the standard city parking ratios can be met by the project, Capstone West recognizes that most individual students will own vehicles and extra spaces must be provided to insure occupancy of the units and to prevent parking overflow onto surrounding streets. The configuration and arrangement of the three creeks affecting the property have made the layout of parking very inefficient. Capstone West requests that the City permit parking on the land dedicated to the future railroad overpass. Capstone West is willing, in the event of the construction of the overpass, to insure the viability of the overpass and maintain sufficient parking by: 1)building either a retaining wall below the slope of the overpass or 2) building a parking structure on the project site. A portion of 7-7 the projected annual cash flow surplus could be directed to a sinking fund to ensure that adequate funds are available for the necessary construction improvements. 4. Sacramento Drive Extension: Would the Council consider relocation or deletion of the Sacramento Drive requirement of the original subdivision of parcel#1? • Discussion: The original industrial subdivision called for the extension of Sacramento Drive through parcel #I with a connection to Orcutt Road at Duncan Road. Locating Sacramento Drive across this parcel, divides the student housing project in half, compromising student safety and generating additional noise impacts. Given recent upgrade of the existing drainage swale on Parcel 1 to `creek' status, it is difficult to also accommodate the Sacramento extension and maintain the threshold feasibility requirement of 800 beds. City Engineering has suggested an alternate location through parcel #2 to connect at McMillan Drive. This results in the loss of 1 building with the resultant bed count in the 710—730 range. This option would require a collaborative effort potentially requiring reduced or deferred impact fees in order to be financially viable. If this is a critical project component, Capstone West will continue to explore all options with City staff. 7-8 Fr•1m.'G*"JTUNE CIEVELi iPMENT IN-1 el-C li a ii (A- `''i iil' rillcapstonewest 162 S.Rarchc Santa Fe Road c4Ate 8-30 Enchlwi.Cbllfornla 92024 766.633.1 CC6 April 10,2001 760.6 .1 C& wY,wxcaAstcr.ecomPz;iies.wm Andrew G. Merriam,Principal Director of Planning Cannon Associates 364 Pacific Street San Luis Obispo,CA 93401 RE: Capstone West's Agent for Entitlement&Planning Issues San Luis Obispo Student Housing Project Dear MT.-Merriam- This r..Merriam-This will confirm that you are authorized to.act on behalf of Capstone West as their Agent for planning and entitlement issues in support of our proposed San Luis Obispo Student Housing Project. I would be pleased to clarify any related questions via telephone at 760 633-1006. Sincerely, IA John E.Vawter, Chief Operating Officer Capstone West 7-9 Capstone West-General Plan Amendment Application TABLE OF CONTENTS I. Planning Application Form H. Request for General Plan Amendment III. Project Description IV. Zoning of Adjacent Areas V. Statement of General Plan Consistency/Relationship of Changes to General Plan Elements VI. Comparison of Impacts Resulting From Change of Zoning VII. Map Exhibit Attachment 2: Request for Density Bonus Appendix A: Square Footage Calculation Appendix B: Parking Calculation Appendix C: Water Usage Calculation Appendix D: Wastewater Generation Calculation 011129/P1WPmjw Mmag==VRoject NotNGPA ApplicatiOWGPA Rweion 4.4-02/rOC 4-4-02 7-10 1 Capstone West-General Plan Amendment Application I. Planning Application Form 7-11 J � city San Luis owspo ..0PLANNING APPLICATION Community Development Department • 990 Palm Street • San Luis Obispo, California 93401 • (805)781-7172 Project Address and Assessors /Parcel Number(s):oc.*-ort-o,6(ate oau.ar no)�OS�- zz t -rn,3 ' C'TA t Ot2Lr..rT �-o• ; OS3'-1.Z 1 —OI b l�}SC t3Rcy�D ZT�O�r3—2Z 1 C3c :!58re0 ae t:7�� 211 036 What do you want to do? What is your final goal?,Qaat.tc.ntuT ty V-e;4n.lera-nr4f--- A Z:V4% & eitaud6s pa-c, /I US-S 4r4p M-Pv7 TD 2-4-Ptd ♦ w- T"e, AeNDNW, %7Agcme Tp .e. STU;;% T- N•0US1 &- Pao .ur WrTLa app¢o><rMd..T'>l,t.'t' s ..Qs . Applicant(Who is proposing the project?):CAff=tL0 'NsyceT-,Arrt`l624100k E"1-1- Day Phone:09-c�l1la3- tbce A.pplidant's Addresss1&71- 4,0- "taCAAO Set.tM F-V, SV. L+.rtutstntag C.s azoyq-. Representative (If any): CA?, � cma 61, n Arm , A-"iTN 41an°�-v`i M�e¢,�en Day Phone:cfts� 44-146-7 Representative's Address•' PartFtc,5r; SAM t,utev oats.eo , cta 9-)46i Property Owner(if other-than applicant): 0 - gam- ATrAe-"LAe-* -r t Day Phone:* Ars'ac-HzV Owner's Address'r` arr�ca.1 Meer t �N PCt.1.r�yJt tis Please send all correspondence to Othe applicant O the representative O the property owner. Property OwnerAuthorization Applicant/Representative Certification By signing this application 1 certify that I have reviewed this completed By signing this application 1 certify that the information provided is accurate. I application and the attached material and l consent to its filing. 1 agree to allow understand the City might not approve what rm applying for,or might set the Community Development Department to duplicate and distribute plans to conditions of approval. I-Vree to allow the Community Development I derested persons as It determines is necessary for the processing of the Department to duplicate and-distribute plans to interested persons as A application. determines'Ls necessary for the ing of the application. .4 ro oz Signed Date Signed Date Permission to Access Property Interior Inspection Contact Information This section is to be completed by the property owner and/or occupant who Occasionally,Community Development Department Staff may need access ubrtfrols access to the property. To adequately evaluate many project to one or more buildings an the Project site. if this is the rase.Staff will use proposals Community Development Department Staff.Cormtissloners and City the contact information below to arrange an appointment Council Members.will have to gain access to the emdedcr of the real property in order to adequately review and report on the proposed project Yarr signature below certiflees that you agree to give Bre City permission to access Me project Name: site from 8 am.to 5 pm.Monday through Friday.as part of the normal review of this planning applicatim Address: Signed Date Day Phone: CHECK REVIEW APPLICATION No. FEE PAID Notes to file: ❑ Remning/M ❑ Use Pe>imit ❑ Variance O ARC Review C E3Env.Review OF ❑ 'Subdivision o ❑ GP Amendment aori ❑ Annexation to ❑ Other Application fee paid by: ❑the applicant ❑the representative Cl the properly owner. Received by: Date: ern g",X�e'. '� 1■ sew. '. t r,. 4 Community Development Department, 990 Palm Street, - San Luis Obispo, California 93401 • (805) 781-7172 Applicant: You must complete this form and submit it with your application. Check each box to indicate that you have provided { the appropriate information. Everything on this checklist is f�ICl required unless otherwise indicated by planning staff. { R. OD Map amendment and rezoning,$4,677 (estimate) O Text amendment,$5,269(estimate) Q Completed Planning Application Form: Applications can be obtained from the Community Development Department or by mail, fax, or electronic mail. Q Statement describing how the amendment carries out existing policies of the general plan or how the proposed change in policies is warranted by neww conditions or community desires. Statement describing how the proposed change or changes relate to other general plan ele- ments. Q Map exhibit taken from the General Plan Land Use Map: One 8 1/2"X 11"map with the area to be changed highlighted and the proposed change clearly labeled. 2 Q Text exhibit with the existing words to be deleted lined through and words to be added under- lined indicating proposed new text. Other. = pPlicarrts i e em comp ica a b .a lICa � u - Section I Capstone Rest- General Plan Amendment Application Attachment 1 — Property Owners Property Owner Address Phone Assessors Property number Parcels Address Numbers Ground Zero LLC, 1010 Peach St. San (805) 541- 053-061-048 953 Orcutt Road Bob Schiebelhut Luis Obispo, CA 2800 93406 William E. Tickell Jr. 3233 Davis Canyon (805) 595- 053-221-033 791 Orcutt Road Rd. San Luis 2322 053-221-016; 3330 Broad St.; Obispo, CA 93405 053-221-030; 3360 Broad St; 053-221-036 no address 011129/PLWProjMMmagr mt(Pmj=NoIMGPAAppiiCai0WGPAR"Woo"-02/AH=hmrnlI-pmpeny0w 7-14 Capstone West-General Plan Amendment Application H. Request for General Plan Amendment 7-15 Section If Capstone West-General Plan Amendment Application H. Request for General Plan Amendment The applicant requests changing the land use designation of the site located on Orcutt Road from services and manufacturing to high density housing. The related zoning changes would be from "M-PD"and"C-S-S"to "R-4-PD". The intent of this application is to provide a 13 acre site that is designated and zoned to accommodate approximately 800 beds of student housing and related supporting facilities (i.e. exercise room, activities room, computer room, and bike storage). It is acknowledged that the proposed change of land use designation and zoning would effect a reduction in the City's current supply of service and manufacturing land. However,the applicant suggests that this is a logical and practical change for two primary reasons: 1) The City has no other vacant land that is appropriate for student housing, and 2)The airport area offers highly suitable land for the expansion of services and manufacturing. The proposed project will also require an update to the Circulation Element to reflect the revised extension of Sacramento Drive. The routing of Sacramento Drive will be resolved as part of the Development Plan, at which time the Circulation Element will be amended. 01 1 129ftW/Projm Mmmg®eMtProjW No[en/GPA ApplicmloNGPA Revision"-OLRequ=t for GPA 7-15 Capstone West-General Plan Amendment Application III. Project Description 7-17 Section III Capstone West-General Plan Amendment Application M. Project Description The site currently consists of three vacant parcels. The area of the parcels totals approximately 13 developable acres which excludes nearly two additional acres designated by the City as part of the creek corridor system and future railroad overpass dedication. The site characteristics and location are shown on Exhibit A. The majority of the units will be developed as 4 bedroom suites with a lesser amount of 2— bedroom and 1—bedroom suites. All suites will include a kitchen, common living space and balconies. A community room, pool and recreational facilities such as volleyball and basketball will be included. Vehicular parking will be `on grade' in parking areas that are convenient to the units. Preliminary site planning efforts are ongoing with the estimated bed count to be in the 800 range. Individual buildings will be organized into groups to create neighborhoods anchored by larger exterior spaces. The buildings will be strategically arranged to take advantage of numerous creeks that are either on-site or adjacent to the site. Current plans include 3 story, walk-up units with breezeways. At the P level, we are considering a modest amount of 2- story townhouse units with internal stairs that would selectively increase the building height to 4 stories. Our planning and design efforts will incorporate the following elements: ■ Create communal areas and informal gathering spaces including courtyards, recreational spaces,postal facilities and appropriate management offices. We recognize that amenities promote interaction and student involvement. ■ Carefully review of transportation systems/pattems including parking areas,bus stops and bicycle pathways with special adequate bike parking areas ■ Embrace technology—Each bedroom and living room will be equipped with the latest technology including data, cable TV and telephone. • Energy efficiency and environmentally sensitive use of materials • Daylighting—Wherever possible provide two sources of light and(cross) ventilation for units. ■ Safety & Security—ADA, exterior lighting, deadbolts. All building will be sprinkled with fully addressable Class A fire life systems. 011129/PbaVPrq¢t ManagcmmARojW Note GPA AppticatioNGPA Rwi%ion0- ovpmjw docription6-10-02 7-18 "moi- .+k„ .• t �s �'� ^;,+�. T -T �•Lair ,;[:;�. 71, VAX AT G EK STUDENT APARTMENTS San Luis Obispo, California M '� S' T'73� ' .! �®�•i 3� � ,air �,� � rA a• , , _ _r- �f It � l i SITE �rUad eet �- 1 -'Sacro` , "r' s "Willow�.�y�zs +}yN � 4ti4n� w— .�'�\•C_.,�- 1 .-`�� r rr �rw8c rl r n �f�i��!iw a�te■.I�II��!!�� —L./—_®—o'�aw �I®k�l�'�MM `1�1�'�•'` al■ Oi■A■li® IY�I -�L II'',fWI:uI1R c �(11�■ � _ -�- - -t _ I II�'lll''I'Ifkf'illll _� �.�% �� �Iw�� o ai�w deli ul 'err■.if• al� �'.�i ._��ul �I �I� 'r,'�1= °n! �' �_I'■■9i � i'iu'141111f slu_ _. -Am�_ . _Is_�I"�` I�7 . I 'llirlll(il•z.l�r".���� :�r�-�•. , � Mill iM/ I ��Imc I, ��al 'Itwl •� a—'�III�I-u -r ' J � � �. Mill _- pYi•i • M �• ■ Yllm /^ •yr. ����� � L—•o '�e r� „•� a =IBM rrh4 11 .Y lal WEIIzyAA►'r-1 U:p. t%Y Q�j •.1�� .y .....-, Y�il.....11tt ��I�L�Y• CIIII .—. Ctl 11 •lY.:S�': '• ,irs It — I w vma 1 � im •f• i n ',�������1'Iy���1'�.-.gni!- � � 1 •�!' � �I I�� •-fit !,l + ' �11F jV E 41 IX .. i'<.{� .rc• ���{:µf1\�j �.�I!1 ■ r a��f �- �:.'i:}49.`-:,. Irl- till;1 I rI 9II. G •ra. (\ I I Y i u Financial Overview We propose a unique structure Capstone created several years ago that involves purchasing privately held land and donating it to a university or community. In this case, the project will be donated to a 501(c)(3) not-for-profit Corporation jointly established by Cal Poly and the Housing Authority of San Luis Obispo (HASLO) with Capstone's assistance. Working with the foundation, Capstone and our bond underwriter, Morgan Keegan & Co., will arrange financing for 100% of the funds needed for the development of the Project. This financing will be secured through the sale of tax-exempt bonds issued by either a local municipal or State-level issuer, and be structured as"non- recourse"to the foundation, limiting its liability to its interest in the Project. For the project to be viable, the proposed project must be financially self-sufficient and able to pay for the land as well as the building and related improvements. Cal Poly and HASLO are not required to make any cash contributions, financial or operational commitments or guarantees that would necessitate financial statement disclosure. Thus, the 30 year, tax-exempt debt used to finance 100% of the capital costs of the development is "off-balance sheet" debt to Cal Poly and HASLO,with the purchasers of the bonds having only the project itself as collateral. The source of repayment of the indebtedness will be limited to the rental revenue generated by the housing. The housing revenues will be used to pay project debt service, operating expenses, deferred project costs/fees and to fund long-term repair and replacement reserves. Due to conservative lender requirements including underwriting to a 1.20 debt coverage ratio, it is anticipated that the project will generate a substantial positive cash flow that would potentially be available to fund affordable housing projects. The projected surplus cash flow is estimated to be in the$500,000 range in the first few years of the project. This figure will modestly increase over time as the debt is reduced and rents are increased per the CPI. The project has initially been discussed with the City, HASLO and Cal Poly. Assuming that the community is receptive to the project including the proposed change in land use, a logical next step is to refine the ownership structure. Of the numerous options available, we believe the following three are the best options for both the City and Cal Poly to consider. Following the options are comments that describe the related advantages and disadvantages. Option 1: Ownership to Cal Poly;Surplus to Cal Poly • Limited or no incentive for City to support project • Cal Poly as sole beneficiary will readily execute referral agreement required by tax-exempt bond credit enhancing agency • Does not provide long term economic benefit to HASLO; project will have to assume responsibility for up-front Affordable Housing impact fees • No incentive for City to waive or defer fees • Strong connection to Cal Poly, including referral agreement, is key criteria for lender and credit enhancer...thereby increasing likelihood of funding approval • Cal Poly will own the community upon repayment of the project indebtedness 7-23 Option 2: Ownership to Cal Poly; Surplus to HASLO • Cal Poly and HASLO are both beneficiaries ensuring a collaborative process • Creates incentive for City to support project • Cal Poly as co-beneficiary will execute referral agreement required by lender • Provides long term economic benefit to HASLO; City may waive Affordable Housing impact fees; City may consider waiving or deferring selected impact fees • Creates substantial annual cash flow for approximately 30 years to build additional affordable housing in SLO • Cal Poly will own the community upon repayment of the project indebtedness Option 3: Ownership to HASLO; Surplus to HASLO ■ Creates incentive for City to support project • No incentive for Cal Poly to execute referral agreement w/out ownership position • Provides ownership and long term economic benefit to HASLO; City may waive Affordable Housing impact fees; City may consider waiving or deferring selected impact fees • Creates substantial annual cash flow for approximately 30 years to build additional affordable housing in SLO • No connection to Cal Poly makes funding the project much more difficult if not impossible • Haslo will own the community upon repayment of the project indebtedness Option 4: Joint Venture • Both Parties share equity development and cash flow surplus 7-24 About Capstone Over the past 11 years, Capstone has successfully partnered with colleges and universities in the development of fifty-seven (57) student-oriented residential communities with a development cost of over $809 Million. Including projects that are currently being developed, the totals increase to 66 residential communities with a development cost of$964 Million. Capstone is unquestionably the most experienced developer in structured tax-exempt finance for student housing communities. Capstone created the industry standard format of financing known as the"off balance sheet" method, and has successfully closed or is in the process of closing over $378 million in this type of f inancing. Of Capstone's forty-four on-campus developments, we coordinated the financing for twenty-one of the communities, while the remaining were financed by our university partners. Capstone's philosophy is quite simple: approach each opportunities as a "partnership" with the college or university. We define this philosophy as follows: "To act as a partner with an institution to share developmental, management, and financial expertise on an as- needed basis." As a result, Capstone's programs, based upon our extensive experience, are designed to maximize the options available to our collegiate partners and thus provide them with unique flexibility. To better serve our university partners on the west coast, Capstone has committed the resources and one of our founding principals, John Vawter, to manage a west coast office near San Diego. Capstone West will coordinate development of student housing communities for those universities located in the West Coast and Rocky Mountain time zones, and be supported by the corporate resources of Capstone Development Corp., headquartered in Birmingham, Alabama. John Vawter is Chief Operating Officer of Capstone West. Joining him is Greg Gill, Sr VP and project manager. Greg is an architect and Cal Poly graduate. Jeff Allmaras, Valerie Frost and Chad lzmirian will provide architectural and construction management support. Presently, Capstone West is developing or has recently completed the following student housing communities • University of the Pacific/Stockton, California-200 student beds completed fall 2001. ■ University of the Pacific/Stockton, California—Phase 2 student housing project for 2003. ■ University of San Diego/San Diego, California-362 student beds for the fall 2002 term. ■ South Orange County Community College/Tustin, California—1,000 beds in planning Team Organization To compliment our experience and capabilities, and to best serve the unique needs the project, Capstone has commitments from McLarand Vasquez Emsiek & PartnersofIrvine, CA as architect; Cannon Engineering of San Luis Obispo as Civil Engineer, Morro Group of San Luis Obispo of as Environmental Consultant, and Firma of San Luis Obispo as Landscape Architect. Additional team members are currently being considered. Schedule The target schedule is to occupy in August '05 to accommodate Cal Poly Fall Quarter incoming students. Capstone will be working closely with The City of San Luis Obispo to manage the entitlement approval process. We pian to process the Specific Plan concurrent with the General Plan Amendment. Relative to CEQA, we understand that a focused EIR, rather than a mitigated negative declaration will most likely be required. It is assumed that this may require a 6-8 month process. In addition, we have budgeted 8-12 months for creek related approvals from the Army Corps and Fish &Game. 7-25 capstoneon -campus Student Housing Developments Spring Hill College,Mobile,AL 1996 143 $ 3,261,000 Tuskegee University,Tuskegee AL _^ - 1997 504 $ 11,136,000 University of West Florida Phase I,Pensacola,FL � 1997 192 $ 5,642,349 Gardner-Webb University Phase I,Boiling Springs,NC � 1997 143 $ 1,340,080 �Arkansas Tech University,Russellville,AR 1998 168 $ 5,232,327 Belmont University,Nashville,TN 1998 252 8 8,500,925 Fast Tennessee State University,Johnson City,TN 1998 300 $_._ 7,764,157 Southern Polytechnic State University,Marietta,GA 1998 288 --$ 8,678,154 Rochester Institute of Technology Phase I,Rochester,NY _ 1998 256 $ 8,825,000 Florida Atlantic University-Honors College Phase I,Jupiter,FL 1999 150 _ $ 5,851,255 Southeastern Louisiana University,Hammond,LA 1999 312 $ 6,799,450 University of West Florida Phase ll,Pensacola,FL. 1999 288 $ 7,770,104 Rochester Institute of Technology Phase II,Rochester,NY 1999 512 $ 18,177,917 Christian Brothers University,Memphis,TN 1999 142 $ 5,000,000 University of Central Oklahoma,Edmond,OK 1999 384 _ _ $ 14,402,230 Gardner-Webb University Phase II,Boiling Springs,NC 1999 143 $ 3,746,000 Benedictine University,Lisle,IL 2000 276 $ 14,500,000 Oklahoma State University Phase[;Stillwater,OK 2000 631 $ 25,602,070 Towson University,Towson,MD 2000 420 $ 18,770,000 Averett College,Danville,VA 2000 143 $^ 5,500,000 Stillman College,Tuscaloosa,AL 2000 300 $� 6,981,254 Oklahoma State University Phase II,Stillwater;OK 2001 1,101 $ 55,071.,492 Southeastern Louisiana University Phase II,Hammond,LA 2001 270 $ 7,099,919 University of Connedlart,Storrs,CT 2001 967 $V 41,261,463 University of Alabama at Birmingham,Birmingham,AL 2001 513 $ mV124,839,348 University of Maryland-College Park,College Park,MD 2001/2002 1,253 $ 75,194,459 University of the Pacific,Stockton,CA 2001 200 $ 10,300,000 — .-_..........._ Xavier University,Cincinnati OH 2001 277 $ 11,983,691 Florida Atlantic University-Honors Coilege-Phase II,Jupiter,FL 2001 1504 $ 5,663,174 Oklahoma State University-Okmulgee,Okmulgee,OK 2001 414 $ _ 15,812,013' University of Central Oklahoma Phase ll,Edmond,OK 2001 302 $ 8,895,404 Oakland University,Detroit MI 2002 459 $ 20,715,670 Southeastern Louisiana University Phase III,Hammond,LA 2002 400 $ 10,000,000 University of San Diego,San Diego,CA 2002 362 $ 27,000,000 Indiana University-Purdue University Indianapolis(IUPUI),Indianapolis,IN 2002 751 $ 41,080,000 Florida Atlantic University-Boca,Boca Raton,FL 2003 300 $ 12,000,000 Oklahoma State University Phase III.Stillwater,OK 2002 1,071 $ 47,495,000 Lawrence Technological University,Detroit,MI 2002 230 $ 9,368,557 Winthrop University Real Estate Foundation,Rock Hill,SC 2002 423 $ 17,000,000 Southwest Texas State University*,San Marcos,TX 2002 660 $ 44,334,596 Teikyo Post University,Waterbury.CT 2002 150 $ 6.000,000 University of the Pacific Phase Ii,Stockton,CA 2003 200 $ 10,000,000 Total • and Bedrooms 16,411 $ CPA.C15,058 'Total cost includes facilities other than housing 1\ Capstonedevelopment Off-Campus Student Oriented Housing Developments University Commons,Tallahassee,Florida 1991 480 $ 6,996,671 University Commons,Starkville,Mississippi 1991 48Q $ 7,176,665 University Commons,Athens,Georgia Phase I&II 1992/1993 768 $ 12,872,000 University Commons,Tuscaloosa,Alabama Phase I&II 1993/1997 696 $ 11,881,778 University Commons,Gainesville,Florida 1993 600 $ 9,973,000 Gainesville West,Gainesville,Florida 1998 112 $ 3,492,790 University Commons,Oxford,Ohio 1994 480 $ 7,808,000 University Commons,Oxford,Mississippi 1994 528 $ 8,617,000 University Commons,Columbia,South Carolina Phase I&II 1994/1999 696 $ 13,636,624 University Commons,College Station,Texas Phase 1&II 1995/1997 960 $ 20;804,607 University Commons,Baton Rouge,Louisiana 1995 528 $ 9,478,132 University Commons,Norman,Oklahoma 1995. 792 $ 14;664,296 University Commons,Lexington,Kentucky 1996 672 $ 13,183,512 University Commons,State College,Pennsylvania 1996 696 $ 14,387,907 University Commons,Manhattan,Kansas 1997 696 $ 15,345,028 University Commons,Bloomington,Indiana 1997 792 $ 18,519,536 University Commons,Urbana, Illinois 1998 732 $ 18,619,330 University Commons;Austin,Texas 1998 792 $ 21,079;622 Capstone Commons,East Lansing,Michigan 1999 654 $ 17,244,190 University Commons,Eugene,Oregon 1999 696 $ 21;447;678 Total Bedrooms Capstone West-General Plan Amendment Application IV. Zoning of Adjacent Areas 7-28 1 , Section IV Capstone West-General Plan Amendment Application IV. Zoning of Adjacent Areas: A. North: 1. Manufacturing(M) 2. Service Commercial (C-S) B. South: 1. Manufacturing(M; M-S) 2. Service Commercial (C-S-S) NOTE: This area is currently occupied by several residences C. East: 1. Medium-High Density Residential (R-3) 2. Medium Density Residential (R-2) NOTE:This area consists of apartment complexes as well as a mobile home park D. West: 1. Service Commercial (C-S-S) NOTE: Development is planned for this vacant property with construction to begin in 2002 SEE EXHIBIT"A"for map of existing zoning 011129/Phm/RojW tvfln&==VPmjm NotNGPA App1,cai0WGPA Rt bion4-4-ozsxvning inning44-02 7 -G7 �:, r. � � � \\\\ 1 ` `�� � �,i� � �1 .,� I_ �•, � � - �� - � I --... �. �� �� �_7r7 .rir �C.� ,y� y,� '• , ' �� .. � �� I �� I J4 � — __ �� � _— Y �� 1 �� �� • , / ._� -:��� \ '� ' ''�> - .�- i �r «i ':` � ��� r - n.- r ^�_ �� i •- _ � _ _ •, I i � qa .I / I ' n� 1 • I Capstone West-General Plan Amendment Application V. Statement of General Plan Consistency/Relationship of Changes to General Plan Elements 7-31 Section V Capstone West-General Plan Amendment Application V. Statement of General Plan Consistency/Relationship of Changes to General Plan Elements: Consistency analysis of the proposed land use with policies of related Elements of the General Plan. A. Land Use Element 1. LU 2.8.1 Large Group Housing. This section allows for large group housing in high density residential areas or in suitable commercial or light industrial areas (General Plan Digest, Land Use Element,page LU-34). This section also states that group housing should have convenient access to services. • Response: CONSISTENT. The proposed project is consistent with the General Plan policy for large group housing. The proposed project site lies within a light industrial area composed of C-S and R-3 zones. The short distance to commercial services in the area can reduce traffic impact by enabling residents to bike or walk to these services for their frequent shopping demands. 2. LU 6.4.6 Creek Setbacks. Establishes guidelines for building setbacks along creeks (General Plan Digest, Land Use Element,page LU-73). • Response: CONSISTENT. All creek setbacks have been determined by Neil Havlik, City of San Luis Obispo Natural Resources Manager. Project designs will minimize impacts on the riparian corridor. 3. LU 1A Jobs/Housing Relationship. Housing supply should keep up with demand(General Plan Digest, Land Use Element,page LU-12). • Response: CONSISTENT. By effecting a zoning change to build student housing,the project will augment the City's housing supply. 4. LU 1.7.1 Open Space Protection. Sensitive wildlife habitat should be protected as open space. (General Plan Digest, Land Use Element,page LU- 13). • Response: CONSISTENT. The project will protect all creek areas which provide wildlife habitat . 5. LU 2.7.4 Cal Poly Adjacency. In order to minimize student traffic student housing should be located close to Cal Poly(General Plan Digest, Land Use Element, page LU-34). • Response: PARTIALLY CONSISTENT. Review of available land use resources and recently expressed neighborhood concerns adjacent to Cal Poly find that there are no areas adjacent to Cal Poly that can accommodate a project of this size that efficiently houses large numbers of college students. Existing student housing projects such as Stenner Glen and Mustang Village were built when larger tracts of land suitable for such a project were still available. 0111:91PWVProjw Mmagcnm✓PmjW Notc✓GPA ApplicalioNGPA Reviaion 4-4=Gen Plan wmiuency 4-"2 7-32 Section V Capstone West-General Plan Amendment Application 6. LU 2.4.8 High Density Residential. Such development should be located near downtown, Cal Poly, or high concentrations of employment. (General Plan Digest,Land Use Element,page LU-33). • Response: PARTIALLY CONSISTENT. SEE RESPONSE to subsection 5 above. 7. LU 2.5 Affordable Housing. Development will conserve or produce affordable housing(General Plan Digest, Land Use Element,page LU-33). • Response: PARTIALLY CONSISTENT. Creation of new student housing can make available low cost rental housing elsewhere in the City. 8. LU 6.4.5 Open Channels. Open creek channels should be kept clear (General Plan Digest, Land Use Element,page LU-72). • Response: PARTIALLY CONSISTENT. The project designs will comply with the setbacks leaving open channels unaltered except in specific locations where bridging of channels is necessary to address circulation issues. Any alteration of channels will be permitted through the California Department of Fish and Game and the Army Corps of Engineers. The use of bridges,where possible,will leave stream channels unaltered. 9. Other related policies: LU 1.7.7 Preservation of Trees; LU 1.9.4 Design Standards; LU 2.2.8 Natural Features; 2.2.10 Compatible Development; LU 2.2.11 Site Constraints; LU 6.4.3 (E.4) Flood Hazard Protection. • Response: CONSISTENT. The project complies with all policies listed in subsection 5 above. 011129/Plan/Project Managemem/Project NotNGPA Application/GPA Revision 44.02'Gm Plan comes y 44-02 7-33 1 1 Section V Capstone West-General Plan Amendment Application B. Circulation Element 1. C18.1 New Development. (Other related policies: C12.7 Transit Service; Cl 3A Bicycle transportation; C143 Pedestrian Access). New development is responsible for construction of new streets,bike lanes, sidewalks,pedestrian paths,bus turnouts(General Plan Digest, Circulation Element,page C1-23). • Response: CONSISTENT. The project applicant is committed to supporting alternate modes of transportation. Project plans will include bicycle storage and parking. The project applicant is aware of the City's goal to construct a Railroad Safety Bike Trail to Cal Poly which will pass close to the project site. The Railroad Safety Bike Trail will provide a safe, direct route to Cal Poly for project residents who choose to bicycle. Project plans will support use of transit service through provision of transit facilities. Street improvements will include bike lanes,bus turnouts, sidewalks and pedestrian access. 2. C18.4 Major Network Changes. Street network changes require amendment to the Circulation Element(General Plan Digest, Circulation Element,page C1-24). • Response: CONSISTENT. Amendment to the Circulation Element for changes to the proposed Sacramento Drive extension will be requested at the time of Development Plan application submittal. 3. C115.15 Circulation Impact Analysis.The Circulation Element requires new developments to provide information on possible impacts to nearby intersections and neighborhoods and anticipated community-wide transportation impacts. (General Plan Digest, Circulation Element,page Cl- 42). • Response: CONSISTENT. A full transportation impact analysis will be prepared as part of the project EIR. While the transportation evaluation is not complete,preliminary studies** indicate that a) the difference between 1000 potential manufacturing or commercial employees and 800 students does not significantly change potential traffic levels on adjacent streets, and b) the student travel demands will generate lower levels of travel at peak hours than potential manufacturing or commercial uses of the site. **Data generated using ITE trip generation values and reasonable maximum development densities for manufacturing/commercial service uses and high density residential uses. See Section VIA of this application for more information on circulation issues and trip generation data. • The project applicant is committed to working with the City to address traffic reduction through various programs including extension of the Railroad Safety Bike Trail to Cal Poly, expansion of Orcutt Road width, intersection improvements at Laurel Lane, convenient location of bus stops and project site parking reduction incentives. 0111291PIaNProitxt Manag=mVPtgat Notcs/GPA ApplicatiodGPA Revision a.a-021Gm Plan comistmry x-402 7-34 r Section V Capstone West-General Plan Amendment Application See Section VIA - Circulation Impacts for Comparison oflmpacts Resulting From Change of Zoning 011129/PLvdRojm M=agc LIPojw Note/GPA AppOcmioNGPA Revision 4-0-02/Gm Plan wmisimcy 4-4-02 7-35 Section V Capstone West-General Plan Amendment Application C. Open Space Element 1. OS 3.0 Creeks.. Discusses preservation of creeks as open space in their natural state through adequate setbacks, restoration techniques,use of riparian native plants, erosion and sediment control (General Plan Digest, Open Space Element,page OS-6 to OS -16). • Response: CONSISTENT. All creek setbacks have been recently determined by Neil Havlik, City of San Luis Obispo Natural Resources Manager. The project designs will substantially comply with the setbacks to minimize impacts on the riparian corridor. All creeks on the projects site will be preserved through substantial compliance with setbacks, and sediment and pollution prevention plans. The potential exceptions are: 1)Roads required by the Circulation Element 2) Safety issues requiring road alignment which infringes into the creek setback 0111291Pbo!Pmjeet ManagemenVProject Notes/GPA ApplicntioNGPA Revision a�ovcieo M=consistency 4 -02 7-36 Section V Capstone West-General Plan Amendment Application D. Housing Element 1. H 2.23 Creation and Preservation—Affordable Rental Housing. City will preserve and expand its affordable housing supply(General Plan Digest, Housing Element,page H-3). • Response: CONSISTENT. The project's creation of student rentals can make available rentals in other areas of the City,and therefore reduce pressure on the City's low cost rental supply. 2. H 8.2.1: Encourage Special Needs Housing. The City will encourage housing that meets the special needs of families with children, single parents, disabled persons,those desiring congregate or co-housing lifestyles, the elderly, students, and the homeless. (General Plan Digest,Housing Element, page H-17). • Response: CONSISTENT. The proposed projects fulfills the need for creation of student housing as discussed in Section 8.0: Special Housing Needs. 3. H 11.2.2 Consistency. City should not permit housing development where it conflicts with the goals of the Housing Element, other General Plan Elements, or communitygoals (General Plan Digest,Housing Element,page H-19). • Response: CONSISTENT. Provision of student housing has been identified as a specific need within the community if San Luis Obispo. This proposal, with amendment of the.Land Use Element as requested, will be consistent With the elements of the General Plan. As identified in other sections of this consistency analysis,there are no major conflicts with other general plan elements. (See specifically responses to Section A-1, A-4, and A-5 as discussed, Circulation requirements, Open Space requirements) 4. H 11.23 New Development. New housing development should not be permitted on sites that should be preserved for open space or parks. (City of San Luis Obispo- General Plan Digest;Housing Element,page H-19). • Response: CONSISTENT. 1) The subject parcels are already intended for development, as is apparent from their current zoning designation; 2)The site has been utilized for various uses over the years and is not considered pristine land. The site location is surrounded by various forms of commercial and manufacturing development, not an ideal setting for a park. 011129/PlaNProjw M=ag==V?roj=Notc/GPA ApplicatioWGPA Rwi.ion 44.021Gm Plan comiatmcy 44-02 7-37 Section V Capstone West-General Plan Amendment Application E. Conservation Element 1. CO 5.1.6 Creek Protection. Creek systems supporting wildlife should not be altered in a way that might harm fish. Dumping of pollutants is prohibited. (General Plan Digest, Conservation Element,page CO-10). • Response: CONSISTENT. The applicant will substantially comply with creek setbacks. Riparian trees supporting wildlife will not be removed. Disturbance of streambeds will be minimal. Any specific areas which may require bridging will be permitted through the California Department of Fish and Game and the Army Corps of Engineers and will be compliant with all required conditions. A Storm Water Pollution Prevention Plan will be prepared for preventing pollution of surface water from runoff. F. Noise Element 1. N 1.2.6 New Development Design and Transportation Noise Sources. Noise sensitive development should be located and designed to meet the maximum outdoor and indoor noise exposure levels listed in table 1 of the Noise Element(General Plan Digest,Noise Element,page N-3). • Response: CONSISTENT. Any residential development will perform the requisite noise studies and include noise mitigation as needed. Project response will include site planning, use of material, and use of buildings to shadow active outdoor areas, as well as appropriate noise setbacks. 2. N 1.2.1 Minimizing Noise. New development should minimize noise exposure and noise generation. (General Plan Digest,Noise Element,page N- 1). • Response: CONSITENT. There are no immediate neighbors that are classified as"sensitive receptors"which would be sensitive to noise generation by the project.. The area.is surrounded on two sides by the railroad and industrial areas. Separation of the R-3 housing to the east by the railroad tracks creates a noise buffer to the residences in that area. See also response subsection F-1. 011129/PIeNProjm Ma g==VPmjw NotcVGPA ApplicatioNGPA R"imon 4- 02/G=Plop mmivtmcy 4-4-02 7-38 Section V Capstone West-General Plan Amendment Application G. Safety Element • Response: CONSISTENT. A change in zoning of the subject property from M-PD and C-S-S to R-4-PD should not violate any of the policies in the Safety Element. H. Safety Element • Response: CONSISTENT. A change in zoning of the subject property from M-PD and C-S-S to R-4-PD should not violate any of the policies in the Safety Element. I. Water and Wastewater Element • Response: CONSISTENT. A change in zoning of the subject property from M-PD and C-S-S to R-4-PD is not anticipated to conflict with the policies in the Water and Wastewater Element.Residential development of the subject property will conform with those policies pertaining to the appropriate use of the City's water and wastewater systems 01 I1291PIanfP jw Manag=cWPmjM Nota/GPA AppOcatioNGPA Revision 44-ONGm Plan consincnU 4-402 7-39 �\1 i I Capstone West-General Plan Amendment Application VI. Comparison of Impacts Resulting From Change of Zoning 7-40 Section VI Capstone West-General Plan Amendment Application VI. Comparison of Impacts Resulting From Change of Zoning Section IV compares impacts of a potential project on the subject property as currently zoned to a student housing project under the proposed zoning. A. Circulation Impacts 1. Development Under Existing Zoning. For the purpose of comparison with development of student housing under the proposed zoning,the applicant has calculated the square footage of a development project maximizing usage of the site under the current zoning of M-PD and C-S-S. It is assumed that a research and development office project or manufacturing project under the current zoning on the site,utilizing 60% coverage of the site*,would develop buildings totaling 344,400 square feet of floor space. Occupancy of 1 person per 300 square feet would equate to a total of 1148 employees on site. (See appendix A for coverage calculations). *Total square footage of buildings and total employees on site could be higher using the zoning ordinance's maximum allowed coverage of 75%,however, 60%was chosen as the more realistic coverage factor based on identified site-specific constraints.. 2. Comparison of Traffic Impacts under Existing Zoning versus Proposed Zoning. ** • Trip Generation-Average Daily Traffic: Current development plans for the site are for a Business Park/Research and Development Center with an approximate employment of 1000 people. Utilizing ITE Land Use Code 770, average daily traffic for this use is 4040 ADT. The proposed student housing development for 800 students would produce 2680 ADT using ITE Code 220 for apartment. This proposal would decrease the total number of new trips by 34%. • Peak Loading a.m..and p.m.peak hour of generator traffic: The existing land use will produce an estimated 450 am peak hour and 390 pm peak hour trips. The proposed project will produce 224 am peak hour and 320 pm peak hour trips, a 50%reduction of the trips added to the roadway system during the am peak and an 18%reduction during the pm peak hour. • The change in zoning from M-PD to R-4 PD for the Capstone Student Housing Project provides a reduction in daily and peak hour trips from the existing business park use. In addition,trip management and reduction will be addressed by new programs including utilization of alternative transportation(buses, bicycles), and carpooling. These programs specifically address traffic impacts related to the distance of the projects site to Cal Poly campus. **Data presented from Preliminary Comparative Traffic Analysis prepared by:Sandy L.Bergam,PE;Senior Civil Engineer Cannon Associates. Ms.Bergam is a Registered Civil Engineer in the State of California with experience in land development and traMc engineering for both the public and private sectors. 011129/P1;w&mjm Management/Pmilm NmGPA ApplicatwNGPA gcvisioo 44-02 O=Lmim&ucck i�.uc J-9-02 7-41 1 Section VI Capstone West-General Plan Amendment Application 3. Parking. The total quantity of required parking spaces under the existing zoning of M-PD and C-S-S (using the assumption of 60%coverage as explained in Appendix A) would be greater than the parking required by a high density housing project under the proposed R-4-PD zoning using maximum allowed density. All development on the site will be in compliance with the parking requirements set forth in Table 6 of the Zoning Ordinance. (See Appendix B for parking calculations). B. Creek and Wetland Impacts Impacts on creeks and wetlands as a result of development on the site are not considered to change under a new R-4 zoning versus impacts resulting from development under the current M-PD and C-S-S zoning.The creek setbacks defined for the project site remain the same whether the project site is zoned CS- S and M-PD or R-4-PD. Thus, there is no change in creek and wetland impacts associated with a zoning change to R4-PD. The proposed land use will require encroachment into creek setbacks along Acacia Creek for circulation safety reasons. Development under any zoning could require this encroachment into creek setbacks for circulation safety reasons. In order to align the proposed project's driveway onto Orcutt Road with the opposing street intersection the driveway must infringe on the setback. Circulation safety issues are accepted as exceptions to determined creek setbacks. Because of the irregular vegetation boundaries along the creeks on the subject site, the creek setbacks are jagged rather than straight lines along the creek corridors. In order to facilitate practical site design, some creek setback averaging may be requested for minor incursions into the creek setbacks. Averaging requests will be submitted with the Development Plan application. C. Other Impacts and Concerns 1. Issue: Water Usage Response: Expected water usage for development under the proposed zoning change is calculated to be approximately 6.2 acre feet per year greater than expected water usage for development under the current M- PD and C-S-S zoning. (See Appendix C for water usage calculations). A preliminary conversation between Cannon Associates and John Moss of the City's Utilities Department indicated that the City's current water supply is sufficient to provide for the proposed student residential /� 011129/PInNProjm M=S w,mtlPmjw NowGPA ApplicmioNGPA R"m0n 4h02/Ci=1M1nn&ffcc*bs=4-9-02 7-42 i Section VI Capstone West-General Plan Amendment Application complex. He recommends that the project be pursued in a timely manner so as to assure water availability by the time the project is ready to connect. 2. Issue: Wastewater Generation Response: Expected wastewater generated by development under the proposed zoning change is calculated to be lower than development under the current M-PD and C-S-S zoning. (See appendix D for wastewater generation calculations). Any development of the subject property, regardless of zoning,will be required to evaluate the existing wastewater infrastructure's ability to accommodate additional wastewater generated by that development. Where deficiency of wastewater infrastructure is identified, development will be responsible for improvements to the wastewater infrastructure(Municipal Code; Section 2.44,Resource Deficiencies). Any development on the subject property will correct wastewater deficiencies as needed as part development plan process. 3. Issue: Police/Fire Service Response: Police and fire services required by a student housing project under the R-4-PD will be of a different nature than those required by research and development project under the M-PD and C-S-S zoning. Existing police and fire service are expected to be adequate to serve the needs of the project. Project access will accommodate emergency vehicles. 4. Issue: Railroad Grade Separation Response: Railroad grade separation issues will be present regardless of the zoning of the site or the exact nature of the development. An upgrade of the at-grade crossing will be part of the Orcutt Road widening. Any development of the subject property should work with the City and SLOCOG to facilitate this upgrade. Future plans call for an above-grade railroad separation. A portion of the subject property has already been deeded to the City of San Luis Obispo for the planned above-grade separation. If parking were allowed in portions of this area, the applicant would insure viability of future overpass construction and maintenance of sufficient parking by: 1)building either a retaining wall below the slope of the overpass or 2)building a parking structure on the project site, at the time of overpass construction. 5. Issue: Soil Suitability Response: Soil Suitability will be determined for any project regardless of the zoning. The development application for development under R-4- PD zoning will be contingent on soil suitability. A full soils study will be conducted. 011129/Phw?roj=Mawg=Ce Projw Nol mGPA ApplicxioNGPA R"ision 9-0-02/Ceculafion&...k L%.%=44-02 7-43 Capstone West-General Plan Amendment Application VII. Map Exhibit 7-44 Cog=wee-Om®I PlaaAm®deeae,iam8ecton EXHIBIT °B° - GENERAL PLAN AMENDMENT PROPOSED ZONE CHANGE M M � a4.s cos _ M M &9 R+3 U-MU C-8 - SPO i I I I C-S•PD M O8 I I 0 PROJECT SITE .f.BS y0 F �C964PD M a WS �Le °flims PROJECT SITE WITH PROPOSED City Urnit IJne ZONE CHANGES FROM M—PD Creeks CasservadorvopenSpace(uos) j AND C—S—S TO R-4—PD Low Density Residential(11-1) Medium Density Residerdtel(R-2) n Mediumaiigh Density Residential(R- High Density Residential(R14) owe(a) Nelghborhood Commercial(C-N) Caul Commercial(C-C) 0 Retail Commercial(C-R) i®Tourist Commercial(C-T) Service Commercial(C-S) 40 Manufacturclg(M) ID Publk Facility(PF) Overlay Zones N-tGshoric S-Special CorWderatlon SP-Specific Plan Area F", j P�Dnt � M��o ftrcd Size(".CJDs's) 7-45 Capstone West- General Plan Amendment Application ATTACHMENT 2 - Request for Density Bonus Issue: Density Allowance. The applicant requests consideration of a density bonus by the Planning Commission and City Council. Maximum allowed density under the R-4-PD with a permitted Group Housing designation (Zoning Ordinance; Chapter 17.20; Section 17.20.020; page 60) is 55 persons per net acre. Therefore, maximum allowable density on the 13.18 acre project site is 725 persons. The applicant requests a density bonus of 12%to allow for an additional 75 beds on the project site, bringing total allowed density to approximately 800 persons, or 61 persons per net acre. Response: The project design meets the following criteria necessary for density bonus eligibility as listed in section 17.62.040(subsections A and B) of the zoning ordinance(Zoning Regulations, Chapter 17.62 Planned Development,page 94). Specific details of the site design in relation to the criteria below will be provided at the time of Development Plan application. submittal. Criteria 1: The project will provide student housing. The facilities provided by the project will be designed to meet the special needs of students. Students currently occupy a large percentage of the rental housing in the City of San Luis Obispo. The majority of those rentals are not specifically designed as student housing,but rather as single or multiple family dwellings. Single or multiple family dwellings are not suited to the needs of students who may share bedrooms,with more cars per household than the average family,and spend more time on campus where other amenities are available to them. The applicant's project design will accommodate the need for adequate student parking, as well as other student needs such as secure bike storage. Criteria 3: The applicant intends to offer housing to students that is more affordable than conventional housing, thusaddressing the demand for student housing. Because students generally rent in the lower rental price range, the student housing offered by the project opens up lower cost rental housing elsewhere in the City that would otherwise be rented by students. Criteria 4: The applicant's conceptual site design makes use of the natural features of the site with most units overlooking green space, rather than the typical apartment complex surrounded by parking lots. The applicant intends to landscape the site to enhance and utilize the existing natural features. Criteria 5: Compact design of the units situated in groupings of two or four bedrooms with one central living space will result in conservation of energy and resources. Additionally,the typical student resident use campus facilities 01 1129/Plnn/Projm M=g=cu/Rojen No1NGPA ApplicmioNGPA Revision*4A71Dm icy bonze 44.02 7-46 Capstone West- General Plan Amendment Application such as the gym and library, resulting in less resource use at home. Natural landscaping planned for the project will result in less resource use through lower water and maintenance demands. Planned traffic mitigation measures may result in less gasoline resource consumption use through increased carpooling and increased use of public transit and bicycles. 011129/PbnfPtOj=Manager gPmjea NotNGPA AWIicatioNGPA Revision 4-4M../Drneny bonus 4 -02 7-47 Capstone West-Geneml Plan Amendment Application Appendix A Square Footage Calculation for Development under M-PD or C-S-S zones: The current zoning of M-PD and C-S-S allows for a maximum 0.75 floor area ratio (FAR) or 75%maximum coverage of the net acreage of the site. Assuming 60%coverage on the site results in approximately 344,400 square feet of building floor area. While the allowable coverage could be larger based on the 75%maximum coverage allowed by the Zoning Ordinance,a lower coverage of 60%is more reasonable with the constraints of the site and has been used to calculate a potential project's size under the current zoning. This application will assume potential development on the site under the current zoning to have a building coverage of 344,400 square feet. Occupancy load set forth in Table 10-A of the 1997 Uniform Building Code (1997 Uniform Building Code,Volume 1, International Conference of Building Workers; April 1997; Page 1-125)allows for 1 person per 200 square feet in manufacturing areas and 1 person per 100 square feet in offices. For the purpose of this analysis occupancy load will be calculated using a factor of 1 person per 300 square feet. For development under the current zoning maximum occupancy load is calculated as 1148 persons total. Givens Net developable acreage of site: 13.18 acres Maximum floor area ratio (FAR): 0.6 1 acre=43,560 sq feet Allowed occupancy load: 1 person per 300 square feet Calculations: Allowed Floor Area: (13.18 acres)x (0.6 FAR) =7.908 acres of allowed floor area coverage (7.908 acres) x (43,560 sq ft/acre)=344,472.5 sq ft of floor area coverage allowed Allowed occupancy load: (344,472.5 sq ft) x (I person/300 sq ft)=1148 person total occupancy 011129/PIaNPmj=Manag=mt/Pmjw Notc GPA Appli"tioNGPA Revision 44 WAppendia A-wvvagc calcv 4-0-02 7-48 Capstone West-General Plan Amendment Application Appendix B Parking Calculation Parking calculation for development under M-PD or C-S-S: Given: Required parking for manufacturing, offices,research and development as put forth in Table 6 of the Zoning Ordinance: 1 space per 300 square feet of office area Assumed total floor space: 344,400 square feet Calculation: (344,400 sq ft) x(1 space/300 sq R)= 1148 parking spaces required Required parking for assumed 344,400 sq ft development under M-PD and C-S S zoning is 1148 parking spaces Parking calculation for development under R4-PD: Given: Required parking for dwelling in R-4 zone as put forth in Table 6 of the Zoning Ordinance: 1.5 spaces for the first bedroom and 0.5 spaces for each additional bedroom in a unit. Based on the parking requirements in the zoning ordinance: • A four bedroom apartment unit requires 3 parking spaces, a 43 ratio of bedrooms to parking spaces. • A two bedroom apartment unit requires 2 parking spaces, a 1:1 ratio of bedrooms to parking spaces. • A one bedroom apartment unit requires 1.5 parking spaces, a 2:3 ratio of bedrooms to parking spaces. The proposed student housing project's maximum density would be approximately 800 bedrooms. Total parking for a 800 bedroom project(designed with 2 and 4 bedroom units) project should not exceed 850 parking spaces. The exact number of required parking spaces will be determined in the development plan. Total required parking for student housing development under the proposed R-4-PD zone would be calculated based on number of bedrooms per unit and total units. CONCLUSION: The total number of required parking spaces under the proposed zoning is less than the calculated required parking for maximum development under the current zoning. 011129/PIaNProjecr,%4 nagcmrnUProjM NOIM/GPA Applicmion/GPA Rmiaion 4-"Z/Appendix B—Perking calculation 4.4A2 7-49 Capstone West-General Plan Amendment Application Appendix C Water Usage Calculations Water usage calculations for development under M-PD or C-S-S: Given: Water Usage Factor—manufacturing with low water usage: 0.22 acre feet per 1000 square feet floorspace per year Water Usage Factor—service commercial (office,retail, service activities): 0.06 acre feet per 100 square feet of floor space per year *Because 9.44 net acres of the project site are zoned M-PD and 3.74 net acres of the project site are zoned C-S-S,the calculation below uses a 50%-50% average of the two water usage factors listed above. The average water use factor is 0.14 acre feet per 1000 square feet of floor space. Assumed total floor space: 344,400 square feet Calculation: (.14 ac ft/1000 sq ft)x(344,400 sq ft)=48.216 acre feet per year Water usage of development under M-PD and C-S-S zoning. 48.216 acre feet per year Water usage calculations for development under R4-PD: Given: Water Usage Factor—high density residential: 0.068 acre feet per person per year (Water Usage Factor has been calculated by Ron Munz, City Utilities Conservation Coordinator based on annual water usage by Stenner Glen student housing project) Total persons in proposed project under R-4-PD: approximately 800 persons Calculation: (0.068 ac ft/person/per year) x (800 persons)= 54.4 acre feet per year Water usage of proposed development under R-4-PD zoning. 54.4 acre feet per year CONCLUSION: Development under proposed zoning will have a water usage of approximately 6.2 acre feet per year MORE than development under the current zoning. NOTE:All water usage factors were obtained from Ron Munz, City of San Luis Obispo Utilities Conservation Coordinator 011 1291KPmiw Manag==t/Pmjem NOIa GPA Applicmion/GPA Revision 44-02/Appendix C-Water Usage cla.4-0-02 7-50 Capstone West-General Plan Amendment Application Appendix D Wastewater Generation Calculations Wastewater Generation calculations for deveIo meat under M-PD or C-S-S: Given- Wastewater Wastewater generation factor—Manufacturing/industrial: 120 Gallons per day(GPD)per 1000 square feet floorspace Wastewater generation factor—Office: 190 GPD per 1000 square feet floor space *Because 9.44 net acres of the project site are zoned M-PD and 3.74 net acres of the project site are zoned C-S-S,the calculation below uses a 50%-50% average of the two wastewater generation factors listed above: 155 GPD per 1000 square feet of floor space. Assumed total floor space:344,400 square feet Calculation: (155 GPD/1000 square feet) x (344,400 sq ft)= 53,382 GPD Wastewater generated by development under M-PD and C-S-S zoning: 33;382 Gallons per day Wastewater Generation calculations for development under R-4-PD: Given: Wastewater generation factor—Multiple family dwelling units 120 GPD per unit(assumes 2 beds per apartment unit) Total units in proposed project under R-4-PD: 400 two-bed units (800 beds total) Calculation: (120 GPD/unit) x (400 units) =48;000 GPD Wastewatergenerated by development under proposed R-4-PD zoning: 48,000 gallons per day CONCLUSION: Development under proposed 114=PD zoning should not generate more wastewater than development under current zoning. NOTE:All wastewater generation factors were obtained from David Hicks, City of San Luis Obispo Wastewater District 011129/Pba Pm*t Ma g==t/Projw Nwt GPA ApplicwioNGPA Revi.ion 4-4-02/An dim D-wwtewate mlc 4-"2 7-51 Richard Schmidt ' 544-4247 X5/7/2 03:14PM D1/1 RICHARD SCHMIDT 112 Broad Street, San Luis Obispo, CA 93405 (805) 544-4247 e-mail:rschmidt@calpoly.edu May 7, 2002 Re: Student Housing at Broad and Orcutt -- May 7 agenda RECEIVED To the City Council: P%.i Y 1 200- Student housing at the above remote location is a bad idea. SLO CITY CLERK • It will increase cross-town traffic like you cannot believe! • Promises about private buses are only promises. How many other times have such promises been made and then broken? The Valencia student housing was to have its own buses; soon they quit running, and now most of those student residents drive to school. Bill Bird promised regular shuttle service from his "mall" to downtown. Hah! Did you ever see one of those? Once the project was approved, the promises disapeared into thin air. The same will happen with this student housing project. • Presumably the project will allow Cuesta students to live there. They will drive dear across town, and out to Cuesta, several times per day. • Few of the student residents of this project will ride their bikes to Cal Poly whether or not the railroad trail is ever built. It's just not in their nature to exert that much effort. • Given the affluence, class expectations and past experience of the vast majority of Cal Poly student, they will all have cars, and they will use them -- in preference to other transport modes -- since driving everywhere is viewed as a God-given right. You will soon be faced with demand for wider roads to accommoate this traffic. • The project site is so far from any campus that residents couldn't walk to campus if they wanted to. If the city is seriously considering residential use for this property once again, it should go back to therp for plan (nixed by the fire department) to create a new neighborhood between the Capitolio industrial park, Broad, railroad and the CS zone to the north -- a new neighborhood which will expand upon the success of Villa Rosa. Not student housing. Student housing should be ON CAMPUS. The city should redouble its efrforts to persuade Cal Poly to produce more on-campus housing instead of allowing a student village four miles from campus on land better suited for other uses. Sincerely, COUNCIL C CDD DIR Ej FIN DIR Richard Schmidt CCA00 ❑ FIRE CHIEF YCATTORNEY L7 PW DIR LERK�ORIG ❑ POLICE CHF ❑_ DEPT, � u RECUTIL DIR ([A�—may{ ❑ UTIL DIR ❑ HR DIR i �GWI # - i1Eo F105 . R e• Swtd ev► f MEETIN AGENDA DATE aL ITEM#- . 7-._. RECEIVED In �eS�UY�c. �i'Gh�crd �Chmid f "faY ! 200? SLO CITY CLERK l�Ga M sS - -1 Wk7 Oaf ftc 01,11 i hClLeu a , bv�� 1+ W I' I I i .&:eu eL-) ov wp f w I�ad I s p IGt t e d- � w iv�s lea (ta, ` has b ss�s I �� S GUS i►�$jeVG it �oihf , Sm kt. 41m+- pt'ck .a,bWt- u bled - cawl dfl4 S i aaross awn : cumhL- S r ve I n Savr ( ., -I d o n`f ut. h WU S w4V� gross- - Si�� Sfi�a��n wr/v�-Id I inclined `� ►�rQiiev ��kpa. . if liea i f w U, �. - �l a rid s{-u cClri lr wl�cv l��-e 94 Calm p aia� do . not I ikt. -k paq (-4ke In ouaSiNy Costs - P"klvr ,�� �VV U,4/VLcS . kv as pr��a G� `st�cct, �}�u Pnce fD SfH� do no likCfa pal .50+' Gc�allar-sl�ua,�� bua"A a a�hv� I s-lrov�91u� ,tine, -w,c cwtut u I �O Cv�ua cru., 4�,�. S' klvwa� ny 4�o �P�� wl woad � OrGutf. -Mis wily bring a� affwdab�e plau. fur sivtdev�,fs -b Ii�P , flfFwdaa,lt?.� V1 �� ( -fc� s+ucC�w.�) is cv1' u. pYewtiiuv� , 1-F hot iuvtipossl b e -Fn AM _ I _yv��t l.kc fv u¢��hd Cuwv�ll maa ' pavt � o-w�-- w a� abx aip �wXes � shap in owt. tw�ti• ih rhihd oaf 7✓lr, �mrGftr CGYhm2ui �-s c�2 U ��•� ��a�d, � (ma. bc: Q ?o-od . ide'w wavte� be 71a ham 7vsl TI/L ✓ w� 4� Qs P(60(10 GV sic., PO ce ca,,w�w a,;�- (�LP.-I avl A"4z" " . f-P.� do oto f Uk, /Z? pay dot- G�olla vs ��a v� P I s-hrwl ( W� 4a UN cc, I cru. 4. S� kw vll T`g i a Im &Oa d 0 rW tf. -M is Will b e i n9 al afird ado I le" ? ( att fvr s-I Kd e nh +0 1 W wwda& Utit/uv S+uGQ"*) I S Ou ( M/L , ViM 47W e vRA 1,(it l �'lri� f ''ash, dl� 7L wt-e- a pal 06 owl e mmm( . YY N I00f sic.y Gu c- Xis fay- Shop vkt j a*u hy In mica sf OO '1 1601 S O e a l r`P& kvet yr vi. moot V14. 04.1.6 tea. Nil te NCI,TrCAO ❑ C DIR FIN DIR O ❑ FIRE CHIEF RNEY ❑ PW DIR RIVORIQ G POUCE CHF ❑ DEPT fi D8 CJ REO DIR M UTIL DIR �W►' 0 HR DIR /i CGr a- , -,� I ichardSchmidt ' 544-4247 M5/7/2 03:14 PM D1/1 RICHARD SCHMIDT da �✓ ' 112 Broad Street, San Luis Obispo, CA 93405 (805) 544-4247 e-mail: rschmidt@calpoly.edu May 7, 2002 Re: Student Housing at Broad and Orcutt -- May 7 agenda RECEIVED To the City Council: " ��"' Student housing at the above remote location is a bad idea. SLO CITY CLERK • It will increase cross-town traffic like you cannot believe! • Promises about private buses are only promises. How many other times have such promises been made and then broken? The Valencia student housing was to have its own buses; soon they quit running, and now most of those student residents drive to school. Bill Bird promised regular shuttle service from his "mall" to downtown. Hah! Did you ever see one of those? Once the project was approved, the promises disapeared into thin air. The same will happen with this student housing project. • Presumably the project will allow Cuesta students to live there. They will drive clear across town, and out to Cuesta, several times per day. • Few of the student residents of this project will ride their bikes to Cal Poly whether or not the railroad trail is ever built. It's just not in their nature to exert that much effort. • Given the affluence, class expectations and past experience of the vast majority of Cal Poly student, they will all have cars, and they will use them -- in preference to other transport modes -- since driving everywhere is viewed as a God-given right. You will soon be faced with demand for wider roads to accommoate this traffic. • The project site is so far from any campus that residents couldn't walk to campus if they wanted to. If the city is seriously considering residential use for this property once again, it should go back to therp for plan (nixed by the fire department) to create a new neiahborhood between the Capitolio industrial park, Broad, railroad and the CS zone to the north -- a new neighborhood which will expand upon the success of Villa Rosa. Not student housing. Student hou� should be ON CAMPUS. The city should redouble its efrforts to persuade Cal Poly to produce more on-campus housing instead of allowing a student village four miles from campus on land better suited for other uses. Sincerely, COUNCIL E: CDD DIR Richard Schmidt cCA ED FIN DIR CAO G FIRE CHIEF YCATTORNEY ❑ PW DIR LERK/ORIG 0 POLICE CHF ❑ DEPT yEADS ❑ AECDIR (�j �sltla]'dt ❑ UTIL DIR �j ❑ HR DIR m / CCD / n Q i - n N � _ I 70 W (, W s a I g a � _ o I \ 41 I y. On cc I' yaJ� n .yam \ l ••• �° j : '"h nI R sL n Ilei � � s:$ o' cD cn o � y^ Q Ul � G1 a ---333 �'- I;>• a ©W �' W �' m `gym nCl � � 0 O c i I OD 3 & u y< 44 �. �: p o Cp C 15j! e I C co ID 1 J44* �) � :!fes #f.'.1'�Ta�•.. _ - f. <f t t � , A IL Ir vw Too- IN Ir i% 1� � r •�� � J � r f.. s� f 'err. 'Y •�A An 3- n a e �,� �`� 5%tea r 04, STUDENT APARTMENTS San Luis Obispo California d � x � y , z Aerial Photograph of Site DNA fi NOW us X`k$` x - et� k• 2A a ✓t���, t�k A J t ~u��c tar a�e:�' .fi c"�;,��,0/>i �, ; � ". "9- 00 �i9 ilk � a f n zrl 1 ` f f k k"SY M�`r > 1 1 Key Points • Relieves pressure on rental market by providing 800 additional beds of J student housing for Fall '05 delivery. • Project will be owned by a not-for-profit corporation established by either Cal Poly or Housing Authority of San Luis Obispo (HASLO). � s Corporation Board, assumed to include key City, HASLO and Cal Poly representatives will make Owner decisions. 1 • Project is financially self-sufficient requiring no cash contributions, 1 financial or operational commitments by Cal Poly or HASLO. 1 1 • Creates substantial annual cash flow for approximately 30 years to build 1 additional affordable housing in SLO (estimated @ $500,000/yr and increasing as the debt is reduced and rents are increased per the CPI). 1 1 • Project will fund $2M for City-to-Sea Bike Trail Program 1 1 1 1 1 1 1 1 1 1 1 capstonewesl 1 / 1 1 t 1 Financial Overview We propose a unique structure Capstone created several years ago that involves purchasing privately held land and donating it to a university or community. In this case, the project will be donated to a 501(c)(3) not-for-profit Corporation jointly established by Cal Poly and the Housing Authority of San Luis Obispo (HASLO) with Capstone's assistance. Working with the foundation, Capstone and our bond underwriter, Morgan Keegan & Co., will arrange financing for 100% of the funds needed for the development of the Project. This financing will be secured through the sale of tax-exempt bonds issued by either a local municipal or State-level issuer, and be structured as "non- recourse"to the foundation, limiting its liability to its interest in the Project. For the project to be viable, the proposed project must be financially self-sufficient and able to pay ' for the land as well as the building and related improvements. Cal Poly and HASLO are not required to make any cash contributions, financial or operational commitments or guarantees that would necessitate financial statement disclosure. Thus, the 30 year, tax-exempt debt used to J finance 100% of the capital costs of the development is "off-balance sheet" debt to Cal Poly and HASLO, with the purchasers of the bonds having only the project itself as collateral. The source of repayment of the indebtedness will be limited to the rental revenue generated by the housing. The housing revenues will be used to pay project debt service, operating expenses, ' deferred project coststfees and to fund long-term repair and replacement reserves. Due to conservative lender requirements including underwriting to a 1.20 debt coverage ratio, it is anticipated that the project will generate a substantial positive cash flow that would potentially be available to fund affordable housing projects. The projected surplus cash flow is estimated to be in the$500,000 range in the first few years of the project. This figure will modestly increase over time as the debt is reduced and rents are increased per the CPI. The project has initially been discussed with the City, HASLO and Cal Poly. Assuming that the ' community is receptive to the project including the proposed change in land use, a logical next step is to refine the ownership structure. Of the numerous options available,we believe the following three are the best options for both the City and Cal Poly to consider. Following the options are comments that describe the related advantages and disadvantages. ' Option 1: Ownership to Cal Poly;Surplus to Cal Poly Limited or no incentive for City to support project / Y Cal Poly as sole beneficiary will readily execute referral agreement required by tax-exempt bond credit enhancing agency ■ Does not provide long term economic benefit to HASLO; project will have to ' assume responsibility for up-front Affordable Housing impact fees e No incentive for City to waive or defer fees • Strong connection to Cal Poly, including referral agreement, is key criteria for lender and credit enhancer...thereby increasing likelihood of funding approval Y Cal Poly will own the community upon repayment of the project indebtedness 1 UN capstonewesl J � Option 2 Ownership to Cal Poly;Surplus to HASLO Cal Poly and HASLO are both beneficiaries ensuring a collaborative process ■ Creates incentive for City to support project ■ Cal.Poly as co-beneficiary will execute referral agreement required by lender ■ Provides long term economic benefit to HASLO; City may waive Affordable Housing impact fees; City may consider waiving or deferring selected impact fees ■ Creates substantial annual cash flow for approximately 30 years to build j additional affordable housing in SLO ' ■ Cal Poly will own the community upon repayment of the project indebtedness Option 3: Ownership to HASLO;Surplus to HASLO ' ■ Creates incentive for City to support project ■ No incentive for Cal Poly to'execute referral agreement w/out ownership position ' ■ Provides ownership and long term economic benefit to HASLO; City may waive Affordable Housing impact fees; City may consider waiving or deferring selected impact fees 1 ■ Creates substantial annual cash flow for approximately 30 years to build additional affordable housing in SLO ' e No connection to Cal Poly makes funding the project much more difficult if not impossible ■ Haslo will own the community upon repayment of the project indebtedness Option 4: Joint Venture ■ Both Parties share equity development and cash flow surplus �I capstonevves I I 1 J q 1 1 1 Transaction Flow Chart—Option 2 1 San Luis Obispo, CA April 29, 2002 1 Housing Authority of San Luis Obispo Cal Polytechnic State University "HASLO" • Signs agreement to refer students to Referral Agreement • Issues bonds on behalf of the project the project • Receives excess cash flows of project after • Accepts land donation certain coverage tests are met • Executes Ground Lease • Receives excess cash flows of project Loan.4greement after certain coverage tests are met 1 \GTomnd5016 Not-for=Profit Cor oration •`;; Obligor of norrrecourseproject bonds • Owner of project"Acacia Creek Student Housing 1 Facility Developer: Capstone • Issues non-recourse project bonds through HASLO 1 • Commissions market study Contracts with investment banker to underwrite 1 Agrees to turnkey design and build bonds 1 project Development Contracts with Capstone'tdbuild project • Guarantees cost&delivery date Contract Contracts to manage the project 1 Draw ofbond klanagement Management proceeds to build Contract Fee ' project ' Property Management • Capstone,as the third party manager, ' deposits rents with the Trustee ' Students ' Pay rents directly to manager who in turn deposits money with Rental Rental .4nnual Bond Pavmeats Deposits TrusteePayment 1 ' Bond Trustee ' Bond Proceeds Ammo!Bond J Investment Bankers: Morgan Payment Keegan Bir Company,Inc. Bond Proceeds • Prepares plan of finance Bond Investor • Secures appropriate credit enhancement • Debt repaid solely from project revenue Underwrites project bonds Bonds • Mortgage on project improvements only ' • Invests bond proceeds for instrumentality. • City has no financial obligation for ' with"AAAn third party repayment of debt or for operation and maintenance of nroiect 1 i _ \ 1 1 ► About Capstone i i Over the past 11 years, Capstone has successfully partnered with colleges and universities in the development of fifty-seven (57) student-oriented residential communities with a development cost of ► over $809 Million. Including projects that are currently being developed, the totals increase to 66 i residential communities with a development cost of$964 Million. ► Capstone is unquestionably the most experienced developer in structured tax-exempt finance for i student housing communities. Capstone created the industry standard format of financing known as the "off balance sheet" method, and has successfully dosed or is in the process of closing over i $378 million in this type of financing. Of Capstone's forty-four on-campus developments, we coordinated the financing for twenty-one of the communities, while the remaining were financed by i our university partners. Capstone's philosophy is quite simple: approach each opportunities as a i °partnership° with the college or university. We define this philosophy as follows: °To ad as a partner with an institution to share developmental, management, and financial expertise on an as- needed basis." As a result, Capstone's programs, based upon our extensive experience, are i designed to maximize the options available to our collegiate partners and thus provide them with unique flexibility. 1 i To better serve our university partners on the west coast, Capstone has committed the resources and one of our founding principals, John Vawter, to manage a west coast office near San Diego. i Capstone West will coordinate development of student housing communities for those universities i located in the West Coast and Rocky Mountain time zones, and be supported by the corporate resources of Capstone Development Corp., headquartered in Birmingham, Alabama. John Vawter i is Chief Operating Officer of Capstone West. Joining him is Greg Gill, Sr VP and project manager. i Greg is an architect and Cal Poly graduate. Jeff Allmaras, Valerie Frost and Chad Izmirian will provide architectural and construction management support. Presently, Capstone West is 1 developing or has recently completed the following student housing communities: 1 ■ University of the PaclfidStocldon, California-200 student beds completed fall 2001. i ■ University of the Pacific/Stockton, California—Phase 2 student housing project for 2003. • University of San Diego/San Diego, California-362 student beds for the fall 2002 term. i • South Orange County Community College/Tustin, California—1,000 beds in planning 1 i Team Organization ► To compliment our experience and capabilities, and to best serve the unique needs the project, i Capstone has commitments from McLarand Vasquez Emsiek& Partners of Irvine, CA as architect; i Cannon Engineering of San Luis Obispo as Civil Engineer, Morro Group of San Luis Obispo of as Environmental Consultant, and Firma of San Luis Obispo as Landscape Architect Additional team i members are currently being considered. 1 1 Schedule i The target schedule is to occupy in August '05 to accommodate Cal Poly Fall Quarter incoming 1 students. Capstone will be working closely with The City of San Luis Obispo to manage the entitlement approval process. We plan to process the Specific Plan concurrent with the General ' Plan Amendment. Relative to CEQA, we understand that a focused EIR, rather than a mitigated negative declaration will most likely be required. It is assumed that this may require a 6-8 month ' process. In addition, we have budgeted 8-12 months for creek related approvals from the Army 1 Corps and Fish&Game. 1 VIII ' capstonewest 1 . 1 _ 1 I 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 / capstonewesz 162 S Rancho Santa Fe Road Suite B-30 Encinitas,CA 92024 760.633.1624 May 1,2002