12/14/1988 Meeting - Laserfiche WebLink

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e Pankow cannot prepare leases until the City decides whether it is part of the project. He said the City had assurances from the Pankow Company that if in a reasonable term (negotiated to be December 1, 1989), they are unable to put the financing together to start the project, the City can reassess whether to continue or withdraw its participation. At that time, the City would expect to be repaid for its real expenses, not to exceed $100,000. He said Pankow would take out an instrument of credit (a line of credit, a security deposit) of $1 million to secure that agreement as a good-faith projection. They further state that they are already in this community with several million dollars in existing projects, they have been here for several years, their good name and reputation are at stake, and the company does not usually announce projects and then not do them. Beyond that, Mr. Gleason said it was a good-faith item. Mayor Obie said there is nothing wrong with telling the community there are no guarantees. Responding to Mayor Obie1s inquiry about concessions for library parking, Mr. Farkas said the proposal is for Pankow to build and own the parking. If it is a 240-space facility, those spaces will be used for the office tenants during the day. In the evenings and on weekends, those spaces would be available to the library at no charge. A two-level parking garage would have 320 spaces, and Mr. Farkas said the decision on facility size would depend on cost and a water table problem. Mayor Obie asked about the current library, and Mr. Farkas said it was an e entirely separate issue with which the council would have to deal. Mr. Gleason added that the existing library and property were not on the table as part of the Pankow proposal. He said there was no truth to rumors Ms. Wooten had heard that Pankow would buy the existing library for $1 million, raze it, and build another commercial/professional building at that site. There is no current intention to demolish the present library structure. Mr. Gleason assured Ms. Wooten that if a major downtown bank becomes a tenant in the Pankow building, the City would not be responsible for taking the major tenant1s old building off its hands. Mr. Gleason said if the library only occupies 75,000 square feet, the remainder of the 106,000 square foot shell would be leased by the City to itself or to another tenant. Mayor Obie stated that other than staff time and limited planning investment, the City has no risk until the developer secures a permanent financing commitment and is ready to move ahead with construction. Mr. Gleason confirmed that there is no risk until the development agreement is signed, but he said it is still unclear when that agreement must be signed. The statement or resolution that the City is in or out of the development that is needed from the council by January represents no financial risk to the City; it is not a development agreement, but it will enable Pankow to proceed with architectural and engineering design, marketing, banking, and loan instruments. He said if lIit all implodes, then we walk the deal.1I The council will have to authorize the City Manager to enter into the development agreement and Mr. Gleason said that agreement would not be signed until the e MINUTES--Eugene City Council December 14, 1988 Page 9