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SR-6-Q (26) eD:PC:JM:aa (10/1) srl008.desk.pier Council Meeting: 10/08/91 Santa Monica, 6-0 . . OCT S i991 Ca11forn1a ~t2 - aos- TO: Mayor and City Council FROM: eity Staff SUBJECT: Recommendation to Award eontract for the Restoration of the Billiard Building on the Santa Monica pier Introduction This report requests that the City council award a contract for the restoration of the Billiard Building on the Santa Monica Pier to Unique Builders, the lowest responsible bidder, in the amount of $604,250. The report also outlines the process for repayment to the City of $414,450 of the above amount by the two long-term lessees of the Billiard Building for their respective share of the renovation costs. Backqround The restoration of the Billiard Building is one of the first projects to be implemented as part of the pier Restoration Corporation's (PRe) Santa Monica Pier Development program. The development program, which was adopted by the City Council in February, 1988, identified the Billiard Building as one of the key existing buildings that contribute to the historic fabric of the pier that should be retained and restored. At that time, two long-term tenants, the Crown and Anchor Restaurant, and Seaview Seafood, occupied two of the three lease spaces in the building. The third area, which had been previously leased by Beryl's Plaster studio, was vacated in December, 1988. The development - 1 - 6-0 OCT () IS91 program recommended seeking an entertainment or retail operation for this 4,000 square foot portion. Funds for the renovation of this space were included in the 1988-1991 Capital Improvement Project (elP) Program. As the PRC moved forward with the selection of a tenant for the vacant space, it also began the process of negotiating new leases with the long-term tenants to provide for the restoration of each of their respective portions of the building. New leases were executed in 1990 with both the Crown and Anchor Restaurant and seaview Seafood which require a specified minimum expenditure on the part of each tenant to construct the interior and exterior improvements. The PRC's search for a viable retail or entertainment operation for the vacant space has proved difficult. The first Request for Proposals (RFP), issued in April, 1988, failed to yield a financially qualified tenant. Rather than delay the renovation of the entire building, the PRe recommended that the eity proceed to restore the exterior and core of the vacant portion, while the PRe continued to search for a qualified operator. During this interim period, the PRC has leased this space to the Aresis Theatre Ensemble on a month-to-month basis. As the result of a second RFP process, issued in October, 1990, the PRC has selected the Ash Grove entertainment club for the space. The PRe Board of Directors voted to proceed with lease negotiations for this use at its September 11, 1991 board - 2 - meeting. The Ash Grove would be responsible for the construction of tenant improvements. Design and Construction Process The PRe, along with the tenants of the Crown and Anchor and seaview Seafood, selected Sam Tolkin AlA to design the restoration of the exterior and core of the building. Sam Tolkin has much experience in historic renovation including the restoration of several historic buildings in Pasadena. The tenants have also contracted with Sam Talkin for the design of the interior improvements. The Pier Design Guidelines, adopted by the City Council in February, 1988, provide direction for the rehabilitation of the historically significant buildings on the Pier. The project design is consistent with these guidelines and retains the Billiard Building's key architectural elements while incorporating new details that complement the building theme and provide differentiation among the storefronts. The design has been approved by the PRe, the Landmarks Commission, and the Architectural Review Board, and the project has received all other regulatory approvals required at this stage of the process. Since the construction of the exterior improvements of each of the three leaseholds must be coordinated and performed by a single contractor, staff determined that the City was in the best position to construct the project. However, each tenant remains responsible for the costs of designing and constructing the exterior improvements, and for the cost and actual construction of the interior improvements. The method of payment for these - 3 - costs by the tenants will be discussed in the Budget/Fiscal Impact section. The restoration of the building should be completed in May, 1992. Efforts will be made to enable the construction of tenant improvements in time for a 1992 summer opening. The Crown and Anchor will be closed during the construction period. Seaview Seafood will continue to operate in a temporary building, just west of the current location. A Notice Inviting Bids was published on June 24 and 25, 1991, in the Outlook and in ten (10) construction publications and minority business associations. Plans and specifications were issued to nineteen (19) contractors. Bids were opened and read publicly on July 23, 1991, by the eity elerk. Five bids were received as follows: Unique Builders $604,250 MS eonstruction and Electrical eontractor, Inc. $621,072 Tricon, Inc. $694,600 lEes, Inc. $743,000 DTEC Construction, Inc. $750,000 Engineer's Estimate: $600,000 Unique Builders, the lowest responsible bidder, has good experience in renovation of public buildings. The firm has - 4 - renovated parks buildings for the city of Glendale, classroom buildings for Glendale Community College, and maintenance and restroom buildings for the City of Burbank. Reference checks have revealed high quality work and a cooperative attitude. Budqet/Financial Impact Funds required are as follows: Contract contingencies Total $604,250 $120,000 $724,250 Sufficient appropriation authority is available in Account Numbers 30-740-625-22488-8912-99097 ($604,250) and 30-740-625-22489-8912-99097 ($120,000), Pier Commercial Development/Rehabilitation. A twenty percent (20%) contingency is recommended for this project since it is the renovation of a seventy-five year old building and the extent of structural deterioration is not known. In addition, the condition of the Pier deck and substructure cannot be determined until the floor is removed. The PRe and city staff determined that the revitalization of the pier could best be served by the City'S payment up front for the cost of the exterior renovation of the entire building. The PRe has subsequently negotiated, and the city has approved, modifications to the leases for the Crown and Anchor and Seaview Seafood which provide for the repayment of their proportionate costs over a ten year period at an interest rate of eight percent per year. - 5 - The bid documents required that costs for each portion of the building be broken out. The cost for the vacant area is $189,800; therefore, the two tenants will repay the Pier Fund a total of $414,450 plus interest. The reduction in rent during the construction period has been included in the adopted FY 1991-92 rent revenue projections for the Pier Fund. Recommendation staff respectfully recommends that the City Council: 1. Award a contract for the restoration of the Billiard Building on the Santa Monica pier to unique Builders, the lowest responsible bidder, in the amount of $604,250. 2. Authorize the City Engineer to issue any change orders necessary to complete additional work to the extent funds are available in accordance with the Administrative Instruction on Change Orders. Prepared by: Peggy Curran, Director of community Development stan Scholl, Director of General Services Judith Meister, pier Manager Dave Britton, Acting City Engineer - 6 -