Agenda Request

	City Council
	Agenda Request
Agenda Of:	1/02/08	Agenda Request No:		III B
Initiated By:	regina morales	Responsible Department:		economic development
Presented By:	regina morales	Department Head:		regina l. morales director of economic development
		Additional Department. Head (s):		n/a
Subject / Proceeding:	create reinvestment zone 2007-02 SECOND reading ordinance no. 1657
Exhibits:	ordinance no. 1657
Clearances			Approval
Legal:	joe morris, city attorney		Executive Director:	joseph esch, business & intergovernmental relations
Purchasing:	n/a		Asst. City Manager:	n/a
Budget:	n/a		City Manager:	Allen Bogard
Budget
Expenditure Required: $			n/a
Amount Budgeted/Reallocation: $			n/a
Additional Appropriation: $			n/a
Recommended Action
2^nd reading of Ordinance No. 1657.
Executive Summary
The former Unocal building or officially known as One Sugar Creek Place has been purchased by the Ellman Companies. The Sugar Land acquisition is the Ellman Companies’ first investment in the Texas market. Ellman Companies has development projects in Phoenix, AZ, Washington DC, Toronto, Canada and Denver, Colorado. The building is over 25 years old and because of its age and other factors its value has declined over the last few years. The appraised value has declined from 2003 to 2007 by -40.85% or ($27,901,000). The City will receive $96,002 in 2007 for real property taxes on the existing land and building. This equates to a decrease of $83,703 in tax revenues to the City based on 2007 tax rates. To be competitive in the marketplace it is in need of significant capital investment to upgrade the property if it is to be marketed as a Class A product. The Ellman Companies has purchased the property with the desire to make the needed upgrades. At present their proposed upgrades include HVAC improvements, renovated elevators, reconfigured interior entrance, and expansion of parking garage to increase parking from the existing 1000 spaces to the required 2000 for a building of this size. The Ellman Companies have also identified the opportunity to compliment the existing building by constructing two more office buildings on the site where the current surface parking exists. Currently, the building is leased to Chevron through March 2010 and Flour has subleased space from Chevron. Tenant improvements cannot occur until after Chevron’s lease expires. They are requesting that the abatement requirements be phased with this schedule. A revised phased and scaled abatement schedule was reviewed with the Business Incentive Committee to accommodate the developer’s renovation schedule. Staff is recommending a ten-year tax abatement up to 70% upon completion of all phases for new improvements only. The existing property value will not receive tax abatement and will continue to be taxed at its 2007 certified assessed value. This recommendation is consistent with the City’s tax abatement guidelines and tax abatement ranking system. The Business Incentive Committee has reviewed and concurs with staff recommendation of scaled and phased tax abatement for The Ellman Companies at One Sugar Creek Place.
Exhibits

ORDINANCE NO. 1657

AN ORDINANCE OF THE CITY OF SUGAR LAND, TEXAS, CREATING REINVESTMENT ZONE NO. 2007-02 FOR A 8.9 ACRE TRACT OF LAND LOCATED IN THE BROWN & BELKNAP LEAGUE, A-15 RESERVE “A”, BLOCK 1, KNOWN AS ONE SUGAR CREEK PLACE.

WHEREAS, the Property Redevelopment and Tax Abatement Act (Tax Code § 312 et seq.) authorizes cities to create reinvestment zones and enter into tax abatement agreements with the owners of qualifying properties in reinvestment zones; and

WHEREAS, the City has received an application requesting tax abatement for real property improvements to be located in the zone; and

WHEREAS, the zone is eligible for tax abatement; and

WHEREAS, a public hearing, for which notice was given as required by law, was held at which interested persons were given an opportunity to present evidence for and against the creation of the zone; and

WHEREAS, the City Council has found that the improvements sought to be located in the proposed reinvestment zone are feasible and practical and would be a benefit to the land to be included in the zone and to the City after the expiration of a tax abatement agreement; and

WHEREAS, the creation of the reinvestment zone will be reasonably likely to contribute to the retention or expansion of primary employment or to attract major investment into the zone that would be a benefit to the property located therein and that will contribute to the economic development of the City of Sugar Land; NOW, THEREFORE,

BE IT ORDAINED BY THE CITY COUNCIL

OF THE CITY OF SUGAR LAND, TEXAS:

Section 1. That Reinvestment Zone No. 2007-02 is created for the real property described in Exhibit A, attached to and incorporated into this ordinance by reference.

Section 2. That the Reinvestment Zone created herein is eligible for commercial-industrial tax abatement as provided by law.

Section 3. That Reinvestment Zone No. 2007-02 expires five years from the date of this ordinance.

APPROVED on first consideration on _________________, 2007.

ADOPTED upon second consideration on ______________, 2007.

______________________

David G. Wallace, Mayor

ATTEST:

____________________________

Glenda Gundermann, City Secretary

Reviewed for Legal Compliance:

Attachment: Exhibit A - Property Description

EXHIBIT A

Legal Description

Being a tract or parcel of land containing 8.9825 acres (391,276 square feet) and being situated in the Brown & Belknap League, Abstract No. 15, in Fort Bend County, Texas, and being all of that certain 8.9825 acre Reserve "A", Block 1, One Sugar Creek Place, as recorded in Slide 1235/A of the Plat Records of Fort Bend County, Texas, said 8.9825 acre tract being more particularly described by metes and bounds as follows (with all bearings referenced to the record plat):

BEGINNING at a 5/8-inch iron rod set at the intersection of the northeast right-of-way line of Central Drive (80 feet wide) with the southeast right-of-way line of the U.S. Highway 59 - Southwest Freeway (width varies) as dedicated in Vol. 497, Pg. 26, of the Deed Records of Fort Bend County, being the most westerly corner of said Reserve "A" and the herein described 8.9825 acre tract;

THENCE North 36° 27' 08" East along the northwest line of said Reserve "A" and the southeast right-of-way line of said U. S. Highway 59, a distance of 441.18 feet to a 5/8-inch iron rod set for a point of curvature;

THENCE in a northeasterly direction, a distance of 437.05 feet along the northwest line of said Reserve "A" and the southeast right-of-way line of said U.S. Highway 59, following the arc of a curve to the left, having a radius of 5904.65 feet and a central angle of 04° 14' 27" (Ch=N 34° 13' 48" E, 436.95') to a 5/8-inch iron rod set for a point of reverse curvature at the intersection with the southerly right-of-way line of One Sugar Creek Boulevard (80 feet wide) as dedicated in Slide 1235/B of the Plat Records of Fort Bend County, being the most westerly northerly corner of said Reserve "A" and the herein described tract;

THENCE in an easterly direction, a distance of 46.82 feet along the southwesterly right-of-way line of said One Sugar Creek Place Boulevard, following the arc of a curve to the right, having a radius of 30.00 feet and a central angle of 89° 25' 29" (Ch=N 76° 49' 20" E, 42.21') to a 5/8-inch iron rod set for a point of tangency and the most easterly northern corner of said Reserve "A" and the herein described tract;

THENCE South 58° 27' 56" East along the northeast line of said Reserve "A" and the southwest right-of-way line of said One Sugar Creek Place Boulevard, a distance of 666.19 feet to a 5/8-inch iron rod found for a point of curvature and the most northerly eastern corner of said Reserve "A" and the herein described tract;

THENCE in an southerly direction, a distance of 33.23 feet along the intersection of the southwesterly right-of-way line of said One Sugar Creek Place Boulevard with the westerly right-of-way line of Central Drive (60 feet wide) as dedicated in Slide 1235/A of the Plat Records of Fort Bend County, following the arc of a curve to the right, having a radius of 25.00 feet and a central angle of 76° 10' 03" (Ch=S 20° 22' 54" E, 30.84') to an "X" cut found for a point of tangency and the most southerly eastern corner of said Reserve "A" and the herein described tract;

THENCE South 17° 42' 07" West along the east line of said Reserve "A", being the west right-of-way line of said Central Drive, a distance of 315.11 feet to an "X" cut in concrete for a point of curvature, from which a found "X" cut bears 0.65 feet, N 81° E;

THENCE in an southwesterly direction, a distance of 129.96 feet along the westerly right-of-way line of Central Drive (60 feet wide), following the arc of a curve to the right, having a radius of 270.00 feet and a central angle of 27° 34' 36" (Ch=S31° 29' 25" W, 128.70') to a 5/8-inch iron rod found for a southeasterly corner of said Reserve "A" and the herein described tract;

THENCE North 54° 26' 06" West along the southerly line of said Reserve "A", a distance of 34.63 feet to a 5/8-inch iron rod found for the southwesterly corner of said Reserve "A" in the easterly line of North Lake Sugar Creek as described in Vol. 890, Pg. 181 and Vol. 1013, Pg. 652, of the Deed Records of Fort Bend County;

THENCE along the northerly line of North Lake Sugar Creek, called 6.0720 acres, same being the southerly line of said Reserve "A", the following twenty five courses and distances (the ends of which generally fall within the water and are unmonumented):

North 50° 10' 44" East, a distance of 34.56 feet to an angle point;

North 29° 24' 34" East, a distance of 46.53 feet to an angle point;

North 05° 02' 51" East, a distance of 47.18 feet to an angle point;

North 20° 59' 15" West, a distance of 44.07 feet to an angle point;

North 47° 51' 31" West, a distance of 53.96 feet to an angle point;

North 44° 59' 35" West, a distance of 23.83 feet to an angle point;

North 76° 34' 36" West, a distance of 37.10 feet to an angle point;

South 78° 49' 00" West, a distance of 73 .42 feet to an angle point;

North 60° 34' 55" West, a distance of 44.55 feet to an angle point;

North 11° 11' 00" West, a distance of 83.26 feet to an angle point;

South 78° 49' 00" West, a distance of 146,23 feet to an angle point;

South 11° 11' 00" East, a distance of 28.31 feet to an angle point;

South 78° 49' 00" West, a distance of 47.98 feet to an angle point;

South 11° 11' 00" East, a distance of 19.71 feet to an angle point;

South 78° 49' 00" West, a distance of 96.08 feet to an angle point;

South 11° 11' 00" East, a distance of 15.90 feet to an angle point;

South 78° 49' 00" West, a distance of 23 .96 feet to an angle point;

South 11° 11' 00" East, a distance of 24.05 feet to an angle point;

South 78° 49' 00" West, a distance of 53.91 feet to an angle point;

South 40° 26' 28" West, a distance of 19.11 feet to an angle point;

South 45° 52' 49" West, a distance of 3.27 feet to an angle point;

South 77° 20' 04" West, a distance of 200.12 feet to an angle point;

South 73° 15' 32" West, a distance of 50.27 feet to an angle point;

South 42° 28' 25" West, a distance of 76.36 feet to an angle point;

South 36° 16' 37" West, a distance of 36.19 feet to the northeast right-of-way line of said Central Drive for a southeasterly corner of said Reserve "A" and the herein described tract, from which a found 5/8-inch iron rod bears 0.17 feet, S 23° E;

THENCE North 53° 43' 23" West along the southwesterly line of said Reserve "A" and the northeast right-of-way line of said Central Drive, a distance of 97.97 feet to the POINT OF BEGINNING and containing 8.9825 acres (391,276 square feet) of land, more or less.