The Developer has requested an ENA for the development of an upper upscale hotel on the three acre (3 acre) portion of the Garden Grove Sanitary District landfill property (the "Property"). The ENA will grant the developer time to determine project feasibility. The proposed scope of development would include:

• A new 4-story, upper upscale, AAA Three Diamond, nationally branded hotel with approximately 225 hotel guest rooms.

• Hotel amenities consistent with an upper upscale hotel.

• New surface parking to accommodate the hotel.

The City will also be negotiating with the Garden Grove Sanitary District ("GGSD") for use of the Property for the proposed development.

The ENA will provide the Developer the exclusive right to negotiate with the City, and to work toward the terms of a Disposition and Development Agreement ("DDA"), which will include, without limitation, the economics of the development, the site plan, and the specific uses.

The ENA period is through December 31, 2019. The City Manager may extend the term of the negotiation period for an additional six (6) months if the Developer has provided evidence and the City has verified they are making substantial progress.

Within one hundred eighty (180) days the Developer shall make a written determination whether or not the Conforming Hotel is feasible and there are conditions under which the GGSD landfill, including the SoCal Hotel, LLC property, can viably provide a site on which parking for the development may be situated (the “Affirmative Feasibility Determination” or “Negative Feasibility Determination,” as applicable).

 In the event of an Affirmative Feasibility Determination, the Developer shall submit:

• A site plan and elevation(s) for the Conforming Hotel;
• A construction and operating pro forma which identifies all sources and uses of funds, with respect to the Conforming Hotel and supporting infrastructure;
• A statement describing the proposed method of financing, including construction and permanent financing;
• A list of entities committed to be involved in the development and the operation of the Conforming Hotel, their respective roles, and financial references for such entities;
• An updated evidence of interest by a nationally recognized hotel brand for the Conforming Hotel; and
• Evidence that Developer has adequate and construction access to the SoCal Hotel, LLC property. 

The Developer will deposit with the City the cash sum of Fifty Thousand Dollars ($50,000) (the “Deposit”) concurrently with delivery of an Affirmative Feasibility Determination.  The Deposit will be retained by the City if a DDA is executed by the parties or returned to the Developer upon termination of this Agreement without a City DDA.

This ENA has no impact to the General Fund.  If the City Council decides to enter into a DDA with the Developer, the project, upon completion, would generate new annual tax revenues for the City.  Additionally, all financial impacts will be identified at the time a DDA is considered by the City Council.

It is recommended that the City Council:

• Approve the Exclusive Negotiation Agreement with SoCal Hotel, LLC, and

•  Authorize the City Manager to execute the agreement, and to make minor modifications, execute pertinent documents and amend or extend the ENA period on behalf of the City.