1. BACKGROUND

The City of Albuquerque has assembled the vacant parcels of blocks forty, forty-one, and forty-two of the original town site. This property is located between 8^th and 5^th Streets along the north side of Coal Avenue. The City owns the vacant land between 6^th and 8^th Streets. It is acquiring the vacant land between 5^th and 6^th Streets through condemnation proceedings, and is currently dominion in control of the property. Albuquerque Development Services has vacated the alleys, which run east to west through the site, in addition to the section of 7^th Street north of Coal Avenue. The land has been replatted and is 127,800 square feet. It is zoned SU-3.

The assembled property does not include the house located at 611 Coal Avenue. The City will maintain access to the property through the alley located between 6^th and 8^th Streets.

The Albuquerque Development Commission, City Council and the Mayor’s Office have expressed a need to develop high-density residential units in downtown. This development site has been assembled for mixed income multi-family rental housing. It will provide affordable housing options for those who want to move to downtown. The creation of multi-family housing will enhance commercial activity in downtown.

The development of this site is scheduled to coincide with the construction of the new GSA building. GSA has expressed a need to provide housing options for its employees in downtown. This site is planned to accommodate this need.

2. PROCESS

Albuquerque Development Services prepared Request for Proposals #ADS 98-06, requesting development proposals for a mixed income multi-family housing development, in April of 1998. Prior to drafting the RFP, an outside consultant was hired to prepare a market study. This market study provided the basis for developing the scope of the RFP, and determine a fair value for the land offered for development. The intent of the RFP was to create additional housing opportunities for the downtown area. These housing units would be provided at market rates, with at least twenty percent offered at affordable rates. ADS received three responses to the RFP on June 16, 1998.

ADS staff reviewed all three proposals. Upon their review, two proposals were selected onto a short list. ADS staff interviewed the two development teams between August 4 and August 7. Additional questions were prepared for each development team. These questions focused on financing packages for each proposal. Responses to these questions were received on August 31, 1998. A final review of proposals was scheduled on September 3, 1998.

The following section provides an overview of both proposals.

The following is a comparison of unit mix, total site development, parking, rents, and unit sizes.

*dependent upon financing package.

This proposal develops the property as two building styles. The property located west of 6^th street will include two and three story apartment complexes. Eighty apartments will be on this site. These units will front along Coal Avenue, 8^th Street, and the alley. This will provide open spaces between units. A pedestrian walkway will meander along the vacated portion of 7^th street. A mural wall will be created on the northern edge of this walking path. Parking for these units will be covered and accessible from the alley. A commons area will be developed on the northwest corner of 6^th and Coal Avenue. A day care center (1,550 square feet) is proposed as one of the uses for this commons area. The day care center will be constructed and leased to a professional operator by the Armstrong Brothers.

The property located east of 6^th street includes a five-story apartment high rise. This site will have open space along Coal Avenue and facing the alley. One hundred and ten apartments will be constructed on this site. Open space will exist along Coal Avenue and the alley. A swimming pool will be placed on either the north side of these units, or on the roof of the structure. Parking for these units will be provided underground and will be accessible from the alley.

The high rise includes 5,000 square feet of commercial space on first floor.

Proposed tenants for commercial space: neighborhood grocery store, drug store, restaurant, or a dry cleaner.

Site amenities: day care, playground, private garden paths, storage units, alarm system, internet ready rooms, natural lighting, covered parking, commercial sites east of 6^th street, pool, fitness center, community room, distributed laundry rooms.

This proposal calls for three-story walk up apartment complexes with interior corridors on the site. These complexes would front along the northeast corner of 8^th Street and Coal Avenue, along Coal Avenue, the northeast corner of 6^th Street and Coal Avenue, and the northwest corner of 5^th Street and Coal Avenue. Community buildings and management offices are proposed for the northwest corner of 6^th and Coal Avenue. Sixty-two units are to be constructed east of 6^th Street and Seventy-eight units west of 6^th Street.

The complexes are designed with patio and balcony areas. The buildings will use a variety of colors. Landscaping is designed to provide open spaces and a natural boundary for the property along Coal Avenue.

Parking for this site is accessible from both alleys. It is controlled and uncovered. Additional parking spaces are available along the east side of 8^th street, the west side of 5^th street, and both sides of 6^th street between Coal Avenue and the alley.

Site amenities: laundry facilities, pool, fitness center and on site management.

This proposal invisions townhouses, three, and five story apartment complexes on the site. The five story complexes would be located on the northwest and northeast corner of 6^th and Coal Avenue. The townhouses would front Coal Avenue and 8^th Street. Three story apartment complexes would be placed at the northwest corner of 5^th and Coal, the northwest and northeast corners of 7^th Street and Coal Avenue. Parking is accessible from alleys.

This proposal includes two commercial sites. Proposed commercial space (2800 square feet) is along alleyway located between 6^th and 8^th Streets. Proposed tenants for this space include day care and laundry services.

Proposed commercial space is also on first floor of high rise structures located between 6^th and 5^th Streets. This commercial space is 9900 square feet. Proposed tenants for this commercial space range from a grocery store, day care center, professional offices, dry cleaners, and deli.

Site amenities: commercial sites along 6^th street, pool, exercise room, day care, vending machines, laundry facilities, covered parking, storage facilities, cable and computer ready apartments, 25,000 square feet of open space, secured postal boxes, private front and backyards for townhouse units.

Project Costs

Armstrong 1 utilizes Low Income Housing Tax Credits and conventional financing

Armstrong 2 utilizes Metropolitan Redevelopment Bonds with credit enhancement

Tesch 1 utilizes COA multifamily housing revenue bonds with a 30 year amortization

Tesch 2 utilizes COA multifamily housing revenue bonds with a 40 year amortization

Tesch 3 utilizes NMMFA multifamily housing revenue bonds

IV. STAFF EVALUATION

The evaluation of the proposals was based on the following six (6) selection criteria.

1. Experience and Success Record of Proposer. Criteria for evaluation will include factors such as the offeror’s performance in similar types of development, familiarity and experience with the City’s development approval process, and the capacities of other Team Members (including subcontractors, and others that may play a role in implementing the proposed project):

In reviewing all three proposals, the following strengths and weaknesses were discussed: Tesch Development retained the services of architects and contractors who have demonstrated an extensive background in multi-family housing. The architects and contractors have worked with the developer in previous projects. However, the developer has limited experience in multi-family housing projects. The Armstrong Brothers have built, owned, and managed numerous properties in New Mexico. They own and manage property in downtown. The Armstrong Brothers have retained the services of two additional multi-family housing consultants to assist with their project. The Hampson proposal represented limited experience in multi-family housing design, construction, and development. This project represented the first time any of the team members would work on a joint development.

The Tesch proposal best meets this criteria.

2. Proposer’s Overall Plan. Prepare a narrative, not to exceed two pages, explaining how the proposal will meet the objectives of the Coal Avenue Development. An overall assessment of the project will consider the positive net effect of the project on the Downtown area:

Although the request for proposals did not require a mixed use site, two development teams, Armstrong Brothers and Hampson, recommended commercial and residential use. Producing a greater number of housing units combined with commercial amenities creates the most positive net effect for downtown. The proposed neighborhood commercial spaces benefit not only the project but the surrounding neighborhood as well. The mix of uses will open the project to the surrounding area. The Armstrong proposal balanced the 190 unit housing site with five thousand square feet of commercial space. It is an innovative design that utilizes underground parking, a diverse housing style to achieve density, and blends well with the GSA site, Alvarado Apartments, and the Barelas neighborhood. Hampson proposed 202 units of housing and almost ten thousand square feet of commercial space. It provides underground parking and private yards for townhouse residents. However, the placement of two high rise towers on each side of 6^th street does not blend well with the surrounding sites. The Tesch proposal with 140 units is attractive and creates a pleasant residential street front along Coal Avenue. It is a sound housing proposal that has proven successful with other sites, such as the Alvarado Apartments.

The Armstrong submittal best meets this selection criteria.

3. Price Offered. Purchase offers for the Parcel should be bid as "a per square foot price", and should be a minimum of three (3) dollars per square foot.:

Of the three proposals, the Armstrong submittal best meets the selection criteria.

5. NEIGHBORHOOD COMMENTS

Members of ADS staff conducted presentations with the Downtown Action Team on August 20, 1998 and the Barelas Neighborhood Association on August 26, 1998. Staff members provided an overview of the selection process, and highlighted elements of each proposal.

ADS addressed concerns and questions expressed by these community groups. Common concerns raised by each group included: accessibility and placement of parking on site, unit mix, and site amenities.

The Downtown Action Team expressed some concern in creating additional commercial space along Coal Avenue. Members mentioned the need for day care services in downtown. They expressed the need for high density housing to compliment the GSA building, and for three bedroom units. Concerns were also raised that we did not give more allowance for inexperienced developers.

The Barelas Neighborhood Association expressed concern about rents for each proposal. They also stated that they do not want to see another wrought iron fence around the site similar to the Alvarado Apartments. Concerns were raised with on site parking. They expressed favor in the mixed-use concept, and the need for day care services in downtown. Association directors inquired on the possibility of including the Barelas Community Development Corporation with these proposals.

VI. ROYAL FORK

The Royal Fork site is located at the northwest corner of 4th Street and Coal Avenue. This site has been offered in a previous RFP. Proposals on this site have not resulted in a development agreement. ADS proposes to offer this site to the successful developer of this RFP for inclusion in this development. The purpose of this offer is to create additional housing downtown. The contract for the Royal Fork portion of this development will require City Council approval.

VII. STAFF RECOMMENDATIONS

Upon the review of all three proposals, Albuquerque Development Services recommends the approval of the Armstrong Brothers proposal. The Armstrong Brothers utilize an innovative design which addresses the housing requirements listed in the RFP and commercial services for downtown employees and residents. The placement of a day care center on site and other commercial uses enhances the amenities available for its residents. The project is compatible with the scale of the proposed Social Security building between 6^th and 5^th Streets, and the Alvarado Apartments between 6^th and 8^th Streets. It provides a higher density of 190 units which was a preference in the RFP. The Armstrong Brothers have expressed a willingness to move ahead on design while applying for Low Income Tax Credits and will use Metropolitan Redevelopment Bonds as an alternative if not awarded the LIHTC.

Albuquerque Development Services acknowledges that the proposal submitted by Tesch Development is a viable alternative. ADS would recommend the approval of the Tesch proposal should negotiations with the Armstrong Brothers prove to be unsuccessful.

1. Negotiations should proceed with the developer and the resulting development agreement to be brought to the Chair for signature.
2. Offer the Royal Fork property for development of apartments on the same terms as other property.
3. That developer agree to a mixed use rental tenant mix of not less than 20% and not more than 50% of the units being made affordable to households earning less than 60% of median income.