22 June 2023

Mesa City Council Study Session - TODAY 06.22.2023 >> Purchase of the Downtown Hibbert parking structure + Purchasing from Maricopa County real property located at 245 North Centennial for future use of City operations.

Agenda
1-a Hear a presentation, discuss, and receive an update on Mesa’s Public Safety Mental Health Response.
1-b Hear a presentation and discuss current downtown parking inventory, including the proposed purchase of the Downtown Hibbert parking structure.
1-c Hear a presentation, discuss, and provide direction on purchasing from Maricopa County real property located at 245 North Centennial for future use of City operations.
2 Acknowledge receipt of minutes of various boards and committees.
3 Current events summary including meetings and conferences attended.
4 Scheduling of meetings.

ITEM 1-b HAS A LONG HISTORY

 Purchase price: $8,000,000
 Seller parking option: 300 spaces
 Option term: 5-15 years (performance
based)
 City retains rights to Option Spaces
while not licensed
 Seller parking license: 300 spaces
 Term: 45-years, with two, 10-year
extensions
 License provided only to support new
private development
 License Rates:
 Year 0-5: $35/month/space
 Year 6-11: $45/month/space
 Year 12+: Then published rate

HIBBERT GARAGE – PROPOSED PURCHASE TERMS

 Current City employee parking
generates no revenue
 Opens 600 spaces within existing
garage can be permitted/licenses to
employees of private businesses or new
development
 300 spaces within Hibbert garage
licensed to seller to support new
private development
 $2,900,000: estimated 20-year revenue
 $11,025,000: June 2023 appraised

NEXT STEPS
July 10, 2023 - Council
action on Purchase and
Sale, Option, and License
agreements with seller
value

Type:

Presentation

Status:

Agenda Ready

In control:

City Council Study Session

On agenda:

6/22/2023

Title:

Hear a presentation and discuss current downtown parking inventory, including the proposed purchase of the Downtown Hibbert parking structure.

Attachments:

1. Presentation

File #:

23-0741

NEWS

Mesa recoups $2 million from '90s-era controversy

Maria Polletta

The Republic | azcentral.com

The refund covers money spent in 1996 to bolster the Brown & Brown Chevrolet dealership, a major sales-tax generator at the time.

In 1996, Mesa spent about $2 million to to buy, clear and remediate two-plus acres on the north side of Main Street near Hibbert.
Brown & Brown Chevrolet for decades had been selling cars across the street, and Mesa wanted to help it expand.
The dealership initially promised to build offices, display space and a parking garage but ultimately built only the garage.
Brown & Brown successor AutoNation is now selling the property and has reimbursed the city for its investment.

As Mesa's last downtown auto dealer works to tie up the loose ends surrounding its exit, the city has received a $2 million payout nearly 20 years in the making.

The payment is essentially a delayed reimbursement for money spent in 1996 to buy, clear and remediate two-plus acres on the north side of Main Street near Hibbert. Brown & Brown Chevrolet for decades had been selling a steady spate of cars across the street — making it one of the city's sales-tax darlings — and Mesa wanted to help the enterprise stay in town and expand.

The city's approach at the time prompted heavy backlash,

first because it forced about 40 people out of their homes,
and again when Mesa sold the parcel to Brown & Brown for a token $1.
Vice Mayor Dennis Kavanaugh, who at the time was running for a City Council seat alongside current Mayor John Giles, recalls both officials publicly opposing the deal while on the campaign trail.. .

"Once we knew the property was on the market, we did make some inquiries and ask questions about the cost, but we felt the price they were asking was too high," City Manager Chris Brady said. "I do believe that they're actively working with a group interested in the property, but I can't say who it is."

State Sen. Bob Worsley and his wife, Christi, who are seeking to build a musical performance and education campus, had said last year the dealership site and parking garage would be a perfect fit for their project. But they were not the only party interested in the site, according to Mesa officials. . ."

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ON THE SOUTH SIDE OF MAIN STREET HIBBERT/1ST AVENUE ON 10 ACRES

THERE'S MELODY ON MAIN NOW

Residents will have immediate access to the light rail with direct connection to downtown Tempe and downtown Phoenix and will be within walking distance of restaurants, the civic arts center and numerous other downtown amenities.

Melody on Main, New Luxury Apartment Community, Opens in Downtown Mesa

4/13/2023

Melody on Main, a new mixed-use project, is now leasing and welcoming new residents. Read More

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ITEM 1-c