BACKGROUND:

On April 19, 2005, the City Council asked that staff bring back a discussion of the NBC Master Plan and potential sale of the Catalina property as a one step-two step process.  This is the first step to determine if Council would like staff to bring back a report and what that report should include.

The following information provides a summary of the NBC Master Plan.  The Ordinance approving the Planned Development zone and the accompanying Development Agreement (DA) were approved in March 1997 and the DA is valid for 20 years.

The DA approved the project presented in a Master Plan proposed by NBC with modifications made by the Planning Board and City Council.  The area of the development is roughly bounded by Warner Boulevard and the 134 Freeway on the south, California Street and Olive Avenue on the west, Alameda Avenue on the north, the property boundary of Providence St. Joseph Hospital on the east to Parkside Avenue on the south moving east to Bob Hope Drive down to Warner Boulevard.  The �Catalina Property� is that easternmost portion with the boundaries of Bob Hope Drive, Alameda Avenue, Providence St. Joseph Hospital and Parkside Avenue consisting of approximately 9.3 acres.

The applicant was permitted a total development potential of 1,825,865 office equivalent gross square footage (OEGSF).  This was not an unusually large amount as this amount was determined by using the allowed development rights as dictated in the Media District Specific Plan (MDSP) which is 1.1 times the site area.  This total is 2,136,038 OEGSF, however, NBC had previously transferred 310,173 OEGSF to another property (now the Pinnacle site) which therefore reduced NBC�s total allowable development to 1,825,865.  It is important to note that this development right is a total for the site and therefore includes buildings that already exist.  Records indicate there is approximately 605,872 OEGSF of development currently on the site.  Therefore, the applicant could build 1,219,993 OEGSF more, or could demolish some buildings and build more, as long as the total does not exceed 1,825,865 OEGSF on the site.

The OEGSF is an office equivalent as defined in the MDSP as it relates to traffic.  Thus, if the applicant were to develop structures for uses that had less peak hour trip generation, more than 1,825,865 square feet could be developed.  For example, sound stages have a factor of 4.00 meaning that an office generates the same peak hour trips as a sound stage that is four times larger.  If the site included a 100,000 square foot sound stage, it would count as only 25,000 OEGSF because the trip generation is equivalent to a 25,000 square foot general office.  Or, the applicant could construct media office which has a factor of 1.33 and, for example, could build 1,064,000 square feet which would be equivalent to 800,000 square feet of general office development.  In this example, only 800,000 OEGSF would be reduced from the total allowed square footage for the entire studio campus.

The uses permitted on the site include eating establishments, incidental retail, health facilities and child care facility, all of which exclusively serve employees and their guests on site; and media related uses which include office buildings serving the media/entertainment industry and studios for broadcasting/recording and motion picture production.  The media related uses could also include sound stages, technical space, warehousing for media equipment and workshops for the construction of sets.  Also permitted on the site are any commercial uses which primarily serve the employees or residents of the Media District and which the Director of Community Development or the Planning Board determines will not be likely to attract a substantial percentage of patrons from outside the Media District.  The applicant must also build parking facilities or structures to serve the uses and may construct up to 8,800 parking spaces.

The height permitted for structures is based on their distance from R-1 zones with a maximum height of 15 stories.  The Catalina Property is greater than 500 feet from R-1 zones and therefore has a maximum height of 15 stories.  The setback from street rights-of-way is the same as code, 20% of the building heights.  However, on the Catalina property, special line of sight considerations were given for the existing satellite communication path.  Therefore, the height of the building is based on the setback from Alameda.  In order for the structure to reach 197.1 feet tall (measured to the ceiling of the highest room permitted for human occupancy) the structure must be setback 65 feet from Alameda.  The DA did allow for stair stepping of the building so that shorter portions of the structures could have less of a setback.

The DA set general �envelopes� of development for the various portions of the site, but did recognize that the applicant had discretion over where development occurred on the property.  The �envelope� for the Catalina Property includes two 15 story buildings, one two story building with a footprint approximately equal to the footprint of both 15 story buildings and a parking structure to serve the uses.  A portion of the site is to remain open because of utility easements across the property.  The Environmental Impact Report studied development consisting of 875,400 gross square feet of media office or 658,195 OEGSF.  If the development of the Catalina Property remains at or less than the amount previously studied, no new environmental review is required.  If the development on the Catalina Property exceeded this amount, a new initial study would be done to determine whether the changes require additional environmental review. CEQA Guidelines Sections 15162 and 15163 state that no additional CEQA review is necessary unless 1) a project is substantially changed which will require major revisions of the previous EIR or a substantial increase in the severity of previously identified significant effect;  2) substantial changes have occurred with respect to circumstances such that major revisions to the previous EIR are needed due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects; or 3) new information of substantial importance, which was not known and could not have been known at the time the previous EIR was certified, shows that the project a) will have one or more significant effects not previously discussed, or b) will have substantially more severe insignificant effects, or c) could have mitigation measures which previously were infeasible or considerably different could substantially reduce one or more significant effects of the project, but the project proponent declines to adopt such measures. In those cases, an environmental document would allow for public review. If a project is changed in a manner that the aforementioned is not triggered, then an addendum is the appropriate environmental documentation. An addendum does not provide for public review. (Section 4.4 of the DA also reiterates the above).

Buildings constructed within the envelopes identified in the DA are permitted without any discretionary action.  Only typical building permits are required with building meeting life and safety requirements.  No architectural style was required, just that the finish quality shall be at least to the level of the existing 4NBC building at Olive and Alameda.  Design standards consistent with the MDSP regarding scale and visual relief are also required.

The DA in Section 1.4 authorizes the Developer to assign �less than the entirety of its interests, rights, or obligations hereunder without prior written consent of the City.�  This assignment provision means that NBC has the legal right to assign the DA to a purchaser of a portion of the entire project site. Once assigned, the DA, and all of the terms and conditions of the agreement, shall be binding upon and inure to the benefit of any subsequent owner of all or any portion of the project site and shall also be binding upon such respective assigns, heirs or successors in interest (DA Section 7.5).  Therefore, NBC may sell all or portions of the Planned Development site and the new owner would have the same rights and responsibilities under the DA.

Section 7.7 of the DA states that no third party beneficiaries will be benefited by this agreement, except for NBC�s mortgage company. A �third party beneficiary� is a legal term which is recognized as a person having enforceable rights created in them by a contract to which they are not parties and for which they gave no consideration. For example, it is stated in the DA, that the Mortgagee is a third party beneficiary and will receive notice of NBC�s default and opportunity to cure. That type of third party beneficiary right is common, and should the parties fail to provide Mortgagee with the stated rights, the Mortgagee can sue the parties under the agreement even though the Mortgagee is not a party to the DA.  A �third party beneficiary� cannot be an assignee, because the assignee becomes one of the parties, and obviously has all rights to sue to enforce the contract. The �third party beneficiary� concept allows non-parties to sue. A clause that limits �third part beneficiaries� is common in land use agreements.

RECOMMENDATION:

Staff recommends that City Council determine if they would like the matter placed on a future agenda and also to direct staff on what information is desired for that report.

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