HomeMy WebLinkAbout11 - Agreement for Preliminary Design and Lease Negotiations for a New Restaurant at the End of the Newport Pier
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NEWPORT BEACH
City Council Staff Report
COUNCIL STAFF REPORT
CITY OF
March 8, 2016
Agenda Item No. 11
ABSTRACT:
The City of Newport Beach issued a request for proposals for a tenant to construct and
occupy a restaurant space at the end of the Newport Pier in March 2014. After a
thorough review of the proposals, staff is recommending approval of an exclusive
negotiating agreement (ENA) with James Ulcickas and Richard Staunton, owners and
co-founders of Bluewater Grill (Bluewater), to allow the City and Bluewater to work
together to develop a conceptual building design and to negotiate the terms of a lease
agreement for a new restaurant at the end of the Newport Pier.
RECOMMENDATION:
a) Find the execution of the Exclusive Negotiating Agreement is not subject to the
California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and
15060(c)(3) of the CEQA Guidelines; and
b) Approve and authorize the Mayor and City Clerk to execute a one-year exclusive
negotiating agreement with James Ulcickas and Richard Staunton, in substantially
the same form as the attachment to the staff report.
FUNDING REQUIREMENTS:
The current adopted budget includes sufficient funding for this project. It will be
expensed to the Newport Pier Capital Improvement Project account in the Public Works
Department. The estimated cost for conceptual design is $18,000 to be shared 50%
with Bluewater Grill.
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Kimberly Brandt, Community Development Director - 949-644-3232,
kbrandt@newportbeachca.gov
PREPARED BY: Lauren Whitlinger, Real Property Administrator
Seimone Jurjis, Assistant Community Development Director, CBO
PHONE: 949-644-3236
TITLE: Approve an Exclusive Negotiating Agreement between the City of
Newport Beach and James Ulcickas and Richard Staunton of
Bluewater Grill Restaurant, for Preliminary Design and Lease
Negotiations for a New Restaurant at the End of the Newport Pier
Approve an Exclusive Negotiating Agreement between the City of Newport Beach and
James Ulcickas and Richard Staunton of Bluewater Grill Restaurant, for Preliminary
Design and Lease Negotiations for a New Restaurant at the End of the Newport Pier
March 8, 2016
Page 2
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DISCUSSION:
Restaurant Space
The Newport Pier, located on the Balboa Peninsula at 21st Street and West Ocean
Front, is adjacent to the historic McFadden Wharf (Attachment B). The City-owned
restaurant building at the end of the pier has been vacant since the previous lease
expired in November 2012, in anticipation of a major renovation or redevelopment of the
property. The existing two-story building was constructed in the 1940s, and it was
expanded and renovated in the late 1980s. After evaluating the existing structure and
the underlying pier, it was determined the building is beyond its useful life and its
removal and replacement is the best economic option. Additionally the restaurant
demolition will allow for renovation of the pier directly beneath the building.
Selection Process
In March 2014, the City published Request for Proposals No. 14-35 (RFP) for a
restaurant tenant to remodel or replace the building and operate a restaurant at the end
of Newport Pier. The City received nine proposals, but ultimately decided to revise the
conditions of the RFP to require the tenant to cover the cost of replacing the building.
Three proposals were received in response to the revised RFP requirements, including
Cube Restaurant, Bluewater, and Machani Group/Big Fish Tavern. City representatives
interviewed Machani Group/Big Fish Tavern and Bluewater in December 2015; Cube
Restaurant had declined to continue in the selection process.
After careful review and consideration between the two proposers, staff believes the
proposal from Bluewater, will best meet the City’s objectives of creating a viable
restaurant on Newport Pier which complements the pier itself, McFadden Square area,
and will serve residents and visitors alike.
However, there are still a number of unanswered questions, such as: What will the new
restaurant building look like? How will it structurally affect Newport Pier? What is the
true cost of the project? How much money are the proposers requesting the City to
contribute? How will the new building affect the public’s use of the pier?
Instead of asking the City Council to commit to a large project at this time, staff believes
that it would be better use of resources to take a small step forward by developing a
conceptual building design in conjunction with Bluewater that addresses these
outstanding questions. Therefore, staff recommends that City Council enter into an ENA
with Bluewater and share equally in the conceptual restaurant design costs.
It is important to note that at this early project stage City Council is only committing to
the development of a conceptual design and to negotiate a lease agreement.
Approve an Exclusive Negotiating Agreement between the City of Newport Beach and
James Ulcickas and Richard Staunton of Bluewater Grill Restaurant, for Preliminary
Design and Lease Negotiations for a New Restaurant at the End of the Newport Pier
March 8, 2016
Page 3
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Approving the ENA does not obligate the City Council to approve the project or a lease
at a future date.
Once a design is completed, lease terms established, and specific costs determined,
staff will return to the City Council with that information and to seek further direction.
Proposed ENA Agreement
Staff has prepared an ENA (Attachment A) to outline a timeframe and conditions under
which the City and Bluewater can develop a building and site design and scope of work,
in order to negotiate the project’s lease agreement terms.
The proposed terms of the ENA are:
1. The length of the agreement will be for one year, with up to one three-month
extension option, unless terminated as provided by the agreement.
2. The following non-exclusive list of items shall be researched and developed, in order
to negotiate the deal points of a lease agreement:
a) Scope of development and improvements for a restaurant;
b) Assessment of the physical and environmental conditions;
c) Site plan depicting proposed building locations, design, size, and uses,
pier improvements, and required engineering for the pier;
d) Pro forma for the project;
e) Financing plan for the project;
f) City’s financial contribution to the project;
g) Scope of entitlements required for the project;
h) Schedule for the project; and
i) Discussion of lease terms and rents for the project.
3. City and Bluewater to share equally (50% each) the cost of preparation of design
development documents.
This agreement has been reviewed by the City Attorney’s office and has been approved
as to form.
Approve an Exclusive Negotiating Agreement between the City of Newport Beach and
James Ulcickas and Richard Staunton of Bluewater Grill Restaurant, for Preliminary
Design and Lease Negotiations for a New Restaurant at the End of the Newport Pier
March 8, 2016
Page 4
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Proposal for Architectural Services for a Conceptual Restaurant Design
Staff and Bluewater reached out to Kelly Architects for a design proposal due to the
firm’s relevant and recent experience with a similar project. Kelly Architects’ conceptual
design proposal includes 3-D renderings for a total cost of $18,000 (Attachment C). If
the City Council agrees to enter into the proposed ENA, then staff will prepare a
professional services agreement with Kelly Architects.
Contract Summary
Proposed Contract
Vendor Name James Ulcickas and Richard Staunton,
individuals (Bluewater)
Term 1 year, three month option
Escalation Clause N/A
Revenue/Year N/A
Cost/Year $18,000 ($9,000 City/$9,000 Bluewater)
Cost/Contract Term (est) $18,000 ($9,000 City/$9,000 Bluewater)
Selection Process
Sole Source or RFP/RFQ RFP
Method (QBS vs. Low Bid)QBS
# of Respondents 10
# of Qualified Respondents 2
ENVIRONMENTAL REVIEW:
Staff recommends the City Council find this action is not subject to the California
Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not
result in a direct or reasonably foreseeable indirect physical change in the environment)
and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA
Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no
potential for resulting in physical change to the environment, directly or indirectly.
NOTICING:
The agenda item has been noticed according to the Brown Act (72 hours in advance of
the meeting at which the City Council considers the item).
ATTACHMENTS:
Attachment A – Exclusive Negotiating Agreement
Attachment B – Maps
Attachment C – Design Proposal – Kelly Architects
Attachment A
Exclusive Negotiating Agreement
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EXCLUSIVE NEGOTIATING AGREEMENT
This EXCLUSIVE NEGOTIATING AGREEMENT ("Agreement") is made and entered
into to be effective as of , 2016 ("Effective Date"), by and between the City of
Newport Beach, a California charter city and municipal corporation ("City"), and James
Ulcickas, an individual, and Richard Staunton, an individual (together hereinafter "Bluewater").
City and Bluewater are sometimes hereinafter individually referred to as a "Party" and
collectively as the "Parties."
RECITALS;
The following Recitals are a substantive part of this Agreement:
A. City is a municipal corporation duly organized and validly existing under the laws
of the State of California with the power to carry on its business as it is now being conducted
under the statutes of the State of California and the Charter of the City.
B. City desires to lease to Bluewater certain real property in need of design,
redevelopment, and improvements, which property consists of approximately 4,055 square feet
located at 1 Newport Pier in Newport Beach, California 92663, and is depicted on Exhibit "A"
attached hereto and incorporated herein ("Site").
C. Bluewater is an experienced restaurant group who has proposed a retail restaurant
on the Site ("Proposal"). The Proposal, which may be subject to refinement and modification as
mutually agreed to by the Parties during negotiations, is generally described in the Proposal
Description attached hereto and incorporated herein as Exhibit "B."
D. The Parties desire to enter into this Agreement to establish a period during which
they will eooperate to explore the feasibility of developing the Proposal on the Site and during
which time Bluewater shall have the exclusive right to negotiate with City with respect to the
terms of an agreement or agreements to provide for the Proposal (herein, "Definitive
Agreement").
COVENANTS:
Based upon the foregoing Recitals, which are incorporated herein by this reference, and
for good and valuable consideration, the receipt and sufficiency of which is acknowledged by
both Parties, City and Bluewater agree as follows:
1. Good Faith Negotiations. During the entire Negotiation Period (defined in
Section 2), City and Bluewater shall negotiate in good faith pursuant to the terms set forth herein
to achieve the objectives and accomplish the tasks described in this Agreement. Nothing herein
shall be deemed a covenant, promise, or commitment by either Party to approve or enter into a
Definitive Agreement with the other Party on any particular terms or conditions. The Parties'
approval and execution of this Agreement is merely an agreement with respect to certain tasks
preliminary to the execution of the Definitive Agreement and an agreement to enter into a period
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of negotiations according to the concepts presented herein, reserving full and final discretion
with City and Bluewater as to the final terms of the Definitive Agreement as required by law. If
for any reason City and Bluewater have not each executed a mutually acceptable Definitive
Agreement by the expiration of the Negotiation Period, and provided that the Parties have not
committed a material default hereunder, this Agreement shall automatically terminate and shall
be of no further force or effect.
During the period of exclusive negotiation, the City covenants and agrees to negotiate
exclusively with the Bluewater and shall not solicit another party for the Property or enter into
any agreement with any other party regarding the development of the Property. The City
acknowledges and agrees that but for this exclusivity, the Bluewater would not have entered into
this Agreement.
2. Term of Agreement. The term of this Agreement (the "Negotiation Period") shall
be one (1) year after the Effective Date; provided, however, that the City Manager, on behalf of
the City, and Bluewater shall have the ri^t to approve an extension of the Negotiation Period for
a cumulative maximum of three (3) months without the requirement of any official action by the
City Council or an amendment of this Agreement, if the City Manager and Bluewater determine,
in their sole and absolute discretion, that satisfactory progress is being made to achieve the
objectives and complete the tasks set forth herein but such extension is necessary to finalize
discussions or negotiations on mutually satisfactory terms.
3. Certain Parameters for Negotiation. The following nonexclusive list of items
related to the Proposal shall be the subject of negotiations during the Negotiation Period:
(a) Scope of development and improvements for a restaurant not to exceed
4,500 square feet, with outdoor dining;
(b) Assessment of the physical and environmental condition of the site;
(c) Site plan for the Proposal (depicting proposed building locations, building
design, elevations, building square footages and uses, pier improvements, and additional
design engineering requirements for the pier);
(d) Pro forma for the Proposal (addressing detailed development and
operational costs, anticipated rents, estimated profit and appropriate return
measurements);
(e) Financing plan for the Proposal (addressing the proposed methods of
construction financing and permanent financing, and amounts and sources of equity and
debt capital);
(f) City's financial contribution to the Proposal;
(g) Scope of the entitlements required for the project (including, but not
limited to. City of Newport Beach, California Environmental Quality Act, California
Alcohol Beverage Control, and California Coastal Commission);
Bluewater Grill Exclusive Negotiating Agreement Page 2
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(h) Development schedule for the Proposal; and
(i) The fair market rents which Bluewater will pay for a leasehold interest in
the Property and terms and conditions of the conveyance of the leasehold interest to
Bluewater.
4. Preparation of Design Development Documents for Citv and Bluewater Review
and romment. City shall act as the Project Manager in developing the Proposal on the Site. City
shall enter into an agreement for architectural design services to develop the preliminary design
of the Proposal, with input from Bluewater ("Architectural Services"). Bluewater shall be
responsible for fifty percent (50%) of the costs of the Architectural Services by depositing these
funds into a deposit account for the benefit of City. City shall be responsible for scheduling
design meetings with its City Council subcommittee, architect, and Bluewater to refine design
drawings.
Bluewater acknowledges and agrees that design and architectural review by the
City and its consultants will be required at each stage of the development of the Proposal and
that sketches, plans, and ultimately working drawings, specifications and similar documents will
be required to be submitted for review and approval pursuant to the Definitive Agreement
("City's Design Review"). Bluewater further acknowledges and agrees that the City, acting not
as a Party but under its general police powers as a charter city and municipal corporation, may
conduct all applicable review and that building design and pier improvement, including, but not
limited to, the selection of building and pier elevations and construction materials, which shall
not be final until approved by the City. Bluewater further acknowledges and agrees that the
City's Design Review shall be rights exercisable by the City distinct and separate from those
additional rights which the City may exercise under its general police powers as a municipal
corporation and charter city.
5. Land Use & Environmental Requirements. The development of the Proposal
shall be subject to all rules, regulations, standards, and criteria required by law and as set forth in
the City's General Plan, Coastal Land Use Plan, zoning regulations, this Agreement, and the
Definitive Agreement. Bluewater shall be responsible for costs related to the Proposal incurred
after the Effective Date, including, but not limited to, fifty percent (50%) of consultant fees and
Architectural Services ("Costs"). Bluewater shall place funds on deposit with the City to pay for
the Costs pursuant to the City's architectural contract, as may be amended.
6. Phvsical Condition of the Site. City and Bluewater shall cooperate and exchange
such information as may be available to either of them regarding the physical condition of the
Site (or applicable portions thereof).
7. Hazardous Material Assessment. Within ten (10) days of the Effective Date, the
City shall provide the Bluewater without charge, copies of reports, studies, surveys and other
data and information on the physical condition of the Site. The Definitive Agreement may
address applicable clean-up issues, if any. In the event an environmental audit evidences a need
for clean-up of any portion of the Site, the City, by this Agreement, does not agree in any respect
to undertake or complete such clean-up. In the event that during the Negotiating Period the
Bluewater conducts or causes to be conducted any environmental audits and/or testing on any
portion of the Site, the Bluewater shall submit copies of any reports resulting from such tests or
Bluewater Grill Exclusive Negotiating Agreement Page 3
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studies to the City. Such environmental audits and/or testing shall be conducted at the sole cost
and expense of the Bluewater. Neither Party makes any representation or warranty as to the
accuracy or completeness of reports prepared by third parties and delivered to the other Party.
Bluewater shall indemnify, defend and hold harmless City from and against all claims, liabilities
or damages, and including expert witness fees and reasonable attorneys' fees and costs, arising
out of any such testing, inspection or investigatory activity on the Property by Bluewater. In
addition, following any such testing, inspection or investigatory activity, Bluewater shall retum,
and repair if necessary, the Property to the condition it was in prior to the Bluewater's
investigatory activities.
8. Miscellaneous.
8.1 Notices. Any notices, requests or approvals given under this Agreement
from one Party to another may be personally delivered, transmitted by facsimile (FAX)
transmission, or deposit with the United States Postal Service for mailing, postage prepaid, to the
address of the other Party as stated in this paragraph, and shall be deemed to have been given at
the time of personal delivery or FAX transmission or, if mailed, on the third day following the
date of deposit in the course of transmission with the United States Postal Service. Notices shall
be sent as follows: notices between the Parties shall be delivered in writing to the following
addresses:
To City: Dave Kiff
City Manager
100 Civic Center Drive
Newport Beach, CA 92660
With a copy to: Lauren Wooding Whitlinger
Real Property Administrator
100 Civic Center Drive
Newport Beach, CA 92660
To Bluewater: Bluewater Grill
Attn: Richard L. Staunton
665 North Harbor Drive
Redondo Beach, CA 90277
8.2 Termination. Each Party reserves the right to terminate this Agreement,
with or without cause, upon thirty (30) days prior written notice to the other Party, thereby
withdrawing from such negotiations without any liability to the other Party, except that (i) each
Party shall be obligated to promptly retum to the other Party all information and materials which
such Party has received from the other Party pursuant to this Agreement and (ii) the rights and
obligations of the Parties set forth in Section 8 shall remain in full force and effect. Any balance
remaining in the Deposit Account shall be refunded to Bluewater. The Parties, by their respective
execution hereof, knowingly agree, notwithstanding anything herein to the contrary, that, except
with respect to the rights and obligations set forth in Section 8 hereof, neither of them shall have
any right to specific performance of this Agreement, nor any other equitable or damage remedies
Bluewater Grill Exclusive Negotiating Agreement Page 4
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under the law. Each Party makes such release with full knowledge of Civil Code Section 1542
and hereby waive any and all rights thereunder to the extent of this release, if such Section 1542
is applicable. Section 1542 of the Civil Code provides as follows:
"A general release does not extend to claims which the creditor
does not know or suspect to exist in his or her favor at the time of
executing the release, which if known by him or her must have
materially affected his or her settlement with the debtor."
City's Initials Bluewater's Initials
8.3 Bluewater Documents. In the event of termination of this Agreement, for
any reason including, but not limited to, expiration, termination or breach of this Agreement,
Bluewater shall deliver to the City, within ten (10) business days, a copy of all surveys,
soils/environmental reports, site plans, pro formas, and other documents prepared by Bluewater
or third parties that are associated in any way with this Agreement. Notwithstanding the
foregoing, in no event, however, shall Bluewater be obligated to make available (or cause to be
made available) any proprietary or confidential documents including reports or studies that have
been superseded by subsequent reports or studies, or any of the following confidential and
proprietary materials: (1) information contained in financial analyses or projections (including
Bluewater's budgets, and capital account information); (2) material that is subject to attorney-
client privilege or that is attomey work product; (4) organizational, financial and other
documents relating to Bluewater or its affiliates (other than evidence of due authorization and
organization, and the financing plan required under this Agreement); or (5) material that
Bluewater is legally required not to disclose other than by reason of legal requirements
voluntarily assumed by Bluewater after the Effective Date. Bluewater makes no representation
or warranty as to the accuracy or completeness of reports prepared by third parties and delivered
to the City.
8.4 Cooperation. The Parties agree to cooperate with each other in promptly
supplying information and analyses relating to the Proposal.
8.5 Assignment. Neither Party shall have the right to assign any of their rights
or obligations set forth in this Agreement without the written consent of the other Party, which
consent may be withheld in such other Party's sole and absolute discretion. Any assignment
must be in writing and executed by both assignor and assignee in order to be enforceable and
after the effective date of the assignment the assignor shall be released and discharged from any
liability or responsibility hereunder.
8.6 Entire Agreement. Amendments, and Waivers. This Agreement sets forth
the entire agreement between the Parties with respect to the subject matter set forth herein and
supersedes all prior discussions and negotiations between the Parties with respect thereto. No
amendment to this Agreement shall be effective unless set forth in a writing signed by an
authorized signator of each Party. No waiver of any provision of this Agreement shall be
enforceable against a Party unless it is set forth in a writing executed by such Party.
Bluewater Grill Exclusive Negotiating Agreement Page 5
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8.7 Administrative Costs and Expenses: Bluewater Deposit. Bluewater shall
be responsible for fifty percent (50%) of all costs and expenses incurred by the City related to
this Agreement including, but not limited to, architectural and consultant fees. Prior to City's
execution of this Agreement, Bluewater shall deposit with City an initial sum that is equal to
fifty percent (50%) of the cost of the contract for Architectural Services ("Deposit Amount") that
the City shall use to reimburse itself for the costs related to the implementation of this
Agreement. Said funds shall be maintained in a separate account by the City ("Deposit
Account"). Within ten (10) business days of a request by the City, Bluewater shall deposit
additional sums to replenish the Deposit Account so that the amount of funds on deposit with the
City is maintained at fifty percent (50%) of the cost of the contract for Architectural Services, as
may be amended to reflect increased costs, with consent by Bluewater. Consent may be given via
email or written correspondence, and shall not be unreasonably withheld. From and after the
Effective Date, the Deposit Account may be used by the City to pay the City's costs including,
without limitation, consultant fees required in connection with the drafting, negotiation and
execution of this Agreement, the Definitive Agreement, or termination of this Agreement ("City
Transaction Expenses") provided that City agrees that City Transaction Expenses to be charged
Bluewater shall not exceed fifty percent (50%) of the agreed upon costs prior to execution of the
Definitive Agreement.
8.8 Assurances to Act in Good Faith. The City and Bluewater each agree to
take all actions contemplated by this Agreement, including timely depositing funds as required
herein, and shall use their respective best efforts to negotiate a Definitive Agreement in
accordance with the provisions of this Agreement. In the event that one Party fails to exercise
good faith in the negotiations contemplated by this Agreement, the other Party may be entitled to
recover those costs identified as Costs in Section 5 and the Deposit Amount defined in Section
8.7 from the Party that failed to exercise good faith.
8.8 Attomev's Fees. In the event of any litigation between the Parties arising
out of or concerning this Agreement, the prevailing Party shall not be entitled to recover from the
other Party its actual and reasonable attomey's fees.
8.9 Interpretation. This Agreement shall be interpreted as a whole and in
accordance with its fair meaning and as if each Party participated equally in its drafting. Captions
are for reference only and are not to be used in construing meaning.
8.10 Governing Law. This Agreement shall be governed by the laws of the
State of California. Any legal action brought under this Agreement must be instituted in the
Superior Court of Orange County, State of California, in an appropriate court in that county, or
in the Federal District Court in the Central District of Califomia.
8.11 Purpose of Agreement. It is expressly understood and agreed by the
parties that this is an Agreement regarding the conduct of exclusive good faith contract
negotiations only and does not convey any interest in the Site whatsoever. This Agreement is not
intended to constitute a binding agreement by the City to lease the Property or commit the City
to develop all or any portion of Site, to financially participate with the Bluewater in the
development of the Proposal, nor is it intended to constitute a binding agreement to enter into a
Definitive Agreement or any other contract. No Party shall be legally bound to consummate
Bluewater Grill Exclusive Negotiating Agreement Page 6
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construction of the Proposal unless and until a Definitive Agreement or other contract has been
executed and delivered by the Parties. Notwithstanding any other provision hereof, neither the
Bluewater nor the City shall be under any obligation to approve or execute any Definitive
Agreement during or upon conclusion of the Negotiating Period. Any Party may refuse to
approve and execute any Definitive Agreement at its sole and absolute discretion, with or
without cause. In the event that a Definitive Agreement is approved and executed by the Parties,
this Agreement shall be superseded by such Definitive Agreement. It is expressly understood
that notwithstanding this Agreement, the Proposal may be modified or not implemented at all
depending on a number of factors including but not limited to compliance with the California
Environmental Quality Act.
Agreement.
8.12 Reserved.
8.13 Time of Essence. Time is of the essence of each provision set forth in this
[SIGNATURES ON FOLLOWING PAGE]
Bluewater Grill Exclusive Negotiating Agreement Page 7
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement to be
effective as of the date first set forth hereinabove.
APPROVED AS TO FORM:
Date:
Aaron C. Harp
City Attorney
CAM c;j.(0Sr|lt#
CITY OF NEWPORT BEACH,
a California municipal corporation and
charter city
Date:
By:
Diane B. Dixon
Mayor
ATTEST:
Date:
BLUEWATER: James Ulcickas, an
individual, and Richard Staunton, an
individual
Date:
Leilani I. Brown
City Clerk
By:
Name: James Ulcickas
Title:
Date:
By:
Name: Richard Staunton
Title:
Bluewater Grill Exclusive Negotiating Agreement Page 8
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11-14
EXHIBIT A
DESCRIPTION OF THE SITE
Bluewater Grill Exclusive Negotiating Agreement Page A-1
11-15
Exhibit A
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Newport
Beach
GIS
Disclaimer; Every reasonable effort has been made to assure the
accuracy of the data provided, however, The City of
Newport Beach and its employees and agents
disclaim any and all responsibility from or relating to
any results obtained in its use.
Imagery: 2009-2013 photos provided by Eagle
Imaging www.eagleaerial.com
2/8/2016
11-16
Exhibit A - 2
M
Newport
Beach
"'i'FOR''
Disclaimer: Every reasonabie effort has been made to assure the
accuracy of the data provided, however, The City of
Newport Beach and its employees and agents
disclaim any and all responsibility from or relating to
any results obtained in its use.
Imagery: 2009-2013 photos provided by Eagle
Imaging www.eagleaerial.com
2/8/2016
11-17
EXHIBIT B
PROPOSAL DESCRIPTION
Bluewater Grill Exclusive Negotiating Agreement Page B-1
11-18
Voit
Real People. Real Solutions.''
2020 Main St., Ste. 100
Irvine, CA 92614
PH (949) 851-5100
FX (949)261-9092
Lie. #01333376
voitco.com
REAL ESTATE SERVICES
July 13, 2015
Lauren Wooding
Real Property Administrator
City of Newport Beach
1 Civic Center Drive
Newport Beach, California 92660
Re: Proposal - BlueWater Grill
1 Newport Pier
Newport Beach, CA 92663
Dear Lauren:
Thank you for this opportunity to work with the City of Newport Beach ("Landlord") to accommodate their
future vision for a once again thriving restaurant on the Newport Pier. BlueWater Grill ("Tenant") looks
forward to working with the Landlord to deliver an exceptional restaurant environment for the City's residents
and visitors. We are very worried about the fisherman on the pier and for the below proposal to be of interest,
we need a plan of action to address fisherman issues and the possibility of creating a new fishing platform.
Voit Real Estate Services on behalf of Tenant is pleased to submit the following letter of intent to Landlord.
1. BUILDING/PROJECT:
1 Newport Pier Newport Beach,
California 92663
2. TENANT I GROUND LESSEE:
BlueWater Grill
3. PREMISES:
An approximate 4,055 square foot retail restaurant. The exact square footage shall be subject to a
mutually approved space plan. Bluewater may want to expand footprint.
4. 40 YEAR GROUND LEASE:
The initial term of the Ground Lease ("Term") shall commence upon substantial completion of
Tenant's FF&E.
The footprint square footage may be subject to an increase with Costal Commission approval.
Newport Beach (Corporate Office) | Anaheim Metro | Inland Empire | Irvine | Las Vegas | Los Angeles | Phoenix | Sacramento | San Diego
11-19
voitco.com
Lauren Wooding
July 13, 2014
Page 2 of 4
Ground lease adjustment dates:
Years 1-6 the annual ground rent shall be $17,500 = assuming a vaiue of $150.00/PSF building foot
print (1,667/sf X $150. = $250,050.00 x 7% = $17,500)
Years 7-40 the annual ground rent shall be the greater of $17,500 or 4% of gross annual sales.
Tenant will be responsible for their utiiities to be further defined in the lease.
5. PAD DELIVERY REQUIREMENTS:
1. Utilities stubbed to restaurant pad at a location mutually agreeable to Landlord and Tenant;
a. Electric: 1200 amp, 120/208 3-phase service with main disconnect. If 277/408v, then a
step down transformer on a pad to be provided by Landlord.
b. Gas: 3,000,000 BTU at the demised premises, or 2" medium pressure gas iine.
c. Sewer: 6" sanitary and a grease trap (4500 gailons) with a 4" grease iine to the demised
premises.
d. Water: 2" domestic, 6" fire water riser, DC and back flow device for fire sprinkier water
supply.
e. Phone: 4" empty conduit to phone pedestal or MPOE.
f. Cable: 2" empty conduit to POC.
2. Level light weight concrete slab, over raised floor, with water barrier facing underside of pier.
3. Aii exterior access improvements in fuli compliance with ADA for restaurant use including
handicap parking.
4. Compiete set of pad building pians and a complete site plan with parking counts.
5. Designated service yard, trash corral and delivery area. Trash corrai large enough for two 6 yd.
dumpsters, one dumpster is required to be recyciable.
6. Fire Hydrants, as required by locai Fire Authority
7. Disclosure of any code limitations on signage, exterior iighting, exterior gas lamps or awnings.
Signage at building and at pier landing visibie from public parking area
8. Renovations to outdoor seating deck per approved plans and specifications including lighting,
iandscaping, railings and access control as required.
9. Ail necessary structural improvements (if needed) to accommodate the new building.
2. WARM SHELL:
Construction estimates for the deiivery of the warm sheil building are $1,000,000 with vaiue
engineering. BiueWater wiil agree cover up to a maximum of $500,000.00. This will require an outside
investor group. The required investor terms wili be approximately @ 8% interest amortized over 72
months ($8,766.00/ mo).
1. All Exterior walls with all exterior finishes and R-19 interior insulation.
11-20
voitco.com
Lauren Wooding
July 13. 2014
Page 3 of 4
2. Roof: completed roof system with R-30insulation under roof deck.
3. HVAC: Package unit-roof mounted with 1 ton per 250 sq. ft. Central plant-4 pipe
supply/return with mutually agreed flow, temp and pressure requirements. Distributed
throughout restaurant per plans.
4. Interior plumbing.
5. Storefront, including doors and windows.
6. Location for roof mounted satellite dish.
7. Adequate space for roof top exhaust/MUA, refrigeration and HVAC units.
8. Fire rated shaft for kitchen exhaust ducting.
9. Kitchen fire suppression system (as required by Plans & Specifications)
10. Building design costs shall be responsibility of Landlord.
11. Restrooms.
12. Other costs as reasonably agreed by parties prior to lease and after tenant has had
the opportunity to evaluate in more depth with its consultants and vendors.
13. Landlord to pay all construction permittees.
Other costs as reasonably agreed by parties prior to lease and after tenant has had the opportunity to
evaluate in more depth with its consultants and vendors
Tenant shall be responsible for managing the construction and tenant improvements for the building.
Please see attached detailed construction estimate.
SECURITY/ACCESS:
Tenant may install its own security system for the Premises. Tenant shall have 24/7 access to the
Building, except in the case of an emergency.
4. SIGNAGEI COMPETITORS:
Tenant shall be allowed exclusive building signage and any additional locations that the Landlord and
Tenant deem beneficial.
All costs associated with said signage including, but not limited to, design, fabrication, installation,
maintenance and removal shall be borne by Tenant.
All signage will comply with the City of Newport Beach's sign criteria.
5. ASSIGNMENT / SUBLETTING RIGHTS:
Tenant shall have the right to assign or sublet any portion or all of the premises, subject to Landlord's
approval, which shall not to be unreasonably withheld.
6. EXTERIOR OUTDOOR PIER SPACE:
Please address Tenant's ability, if any to host events on the pier deck with food and beverage
service.
7. RELOCATION:
The lease shall not provide a right to relocate Tenant.
8. FIRST MONTH'S RENT I SECURITY DEPOSIT:
11-21
voitco.com
Lauren Wooding
July 13, 2014
Page 4 of 4
At lease execution by Tenant, Tenant shall pay the first month's base rent as well as a security
deposit equal to 110% of last month's base rent.
9. BROKER:
Tenant recognizes Carter Harrington and Doug Killian of Voit Real Estate Services ("Brokers") as its
exclusive real estate agent with respect to negotiations for this transaction. Any commission due and
earned will be paid by Landlord in accordance with a separate standard commission agreement.
10. CONFIDENTIAL:
Tenant and Landlord acknowledge that the terms and conditions contained herein and details of the
ensuing negotiations will remain confidential between the parties to the lease and no proposals, lease
drafts, leases or summaries of any kind will be distributed, copied or otherwise transmitted, orally or in
writing, to any other entity or person.
This Letter of Intent is an outline only of certain key terms of the proposed Lease. This Letter of Intent is not
an offer to lease and Tenant and Landlord are not making any binding commitment by signing this Letter of
Intent or by any prior discussion. This proposal shall expire Juiy 30th, 2015.
Should you have any questions regarding this letter of intent, please do not hesitate to contact us at (949)
851-5100. We look forward to working with you on this requirement and continuing our long term business
relationship with the City of Newport Beach.
Sincerely,
Carter Harrington
Lie: 01763924
Senior Leasing Director
Voit Real Estate Services
Doug Killian
Lie. 00887784
Senior Vice President
Voit Real Estate Services
11-22
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Concept 11-24
bo
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g
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so
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Attachment B
Maps
11-27
Feet
Imagery:2009-2013 photos provided by Eagle
Imaging www.eagleaerial.com
Every reasonable effort has been made to assure the
accuracy of the data provided, however, The City of
Newport Beach and its employees and agents
disclaim any and all responsibility from or relating to
any results obtained in its use.
Disclaimer:
2/17/2016
0 400200
Newport
Beach
GIS
11-28
Feet
Imagery:2009-2013 photos provided by Eagle
Imaging www.eagleaerial.com
Every reasonable effort has been made to assure the
accuracy of the data provided, however, The City of
Newport Beach and its employees and agents
disclaim any and all responsibility from or relating to
any results obtained in its use.
Disclaimer:
2/17/2016
0 8040
Newport
Beach
GIS
11-29
Attachment C
Design Proposal – Kelly Architects
11-30
2404 wilshire boulevard, suite 1e
los angeles, california 90057-3310
t. 213.380.8498
f. 213.380.8499
www.kelly-architects.com
Newport Beach Pier Restaurant Saturday, February 20, 2016
Lauren Wooding-Whitlinger, Real Property Administrator
100 Civic Center Drive
Newport Beach, CA 92660
Project: BWG Restaurant on the Newport Pier
RE: Proposal for Architectural Design Services 1603
Dear Lauren:
We are pleased to submit this fee proposal for Architectural Design Services for the new
Bluewater Grill Restaurant to be located on the Newport Beach Pier. It is my understanding that
the City of Newport and Bluewater Grill are partnering to construct a 3,500-4,000 SF
enclosed building with approximately 1,500 SF of exterior dining on end of the Newport
pier. This proposal is based our meeting on February 2nd and subsequent communication.
This letter of agreement will serve as the Contract between Kelly Architects and City of
Newport Beach, herein referred to as the Client, for Architectural and Interior Design Services.
This letter of agreement consists of the following four exhibits:
• Exhibit A – Scope of Services, Phases & Exclusions
• Exhibit B – Compensation
• Exhibit C – Terms & Conditions
• Exhibit D – Signature & Authorization
Please sign and return one copy of this agreement for our records. We are prepared to start
upon your signed approval of this proposal. Please feel free to contact me if you have any
questions.
Sincerely,
George W. Kelly, AIA
Principal Architect
P:\Projects\2016 Projects\1603-BWG Newport Pier\Contract\1603-Newport Pier Restaurant Concept.doc
11-31
2404 wilshire boulevard, suite 1e
los angeles, california 90057-3310
t. 213.380.8498
f. 213.380.8499
www.kelly-architects.com 2 of 4
EXHIBIT A
SCOPE OF SERVICES, PHASES & EXCLUSIONS
PHASE 1 – Concept Design
1. Kelly Architects will meet with the Clients, both the City of Newport and Bluewater Grill to develop the
program, design concepts, pier limitations and Concept Design package.
a. New 2 story restaurant & bar concept on the end of the pier
b. Prominent entrance and open stair
c. Enclosed kitchen
d. New Restaurant dining seating area on main and second levels
e. New men’s and women’s restrooms
f. New patio seating area on main and second levels
g. Loose dining seating with limited fixed seating
h. Walk up window for to-go service
i. New signage to be designed as part of Schematic design
2. Kelly Architects will prepare as-built drawings of the project site including the pier, (E) building
structure, tenant lease area, overall pier perimeter. The basis for these drawings will be PDF’s provide
by the Client and limited site measurements.
3. Kelly Architects will prepare an exterior building design with aesthetic options for review by the Client.
The preferred option will be developed further to include preliminary material selection, window, roof
shape, wall finishes, exterior lighting, railings signage, entrances, and other aspects of the design.
4. Kelly Architects will prepare a concept design of the exterior of the building.
5. Kelly Architects will prepare concept floor plans, cross sections, exterior elevations, hand-drawing
sketches, 3D models, physical materials, pier imagery and other plans as necessary to develop the
design.
6. The Architect will prepare a design presentation for the City Council that will include multiple 3D
colored rendering images of the building from the shore and from all sides. The model will include
preliminary materials and pier contextual elements.
Preliminary Schedule
Concept Design: 5 weeks from contract approval
11-32
2404 wilshire boulevard, suite 1e
los angeles, california 90057-3310
t. 213.380.8498
f. 213.380.8499
www.kelly-architects.com 3 of 4
EXHIBIT B
COMPENSATION
Architectural Fees
Kelly Architects proposes to provide the above listed professional services with not-to-exceed budgets
as follows:
Architect Lump Sum Fee
Phase Arch Fee
PHASE 1 - Concpet Design 18,000$
NOTE: Consultant fees will be authorized under a separate agreement after the Schematic Design
phase when their specific scope of work can be defined.
Reimbursed Expenses
Kelly Architects shall be reimbursed by the Client for all expenses incurred as a result of providing
these services. Reimbursable expenses shall include but are not limited by the following: full size CAD
plots, blueprints, drawing reproduction, renderings, outgoing faxes, telephone calls, postage,
messenger, and delivery services, parking fees and auto travel which shall be reimbursed at the
current IRS rate (as of 1/1/13 56.5¢ per mile). Travel outside the state of California shall be
approved and paid for in advance.
The Client shall reimburse the Architect at 1.15 times the actual cost of materials and expenses as
listed above and at 1.15 times the actual fee of consultants contracted by the Architect.
11-33
2404 wilshire boulevard, suite 1e
los angeles, california 90057-3310
t. 213.380.8498
f. 213.380.8499
www.kelly-architects.com 4 of 4
EXHIBIT C
TERMS AND CONDITIONS
I. Additional Services
Any services not provided above, some examples are as follows:
i. Work requested by the Client that is outside the scope of services.
ii. Changes to work which has been completed by Kelly Architects and approved by the Client in an earlier
phase of the project.
iii. ADA and Title 24 upgrades for existing elevators, building restrooms not associated with the restaurant,
building main entrances and all other areas outside the restaurant unless specified in the Scope of Work
iv. Applications for Modifications or Variances to existing building conditions.
v. In the event of Client-directed project scope of work, complexity, quality or schedule changes that result in
the phase budgets being exceeded, Kelly Architects will advise the Client and request additional fees in
advance of proceeding beyond these budgets listed.
vi. Additional Services will be provided on a case-by-case approval basis and the Architect shall be
compensated on a lump sum or an hourly basis at the rates listed below.
viii. In the event the project scope or schedule changes so that the budgets could be exceeded, the Architect
will advise the Client and request additional fees in advance of proceeding beyond these budgets listed.
Hourly Rates:
Principal Architect $190.00 per hour
Principal Interior Designer $175.00 per hour
Project Architect $150.00 per hour
Interior Designer $120.00 per hour
Job Captain / CAD $110.00 per hour
Sourcing / FF&E Assistance $100.00 per hour
II. Billing
a. Kelly Architects shall invoice the Client monthly for services performed and reimbursable expenses incurred
during the previous month.
b. Payment is due 30 days from invoice date. A late fee of 1.5% will be added to all outstanding balances
after 30 days.
P:\Projects\2016 Projects\1603-BWG Newport Pier\Contract\1603-Newport Pier Restaurant Concept revised.doc
11-34