Thread by @shayshinecastle

If you guys hate having to wait a full week between #Boulder city council tweets, you're in luck: I'm back with a special meeting tonight. The topic: What council wants to do with Alpine Balsam, the 8-acre former BCH campus.

If you recall, during an April budget discussion, several council members asked for an out as costs to redevelop it for city offices mount. boulderbeat.news/2019/04/10/let…

Tonight we'll get a look at what those paths could be. Staff has presented 4 options: Stay the course, Rezone and sell, Sell now, or Pause and do more analysis.

If I had to guess (and I don't like to do that) I'd say council will go with the Pause and more analysis. You know how they *love* analysis.

But maybe they'll surprise me.

Everyone is here but Morzel, so maybe we'll get out of here before midnight. She made her feelings known via an email: She is leaning toward rezoning the property and selling.

Chris Meschuk is starting off the presentation with a reminder of Boulder's "legacy" of big projects: the Holiday neighborhood, Boulder Creek path, the Pearl Street mall.

"It’s what makes Boulder, Boulder. These places are result of long-term efforts that took time, investment by this community, and forward looking community members and councils."

Morzel criticized staff in her email for leaning too heavily toward Option A: Staying the Course.

There are people in medical scrub caps here. Just 2, but still. I love a good stunt.

Update: They've removed the caps. They still have signs, though. Couldn't read what they said.

Back to business: We believe moving forward is the right choice, Meschuk says, speaking for city staff.

References a letter from Boulder County, who also supports this option. They still want to co-locate housing and human services with the city and need at least 120K sq ft.

A reminder of why the city bought this land in 2015: To control what gets built there, and to consolidate city offices. There are two buildings in a high-hazard flood zone that need a ton of work.

Leasing other space (60K-90K sqft for those workers will cost ~$2.5M/yr. The city already spends ~$1M/y on a Center Green building. Meschuck says it's unlikely the city will be able to find/afford offices downtown.

I personally love this irony, bc so many city policies and policies of this particular council discourage creating new office space and drive up prices. (That's not a comment on the policies, just a comment on the irony. Journalists love irony.)

But it's a serious conundrum: The city needs office space. It will be *very* expensive to build and very expensive to rent. It's a pickle.

Let's go over the four options.
Option A: Stay the course
Continue with three-year planning, hospital deconstruction in 2019
Costs: $113-$142M
Invested cost: $2.9M/yr in debt; $8M for Brenton renovation
...

... Future costs: $11-16M for hospital deconstruction
$3-4M/yr for 30 yrs on city offices ($49-58M in renovations; $90-120M with debt service)
$5-20M on flood mitigation/public improvements
Potential income: $18-32M in land sale
Costs minus income: $81-$124M

Timeline:
2019-2020: Begin deconstruction, adopt area plan
20-22: Design Pavilion renovation; deconstruct hospital; update land use/zoning; sell ⅔ of land
2022: Renovate pavilion; flood mitigation; housing financing
24-25: open city services hub; start housing construction ...

... 2025-2027: Finish housing; co-locate county services

Option B: Rezone and sell
Rezoning to the “highest and best use” would add value to property before a sale
Possible deconstruction of the hospital would still be necessary

From the memo:
“It is difficult to predict the potential future market value of the property, though it is possible that the property value does not recoup the city’s initial investment”

However, staff says, this option is “inconsistent with city’s values and practice of community-based planning”

Costs: $69-$74M + $2.5M/yr
Invested cost: $2.9M/yr in debt; $8M for Brenton renovation
Future costs: $11-$16M for hospital deconstruction; $2M initially then $2.5M/yr for leases
Potential income: $15-$40M
Costs minus income: $29-$63M

Timeline:
2020-2022: Deconstruct hospital; update land use/zoning; prep for sale; enter contract
2022-2023: Buyer’s due diligence
2023-2027?

Council is asking some questions.

Nagle: Can we put more restrictions on the property (viewsheds, things like that) to guide redevelopment before we sell?
Yes, Meschuk said. We can write zoning, etc.

Young: If we rezone it to highest and best use, would that include community input?
Yes again, Meschuk says.

Again that "very rough" estimate of what the land would sell for is $15-$40M, based on zoning. The city paid $40M for it in 2015, and has already spent $8M renovating an office building and making annual debt payments of $2.9M

There's some discrepancy over those estimates between council/staff. We'll revisit.

Council also has issues with staff's take on Option B, which is to stop the area planning currently underway.

Option C: Sell now
City would shut down hospital but not deconstruct
Bc of public zoning, buyer may not have a suitable use
Height mods are not allowed, reducing value
“Highly possible” city would not recoup costs
Could sell with or without the hospital

Costs: $50M + $3.5M/yr
Invested costs: $2.9M/yr in debt; $8M Brenton renovation
Future costs: $2M + $2.5M/yr in leases; $1M/yr for hospital security
Potential income: TBD

Timeline:
2020-2022: Enter contract; buyer due diligence; operate/secure hospital
2022-2026?: Sell, development, etc.

Option D: Pause and do more analysis
"Some concerns" over leaving the hospital vacant bc of liability. City would still have to maintain, secure it for ~$1M/yr, plus $4.5M/yr on office leases.

All the options are "viable and possible," Meschuk says. "We believe proceeding with Option A will implement the path you've been providing guidance on since 2015." Costs, financing can be "addressed and phased."

Yates: We've heard a lot of qs from community as to why we're deconstructing the hospital. I know we've explored this already, but can we have a refresher?

(Morzel continues to maintain it can be reused.)

Michele Crane, with facilities, taking this on. It's a hospital; it's a building that's been "patched together over the years." Many big mechanical rooms, designed to serve a hospital. Cost to renovate is $175M. (Would include "gutting.")

Hospital building has "very limited access to light" in much of the building. "It's a complex building, designed to be a hospital, it would need a complete gutting of the systems in any case." Reuse would just be the shell, the form of the building.

323K sq ft, so using $500/sq ft cost, that's $150M.
Yates: Some community members are saying we can do it for $200/sq ft.
Crane: Ppl often talk in construction costs, which doesn't include soft costs and FFE: Furniture, fixtures and equipment

"You have to make sure you're comparing apples to apples."

Yates summarizing: $500/sq ft to renovate; $50/sq ft to tear down?
Crane: Yes

The current plan is for a sustainable deconstruction of the hospital. Staff is presenting some other, cheaper options:

Silver: Meets code but materials don’t have to be recycled; $11-$13M w/maintenance but w/o soil abatement; 1-1.5 yrs w/o soil abatement

Gold: Meets 2020 code; some materials will be recycled; $14-$15M w/maintenance but not soil abatement; 1.5 yrs (no soil abatement)

Platinum: Full reduce, reuse, recycle; $16M including ops/maintenance but not soil abatement; 2 yrs not including soil

Soil abatement could cost another $3-$10M

Yates asking a q about how many housing units you could do in the hospital shell vs. having it torn down.
Crane: We haven't done that, but 2/3 of that building has no access to natural light. Housing would have to have that.

Yates: Fair to assume we could create fewer housing units if we reuse vs. if we scrape?
Meschuk: Yes, that is a fair assumption.

If city were to sell, whoever bought it would be bound to 2020 building codes, which includes some materials recycling. Those are being updated now: boulderbeat.news/2019/04/21/bou…

Essentially, the council is discussing now the financial tradeoff from deconstructing the hospital itself vs. having a buyer do it. The price will be lower bc of that, though, so it's a wash.

Weaver bringing up soil abatement. City is not sure what it will find there, given how long the hospital was in operation. If city takes care of that, it might add some value to the land before a sale.

If they were to buy it as-is, I would assume they would take the risk of the soil abatement and of cost of deconstruction. I would assume they would deduct the cost of those from the price they pay.

Meschuk: We did something similar before we bought, an environmental analysis.

They're voting: Who wants the city to deconstruct the hospital?
Everybody. (Except Morzel, who is not here.)

Brockett: "We've position ourselves better for the next steps, whatever they are."

Yates: "What really persuades me is it's not going to cost $500/sq ft to build housing there." (That's the estimated cost of reuse of the hospital.) We can get more housing there than trying to reuse.

Jones: It's a crazy building that doesn't have access to light, it has a morgue... Not great for housing.

Jones asks staff to break down the $500/sq ft cost of reuse so ppl know what's going into it.

We're going over different deconstruction options, as outlined above. I shot my wad a little early sharing that info, I guess.
The council has been pursuing the "Platinum" deconstruction, saving the most possible.

Crane: "There's a point at which we're going to find so much material in there, we won't find ppl to take it all."

Yates: We should take silver off the table. "We've got to walk the talk. I don't think we can demand something of the community and not do it ourselves."
Jones agrees.

Brockett: Maybe we should focus on timeline. We've got 18 months: What can you do? How much can be reused in that time.
Jones likes that, too.

So city will shoot for at least Gold (meeting 2020 building codes for materials recycling) but try to go above that; whatever can be saved in 18 months.

Next week's budget discussion will include requests for hospital deconstruction.
Majority of excess 2018 funds ($14M) will go to pay for this.
It will pretty much "wipe out" those funds, Cheryl Patelli, CFO, says.

Now we're talking the Pavilion building, which staff has proposed for renovation for ~$59M and house staff from the current leased building and the two in the high-hazard flood zone downtown. City needs, at minimum, 70K sq ft for 260 employees.

The suggestion is for an additional fourth floor, 18,000 extra sq ft for $9M.
It ups the amount of staff from 260-300, which would include all the ppl in the Atrium building on 13th Street.

"You're essentially consolidating 4 buildings," Crane says. "We think it's a value."

Jones is pushing back a bit, bc that 4th story also includes amenities that staff isn't talking about. "If the q is just, do we want to accommodate 15 more staff for $9M, the answer is no."

Carlisle: What's going to happen in the space where the Atrium is now?
A few options have been discussed: dailycamera.com/2018/08/15/cou…

That civic area plan is waiting on the Alpine Balsam discussion.

Atrium building is 30 employees, Crane says.

Brockett: 30 employees, 18,000 sq ft... that's 600 sq ft per employee. ... Do we need that? What's the max capacity in the building?
Crane: We're using 170 sq ft per employee as a standard. (Atrium is 10K sq ft)

Council won't be deciding on a fourth floor tonight.

Weaver: The main thing to come back with is a description of what the amenities are, bc $9M for that few employees is a tough sell. And fourth floor public space doesn't make sense.

Some grumbling disagreement on that, given that it's rooftop space and frequentlhy including in other plans.

Yates questioning the costs to renovate, $700/sq ft. We can build new for less.
Crane: We've adjusted these for a 2024 start, and we've been seeing huge increases in construction costs

Yates: We've already paid for the land. "It blows my mind" that we'll be paying that much when anyone in town could build new for less. And it's tilting me toward leasing space. "Numbers are not quite credible to me."

Carlisle asking about trips to the area. "If we're bringing in employees from 4 buildings, it seems like a huge upgrade in the number of trips, so it seems like a huge consideration."

Yates: "Let's not just use this building bc we have it. Every hold is a buy."
Wants details on how much it would cost to tear down, what else could go there, etc.

Weaver, to Carlisle's point, is asking how many ppl worked at the hospital when it was up and running.
Meschuk: This will bring 600-1,000 workers, plus visitors, patients. This will bring less than half the trips than when it was an active hospital.

We're talking flood now. I *know* this is important but it's so hard to care.
Goose Creek flows near the site. City has been doing flood mitigation since the 1980s there, spending $20M through the 2000s in four large capital improvement projects.

"This is essentially some of the headwaters of Goose Creek, and if we can detain some before it goes down Goose Creek, it could potentially have big downstream benefits." (Meschuk)

Apparently that might not be a good option: Groundwater is basically at surface level in NoBo park, so doing detention would create a huge pond there. That comes from an engineering analysis received just last week.

Oh, goody: More analysis.
City is doing this now to see how it will impact construction on the site. My head is spinning.

I think we're moving on from flood to financials.

Meschuk: The land could all be sold at once, or it could be phased. One parcel can go to an affordable housing developer, then another to a market housing developer.

Kurt Firnhaber coming up to dive a little more into this.

Brockett: Affordable housing is a major goal for this site, and it seems right now like it's not in the financials at all.
Firnhaber: Affordable housing is separate from this. We've been looking at what afford house can be created without further investment.

25-30% of houses there could be affordable without further investment from the city, based on selling some land, etc.

Young: Mostly what we're looking at is rental options, right? Bc that's just what happens?
Firnhaber: We could dictate that some parcels we sell be for sale, some for rental, like at Pollard.

Brockett is attempting to summarize all the financials, and my head is spinning.
Basically, it's this: We can go all in, renovate the Pavilion, etc. and get $$ back from selling the land. Then the city will be on the hook for roughly $6M/yr.

Lease costs are $2.5M/yr, Brockett says, so that's really the tradeoff we're considering in exchange for more affordable housing.

Jones: Take that figure and then make it 50% affordable housing on that site. 25% doesn't seem good enough.

We're talking about co-locating with the county. They say they need 2 acres.
How much housing does that displace, Yates asks? And what are they willing to pay?

They've got 17.7 acres on North Broadway, so I don't want to rush into a decision to sell them 2 acres, bc I think somebody's going to get those 17 acres anyway.
Brockett: I don't think it's an exact comparison, bc you can do higher intensity at Alpine-Balsam.

Yates: This isn't the cheapest land they could buy. We bought it for $5M an acre, we're looking at selling it for $5M an acre.

Someone from the county is here. James Butler: With our facilities master plan, the No. 1 site for us is Alpine-Balsam. I think it would be reasonable to suggest that a market rate would be something the county would be interested in.

But that's not his call, ultimately.

Qs from Weaver: You said you needed 120K sq ft. Could you do 100K?
Butler: 120K is a real solid need for us. "We really can't renegotiate that square footage."

County is also looking at a parking reduction for that space, probably "more aggressive" than 20%. "Our parking needs for our clients is something we want to do a real careful analysis of. We're more willing to work with our employees."

Weaver: 2 acres is what is a little more difficult for us. We're trying not to lose acreage we don't have to.

Yates: As a county taxpayer, why would you pay market rate here when you could do two acres at Iris/Broadway? You already own that land, why wouldn't you just build there?

Butler: We have active functions on that site: 5 buildings with active operations. To consolidate, we'd have to lease space; it would be more decentralized. From a functional standpoint, it's kind of hard to develop that site. (And keep things running.)

"Biggest problem from a development standpoint... it's much easier for us to develop the Alpine Balsam site." Closer to mass transit, things can go on as normal at Iris/Broadway.

In its letter, county wanted an answer by June/July as to city's intent for Alpine Balsam.
Can we get a little bit more time? Brockett asks.
Yes, Butler says.

Brockett: What would collab on affordable housing at Iris/Broadway look like between the city, county? Let's get some details on that, bc if we're losing it at Alpine-Balsam, let's get even more at Iris/Broadway.

Weaver: The letter you sent said selling the site would help fund Alpine-Balsam. So what are you imagining: a private developer? With covenants on it?
Butler: It would be contingent on some kind of sale of our property, bc it's a high value parcel of land.

Butler: This is more a q for (Firnhaber) as to what's a good cost to get affordable housing? I know it's not market rate.
Weaver: It could be market rate to an affordable housing developer if they get tax credits, etc. It's something to work with (Firnhaber) on.

Yates: I'd personally be interested in what a land swap would look like.

Council seems to like that idea.

Not quite following what council is saying, other than "many options look good, let's look at all the options"....?

Brockett: You talked me into Option A. It's looking like it could work out, which I'd not been convinced of before now.

Nagle: If we move forward, will this go out to the community?
Meschuk: On June 4 we'll bring these options back to council and then go out into the public with those.

I think is this around the area plan.

Meschuk: We've been in a narrowing process. The vision plan was a lot of potential uses; now we've got a mix of city services, county services and housing. So we're going to bring those set of options.

Yates OK moving forward with Option A, but not OK with Pavilion building. "That's a lot of $$ per square foot; let's really crunch those numbers."

That figure includes street improvements, etc. Jones wants to know how much those are contributing to the $700/sq ft price.
"It's a little bit more than half" on other projects, Crane says.

Take out the costs that are common with leasing option as well, like furniture, fixtures, etc. Yates says.

Carlisle somewhat echoes that, plus his request to see how much this project would cost elsewhere. "The city is moving east, as it has been for some time," she says.

Jones: Consolidating services is important, especially for human services, bc it makes it easier on the residents. "It's a reason to try and pull this off."

"I see the value in that," Weaver echoes, "it's worth a little bit extra cost" especially spread out over 50-100 yrs.

"I want to keep at least studying it. I think there are benefits."

Yates: It would be great if there was some community amenity there. Housing is great, but what we hear from the community is, we spent $40M on this, what's the benefit to everybody?

OK, to sum up: City will continue, for now, with Alpine Balsam planning for city services, housing and county services. But still subject to change.

That's all for tonight. See you again on Tuesday.

@threadreaderapp, please unroll. Thank you.