14 Staff Report - Verizon Building 15900 Los Gatos BoulevardN OF MEETING DATE: 3/19/07
MANAGER MATTERS
~o X05 COUNCIL AGENDA REPORT
DATE: March 16, 2007
TO: MAYOR AND TOWN COUNCIL °
FROM: DEBRA J. FIGONE, TOWN MANAGER
SUBJECT: STATUS OF THE DUE DILIGENCE PROCESS FOR THE PURCHASE OF
THE VERIZON BUILDING LOCATED AT 15900 LOS GATOS
BOULEVARD
INTRODUCTION:
Council met in closed session on February 5, 2007 and again on February 12, 2007, to discuss an
offer to purchase an office building owned by Verizon and located at 15900 Los Gatos
Boulevard. Council directed that a report be made in open session regarding the potential
purchase and related due diligence process. As discussed more fully below, Verizon has
accepted the Town's offer to purchase the property for $3.2 million, subject to a 60-day due
diligence period for the Town to determine the feasibility of using the site to house some or all
Town police services.
BACKGROUND:
The subject property is located on the east side of Los Gatos Boulevard, roughly 600 feet north
of Blossom Hill Road. The site is directly north of the Cornerstone Shopping Center. The site is
currently owned by Verizon and contains a building that houses office space and a telephone
switching facility.
Verizon obtained approvals from the Planning Commission on December 13, 2006 to demolish a
portion of the existing building to create two separate buildings and to subdivide the property
into two parcels (see Attachment 1). Verizon is selling a 1.09 acre parcel that will contain an
8600 square foot office building after demolition. Verizon is currently preparing the site and
building for sale and is in the process of recording the parcel map to implement the subdivision
of the site.
PREPARED BY
BUD N. LORTZ, Okj-~
Director of Community Development
Reviewed by: Assistant Town Manager
Clerk Administrator Finance
Town Attorney
Community Development
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PAGE 2
MAYOR AND TOWN COUNCIL
SUBJECT: DUE DILIGENCE PERIOD ON VERIZON BUILDING
March 16, 2007
DUE DILIGENCE ISSUES:
The Town is evaluating the site for the purpose of using the building for a Police facility. The
Town has not determined whether to proceed with the purchase of the property. Under the terms
of the Town's offer, it has a 60-day due diligence period to evaluate the property and determine
whether to proceed with the purchase. The following will be evaluated:
1. Neighborhood reaction to the possible relocation of some or all police services to the site.
Staff anticipates hosting a neighborhood meeting within 30 days to discuss possible
scenarios for relocating police services to the site and obtain public responses, including
related neighborhood concerns.
2. Phase I and II environmental site assessments to determine the presence of any hazardous
materials.
3. Architectural feasibility to identify the parts of current police operations that can be
relocated to the existing building within a relatively short timeframe. This process will
also evaluate the feasibility of expanding the building to house all police services, should
the Town do so in the future.
4. Parking on and access to the site.
5. Costs to remodel the facility and financing plan.
Staff will retain consultants to assist in the site evaluation. Any final decision to approve a
purchase agreement for the property must be made by Council in open session. An additional
meeting will be held by the Planning Commission, which is required by State law to review the
proposed purchase for consistency with the Town's General Plan. The Commission will also
consider any environmental determinations made under the California Environmental Quality
Act ("CEQA").
CONCLUSION:
The Town has not reached a decision on the purchase of this site. The Town has 60 days to
completely investigate the property, obtain public input, and then decide whether to complete the
purchase.
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