The City of Penticton is seeking Expressions of Interest to sublease and develop one or a combination of the following:

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1 Issued: May 17, EOI-01 Request for Expressions of Interest To Lease Skaha Lake Marina Building and Waterfront Properties located at 124 South Beach Drive, Penticton, BC The City of Penticton is seeking Expressions of Interest to sublease and develop one or a combination of the following: 1. Core Lease Area 1.00 acre of land plus 2.29 acres of water lot including a marina on a sub License of Occupation with approximately 4,000 ft 2 of commercial space at 124 South Beach Drive, fronting Skaha Lake. 2. Expansion Area 1 An additional 2.40 acres to the east that could be used for expansion of the land lease area, creating a total of 3.40 acres. 3. Expansion Area 2 An additional 3.43 acres to the north that could be used for expansion of the land lease area to create a total of 6.83 acres. Submissions, not to exceed three (3) pages, must be received in a sealed envelope, marked on the outside with 2013-EOI-01 Expression of Interest to Lease 124 South Beach Drive and must be received by way of mail, courier or hand delivery at the office of: City Purchasing Department City Yards 616 Okanagan Avenue East Penticton, BC V2A 3K6 Fax or submissions will not be accepted. Submission Deadline: TUESDAY, JUNE 25, 2013 at 2:00 p.m. local time Inquires must be submitted in writing to cathy.ingram@penticton.ca NOTE: Should any potential proponents download this document, it is the proponent s responsibility to check for Addenda s which will be posted on the City of Penticton's website: 1

2 INTRODUCTION In the fall of 2011 following public consultation the City adopted a new Vision Statement: Penticton is an innovative, adventurous, waterfront City that focuses on sustainability, community and economic opportunity. Over the ensuing years strategic priorities have been developed to realize this vision. One of the most important natural assets we have in our community are our two lakes, Okanagan at the north end and Skaha at the south end. The goal of the City is to create some vibrancy at both of these significant waterfront locations. The types of developments that could meet this vision include: hotel, restaurant, retail, marina, sports, entertainment or recreation. At Skaha Lake improvements have been made to enlarge and improve the park space, private developers and the Penticton Indian Band are developing the north west shore of Skaha Lake and the City now wants to take bolder steps in pursuit of realizing our vision at the north east side of Skaha Lake. The City would like to work with the private sector to develop City owned or City leased land to create a sense of vibrancy and adventurousness at the Skaha Lake waterfront. The City would like to hear from respondents who would be interested in making an investment in our community. Further along in this document the permitted uses allowed for in the Zoning Bylaw are laid out. That being said the City wants to be clear that we are open to considering other uses that will create the vibrancy we are after. The City is willing to work with respondents to navigate the public process required to amend land use bylaws so that the vision can be realized. BACKGROUND The Community The City of Penticton is located in the south central part of the Province of British Columbia. The city of 32,000 is nestled in the bottom of the beautiful Okanagan Valley between two pristine lakes, Okanagan to the north and Skaha to the south, with rolling mountains providing a dynamic backdrop to the east and west. The Valley itself is home to more than 350,000 people. This area has become a prime destination for residential and small business relocations due to the gentle climate, excellent transportation links, strong labor force, and the ready availability of first-rate recreational opportunities. 2

3 Penticton offers business, investment and retirement opportunities in a location that is second to none. It has the most attractive climate of all cities in Canada according to Environment Canada statistics. Penticton has all of the amenities of larger urban centers, yet maintains the tranquility of a small community. Penticton s economy is based on: Agriculture (130 wineries are in immediate area); Tourism (1.5 million visitors per year; 41 hotels); Manufacturing (85 companies are based here); and Retirement (25% of the population is over 65). There are over 100 wineries within a one hour drive of Penticton, most having tasting rooms and retail outlets. Penticton is an all-season playground with modern recreation facilities which include ice arenas, an indoor pool with waterslide, a curling rink, a gymnasium, and an indoor soccer facility. Many of these facilities are located in one convenient campus-like setting and include the South Okanagan Event Center, a 5,000 seat convertible dry floor space / ice bowl, a community ice rink, a new 10 lane swimming / leisure pool, a curling rink and the 60,000 ft² Penticton Trade and Convention Centre. The area has a multitude of outdoor recreation pursuits. In the immediate vicinity golfers can challenge themselves on 7 championship and 21 additional golf courses. Downhill skiers can take advantage of the Apex Mountain Ski Resort, only a 30 minute drive from Penticton. A further 5 minute drive provides cross country skiers with access to the majestic Nickel Plate Nordic Centre. Local mountain biking adventures are available for all skill levels from trips down the reclaimed KVR railway lines to challenging single track mountain trails. Road cycling in the Penticton area also abounds in rolling hills and adjacent to the pristine lakes. Penticton is home to many world class cycling events and it is not uncommon to see individuals and teams taking advantage of our excellent shoulder season weather for training. For those seeking a vertical challenge, the Skaha Bluffs offer some of the best rock climbing in Canada. Penticton also offers access to the water through two marinas located on Okanagan and Skaha Lakes. The north end of Skaha Lake adjacent to or at the lease location is home to the Dragon Boat Festival, Sand Castle Building Peach Fest Event and the Mr. Muscle Miss Bikini 3

4 Contest and may soon be home to a year round water ramp for free style aerobatic training. In addition Skaha Lake Beach is one of the favorite locations for tourists and locals to spend time at during our beautiful and busy summers. In the near vicinity some exciting things have been happening. The summer of 2013 will see the Barefoot Beach Yurt Campground and Beach development opening on the North West side of Skaha Lake, approximately 1 km west of the lease lands. Construction of the Penticton Indian Band Arrowleaf residential / golf course development is scheduled to commence in 2013 and the Skaha Meadows 9 hole golf course continues to operate. This proposal call presents some opportunities to the right developer. The Skaha Lake the marina at 124 South Beach Drive is the only marina serving the entire Skaha Lake and currently there are no waterfront restaurants on the lake. The City of Penticton has also made some recent changes to building permit fees and introduced a Development Cost Charge Reduction bylaw both of which, depending on the nature of the development, may be of benefit to potential respondents. The Lease Areas The area available for lease is made up of three distinct parcels available for lease either as a whole or on an individual basis: 1. Core Lease Area 1.00 acre of land plus 2.29 acres of water lot including a 66 slip marina as outlined in red in Figure Expansion Area 1 - To allow for redevelopment the land lease area could be expanded by 2.40 acres to a total of 3.40 acres by including the property to the east and the lot at 3915 South Main Street as outlined in blue in Figure Expansion Area 2 To allow for redevelopment the land lease area could be expanded by 3.43 acres to a total of 6.83 acres by including the land to the north as outlined in green in Figure 1. 4

5 Figure 1 Lease Areas Lease Term Available The City is open to consider varying the term of the lease, with the minimum lease term being five (5) years. The more intensive the level of development the longer the lease term that the City would be willing to consider. The exact term of the lease will be negotiable depending on the nature of the Expression of Interests brought forward. Legal Description The legal description of the property for lease is: By way of Lease: (A) Part of 124 South Beach Drive with a legal description: Lot A, District Lot 189, Similkameen Division Yale District, Plan

6 (B) Expansion Area 1 includes a larger portion of Lot A, District Lot 189, Similkameen Division Yale District, Plan 9936 plus 3915 Lakeside Road which has a legal description: Amended Lot 4 (See F) Block 209, District Lot 190, Similkameen Division Yale District, Plan 466. (C) Expansion area 3 includes an even larger portion of Lot A, District Lot 189, Similkameen Division Yale District, Plan 9936 plus 3915 Lakeside Road which has a legal description: Amended Lot 4 (See F) Block 209, District Lot 190, Similkameen Division Yale District, Plan 466. All scenarios include the marina which is through a Sub Licence of Occupation and has a legal description of: (A) That part of the District Lot 4048s together with that part of District Lot 4017s both of Similkameen Division Yale District, containing 1.05 hectares more or less (or 2.59 ac., of which ac. is un-surveyed filled foreshore and the remaining 2.29 being a water lot containing the marina). Location and Neighbourhood The subject property is located off the 3800 block of South Main Street at the northeast end of Skaha Lake. The property is on Skaha Lake and adjacent to the public Skaha Beach Park. Official Community Plan Designation Official Community Plan Bylaw designates the lease areas as Parks and Recreation. Development Permit Area Designation Large portions of the lease areas adjacent to Skaha Lake and adjacent to the north south water course that runs adjacent to South Main are included in the Riparian Development Permit Area of OCP Bylaw Zoning Designation Zoning Bylaw designates the lease areas as P2 Parks and Recreation and allows for the following Permitted Uses: 6

7 Carnival Community garden Government service Indoor recreation Marina Outdoor amusement, entertainment and recreation Outdoor market Public parking lot Accessory use, building or structure As stated in the introduction the City is interested in making this part of Skaha Lake vibrant and adventurous and is would be prepared to consider other uses subject to an amendment of the Zoning Bylaw subject to all due public process and passage by Council of the required amending bylaws. Park Dedication Bylaw Portions of the lands being leased under this Expression of Interest are included in Park Dedication Bylaw , see Figure 2. This bylaw defines Public Parkland as an area of land set aside to be used by the public as a place for rest, recreation, exhibitions, agriculture, exercise, pleasure, amusement, enjoyment and any other activity or use related or ancillary thereto and without limiting the generality of the foregoing. Lease uses that do not fit this definition will require an amendment of the bylaw, which would include assent of the electorate. Please note that portions of the lease area where the marina buildings are now situated are outside of the Park Dedication Bylaw limits. As stated in the introduction the City is interested in making this part of Skaha Lake vibrant and adventurous and is would be prepared to consider other uses subject to an amendment of the Zoning Bylaw and changes to Park Dedication Bylaw including all due public process. 7

8 Figure 2 - Park Dedication Bylaw Lands Geotechnical A preliminary geotechnical assessment was completed by Levelton in August of Some of the more significant findings are as follows, respondents are responsible to view the complete report: Geotechnical Suitability of Site for Development 1. The majority of the site is most suited, from a geotechnical perspective, for construction of one to two storeys, relatively lightly loaded commercial or residential buildings; 2. Higher buildings may be considered for some areas, but additional site preparation and ground improvement and or deep foundations maybe required; and 3. Below grade construction is not recommended due to high ground water table and potential for flooding. Geotechnical Constraints of the Site 1. Variability in compressibility of the silt deposit; 2. Shallow ground water table; 3. Potential of post-construction settlement due to consolidation of silt; 8

9 4. Low bearing capacity of near-surface silt; and 5. The need to avoid development in areas that could be impacted by instability of the slope to the east of the site. Slope Stability 1. There is a set forward area varying from 10m to 27m wide directly west of the west curb line of South Main Street. A complete copy of the Geotechnical Report is available upon request and should be reviewed by respondents. Environmental A Stage 1 Preliminary Site Investigation was completed by Levelton in June of A summary of the Stage 1 report is as follows, respondents are responsible to view the complete report: City Lease Area from the Province of BC, the area west of the marina building. 1. An Area of Potential Environmental Concern in the form of a former Underground Storage Tank north of the marina building in the area leased by the City from the Province of BC. Due to changes in regulatory framework since removal in 1997 a Stage 2 Preliminary Site Investigation was recommended. A Stage 2 Preliminary Site Investigation was completed by Levelton in April 12 of The Stage 2 Report identified the following: 1. Analytical analysis of soils from the identified Area of Potential Environmental Concern indicated that concentrations were below Residential Parkland Standards. 2. Ground water sampling of two of the three wells did not exceed applicable standards. 3. Ground water sampling of one of the wells identified Pyrene that was above the Aquatic Water Standards and two other items that were near detection limits. 4. Two additional ground water sampling tests were taken at the Pyrene well and those tests confirmed that Pyrene below laboratory detection limits. 5. Based on the Stage 2 Preliminary Site Investigation intrusive subsurface investigations are required at this time. 9

10 City Owned Lot A 1. The likelihood of soil or ground water contamination in excess of applicable Contaminated Sites Regulations Commercial Land Use Standards is low. No Stage 2 Preliminary Site Investigation was recommended. Copies of the complete Stage 1 and Stage 2 Preliminary Site Investigation are available on request and should be reviewed by respondents. Utilities and Easements on the Property Located on the property are water mains, sanitary sewer mains, gas lines and a BC Gas Easement. These are as illustrated on Figure 3. In addition to these there are also underground irrigation systems. 10

11 Figure 3 Utilities and Easements on the Property Lease Area Details and Condition - Core Lease Area The lease area is a functioning Marina with two pump gas bar, and a motor sport sales and repair Centre. The lease space includes: Building: 1,600 ft² sales area for motorcycles, quad vehicles, and motor bike, quad & boat accessories; 600 ft² central area comprising a parts room, two 2-piece washrooms and an office; 1,800 ft² repair and maintenance shop. The shop area has 14 ceilings and two (2) large overhead doors at the south end of the building for access. parking area adequate for storage of 60+ boats is perimeter fenced with 6 chain link fencing; Marina: +-66 boat docking slips two gas pumps Snack bar The moorage season running from March 1 to November 30 inclusive (9 months), storage season October 1 to March 31 inclusive (6 months). The general condition of the building is serviceable but requiring updating. The docks in the marina are in need of major overhaul or replacement. All measurements are approximate. 11

12 Figure 4 Core Lease Area, Marina view to the south east Figure 5 Core Lease Area, Marina view to the south west Lease Area Details and Condition Expansion Area 1 The lands are currently used for parks and recreation purposes and contain grass, trees, a water course, pathways and a parking lot. 12

13 Figure 6 Expansion Area 1, view to the south Figure 7 Expansion Area 1, view to the north Lease Area Details and Condition Expansion Area 2 The lands are currently used for parks and recreation purposes and contain grass, trees, a water course, pathways and a boat trailer parking lot. 13

14 Figure 8 Expansion Area 2, view to the south west Figure 9 Expansion Area 2, view to the north 14

15 Proposed Utilizations The Core Lease Area was last used as a motorsport sales and repair facility and marina. Expansion Areas 1 and 2 were both last used for parks and recreation purposes. Any legal use would be considered. Preference will be given to options that help realize the vision statement and strategic priority of the City and take advantage of or complement the proximity to the lake. Any option should also maintain or speak to how the boat launch and boat trailer parking would be maintained within or relocated from Expansion Area 2. Special consideration may be given to intensive redevelopment of the site as a restaurant/hotel complex. Depending on the land uses contemplated and the location of any proposed construction activities rezoning of the land and a development permit may be required. These are to be addressed prior to entering into the lease and are subject to due Council and Public process. Access, Egress and Parking Access and egress is available by boat or by vehicle from South Main Street. There is adequate parking for the operation of the successful proponent. Services All services are available in the area. Electric power is available by way of overhead lines. Natural gas is provided to the site. The site is connected to sanitary sewer. SUBMISSION AND PROCESS Respondent s Submission The respondents Expression of Interest should include the following: Description of the lands that the respondent wishes to lease; Offered lease rate on a triple net basis; Detailed description of the intended use of the lease space; 15

16 List of projects the respondent has completed; List of references; and Description and estimated cost of any lease holds contemplated. Respondent Expenses Any cost incurred by the respondent in the preparation of their Expression of Interest and any subsequent negotiations, if any, will be borne solely by the respondent. Selection Process and Disclosures Expressions of Interest will be considered based on: the type of operation and fit with the nature of the area; perception of the probability of success of the business at the location; and lease rate offered. This Expression of Interest does not form an agreement. The City is under no obligation to enter into negotiations or contract with any respondent. The City at their sole discretion may pursue any Expression of Interest and may provide a Sublease directly to a respondent on the basis of an Expression of Interest without further requests, consultation or disclosure. The City is under no obligation to provide rationale or justification of the selection process to any of the respondents. The act of submitting an Expression of Interest signifies the respondent s acceptance of the terms and conditions in this section (Selection Process and Disclosures) and indemnifies the City of any and all liability to the respondent associated with the Expression of Interest process. Ownership of Documents All documents, including Expression of Interest, submitted to the City become the property of The Corporation of the City of Penticton. Responses will be received and held in confidence by the City, subject to the provision of the Protection of Privacy and Freedom of Information Act. Additional Information The City may request additional information from respondents. In addition, respondents may also be asked to participate in telephone or in-person interviews to discuss their Expression of Interest and to answer questions. 16

17 City Documents Available for Respondent Review City of Penticton Official Community Plan Bylaw , please see ty%20plan%20bylaw% pdf City of Penticton Zoning Bylaw , please see: ty%20plan%20bylaw% pdf City of Penticton Development Cost Charge Reduction Bylaw , please see: st%20charge%20reduction%20(bylaw% ).pdf City of Penticton Building Bylaw 94-45, please see: pdf City of Penticton Fees and Charges Bylaw , please see: City of Penticton Park Dedication Bylaw , please contact the Purchasing Manager for a copy. August 29, 2012, Levelton Preliminary Geotechnical Assessment Report Skaha Lake Development Lands Penticton BC, please contact the Purchasing Manager, Cathy Ingram, for a copy. June 2012, Levelton Stage 1 Preliminary Site Investigation East Skaha Lake City Lots Portion of 124 South Beach Drive & 3915 Lakeside Road Penticton BC, please contact the Purchasing Manager, Cathy Ingram, for a copy. June 2012, Levelton Stage 1 Preliminary Site Investigation East Skaha Lake City Lease Assembly Portion of 124 South Beach Drive Penticton BC, please contact the Purchasing Manager, Cathy Ingram, for a copy. April 12, 2013 Levelton Stage 2 Preliminary Site Investigation, please contact the Purchasing Manager, Cathy Ingram, for a copy. 17